Electoral contests are open influencing processes. Candidates expound their differences with each other – often heatedly – and find issues around which to contrast their differences, which may be deeply held policy commitments, sharp contrasts in style or tone, or contrasting personalities or public images.
Some candidates may have some difficulty in identifying significant differences between them on any set of criteria, which gives no incentive to the electorate to vote either way except on grounds of personality.
Stable situations tend to produce bland election campaigns with a prejudice in favour of the incumbent – ‘better the devil you know’, etc. Unstable situations, or threats of them, produce livelier campaigns, particularly where the contestants are able to differentiate credibly their solutions to the instability. In periods of threatening instability, the incumbent is vulnerable – if only for being, and necessarily so, on the defensive. Of course, ambitious candidates may attempt to create the spectre of an impending threat unless they are elected, but if the credibility of the spectre is in doubt, so is the candidate alluding to it.
The 150-year-old Chicago Board of Trade (CBOT) is the world’s largest futures exchange. It is housed in a magnificent classical building (for those who have never seen the CBOT building, it bears a passing resemblance to London’s Savoy Hotel, only it is much larger). Its ‘open outcry’ method of executing contracts had a venerable history; and dealers paid large sums to acquire a seat – the necessary attribute to trade in ‘the pit’ – which reflected the lucrative licence that seats gave their holders to make money.
In the late 1990s, electronic technology became the most serious threat to the traditional beneficiaries of pit trading. For a start, electronic trading is cheaper.
It slashed the high back office costs of the trading firms that reconciled their trades manually.
The 1998 election for the post of Chairman was a knife-edge affair. Only 19 votes separated the contenders. The defeated candidate, the four-term incum-bent, Patrick Arbor, fought a difficult campaign. He was trying to reform CBOT from within by several radical initiatives that aimed to reconcile the exchange to the electronic age. His opponent, David Brennan, a 41-year-old soya-bean trader, capitalised on the widespread fears of the trading firms that felt most threatened by the competition of electronic trading exchanges, and he ran a suc-cessful FUD (Fear, Uncertainty and Doubt) campaign – the scary option always open to challengers against incumbents.
Proposals by Arbor to face the electronic challenges with radical reform of the ways that CBOT did business were characterised as ‘unsound’ and alluded to Arbor’s alleged ‘complacency’ in the face of the very real threat from electronic trading. This spin clearly found a response in the votes of the discontented, who witnessed a sharp slump in seat prices (one clear measure of the confidence traders had in the future of the exchange).
Radical changes always provoke discontent – some of it aimless – among those inconvenienced by both the threat of change and the response to it. Arbor at one point, getting personal, called Brennan a ‘flat-earther’, alluding to his obstinate refusal to accept the inevitability of the demise of the open-outcry
traditional system. This allusion was true, not just in Chicago but anywhere in the exchanges of the world where proponents of open-outcry tried to stem the inevitable triumph of the cheaper, faster and more efficient electronic trading alternatives.
Arbor wanted to move CBOT towards electronic trading before electronic trading drove CBOT into impotence. This is a difficult policy to articulate in an atmosphere of fear. The more the inevitability of change is highlighted, the more the fear of change is excited, and the more the practicalities of reform are questioned by those affected by it.
Thus, Arbor’s proposals to work with CBOT’s rival, the Chicago Mercantile Exchange, and with Eurorex, the European exchange, in developing electronic common clearing to cut their back-office costs caused widespread concerns among the smaller trading firms. These concerns were aggressively exploited by Brennan, who articulated a vivid but conservative stance.
To some extent, Brennan’s campaign was aided by the apparent stance of the Commodity Futures Trading Commission (CFTC), the government regulator, which had imposed a moratorium on the introduction of electronic links to foreign exchanges in 1997. This protectionist measure stemmed from the obvious position of weakness of the US exchanges in the face of more advanced electronic competition from Europe. But it was no long-term solution, and resistance to change was bound to crumble as the evident success of the Eurorex exchange demonstrated the long-term superiority of electronic trading.
Under competitive pressure from Eurorex, the prestigious London Interna-tional Financial Futures and Option’s Exchange (Liffe) had been forced to give way to screen-based trading, and it was clear that Chicago could only hang out for a short period, even if sheltered by the CFTC. Hence, Brennan’s electoral suc-cess was a mixed blessing. The die-hards who voted for Brennan against Arbor, the incumbent, voted for the least satisfactory outcome. They prevented rapid reform towards electronic trading but got themselves stuck in an uncertain mire.
Brennan, the beneficiary of conservative fears, was trapped in the twin pres-sures of the inevitability of technical change towards screen-based trading and the impossibility of sticking with the open-outcry system of the past. He talked of transforming CBOT into an ‘electronic open-outcry exchange’. But trading firms, unable to overcome their fears or to afford the investment for the techno-logical switch, were also the least able to afford the higher costs of the traditional methods they voted to preserve. Brennan’s platform of somehow merging the two methods was a triumph of the rhetoric of electoral expediency over practical necessity.
Within hours of his election victory over Arbor, Brennan was making noises remarkably like an acknowledgement of the good sense of Arbor’s reform programme, including the proposed alliance with Eurorex. He spoke of the
‘mutual interests’ of CBOT and the Chicago Board of Options Exchange (another neighbour of CBOT).
Source: adapted from The Financial Times, 14 December 1998, Nikki Tait Questions
1 How would you explain the electoral struggle between Arbor and Brennan in the light of the definition of ‘influencing’?
2 If Arbor, the incumbent, was vulnerable while implementing difficult re-forms, was Brennan’s campaign anything more than an opportunist exploita-tion of his opponent’s vulnerability?
