Illustration by Rachel Revilla
Every successful business leader, especially those who want to stay at the top, must know how to lead and master difficult conversations and how to deal with conflicts.
I was born in Germany. Germans can be incredibly direct, which does not make them ideally suited for business diplomacy. Most Germans will barge through boardrooms with a verbal sledgehammer, completely ignorant of the other person’s feelings.
A lot of Filipino businesses, however, are at the other end of the spectrum, where mastering difficult conversations in the boardroom or at an executive level is a definite growth area. Many will even try to avoid difficult conversations altogether. What are the root causes? Too much respect for higher authority, fear of conflict and fear of disagreements.
Ticking time bombs
Disagreements or conflicts that are not openly addressed turn into almost insurmountable conflicts and become explosive ticking time bombs at the office and in the boardroom.
Of course, if you are the owner or CEO, this leads to a lot of sugarcoating as well: people will not give you the bare facts because they are afraid of the consequences if they tell the truth. That means you have to fly blind—not a good idea for a business leader.
On a company-wide level, disagreements or conflicts that are not openly addressed grow into silos. This is why a lot of Filipino businesses have to cope with a high amount of silos, resulting in staggering level of inefficiencies, lack of synergies and lost business opportunities.
As a consequence, a lot of businesses lose their profit potential due to a lack of proper collaboration and communication between board members or departments and among the different businesses within a group.
There is an old saying that when you put two people in a room, sooner or later, conflict is about to happen. The secret is not to try to avoid disagreements or conflicts. They are a natural part of life and business. The important thing is how you handle them.
The No.1 rule for mastering difficult conversations
Address them as soon as they occur because the longer you wait, the bigger they will become. I recommend a 24-hour rule: force yourself to address the uncomfortable within 24 hours at the latest. Will that be pleasant? No. But I can guarantee you that it will be a lot more unpleasant if you wait.
On a company-wide level, establish a clear directive that all major disagreements or conflicts must be addressed within 24 hours. Reprimand people who do not follow this rule.
We were advising an American family that owns a diverse group of companies. A leading executive of one of their businesses went behind the back of another business within the same group and badly damaged their reputation. However, the issue was not openly addressed. Instead, the responsible parties tried to hide behind company policies and delegated the solution of this conflict to members of the board.
The result was devastating: a complete lack of trust between the two businesses. For months, several members of the family had to focus a lot of their mental energy on solving what had become an explosive time bomb. Of course, this also badly affected the overall morale of the entire executive team across the different companies.
The No. 2 rule for mastering difficult conversations
Put your ego aside. Focus on what really matters: the overall good of the company. If both parties share the same long-term goal and vision—do what is best for the business—then that is the place the conversation should start. This is your common ground.
One of our Filipino clients owns a large group of companies, some of them market leaders in their field. One of their board members in charge of distribution had been consistently underperforming for years, but nobody wanted to tell him. When we worked with the board to introduce the practice of having more open conversations, they finally started to address each other’s strengths, successes, weaknesses and failures. They learned to talk openly about the fact that he needed to be removed and replaced with someone a lot more capable. The result? The business thrived.
The No. 3 rule for mastering difficult conversations
Your goal is to get to the truth, not to be right! Read this again: not to be right. Yet most executives try to do exactly that. They rarely listen to the other party. They are so busy already formulating their response.
In any disagreement or conflict, there are always two sides to the story. Your goal should be to hear both sides and get to the truth of the matter. And that is what is best for the business.
Another example of a family business we advised: the son of the owner clearly did not want to follow in his father’s footsteps. But the son never openly talked about it to his dad and the father never asked. To everyone else in the business, it was obvious. The result? The business suffered immensely and profits took a dive.
The solution? First, enable an open and clear conversation between father and son. Then, decide if the son can be motivated, coached and trained to grow into the top leadership position. If not, it is better to get someone else outside of the family who is more fit to take the reins to ensure the survival of the business.
The No. 4 rule for mastering difficult conversations
Establish clear ground rules. Take the three-minute rule, which states that one party talks for three minutes without being interrupted, then the other party talks. The American Indians practiced a similar rule when discussing important matters within their tribe to make sure everyone’s voice was heard and conflict did not escalate. They passed an object around and whoever held the object was allowed to talk. All others had to remain quiet.
Two brothers in a Swiss family business were both being groomed to be the next in line to lead the family group of companies. However, they had a lot of sibling rivalry and conflicts.
The entire group of companies was suffering because the two brothers could not get their communication and collaboration to a higher level. When I coached them on how to improve their collaboration, I made sure they understood that both of them ultimately had the same goal: to see the family business thrive.
They needed clear rules for their interaction: how often they should communicate with each other; how their disagreements should be addressed; and who had the ultimate say. These rules allowed them to establish a more and more natural way of communicating with each other. Today, they lead the business successfully together.
Solutions and next steps
ʎ Do not try to avoid disagreements or conflicts. Focus on how you handle them.
ʎ Practice the four rules for mastering difficult conversations. INQ
Tom Oliver, a “global management guru” (Bloomberg), is the chair of The Tom Oliver Group, the trusted advisor and counselor to many of the world’s most influential family businesses, medium-sized enterprises, market leaders and global conglomerates. For more information and inquiries: www.TomOliverGroup.com or email Tom.Oliver@inquirer.com.ph.