Wednesday, February 16, 2011

Conflict of Interest



I just got done reading a great book entitled "Negotiation Genius" by Deepak Malhotra and Max Bazerman.  I would highly recommend it if you want to tune up your negotiation skills.  Our entire management team read it and thoroughly enjoyed it.  

One of the quotes that stood out to me in the book was by Upton Sinclair.  He said this, "It is difficult to get a man to understand something when his salary depends upon his not understanding it." 

This simple statement opened my eyes as I thought about people that I negotiate with on a daily basis.  In the commercial real estate industry, we deal with all sorts of people: engineers, architects, property managers, brokers, developers, attorneys, bankers, government agencies, and city officials just to name a few.  Each one is unique and different in his own way. 

Recently, I was dealing with a large issue on one of our development projects in Texas with one of the groups mentioned above.  It became very clear to me that Sinclair's quote was extremely prevalent in our negotiation.  The guy was afraid that he would work himself out of a job if he moved things along faster than they wanted to go.  Talk about frustrating, and talk about a conflict in interest!      

So how do you solve this issue that is outside of your control?  We had to try and solicit advice and expertise from people who did not have a stake in the outcome and who didn't profit from manipulating his behaviors and decisions.  Deepak said it best in his book, "Most of us view conflicts of interest as a genuine societal problem that must be remedied.  We understand that conflicts of interest can contort people's judgments.  Yet we have trouble believing that they affect our own judgments." 

When we enter into a negotiation, we have to remember that each one of us brings our own biases, and behaviors to the negotiation table with us.  Before we enter into the negotiation, we must realize our own fallibilities as well.  Not an easy thing to do, but something we all can consciously think about and grow from! 

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