The role of confidence in leadership and negotiation

“Confidence is a gift, given to you by yourself. To have it costs nothing but to not have it comes with an immeasurable price tag.”

Debbie Dickerson, Confidence is Your Game Changer

Confidence is a fundamental part of effective leadership and negotiation (among other endeavors in life).  However, what it means to be appropriately confident is sometimes unclear and can cross a fine line into being over or under confident.  Let’s explore this idea and try to grasp its role as it pertains to leadership and negotiation. 

The word confidence comes from the Latin word confidere, which means 'to be sure.'  However, how do we know how sure we should be?  It is a little bit like Goldie Locks and three bears.  As you will recall in that story, Goldie Locks tried porridge that was too hot, too cold, and then just right.  Similarly, you can be too sure in yourself (AKA overconfident or cocky), not sure enough in yourself (AKA under confident or meek), or you can have just the right amount of confidence.  When you have just the right amount you continue to trust yourself even when you fail…without questioning your overall ability.  Clearly the best leaders and negotiators find that sweet spot.    

When it comes to the role of confidence in leadership and negotiation it is not a stretch to say that it forms the foundation of everything that is done in these realms.  For example, when it comes to leadership Francisco Dao explains, “Self-confidence is the fundamental basis from which leadership grows. Trying to teach leadership without first building confidence is like building a house on a foundation of sand. It may have a nice coat of paint, but it is ultimately shaky at best.”  Similarly, when it comes to negotiation, listen to the words of international negotiator Lahktar Brahimi, “You have to be, at the same time, arrogant because you want to solve problems that look unsolvable, but you need to also be very very humble.  These are contradictory things but if you look closely they are not that contradictory.  You also need to have determination, you want to succeed, and you think (reaching success) is doable.  But you also need to be modest, don't play god, you are not god and you have to accept failure as part of the process.”

The key to confidence in leadership and negotiation is the belief in yourself that you can do whatever you set your mind to do, but that has to be combined with an ability to listen to others when you are off course or heading down the wrong road.  If you fail to listen you are over confident.  As Stone, Patton, and Heen explain in their book Difficult Conversations, “One reason people are reluctant to admit mistakes is that they fear being seen as weak or incompetent. Yet often, generally competent people who take the possibility of mistakes in stride are seen as confident, secure, and ‘big enough’ not to have to be perfect, whereas those who resist acknowledging even the possibility of a mistake are seen as insecure and lacking confidence. No one is fooled.”  Conversely, if you listen too much and lose your way, than you lack confidence. 

Confidence, however, is not just about how we ourselves when it comes to leading and negotiating.  It is also about how followers or others we are trying to influence see us.  As Thomas Wren explains, “Not only is the leader’s self-confidence important, but so is others’ perception of him. Often, leaders engage in impression management to bolster their image of competence; by projecting self-confidence they arouse followers’ self-confidence. Self-confident leaders are also more likely to be assertive and decisive, which gains others’ confidence in the decision. This is crucial for effective implementation of the decision. Even when the decision turns out to be a poor one, the self-confident leader admits the mistake and uses it as a learning opportunity, often building trust in the process. . . .”  The same can be said for negotiation.  If the other negotiator senses a level of confidence in you than they are more open to your proposals and ideas and will also have a level of respect for you that won’t been seen if you come across as over or under confident.  According to a study by Huthwaite International, a UK-based sales and negotiation specialists firm, under-confident negotiators achieve a successful outcome in just one in five of the negotiations they’re involved in.  The survey of over 1,300 professionals in 52 countries also found that those who feel ‘neutral’ achieve an even lower rate of success in negotiations, with only 16 per cent of them succeeding.  Successful negotiators were defined as those who implemented 75 per cent or more of their negotiations without the need to renegotiate. Those defined as unsuccessful were negotiators who had a rate of success lower than 50 per cent in their negotiations.

The study also stated that more than six out of 10 (62 per cent) of successful negotiators describe themselves as “very confident” when entering negotiations.  As the CEO of Huthwaite, Tony Hughes, stated “Confidence has a huge impact on negotiators’ behaviour and what they ultimately achieve.” Hughes ends the study with the following advice for negotiators, but also seems relevant for leaders, “Our advice is to be confident but not aggressive. Try to strike the right balance with your negotiation partner and focus on long-term partnerships.”

