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A study by WHU – Otto Beisheim School of Management and Arizona State University provides answers to the question of the real difference between a bluff and a lie in business negotiations. The distinction is an important one, as the psychological consequences are fundamentally different – for those affected by a bluff or a lie, and for the actors them-selves.

Be it VW, campaign promises or deliberate dives to trigger penalty kicks: We are surrounded by deceptions. Business negotiations in particular are often said to resort to bluffs and lies to improve a particular party’s negotiating position – with the end justifying (almost) all the means. To date, research has considered bluffing a form of lying or regarded bluffs as the “more harmless variant” of a lie. The results of eight staggered studies by an international research team at WHU – Otto Beisheim School of Management and Arizona State University contradict this assessment and identify fundamental differences.

“The difference between a bluff and a lie can be found in the eyes of the beholder: as victims, we are annoyed with ourselves if the other side successfully bluffs, but no one wants to negotiate with a liar, if at all possible, ever again. Lying is immoral, but bluffing is viewed as amoral, both by participants and by those affected, i.e. as a negotiating tactic that does not constitute ethical misconduct,” notes the WHU negotiation expert Professor Dr. Lutz Kaufmann.

Surprisingly, both negotiation experts and laypeople would take the same view, as Christian Schlereth, Professor of Digital Marketing, explains: “A lie is fundamentally about falsifying information or making false promises. Bluffs, on the other hand, are about feigned emotions, such as sympathy, misrepresenting one’s own bargaining position, or making empty threats, such as breaking off negotiations.”

As the researchers also show, lying, for instance, can be reduced by means of a code of conduct, but this will have no impact on bluffing. “Instruments like these increase stakeholders’ moral awareness. This works against lies, but not against bluffing, because with bluffing, moral considerations play no role from the outset. Bluffing is considered a moral-free negotiating tactic that even has to be learned,” as WHU researcher Dr. Jörg Rottenburger summed up.

Prof. Dr. Lutz Kaufmann is a professor in the Supply Chain Group at WHU and instructor of the Negotiations Program. Get more information about the WHU Negotiations Program and enhance your negotiation skills!

Lutz Kaufmann, Jörg R. Rottenburger, Craig R. Carter, Christian Schlereth (2018), “Bluffs, Lies, and Consequences: A Reconceptualization of Bluffing in Buyer-Supplier Negotiations,” Journal of Supply Chain Management, Vol. 54., in press

Jörg R. Rottenburger, Craig R. Carter, Lutz Kaufmann (2018), “It’s Alright, it’s just a Bluff: Why do Corporate Codes reduce Lying, but not Bluffing?” Journal of Purchasing & Supply Management, Vol. 24., in press

A field report by Marianne Ohm, Managing Partner of codiviti UG and participant in the 6th General Management Plus Program.

May 20, 2019: Coming from Germany, USA, Japan and Sri Lanka, our group came together in Düsseldorf to join the first module of WHU’s General Management Plus Program. This eight-month-long program aims at developing new concepts for a learning center in Bandarawela, Sri Lanka, in order to improve future prospects for young people located in this area. During the program, we will be supported by a partner-team in Sri Lanka as well as by staff members at WHU and BOOKBRIDGE. During the first three days in module 1, we worked on the development and implementation of strategies. The long-awaited kick-off of our Business Impact Project took place during the last two days. Starting now, we have eight months to define, advance, and implement our project.

How to implement strategies successfully

During the first two days, Prof. Peter Witt humorously – and sometimes provokingly – introduced the overall topic business strategy. Using many practical examples, we learned what constitutes a good strategy formulation and, as a team, developed our own strategies. We also got to learn strategic instruments for innovation and marketing. We especially focused on the challenges in implementing strategies that arise due to emotional factors: Only a small part of our decisions are made rationally. On the last day of the Strategy Essentials Program, Prof. Miriam Müthel demonstrated how to drive the implementation of strategies forward. Additionally, we discussed the topic of change management, focusing on motivating people and inspiring them to follow their own goals (“The people side of strategy”): Why and how do we change communication, leadership and corporate culture to implement our strategy?

Beyond learning – connecting with other high potentials

Our team included company executives as well as self-employed entrepreneurs. During coffee breaks, lunch and a get-together on the first evening, we had plenty of networking opportunities to gain exciting insights into each other's daily work. In the course of three days, we got to already know one part of our team for the Business Impact project.

Business Impact Project – ready, set, go!

