NEGOTIATION AS A CORE ORGANISATIONAL COMPETENCY

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I recently, responded to a SPANS negotiation forum discussion thread involving the leading question ‘Does Mutual Gains training pay off’. The question linked to an observation by Lawrence Susskind and Hallam Movius in their book ‘Built to Win: Creating a World Class Negotiating ‘ suggesting that one off, stand-alone negotiation training does little to develop negotiation as a core organisational competency and the collaborative advantage it offers to the firm. The following contains an edited version of my response.

The key benefit of the one off training activities appear to be, raising awareness to alternative approaches and strategies to traditional distributive bargaining – in doing so, it is reasonable to expect that it has the potential to ‘open the door’ to more a more sustainable approach to embedding negotiation as a core organisational competency, yet it appears instead, that the ‘one off’ training approach becomes a barrier to institutional learning, as the easy/soft option appears to attract is as you mention is the reference to ‘oh, we already know all about it,” or, “yes, we had a training about it last quarter,” or “yes, we have a team who specialize in it,”

Somehow, many contemporary organisational managers and leaders appear to miss the point that both the structure and process of the organisation is built upon negotiation. Organisational structures are now moving toward more organic, fluid, collaborative, networked structures (both form and process) and away from the traditional rigid, hierarchal structures – hence, collaboration will be needed as a core organisational competency to succeed in today’s rapidly changing and competitive marketplace – Negotiation forms part of this collaborative skill set, for after all, the collaborative, networked organisational form is a socially negotiated order.

Diversity is also the key to innovation and value creation in collaborative networks – that’s the bright side – the dark side of diversity is that it can lead to increasing conflict and inertia if not embraced and managed well. This observation resonates with an example of an orchestra cited in a linked article to the initiated discussion – when collaboration is done well, the organisation creates ‘music’ (the harmony of complementarity), however, when approached in the wrong way, it is more likely to produce organisational ‘noise’ (conflict arising from competition and clash of values, interests etc). I wonder how many firms embrace dispute resolution systems without the accompanying skill-set to make them effective.

The collaborative advantage that accompanies the rise of the networked organisation also carries with it the increasing risk/occurrence of organisational conflict. The CCP Global Human Capital Report (2008) found the average employee spends 2.1 hours a week dealing with conflict – to me this equates to approx. 5% of the total of any organisation’s workforce costs attributed to conflict. This does not take into account the high costs of conflict avoidance, and also failed deal making – if this loss of productivity was attributed to other operational aspects of the firm, such as a manufacturing systems defect or other tangible asset, you would expect the firm to respond with considerable investment into fixing the system . – So why doesn’t this extend to negotiation and collaboration skill development as an organisational (system) competency? Perhaps many of today’s leaders are ill equipped (through lack of awareness, competence or confidence) to lead the new organisational form, so they hold onto the legacy of applying old managerial mindsets to new ways of organising.

I am not aware, other than in the examples cited in ‘Built to Win’, of other leading organisations that do the type of training we are referring to, and so would also be interested to learn if they exist, how widespread etc. I would be also interested (as mentioned in ‘Built to Win’) in learning of the extent that organisations can point toward a standard Negotiation theory and practice that they promote throughout their organisation – I suspect the evidence would point to a paucity of organisations who could claim a standard negotiation theory and/or practice embedded into their systems.

The engagement and role of organisational leaders to promote the uptake of organisation wide negotiation learning is worthy of a further discussion.

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