With a moribund health care deal now in the rearview mirror, Donald Trump might start rethinking his signature “final offer” ultimatums and “walk-away-from-the-table” negotiating techniques.
If only Trump could consult Utah’s late, great deal-man, Larry H. Miller.
At a recent event honoring scholarship recipients of the Richard Richards Institute for Ethics at Weber State University (disclosure: I serve on the institute’s advisory board), Utah Jazz president and Mr. Miller’s wunderkind mentee, Steve Starks, shared a few stories.
When the then 28-year-old Starks was on-boarded at the Miller Group, Utah’s Pharaoh took time to train Joseph firsthand.
And boy, as Starks tells it, Miller knew how to do deals.
His secret? Make sure that every deal was conducted in a way that two years later each party could shake hands and look the other in the eyes without compunction.
In the middle of contract negotiations, Starks recalls, Miller would even flag areas of the contract in which he thought the other party deserved a better deal.
Today, with nearly 60 dealerships and myriad business interests, Miller’s empire does thousands of deals a week. With some 10,000 employees, it’s probably now easier to stumble, but Starks says they still strive to live up to their late-boss’ legacy.
Win-win is a cliché. And, certainly, Miller the man did not lack competitiveness. But, by making sure all parties benefited from a given deal, Miller was doing what was best for his own interests as well. Starks listed examples in which Miller’s reputation as a trustworthy partner paid off in the millions.
Trust, not winner-take-all game theory, is what our country needs.
In their book, “Animal Spirits: How Human Psychology Drives the Economy, and Why It Matters for Global Capitalism,” Nobel Prize-winning economists Robert Shiller and George Akerlof argue that trust and other emotional states have a profound effect on markets.
Writing for the Wall Street Journal, Shiller states: “there are good times when people have substantial trust... As long as large groups of people remain trusting, people’s somewhat rash, impulsive decision-making is not discovered.” In other words, when we trust we give people the benefit of the doubt — whether it be lawmakers or car dealers. Consequently, more deals get done.
Trust, however, has been in a precipitous decline for nearly two decades. If America is to be great again, we need trust in high doses with an extra-strength prescription for those in Washington.
President Trump, still not done with his third month in office, has a unique opportunity over his tenure to potentially assuage intra-party factions and to hit pause on partisan animosities. But it can’t be done through strong-arm negotiations that leave the opposing side feeling like the loser.
Trump’s business life seems best defined by Tennyson’s famous line “red in tooth and claw.” Trump stated during the campaign, “I mean, I view myself as a person that — like everybody else — is fighting for survival.”
The bloody fight for survival may be good for campaigns, but its utility is limited when it comes to sound, shared governance.
Richard Nixon once wrote that he took an adviser’s counsel to be a “good sport’’ during the White House Correspondents Dinner, only to discover that at the very next press conference: "The reporters were considerably more bad-mannered and vicious than usual."
He concluded: “This bears out my theory that treating them with considerably more contempt is in the long run a more productive policy.’’
There are undoubtedly short-term gains from such zero-sum philosophies. However, I have to disagree with the late president. In the long run, posturing for personal gain is unquestionably corrosive.
Larry H. Miller called himself a “bridge-builder,” even though he sold cars and traded NBA stars. Trump too can build bridges and engender trust. But it won’t come from one-sided negotiating; rather, it will come by borrowing a chapter from Miller’s version of “The Art of the Deal.”