During the last two days of module 1, we finally learned more about our project, and got to know our team (especially the participants located in Sri Lanka), a potential investor and our coaches. Dr. Carsten Rübsaamen, founder and CEO of BOOKBRIDGE, passionately introduced us to his Social Enterprise as well as to non-profit companies in general, using some success stories as examples. Having started with a large delivery of books to Mongolia and the following construction of a local learning-area, there are now 28 learning centers in Mongolia, Cambodia, Sri Lanka and South Africa.

Inspiration for our project

At the end of January 2020 we will travel to Sri Lanka to implement our project. To prepare for this, Sujitha Miranda, Country Manager of the Learning Centers in Sri Lanka, came to Düsseldorf. She informed us about the political and economic situation in Sri Lanka, "our" learning center in Bandarawela, the Dos and Don'ts of her country and its beautiful countryside. Sujitha's story was very inspiring and motivating. During the first evening in Düsseldorf, she told us about her road to BOOKBRIDGE and how she became a Country Manager in Sri Lanka.

Working in a diverse and virtually connected team

The program kept preparing us for the joint project, but we still didn’t have enough information about what the actual project would be. After a few more days of suspense we finally got to learn our entrepreneurial challenge for the next months: We would work on further developing and refining a learning center in Bandarawela which would give young people in the region better prospects for their future.

During these first days, we grew together as a team, supported by a team-building unit, which helped us to establish some basic rules for our work as a team. It became clear to us that there are several challenges awaiting our team: During the program, most of our communication takes place virtually, we live in different time zones and we have different cultural backgrounds. Furthermore, our project team consists not only of the participants of the GMP+ program, but of the employees of the learning center in Bandarawela as well. Therefore, a common vision and honest communication are central aspects for our work as a team.

To establish a smooth teamwork, we also got an introduction into our collaboration tools (such as “Teamwork” and “Zoom”), a first conversation with our potential investor and reflections on our project’s vision.

We will meet again one week after the first module in a video conference. For now, we said goodbye in order to return to our home countries, with many unanswered questions but also a lot of motivation , we said goodbye.

I am happy to take up this unique challenge to make a difference in Sri Lanka!

​Marianne Ohm is 27 years old and has been into various fields of voluntary work for almost 10 years. She is CEO of codiviti UG and regularly gives lectures on topics such as future skills and programming. Her hobbies are meetups, reading, crafting and strength training.

Professor Dr. Jürgen Weigand is Academic Director WHU EMBA Program and the Center for Responsible Leadership at WHU – Otto Beisheim School of Management. Having worked as a senior advisor for various international blue-chip companies, he is an expert in business strategy and conveys the necessary skills and knowledge to become a good leader. In this interview, he points out the most important qualities of a good leader, the influence of digitalization on leadership, and more.

What are the most important qualities of a good leader?

“Transitioning into a leadership role means having three key capabilities: The will, the skill and the integrity to lead. This may sound challenging, but there are both a lot of leadership knowledge and tools that you can learn to develop your authentic leadership style. Additionally, mastering leadership requires of self-reflection and feedback from others.”

Does Digitalization influence the role of General Manager?

“Yes, definitely. Let me mention two: First, disruptive innovation may change the ‘game’ in your industry, so General Managers will have to think more and more about how to sustain competitive advantage. Second, ways and speed of communication with all stakeholder change, which means that GM need to constantly reflect upon leadership and communication style.”

Can General Management be learned?

“In my over 20 years of experience in designing MBA and lifelong learning programs, I have observed that three broad areas of knowledge and skills are highly relevant: a) Business acumen – the ability to understand the financial side of your business, b) Strategy – the ability to formulate and execute strategic initiatives in your team or business unit and c) Leadership – the ability to motivate and guide teams. All this can be learned!”

In the recently published Financial Times Executive Education Open Programs Ranking, the WHU - Otto Beisheim School of Management's Executive Education program ranks 45th in an international comparison.

Compared to the previous year, WHU was able to improve its ranking by 15 places. "We are very pleased that the high quality of our Executive Education program is again reflected in the Financial Times Ranking," explains Prof. Dr. Markus Rudolf, Rector of WHU. "It confirms our claim to offer outstanding continuing education for managers at an international level.

WHU bundles its continuing education offerings in the Executive Education area. The portfolio includes customized programs for individual companies, open programs for individual participants or small groups of companies, and the Certified-in-Programs, a continuing education option at MBA level. In the Open Programs, WHU currently offers seminars on digitization, entrepreneurship, finance, leadership, and negotiation strategies.

