Amid mounting distrust, this year's negotiation between the NFL and the players' union is set to make the Super Bowl look like a Pop Warner exhibition match.
With the peace broken between the National Football League (the owners) and the National Football League Players Association, this game has taken a major twist. In the process of designing a new Collective Bargaining Agreement that's suitable to both parties, a number of issues are up for discussion including revenue distribution, how many games will be played in a season, the health benefits for players, and many others. If both sides can't come to agreement on the by the March 3 deadline, then it's quite possible there won't be a 2011 season.
However, contrary to popular belief, the biggest barrier to the NFL and NFLPA completing any deal isn't a contractual problem — it's much deeper than that. While most popular media is speculating that the make or break issue is the number of games in the season or the salary cap, here's the reality: the key to both parties winning this game is the development of mutual trust. Without it, no deal will be done and the cost to owners, players, fans, and all the workers in jobs related to the industry, will be enormous.
Where did the negotiations between the NFL and NFLPA go wrong? There are a number of factors that dissolved the trust. Here are the three that have done the bulk of the damage:
• Negotiation Publicity — Between twitter updates, blog posts, and press conferences, it's apparent that both sides have plenty to say, they'd just rather say it to an uninvolved third party: The media. They are spending too much time trying to wrestle for public approval, when really the public doesn't have any say in the matter.
• Negotiation Obscurity — There's a lack of transparency between both parties. The NFLPA requested to see the "books" of the owners, to determine if their request for a higher percentage of revenue was validated. They refused to open them. Additionally, neither side is talking to the other. Before Super Bowl weekend, the last formal, and private, conversation between both parties took place before Thanksgiving.
• Negotiation Absurdity — Rather than engaging in substantive negotiations and working together to expand the number of variables and issues that can be discussed, both sides are trying to expand the number of players involved in the game. The NFLPA recently visited Congress on a "field trip" and the NFL locked in television contracts that pay through a lockout. It feels like this deal has been set up to fail.
So what's the take away for business pros? Trust is easily broken, but extremely powerful when intact. In order to get the maximum value from any negotiation, agreement, or commercial transaction there needs to be a high level of trust between all the parties involved.
Almost every day, every single person on the planet engages in multiple transactions, often with complete strangers, because of trust. This can be seen at the cash register of a local grocery store, during a billion-dollar merger and acquisition, or while simply making an online deposit with a bank. Trust is money. It's what allows money to flow through the economy and for everyone to make a living. Conversely, when there is distrust between two parties involved in a transaction, it's highly likely that there will be a negative economic impact.
Based on the mishaps of the NFL and NFLPA negotiation, there are a few business and life lessons to keep in mind when looking to build trust in any potential bargaining situation.
First, private matters should be kept that way. Individuals looking to rack up points with their boss, coworkers, or friends should build trust by being thoughtful and careful about disclosing personal information to others.
Second, it's a lot easier to avoid potential negotiation fumbles when everyone knows all the details of how the game is going to be played. This starts by talking to each other. If there's something that can't be disclosed to the other party, than there should be a legitimate reason for the lack of transparency.
Last, always seek to increase the potential value of the deals by expanding the variables, not the number of parties involved. In studies of over 25,000 negotiations by MarketWatch Centre of Negotiation, it was found that more than 60 percent of all corporate negotiations conclude with a result that is less than originally expected. Through openness, honesty, trust and a genuine desire to expand the size of a deal on all sides, both parties can walk away with value far bigger than they ever thought possible.
Keld Jensen is the author of the book Negotiating Partnership and writes frequently on international business issues. He is a frequent speaker at conferences around the world and has worked with numerous global businesses in a training and consulting capacity.