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A New Negotiation

Culture

Prof Dr Katia Tieleman, Vlerick1

The warlord

Fighting our roots?

If these are our biological roots, is true human nature and cooperation a doomed story?

Are conflict and violance simply in our genes, rendering negotiation and conflict management useless?

Is cooperation only sustained by a thin layer of culture?

“Survival of the fittest”

Social Darwinism: life is a struggle in which those who make it should not let themselves be dragged down by those who don’t

Herbert Spencer (19th century) tanslated what he saw as the laws of nature into business language, coining the phrase: “survival of the fittest”

The book sold hundreds of thousands of copies

“And while the law (of competition) may be sometimes hard for the individual, it is best for the race, because it ensures the survival of the fittest in every department” Andrew Carnegie(Scottish born American Industrialist and Philanthropist. 1835-1919)

“If evolution and the survival of the fittest be true at all, the destruction of prey and of human rivals must have been among the most important. . . . It is just because human bloodthirstiness is such a primitive part of us that it is so hard to eradicate, especially when a fight or a hunt is promised as part of the fun.”

William James(American philosopher & Psychologist, leader of the philosophical movement of

pragmatism, 1842-1910)

Ruthless competition becomes a law of nature

Competition became a law of nature - the evolutionary spirit became the adagio of business

We ambraced competition and the resulting conflict as our chief organising business principle

Biology is called upon to justify/explain a society based on selfish principles

The “homo economicus” is born

We established a very unproductive negotiation environment

Belgian political negotiations

Union - labour negotiations

• Nobody can be trusted

• Negotiations are suboptimal - compromise

• Conflict is all around - the evidence is striking

85% of employees exposed to conflict2008 Study among 5000 employees in 9 countries (EU/Americas)

56%29%

15%

Have to deal with conflictoccasionally

Have to deal with conflict always / frequently

Costs of conflict 2008 in terms of employee time in the US alone

359 000 000 000 USD

Conservative estimate!

Legal costs• Nearly 90 % of US

companies engaged in litigation (27 to 147 average number of law suits at any given moment)

• More concern about high costs of litigation than about winning

• Costs are very hard to assess, but run up to 5 % of company’s overall gross revenues

Workplace consequences of conflict witnessed

0% 5% 10% 15% 20% 25% 30%

27%

25%

18%

18%

18%

16%

13%

9%

Personal insults & attacks

Sickness & absence

Cross-departmental conflict

Bullying

People left organisation

People fired

Employees moved to other departments

Project failures

70% see managing conflict a critically important leadership skill - how do managers do?

0%

10%

20%

30%

40%

50%

Managers Employees

Managers handle conflict wellManagers do not handle conflict as well as they should

Cost of conflict

Unresolved conflict and ineffective cooperation represent the largest reducible cost in many businesses

Effects of unresolved conflict

• First order effects

• missed deadlines, termination costs, recruitment expenses

• Second order effects

• missed opportunities, increased supervision

Is it really nature?

Biology is often a justification

Every debate abour society and governments makes huge assumptions about human nature, which are presented as if they came from biology. But they almost never do (Frans

De Waal)

Assumptions about biology are always on the negative side

Youtube: monkey cooperation & fairness

Our inner ape is not nearly a nasty as advertised: the apes trust each other!

Biologists (the only ones with comparative material) conclude that we are group animals: “highly cooperative, sensitive to injustice, sometimes warmongering, but mostly peace loving”

Empathy and cooperation come naturally to our species - if you give food to a group of chimpanzees, within 20 min. everybody will have some food. Many animals survive not by eliminating each other of keeping everything for themselves, but by cooperating

Biologist plee to overhaul assumptions about human nature that turns out to be a projection.

Competition is obviously part of the picture, but 95 % of the time the creatures that represent our biological roots are cooperating

Violence is in our genes, but so are reconcilliation and conflict management

There is as much cooperation and trust as competition in nature

It is not nature holding us back

How do we nurture the cooperation?

We need to develop our

NQ (Negotiation Intelligence)

As we evolve from

Shareholder to stakeholder capitalism‣ Sustainable companies manage to reconcile these interests

Market to Society ‣ In the market, consumer organisations, NGOs, governements

etc. play a role‣ Leadership will be conditional upon consensus building

capacity‣ NQ becomes increasingly important

The logic of

NQ (Negotiation Intelligence)

• The logic of rational choice

• The logic of appropriateness

• The logic of transformation

• Cooperation is more then a selfish cost/benefit analysis based on a set of fixed utility functions (preferences) or an adherence to appropriatness (norms and emotions)

• Cooperation is increasingly about the co-creation of joint opportunities, about turning confrontation into cooperation

• WE NEED A LOGIC OF TRANSFORMATION TO DEVELOP A NEW NEGOTIATION CULTURE

The model of

NQ (Negotiation Intelligence)

Unlocking fixed potential

Unlocking fixed value

Unlocking the safety kit

Masterkey

Knowledge

Skills

Attitude

From individual to organisation

We also need Corporate Negotiation Intelligence (CCQ)

Given the bottom line impact of our negotiation behaviour, we need to develop a systemic approach rather than a case by case ad hoc approach - often leading to champagne at the signing of a deal, but bitterness after

Recent studies show that, even during the economic crisis, companies with a high negotiation majurity performed much beter than the avarge (a decline with more than 30 % versus an increase of 42,5 %)

From individual to organisation

We are currently designing a construction plan for

CNQ

Some building blocks include:

• Key negotiators trained and aware (no one-off event)

• Optimised negotiation processes

• Cross-stakeholder collaboration (including the implementers and the overall strategy designers)

• Approval and escalation system (mandate)

• Measurement of negotiation success

• Common negotiation standards (corporate playbook)

• Knowledge sharing system

Towards a new negotiation culture

If we want to move from improved negotiation compententies to a new negotiation culture, we need to work on:

• Individual NQ

• ONQ

Mission for HR managers?

• Only 20-30 % of HR managers reports that they are strategically involved

• Yet, HR managers are strategically well placed to foster a new negotiation culture based on Negotiation Intelligence

Thank you for your

attention!

Prof Dr Katia Tieleman, Vlerick

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