Managers try to set goals for their employees that are developed with the best of intentions, but the real world is fraught with many examples where these have turned disastrous. This article focuses on how to work with employees to mutually set goals, consider negative ramifications and take actions that include ethical considerations to really achieve the desired results. When this is unclear, this can lead to unexpected and negative results.
Managers often provide financial incentives for various activities for their employees. These are often formulated with the best of intentions, but in the end, employees often focus on the incentive and not the client’s needs. When this happens, the result is a real disaster. Here are just two well knows examples.
- 1990’s Sears auto gave hourly sales goals. This resulted in unneeded repairs and overcharges. As a result, Sears’ reputation suffered for years.
- Enron bonuses for meeting challenging revenue goals. The impact was fraud and Enron went out of business
What went wrong? Goals need to be specific, measurable, achievable, relevant, and timely. These goals met all of these criteria, but they missed some critical points. These were,
where did these goals fit in with the values purportedly of the company, and were they discussed with employees to modify the goals when considering values?
How did customer satisfaction, employee satisfaction, leadership development, and training fit into the goals for revenue? They didn’t. How did corporate values fit into the goals? They didn’t. So, what can be done to ensure goals are clearly thought out and they do consider other elements beyond the bottom line when negotiating on behalf of the company? Three points to consider when setting goals related to negotiations are to have a clear focus, seriously consider ethics, and have a collaborating perspective over competition for the best results.
Have a clear focus
When the focus is on the bottom line as was presented in the two major failures above, employees responded as you might expect. To narrow of a focus is not healthy for any organization or negotiation. Yes, there is a bottom line with a Best Alternative to a Negotiated Agreement (BATNA). That is if BATNA is not met it is better to walk away from the deal. However, besides the dollar amount what are other considerations going forward? Consider, a host of items such as:
- How will employees view the result?
- How will the other party view the agreement?
- What about other customers?
- How will other stakeholders including vendors view the results?
- What about the public?
- Might there be future contracts?
- What about relationships with competitors?
- Are short term results negatively impacting long term impacts?
- Will this improve customer satisfaction?
- Will this improve employee satisfaction?
- What does this say about leadership?
- Is there an impact on employee development?
- What does this say about our mission, vision and values?
It is relevant to look beyond the bottom line. Within the organization how will the result be perceived looking up, down and laterally on the organization chart? How about outside the organization? How the negotiated result may be perceived by vendors, customers and other stakeholders? What are the ethical implications?
Before moving on consider the culture of your organization and whether the anticipated results fit within your corporate culture and the culture’s tolerance for risk.
Seriously consider ethics
What does this mean? Negotiators need to focus on not only on the end result, but also on the means to get there. There are two major areas of consideration.
- may lie or make false promises, and
- may misrepresent their performance to you their employer or to the other side.
Think of how this may impact you and your organization. What is your reputation in the marketplace? How important is your brand and standing in the community, your market, the industry and beyond? Unfortunately, you typically won’t know the ramifications of negative ethical behavior until sometime later. At that point it is too late and the damage has been done. Think of the potential ramifications.
In her book, 7 Lenses, by Linda Fisher Thornton, presents real insights considering
- Greater Good
A question is, what are your guiding principles and how do these play out with your negotiations? Are they known and are those negotiating with you fully on board? How can you be sure? Did you have conversations ahead of time to make sure everyone was aligned on the same page? You need to lead in ways that bring out the best in others. When others see positive intent and impact, they will gain insight into your culture. Lead for the greater good.
The need for collaboration versus competition
Competition is good, but to much competition is not healthy. Consider parents with children and sports. Learning fair play, playing by the rules, good sportsmanship, playing hard, doing your best and persistence are great qualities learned from sports. However, sometimes overzealous parents or coaches begin to teach unhealthy lessons related to winning with various costs. When that happens, this can begin to undermine the positive lessons mentioned above.
Similarly, the narrow focus on the bottom line in a negotiation can undermine the big picture of what lessons are being learned through the process. What are the lessons that can be learned from this negotiation that can be applied to future negotiations?
When developing cooperating and/or collaborative strategies it may be possible to take advantage of opportunities that were unforeseen.
There may be ways to create value for each of their organizations.
In a negotiation the manager needs to really think through what it is they want to have happen and ensure balance well beyond the bottom line.
- Make sure to prepare ahead of time
- Focus on collaboration
- Keep the big picture in mind not just the bottom line
- Be conscious of emotions – theirs and yours and stay positive
- Remain ethical to your values.
When you actively listen considering the concerns of the other party by paraphrasing, summarizing, asking open ended questions and empathizing you are more likely to develop trust and work toward alternatives that may be more mutually acceptable.
As a manager your set the tone. Everything you do is being watched by your people. When they negotiate on your behalf, they believe they are doing so with your support and understanding. It is very important that you transfer your thoughts on the big picture, their focus, the firm’s ethical character, and the desire to work collaboratively towards a mutually beneficial result. If these ideas are not transferred clearly, and the focus becomes the bottom line, be leery of the potential implications. If this is the case, history presents some very negative implications going forward.
About the Author
Mike is a professional speaker, and a mediator/negotiator that addresses business valuation and other issues with the IRS, and issues for clients as a conflict resolution expert. You may contact Mike directly at email@example.com and at (651) 633-5311. Mike has written 11 books including, The Servant Manager, Business Valuations and the IRS and Peaceful Resolutions that you may find helpful. [Michael Gregory, ASA, CVA, NSA, MBA, Qualified Mediator with the Minnesota Supreme Court]