The Deal
Saturday, November 21, 
5:14 pm

The devil's deep water

Posted on December 15, 2006 at 10:49 PM
Filed under: 2006 | Corporate Tool | Nov.-Dec. 2006 | The Magazine
Tagged: , , , , , ,
[ Share ]  [ E-mail ]  [ Leave a Comment ]

JoshKingCT.pngIf you've ever made the 90-mile drive from Santa Barbara to Los Angeles, you'll know the route requires two very different soundtracks: The first, shorter stretch, heading south on the Ventura Highway, hard against the Pacific, demands surf music -- sharp, bouncy and 100% thought-free. Turning east and heading away from the beaches, you enter the Heritage Valley -- citrus and farm country, the ravines filled with orchards, vineyards and nursery stock. This environment calls for some twang, which is why I found myself listening to Emmylou Harris as I passed through Santa Paula on a recent trip.

Emmylou has a lot of great songs, but one of her best is "I Don't Wanna Talk About It Now," a gritty portrayal of how we can torture ourselves with relationships we know are no good. We shouldn't do it, but we keep going back -- the head says no, the heart says yes, etc. Vast archives of art, literature and music are built on the simple truth that we humans are remarkably prone to acting against our interests. While economists talk on and on about the efficiencies of markets, we busily demonstrate how our emotions run roughshod over our rationality.

We deal people are far from immune. Oh, we may think we're coolly rational creatures, living and breathing by our DCF models and the maximization of shareholder value. But beneath that businesslike exterior beats the same mixed-up, brooding heart of any other human. We have our emotional needs and they must be met! We also know that our counterparties are similarly seething balls of ego and raw nerves, and that without the right kind of counterparty coddling, a deal will dissipate like the morning dew. That's why we'll fly across the country just to meet someone in person for an hour. It's why we patiently listen, a model of concern and understanding, to the droning speeches of those we are about to (politely, oh so politely) say no to.

Human contact and recognition are essential to establishing trust and respect. And we know from hard experience the negative side, how we will abruptly shut down when faced with head-on assaults on our credibility or competence. Try starting your next negotiation by cutting straight to your leverage or disrespecting your counterparty, and see how far it takes you. At best you'll be struggling to get the discussion back on track; more likely, your counterparty will find a reason to stop talking with you. The psychic satisfaction of keeping a jerk from getting what he wants is a powerful thing. For some, it will be worth scotching a deal that is otherwise in the company's interest.

But attraction is at work, too: Just as Emmylou sings of going back to a rotten relationship time and again, we've always got to guard against being dazzled by the shiny wares we deal with. Deal fever will easily set in, causing us to chase our targets beyond the point we should have abandoned the hunt. One reason so many deals fail is because senior management stayed on past last call rather than stumbling home to try again another day.

In our own work, it's painless enough to try to be professional and courteous, even when tensions are high. With practice, it's not even that hard to withhold the zingers our younger selves would have thrown to deflate the pompous gasbags we run across. In truth, identifying the emotional needs of counterparties and working to fulfill them is a big part of what makes dealmaking fun.

The tougher battle is against our own ecce homo failings -- the "devil's deep water" that Emmylou reminds us we are prone to sink under. Do I fight against a deal because it's a bad deal, or because the other side is treating me shabbily? Would I rather punish bad behavior than suck it up and reap the rewards? More than once I've found myself wanting badly to blow a deal up just so I could show the other side that their bungling had consequences. Great fun in the short run, but at what cost? Always best to rise above -- even if so doing doesn't have the makings of a great country song. - Josh King

Josh King works in business development for Clearwire Corp. in Kirkland, Wash. You'll find more of his writing on his blog at corporatetool.blogspot.com.



Join Corporate Dealmaker's LinkedIn forum

Comments
Post a comment


Search


Search For

Corporate Dealmaker Video


Deal Economy 2010: Avaya's Ali on digesting Nortel

Avaya Inc.'s Mohamad Ali on the company's next target.
Decade of The Deal


Movers & Shakers


Juergen Lasowski
Onyx Pharmaceuticals Inc.

Edward Swallow
Northrop Grumman Corp.

Owen Mahoney
Outspark

Alice Kim
FLO TV Inc.

Eric Hausler
Isle of Capri Casinos Inc.
Juergen Lasowski, Onyx Pharmaceuticals Inc.
Edward Swallow, Northrop Grumman Corp.
Owen Mahoney, Outspark
Alice Kim, FLO TV Inc.
Eric Hausler, Isle of Capri Casinos Inc.


COMPLETE MOVERS & SHAKERS ARCHIVES

The Magazine


MACDdec1cover.gifAnd the winners are...
Even in a period when things like toxic credit default swaps and noxious structured investment vehicles dominate the conversation in many parts of the deal community, people are still willing to take the time to recognize skill and achievement in the strategic transactions that help those companies adapt and grow.
View the complete issue


Last Issue
Archives
Suggest a topic
Purchase a reprint
Subscribe to The Deal


Monthly Archives


Syndicate

Contributors

footspacer.jpg footspacer.jpg footspacer.jpg footspacer.jpg footspacer.jpg


©Copyright 2009, The Deal, LLC. All rights reserved. Please send all technical questions, comments or concerns to the Webmaster.