“Bargaining” is Not Negotiating

I was recently asked, in my capacity as a negotiations coach, what was my opinion of the Detroit automobile manufacturer’s bailout. I am completely opposed to it, but for a reason that politicians and the media have not discussed.

Detroit’s auto manufacturers always employed flawed concepts when dealing with the United Auto Workers. Essentially, they engaged in “bargaining”, not negotiating. At the heart of the problem is what negotiators call “mission and purpose.” The auto manufacturers believed that negotiating was the same as bargaining, but bargaining requires a mindset that requires compromise.

They sat at the table and asked themselves what they would have to give up to the union to get the deal done and make their numbers in the year ahead. The most powerful “bargaining” or negotiating tool is the ability and readiness to say no and they did not exercise it.

The result is that years of “bargaining” left the Detroit auto manufacturers unable to compete even with others engaged in the same business in the United States. Looking for those on whom to place blame is now the order of the day. Typically, labor is blamed for greed or laziness. Government legislation and regulations are also blamed.

Time and again, however, the leaders of the Detroit auto industry failed to base their most critical negotiating decisions on a clear vision, on a firm grasp of what their mission and purpose was.

Mission and purpose is defined as the long-term aim of an organization and it is their continuing task and responsibility. From my observation of the Detroit auto industry, it appears that they simply did not have either an understanding of their mission and purpose or a commitment to anything beyond the “bargaining” agreement at hand.

The result is that they became trapped in knee-jerk decisions that now threaten a cascade of failures beyond themselves, harming suppliers, destroying consumer confidence, and creating a situation that politically is so disastrous the current administration decided to hand it on to the incoming one. They are doing so with public funding that was not intended for this purpose.

Money, particularly public funding, will not save an industry that makes ineffective decisions. Change is required and without bankruptcy there will be no change.

As a veteran of the Vietnam War, I recall of how many times Ho Chi Minh and his negotiators said no to the compromise mindset of Richard Nixon and Henry Kissinger. At great and tragic loss of lives to both sides, the Vietnamese held fast to their mission and purpose. Vietnam is now a sovereign nation with diplomatic relations with the United States.

There are many other examples; as a former airline pilot, I recall how, in the 1970s with the airline industry facing deregulation, the founder and chairman of Continental Airlines killed himself in his office. Only tough decisions restored the airline to solvency and a competitive position.

That is the mission and purpose for the three Detroit auto manufacturers; solvency and the ability to compete in the global marketplace. It should be the mission and purpose of the United Auto Workers as well.

Only sound bankruptcy procedures will produce a successful outcome. Only tough decisions in which all parties share a common mission and purpose hold any hope for them.

Polls show that the vast majority of the American public opposed a bailout. Many in Congress opposed a bailout. The Detroit auto manufacturers and the UAW are going to have to take no for an answer.

Jim Camp is an internationally known negotiation coach and the author of two bestselling books on the subject. He is the CEO of The Jim Camp Group whose Internet site is http://www.startwithno.com.
[print_link]

GHTime Code(s): 1ac18 aa0ed