The benefits of openness against the demands of negotiation
This is one of the few times in life that I will discuss football. Or sports. In my defense, I hope to make this post boring enough that no sports fan would bother reading it. Here goes.
The only football team I care about is Ebbsfleet United, and that is only because it was founded as an innovative social experiment. The club was bought with funds from fans, it remains completely owned by fans, and the fans are supposed to vote on every decision.
Earlier this week I received this message from the club:
We know you have followed MyFootballClub and Ebbsfleet United’s progress, which is why we wanted to keep you up to date with some breaking news.
Ebbsfleet United have received an offer from a League club to purchase striker John Akinde. This request follows a number of offers, from several different clubs over the last few months. MyFootballClub members are currently voting whether to accept or reject the bid.
The offer, made on Wednesday 27 August, is in excess of £140,000. Ebbsfleet United could also receive further payments depending on performance plus a significant percentage of any sell-on should the player be transferred to another club.
Fuller details of the deal – and the reasons why Liam Daish, the CEO and the Chairman believe that this offer is in the best interests of the football club as well as the player – will be disclosed if the transfer proceeds. (This is to protect Ebbsfleet United’s future negotiating position should the deal falter.)
Liam Daish, the CEO and Chairman are seeking the opinion of the club’s owners, the MyFootballClub members. Members have until 19:00 (UK time) Friday 29 August to decide.
This is quite a dilemma for me. I don’t mean whether or not Mr. Akinde should be sold – it is possible for me to care less, but not by much – but rather by the decision not to disclose full information to the club’s owners, the fans, so as
to protect Ebbsfleet United’s future negotiating position should the deal falter
There ought to be a way to use openness as a strength. On the one hand you have Mozilla’s Firefox web browser which continues to beat Microsoft’ Internet Explorer in quality and features. My brother pointed out to me that this state of affairs is ludicrous. Microsoft could pay for an entire team of programmers to do nothing all but watch the Mozilla team’s work and then copy it. In fact, they could literally copy and paste the code into their own web browser because Mozilla has a very permissive open source license. And yet, Microsoft’s closed work continues to trail Mozilla’s open work. This is the beauty that I see in open source software.
And yet as I study for my MBA I learn about negotiation skills and the importance of restricting information. A key tactic for building co-operation rather than capitulating to competitors in a negotiation is to have gradual, sequential sharing of information. Share a little information. If you negotiator reciprocates with sharing some of his or her own information, you can share yet more of yours, and so on. If you share all of your information at the outset, however, you lose because the person you are negotiating with has all the information while you only have half, and because information is power in a negotiation.
I do not know how to use openness as a strength. There must be a way, but I do not think it has been discovered yet because openness is still a new phenomenon. Even the Mozilla example is not about beating Microsoft because openness overcomes secrecy, but because the advantages of openness in collaboration outweigh the advantages of secrecy in planning against competitors.
But there really ought to be a value for openness in planning against competitors. For example, one advantage that Israeli negotiators have against the Arab dictators is that the Israelis can always say that they personally agree to something, but that The Knesset will never approve it, or at least that the negotiators have to consult with the rest of their people back home. By contrast our “leaders” never get to say that they have to get approval from their populace. And the open societies of the West beat the closed ones of the USSR, and will go on to beat the pseudo-open one of Russia today, because lively public debate minimizes inappropriate decisions made through private negotiations.
I do not know, however, how to apply this in business. I cannot find any books about it, and the few examples like open book accounting are practiced by mavericks like Ricardo Semler. There does not seem to be a body of knowledge showing repeatable best practices that I can learn how to copy.