Wednesday, 22. February 2017

WHU-Professor Lutz Kaufmann comments on Negotiations with US-President Donald Trump

There is much talk at the moment about Donald Trump and his recognizable and assumed negotiation style. Firstly, the US President is felt to be erratic and narcissistic – and it is always advisable to adapt one’s negotiation style to the other person’s personality profile. Secondly, there are people who even see Trump’s unpredictability as possibly masking a clever strategy that gives him a starting advantage in any negotiations. That too is correct.

Intelligently structured negotiations

However, this all fails to take into account a much more important negotiation strategy – after all, few protagonists will get to negotiate with the President himself, and fewer still with him on his own. A far smarter negotiation strategy is therefore to engage in intensive negotiations with anyone but Trump himself. For instance, the German government team has done this admirably from the outset: Ministers Sigmar Gabriel and Ursula von der Leyen – to take just two examples – were very quick to enter into dialog with their respective counterparts. It is important to note that, with Trump, everything does not hinge on on-the-nose  negotiation showdowns like with hostage-takers or car salesmen. What is needed instead are intelligently structured and timed negotiation campaigns based on careful stakeholder analyses.

One example of a smart move in such an overall campaign is the invitation of Ivanka Trump to Germany. During chancellor Merkel’s recent visit to Washington, German managers and entrepreneurs were part of her delegation. During a talk about the German educational system (i.e. the dual vocational training) they extended an invitation to the daughter and therefore a highly influential advisor of President Trump to visit educational centers in Germany.

In complex negotiations, substance is key

Another example that highlights the importance of negotiation skills beyond the obvious ones was provided by the President himself in the days when he tried to gain support for his health care bill. He is said to have used a lot of pressure in the form of coercive power (threats of punishment). That this  hardball type dealmaking behavior is not sufficient was underscored by recent comments from aides who described the President as not particularly knowledgable about health care. Knowing about the subject matter is particularly important if the other side cannot simply be swayed into accepting a deal. In complex negotiations, substance is key.

Professor Dr. Lutz Kaufmann
Chair of International Business and Supply Chain Management at WHU – Otto Beisheim School of Management.
Academic Director of WHU‘s Negotiations Program for Executives

Professor Dr. Lutz Kaufmann