“My father said: You must never try to
make all the money that's in a deal. Let the other fellow make some money too,
because if you have a reputation for always making all the money, you won't
have many deals."
Quote by the late powerhouse
Oil Industrialist, Paul Getty, capturing with great simplicity, the importance
of win-win situations in Business.
Negotiation is at the centre of this concept of “win-win” and this
article highlights, how even the most diverse stakeholders can reach agreements
where all parties involved can feel appreciated and respected.
How can you advocate for a low carbon future when your company is
among the largest emitters of carbon dioxide in the United States? A question
James Rogers of Duke Energy is asked a lot. In the beginning Rogers was the
newly appointed CEO of Personal Service Indiana. A company that in 1988 had
just written down a €2.7 Billion loss on a half constructed nuclear plant. The
reason? The plant development was halted halfway through by environmental
groups, resulting in PSI’s largest construction project being shutdown. The
company’s finances were in disarray, morale was low and the company had lost
touch with its stakeholders and customers.
It was then that Rogers developed the plan; 100 days of listening. The idea,
set out entirely by Rogers himself, was to meet with the companies many
stakeholders in an attempt to” identify issues, set priorities, figure out who
to trust and start repairing and rebuilding relationships” No matter what
guidance he sought from the already established and veteran PSI board, he was
always given one piece of advice, do not meet with any environmentalists.
Internally, the idea of the CEO talking to the very groups who caused the
recent meltdown was met with such resentment that Rogers almost decided to
change course.
However Rogers prevailed and met with the leaders of the
environmental groups. For him the goal was to come away with a better
understanding of the group’s point of view and to see the issue from their
perspective. He was quickly able to focus in on three of the opposition’s core
beliefs; “ Nuclear energy was too costly, waste disposal was unmanageable, and
the additional 2,360 megawatts of base load generation capacity wasn’t needed.”
Rogers although disagreeing with some points, listened.
After the meeting Rogers realised that environmental risks had to
be integrated into company decision making. In hindsight the lack of this
function a result of the construction plant disaster. The company decided to
convene and negotiate with its diverse stakeholders, especially
environmentalists, to write a public statement about environmental
considerations in future business dealings so as to never again “ waste
billions of dollars on half constructing a plant.” Management would warn this
would only empower groups that opposed the operations of PSI, but that was
exactly what Rogers wanted to do.
With the help of the many stakeholders of PSI the company
negotiated a 10 point corporate Environmental charter, allowing a total
integration of company decision making with environmental risk.Rogers’s ability to treat the Environmentalist point of view and
perspectives with respect and appreciation is a great example of putting
agendas aside and simply listening to the needs and concerns of the other
party. The nuclear plant construction was halted yes, but the 10 point charter
allowed PSI to "plant a stake in the ground."
Final Thoughts:
You have to wonder if the company had merely listened to these
environmentalists groups in the first place when initial planning for
construction was under way, how much different the situation could have been.
If the company had adopted Rogers’s approach of “empowering” stakeholders so as
to make them feel respected, appreciated and listened to, who knows? They could have negotiated and reached an agreement. After all,
the 3 core beliefs of the opposition weren’t exactly earth shattering.
The power of listening is as important in business as it is in day
to day life. The lesson that can be taken away from this example is to always
be open to engage in negotiations with opposing parties and to treat the views
and opinions of other stakeholders involved with respect and if needed, action.
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