Leaders and compromise

To many, compromise is a pejorative term. But its absence breeds stagnation and sometimes destruction. To avoid the two, great leaders opt for a compromise rather than getting stuck with a stalemate. Compromise is giving up on a demand or making a concession. Compromise is the art of making everyone a winner. It is an adjustment of an earlier position to suit the new reality. It can mean the difference between failure and success; it may also mean the difference between living and dying. Compromise thaws stubborn ice and loosens naughty nuts. As observed by Gerald Ford, a former president of the United States of America, “Compromise is the oil that makes governments go.” It is also the lubricant that keeps corporations moving.

The principle behind compromise is that half a loaf is better than no loaf at all. Compromise is the decision to shift from a position when occasion so demands with a view to avoiding an impasse. Insisting on a position when the situation requires a shift does not signal wisdom. As observed by John H. Patterson, “Only fools and dead men don’t change their minds. Fools won’t and dead men can’t.”

Compromise is a strong factor in leadership success. Its absence causes wars, precipitates corporate failures, destroys countries and leaves homes in tatters. Leaders who cannot handle compromise are bound to be sub-optimal because leadership is a series of give and take. A leader must be enlightened enough to know when to insist on having his way and must also be knowledgeable enough to know when it is reasonable to let go. If he does not have this capacity, his leadership will be characterised by so many missteps that will leave his organization gasping for breath.

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World War 1

The assassination of the heir presumptive to the Austro-Hungarian throne, Archduke Franz Ferdinand, and his wife, Sophie, Duchess of Hohenberg, on 28 June 1914 orchestrated World War 1. Following the assassination, which was meant to instigate the break-off of Austria-Hungary’s South Slav provinces so they could go with Yugoslavia, Austria-Hungary authorities issued an ultimatum to the Kingdom of Serbia, asking it to accept an Austro-Hungarian inquiry into the assassination. It also asked Serbia to suppress all anti-Austrian propaganda and to take steps to eliminate terrorist organizations in the country, among other things.

Austria-Hungary demanded a response within 48 hours. Serbia, in its response, accepted all terms of the ultimatum except the participation of Austria-Hungary in Serbia’s internal inquiry into the assassination, stating that this would be a violation of its constitution. This response displeased Austria-Hungary, and relying on the support of Germany, declared war on Serbia, thus triggering the First World War as Russia, Britain, France, Italy, Belgium and Japan also aligned with Serbia.

The First World War left over 10 million people dead and millions of others maimed. The war, which started in 1914, ended in 1919, not because the countries ran out of ammunitions or weapons; the war ended when Germany signed an armistice and other countries agreed to a concession. That was after over 10 million people had been killed and millions of others maimed. The failure of two countries to agree on the mode of inquisition of an assassination caused the death of over 10million people.

Reasonable concession is always better than a stand-off.

 

The MTN $5.2 billion fine

In August 2015, the Nigerian Communications Commission (NCC) fined MTN Nigeria the sum of $5.2billion for its failure to deactivate unregistered 5.2 million customers’ lines, despite several warnings. After initial complaints, MTN, in a letter to the Commission in November 2015, admitted wrongdoing and pleaded for mercy. It also relieved some of its top management staff of their duties. Later, it embarked on a process of negotiating with the Federal Government to beat down the fine. After a while, it was agreed that the fine be reduced to $3.2 billion and the payment should be staggered. It was also agreed that MTN should list its shares on the Nigerian Stock Exchange (NSE).

In the negotiation, both parties made concessions and gained a few things. The Federal Government moved from $5.2billion to $3.2 billion, thus forfeiting $2billion, but it also gained the listing of MTN shares. If the Federal Government had insisted on getting the full fine, MTN could have decided to leave the country, which would have meant that not only would the FG have lost the full fine, it would have also lost taxes from the company, as well as having many of her nationals working with the communications company thrown into the labour market. If MTN had refused to negotiate and had left the country, it would have lost its most important market and would have experienced a slide in its revenue generation. By making concessions, the two parties gained.

Reasonable compromise leaves everybody happy.

 

The making of a good compromise

Here are steps that result in making good compromises.

 

Set out with a good plan

Planning is critical to success in any venture. Lack of planning leads to preventable delays and avoidable disappointments. Having a good plan in place brings success within reach. Before setting out for a negotiation, there must be a plan which states the upper and lower limits of your expected outcome. This means the negotiator must know the ultimate that he expects to achieve from the encounter as well as the irreducible minimum, below which he won’t go. Having these resolved before the commencement of negotiation makes it possible for him to negotiate from the point of strength and knowledge. With these, he knows what to concede and what to resist. But when limitations are not predetermined, there will be room for ambiguity and opacity which may leave the organization shortchanged.

 

Is it a fair deal?

Before agreeing to a concession, the leader must be sure that it is a fair deal. You cannot get a fair deal if you have not availed yourself of all the details about the situation. You cannot strike a fair deal without asking tough questions. You can’t get a fair deal if you are not determined to push hard. You cannot get a fair deal if you are determined to avoid conflict at all cost. If you do that, you will bend backward to accommodate the demands of the other party and they will take advantage of you. If you don’t push hard, the other party will, and that could mean you and your organization would be left with the short end of the stick. Never forget that by making a concession, you and your organization are getting less than you had anticipated from the encounter. While it is better to have a resolution than a stand-off, the resolution must not leave the organisation shortchanged; otherwise it would be worse than a stalemate. The compromise must be such that will not leave anyone in doubt that given the circumstances, the deal is the best possible.

 

Make the gains your focus

In a negotiation, what you focus on is what you get. If you go to the negotiation focusing on what might be lost as a result of the concession, you are not likely going to make a success of the exercise. So, rather than focusing on what you and your organization might lose as a result of the concession, think about what will be gained as a consequence of the concession. The fact is that you are considering concession because the ideal position you started with now appears unrealistic. So, rather than moaning what will be lost as a consequence of not getting what you considered as the ideal, focus on what you stand to gain as a result of the concession.

 

Spare a thought for the other party

In a negotiation, every side wants the best deal. But negotiation often hits rough weather when both parties insist on having their way. The best way out of this tiff is for each party to have a thought for the other party. When you are mindful of the other party, you will rather go for having shared gains than having everything to yourself, leaving the other party worse off. Never embark on a negotiation with the mindset of sacrificing relationship. Try and see the negotiation from the perspective of the other party. Even if you don’t agree with their demands, you will not deprive them of their sense of respect, which is critical.

 

What not to compromise

While it is very good to make compromises so as to move on rather than getting rooted to a point, certain things are beyond compromise. These are your values and purpose.

 

Your values

Your values regulate what you can do and set a limit for you. Your values reflect your sense of right and wrong. Your values determine your character and your character determines the type of person you become. Your character is critical to determining where you end up in life. Your values are like a wall round you; they protect you from engaging in activities that can ruin you and those associated with you. The day you compromise your value, you become defenceless and embark on a slide that may lead to the bottomless pit. Never compromise your values.

 

Your purpose

Your purpose is your essence. It is the reason for doing what you do. Without purpose, people and organisation will drift. Purpose is the anchor that holds an organization steady. Purpose is the energy of life. When purpose is understood, success becomes attainable, but until it is understood, success is nothing but an apparition.  As observed by Dennis Waitley, “Winners are people with definite purpose in life.” Consequently, when purpose is compromised, failure beckons. So, never compromise your purpose.

 

Last line

Those who go far in life are those who do not insist on having their way except when doing so contradicts their value and purpose.