The FT Executive Education Ranking lists the 80 best international continuing education programs in the "Open Programs" category. They are ranked according to the quality of their teaching, the course structure, and the diversity of the participants. The evaluation includes information from the universities as well as surveys of program graduates.

Whether they choose to or not, at one time or another, all executives will find themselves leaving their existing job and taking on a new professional challenge. Anyone leaving their old job and looking for a suitable executive role is suddenly faced with the prospect of examining their own personality and their professional capabilities, and asking the question: “where do I actually want to end up?”. However, the transitional phase between two jobs can and should be used for further personal and professional development.

Personal development and expanding your network

Long-time executives who deliberately decide to give up their current job and devote themselves to a new task tend to undergo a lot of self-reflection before handing in their notice. They have usually got to a stage where they realize they are no longer satisfied at their current company or are hampered in their further development. Conversely, if a termination is effected by the company, executives face a sudden need to reorient themselves.

In both cases it makes sense to use the time between jobs productively – not only to engage in personal development, but also to expand your own personal network. Both of these are useful exercises regardless of whether you have already landed your next job or are still looking for the right role.

These are the questions you should be asking when searching for the right role in senior management:

What is my untapped potential and how can I be sure to deploy it in future?

1. How do I evaluate my own management style and how does this compare to my employees’ assessment of me? How can I get objective feedback about my management style?
2. Which of my skills should I expand, which leadership gaps do I need to close in order to anticipate change processes and boost my personal performance (and that of my co-workers) across departments?
3. Am I an executive who is equipped with the relevant skills for the age of digital transformation? How should I raise my profile?
4. Is my management of my company up-to-date in terms of current development processes?

It is often difficult to answer these questions in detail and satisfactorily without external feedback. At the same time, executives should make the most of any professional transitional phases to confront these – sometimes uncomfortable – questions before they lose sight of them in the cut and thrust of everyday life.

As an executive between two jobs – use the time for personal development

One option that assists both personal (and professional) development as well as expanding one’s own network is further professional development. In particular, providers of “Executive Education” specialize in offering suitable professional development opportunities geared toward experienced executives. “Advanced” or “Executive” Management programs are less about acquiring more basic knowledge. Instead, these training courses provide a favorable framework that inspires self-reflection, where new ideas can be tested in a protected space, and that fosters an in-depth interaction on an equal footing with other participants to expand your own network. Additionally, executives naturally also benefit from updating their professional knowledge.

Most Executive Education courses for experienced executives are split into subject areas that focus on preparing you for top management roles or support you in performing such a role: for example transformation processes in companies, strategic challenges, or authentic management. Network expansion happens almost automatically because these intensive education programs are based on the “sparring” principle: tutors see themselves not only as learning partners on equal footing, but they also facilitate interaction and sparring between the participants.

Executive Program for Senior Professionals

A framework with the “sparring” principle is provided by the Advanced Management for Senior Professionals Program as part of the Executive Education offering at the WHU – Otto Beisheim School of Management. In two three-day sessions, participants from senior management are given the opportunity to reflect on their own perspectives and to develop new approaches for the challenges of the future.

Take a step out of everyday life: time for social responsibility

Sometimes it is time to leave old, well-trodden pathways behind and strike out in a new direction. This does not necessarily mean neglecting your professional goals or career, but it can breathe some new life into existing patterns and structures of thinking. As an executive, use the opportunity to take on some social responsibility. This can go hand-in-hand with personal (professional) development because there are Executive Education courses that unite the two. One example is the General Management Plus Program from WHU, which combines setting up a social business with true entrepreneurial spirit. Participants in this program refresh their knowledge in the field of General Management and at the same time develop their own business model in an emerging economy in Asia.

About the author

Dr. Rebecca Winkelmann is Managing Director of the Executive Education at the WHU – Otto Beisheim School of Management. With a total of over 15 years’ experience in management of higher education institutions, Rebecca has been supporting individual executives and entire organizations in the field of “Personal Development” for seven years, and she develops Executive Education programs.

About WHU Executive Education

WHU – Otto Beisheim School of Management is a privately financed, state-recognized business school with university status based in Düsseldorf and Vallendar. It was established in 1984 and today enjoys a strong reputation in Germany and abroad. WHU Executive Education offers first rate Executive Education programs for high potentials and executives at middle and senior management levels. Our portfolio contains tailor-made programs for companies, open programs (including Leadership, Advanced Management, General Management, Finance, Venture Capital) for individuals and small groups as well as conferences.