So the bottom line is that confidence is a critical and often unforeseen underpinning of leadership and negotiation.  If you have it, find the right balance so you don’t tip too far in either direction.  If you don’t feel confident, probe as to why and then work on those aspects until you do.  It takes time to build confidence if you don’t have it, but when you find it you won’t lose it easily.

  

     

Leaders vs. Managers: Distinct negotiation approaches

There are two basic ways in which to view and approach any negotiation. We can see it as either distributive or integrative; or a combination of the two. Leaders have the ability to see negotiations in both lights, but based on the literature it appears that managers are biased in seeing negotiations as inherently distributive in nature.  Here is why I would make such a claim. 

First, let’s break down some key features of the approaches to a negotiation and then look at why managers are predisposed to focus on distribution and not integrative approaches.

Distributive Negotiations are generally seen as:

·      Having an outcome that is win or lose,

·      Zero-sum in nature or a fixed pie,

·      Actively seeking to assert one’s position only,

·      Focused on limiting information sharing as much as possible,

·      Having the mantra that anything not acquired is lost.

Integrative Negotiations are generally seen as:

·      Having an outcome that is focused on mutual gains for both parties,

·      Focused on creating value and enlarging the pie before dividing it,

·      Seeking to actively understand the other side’s perspective,

·      Understanding the importance of reciprocally sharing information,

·      Having the mantra that mutual giving can result in mutual gaining.

Now that we have clarified that, it is critical that we draw a clear distinction between leadership and management.  John Kotter, Professor at Harvard Business School, explains that the classic business school definition of management revolves around¹:

1)   Planning

2)   Organizing

3)   Directing

4)   Controlling

Contrast that with McFarland, Senn, and Childress, who collaborated to write Twenty-First Century Leadership: Dialogues with 100 Top Leaders. They defined the 21^st century leader as someone who:

1)   Facilitates excellence in others

2)   Has interpersonal sensitivity

3)   Exhibits a mastery over change

4)   Takes a holistic approach -- embracing a wide variety of qualities, skills, and capabilities.

Based on the following descriptions we can see that a manager's inherent training and focus on ‘directing’ and ‘controlling’ aren’t conducive with most element of the integrative approach to negotiations.

Someone who believes they need to direct the discussion won’t actively seek to understand the other side and someone who is trained to control a situation won’t likely be willing to share information in a reciprocal manner. Further, neither directing nor controlling are natural segues into the concept of mutual gain.

Juxtapose this with the 21^st Leader as described by McFarland, Senn, and Childress. Every aspect of a leadership approach lines up with the integrative negotiator:

The concept of mutual gain and that value can be explored and found align with a leader's desire to take a more holistic approach and facilitate excellence in others.

Actively seeking to understand the other side directly connects with a leader's tendency for interpersonal sensitivity. And finally, we find that this leader who has mastery of change understands that giving can result in mutual gaining. Anyone who is comfortable and capable of changing and embracing change will be open to creative and collaborative solutions.

This isn’t to say that the manager bias in negotiation is always bad. Certain negations are best viewed through the lens of distribution. Simple, transactional negotiations are perfectly tailored for the manager. In fact, they are likely to be the most effective and efficient at this type of negotiation.

However, the information presented would seem to indicate that for more complex, multi-variable negotiations you will want to have a leader, rather than a manager, involved.

With thanks to Chayse Myers for his input.

The Leadership Style and Negotiation Approach of Donald Trump. What can we learn from his past for the next four years?

With Donald Trump taking office it is important to ask what kind of leader and negotiator he will be as he leads the United States.  There is certainly ample evidence from his past to draw from.  In this month’s blog post, I will begin by looking at his leadership style and how it can be characterized.  Then I will shift slightly and look at his negotiation approach and the way he tries to develop deals at the table.  In the end I will weave them together to see if we can understand what the next four years will look like.

In terms of leadership style, this is a rather tricky one to characterize.  However, lets give it a try.  There are a number of different leadership styles.  Lets use these five approaches as explained by Rose Johnson on the website Chron (http://smallbusiness.chron.com/5-different-types-leadership-styles-17584.html) The five styles are Laissez-Faire, Autocratic, Participative, Transactional, and Transformational.  Briefly here is a summary of each:

·      A laissez-faire leader lacks direct supervision of their followers and fails to provide regular feedback to those under their supervision. The laissez-faire style produces no leadership efforts from those also capable of exercising leadership. This often leads to poor performance and a lack of control.

·      The autocratic leadership style allows managers to make decisions alone without the input of others. Leaders possess total authority and impose their will on their followers. No one challenges the decisions of autocratic leaders.

·      The participative leadership approach values the input of team members and peers, but the responsibility of making the final decision rests with the participative leader. Participative leadership boosts follower morale because they make contributions to the decision-making process.

·      The transactional leadership style focuses on certain tasks to perform and provide rewards or punishments to followers based on results. Goals are predetermined together and the leader possesses the power to review results and train or correct followers when they fail to meet goals.

·      The transformational leadership style depends on high levels of communication. Leaders motivate followers and focus on the big picture to accomplish the goal.

Given these five styles, where does Trump fit?  At first glance, he seems to be a combination of the autocratic approach and the transactional style. There is little doubt that he has a top down style where he is in charge.  He certainly wields his authority and imposes his will on others.  Further, it is fair to say that the transactional approach is one that Trump talks about often.  Wanting new deals that benefit America and other approaches that see agreements as transactions rather than part of a larger relationship.  However, if we listen to his own words we find quite a different characterization that leads one to believe that he actually has a laissez-faire style.  Consider these comments he made about his own leadership style, "Most people are surprised by the way I work. I play it very loose. I don't carry a briefcase. I try not to schedule too many meetings. I leave my door open. You can't be imaginative or entrepreneurial if you've got too much structure. I prefer to come to work each day and see what develops."  Or consider this characterization of how he plans to deal with the media if he were to be elected president, “I’ll wing it and things will work out.”  As we watch Trump ascending to the Presidency these statements do seem to reflect his leadership approach in many ways.  The lack of details around policies during the campaign and the confidence he has in himself lend credence to this perspective holding truth.         

Now lets weave that together with his negotiation approach.  To do that we can turn to various snippets from his book the Art of the Deal.  To begin, it is clear that Trump is a transactional negotiator and takes a very positional or distributive approach to negotiation.  “My style of deal-making is quite simple and straightforward. I aim very high, and then I just keep pushing and pushing and pushing to get what I’m after.” (pg. 45)  Take the example of the wall he wants to build with Mexico.  The fact that he has stated he will get Mexico to pay for the wall is aiming very high…to the point that people are talking less about the building of the wall and more about who will pay for it.  He also seems to know how to manipulate people – playing on their sense of self.  As he stated, “I play to people’s fantasies. People may not always think big themselves, but they can still get very excited by those who do. That’s why a little hyperbole never hurts. People want to believe that something is the biggest and the greatest and the most spectacular. I call it truthful hyperbole.” (pg. 58)  Trump also suggests that he is unafraid to dig in and may even take a deal past what may make sense or be rational (AKA the psychological concept of entrapment).  As he explains, “I fight when I feel I’m getting screwed, even if it’s costly and difficult and highly risky.” (pg. 236)  Finally, one can hope there is some truth in this statement. “You can’t con people, at least not for long. You can create excitement, you can do wonderful promotion, you can get all kinds of press…but if you don’t deliver the goods, people will eventually catch on.” (pg. 60) 

Practically, his willingness to take risks has resulted in some great 'deals', such as the purchasing of the dilapidated 40 Wall Street in 1995 for $1 million, followed by $35 million in renovations, which resulted in a current value of $500 million today. Juxtapose that with other ventures, in which his laissez-faire approach (and later recalcitrance), have resulted in problems which eclipse any possible gains (e.g. all the problems with Trump University).

What we seem to have in our next president is a laissez-faire leader who likes to sense and feel his way through situations and believes he is more than capable of doing so very effectively.  Now, couple that with a very positional negotiator, who is unafraid to take risks, but ultimately knows he needs to produce results, and you have a very uncertain four years in the offering.