3 What could Arbor do to mitigate Brennan’s appeal to the smaller trading firms?
EPILOGUE
The study of the influence of power can be a fascinating experience. The lives, loves and tribulations of powerful men and women hold the attention of most people, as evidenced by the popularity of films, books, documentaries and gossip about them. There is a lot to be learned from these accounts, be they a serious study or a daily flimsy story. In the age of mass media, the appetite for information about the powerful and the famous – some famous because they are powerful, others powerful because they are famous – appears to be insatiable.
As students of influence, we have a different agenda. It is not for vicarious pleasure that you study the powerful – how they got there, what they do while they are there, and how, eventually, they lose whatever power they had. Your studies, in contrast, aim to inform you about how to emulate the powerful, perhaps on a smaller scale (to become head of your function) and perhaps on the world stage (to become president of the corporation, or even president of your country).
This quest for knowledge links both the people with power and the people without power or authority. The same lessons, from different perspectives, confront both groups. They are both part of a common process, appropriately named the ‘greasy pole’ by past players, but they view it from different places on the pole. Some look ‘up’ to what they might be; others look ‘down’ to where they might go.
Organisations consist of people who have titles, functions and interests. Some-times their personal interests coincide with their corporate interests; someSome-times they do not. But their interests are important inputs into the games they play and can never be discounted. The ability to understand how interests coalesce and divide to produce coalitions and factions with ever changing compositions is an essential attribute of those who would become, and of those who are, influential.
Influencing is not about leading a group of like-minded ‘happy campers’
towards some end they find attractive. Influencers must be able to influence disparate groups of people, some of whom cannot bear to be in the same room together, to do what they otherwise would not do, or not do what they otherwise would do. Managing a coalition of allies means managing a coalition of interests. Some people you regard as mere pawns in your grand plan may privately, regard you as the pawn and themselves as the would-be kings. The eventual denouement will educate one of you in the politics of the careless attribution of roles (and where you are, or are going, on the greasy pole!).
If you survive, you will do so only by accumulating power in the organisation and the wider environment in which you operate. Having power also follows
the universal rule of ‘use it or lose it’. For a time, it may be enough to use what power you have to gain more power, but accumulating power and merely holding on to it exacts an enormous toll in time and energy. Unless it is directed to some agenda (re-election, acquisitions, market share, profitability and so on), your power base will atrophy and you will provoke rivals to manoeuvre to replace you.
It is easy to become distracted by the trappings of power (for instance, status, executive jets, penthouse suites, deference and publicity) and lose touch with the purposes for which you sought the power you have. That is why observation of the doings of the powerful – foibles and all – are a never-ending fascination for so many of us.
To keep a sense of perspective, I am mindful of the apocryphal story of the CEO of a global corporation, who took a holiday on one of the lovely Greek islands and relaxed each day on the beach for a week, not doing much. It was totally relaxing for him. He also occasionally conversed with a local beach boy, who ran a typically disorganised Greek beach stall, from which he was often absent, and sunbathed and swam and fooled around with friends, drinking beer and chasing girls.
In his last conversation before he flew off in his private jet back to his corporate empire, the CEO suggested to the young Greek that he changed focus and joined a company, work his way up it, and took it over. ‘Why should I do that?’, said the beach boy. ‘Well,’ said the CEO, in a triumph of ambitious reasoning, ‘you would have lots of money and could holiday on any beach in the world, like me.’ The boy looked around the beach and then at the CEO. He shrugged, saying, ‘But I am already here on a beach.’
Retrospection
You have come a long way since you started at Module 1 and it is time to look back in retrospect at some of the territory you have covered. One way to do this is to find opportunities to listen to people you observe to be active influencers in your organisation. They may not reflect too closely on what they do and probably seldom think about it, but with a bit of gentle probing they may be willing to talk a little about some of their experiences (because most people, given the chance, are happy to talk about themselves).
When you find people willing to share some of their views and experiences as influencers (or players of organisational politics), you know how to encourage them to wallow by asking open-ended and supplementary questions. If you gain their trust, they may reveal valuable insights into how influencing is conducted in the real world. If they do, you are advised to keep everything confidential.
You can also read the papers – or reports on the Internet – and collect items that cover stories of the activities of influencers. Business pages, power-politics features, interviews of powerful people, and stories of ‘rags to riches’
(and ‘log cabin to White House’) or your country’s equivalent are replete with hints and histories of what some people have done in pursuit of influence and power. Much of these will be biased tales of self-projection rather than objective analysis. You will have to discount some of the tales they tell – being humble is not normally a characteristic of a successful man or woman – and also realise that they will have left a lot out of their account because it is too embarrassing (or criminal) to reveal.
Also, look for stories closer to home. The outbreak of hostilities in a local voluntary organisation can be every bit as tense and instructive as a sudden resignation in a multinational boardroom. Between you and that boardroom there is a multitude of organisations – literally hundreds of thousands – that have political lives, where influencing in all its forms thrives, and each time you peel back the veils that protect them from scrutiny you will learn more about the subject of this text.
Above all, examine your own organisation – you can start with your family and then work outwards. Who are the players? Are there any obvious pawns?
How do they relate to other players – or pawns? Who among them appear politically astute and who totally unaware? Are there any games afoot?
What about the people you know? How would you rate your relationships with them? Is it all push behaviour? With whom do you have good pull relationships? If a relationship is faltering, perhaps, from neglect, what can you do that will restore the relationship – and give you practice in relationship building while you do so?
Try drawing Key Players diagrams and Force Field diagrams for some of the public disputes to which you have access, or which are heavily reported in the
media. These take only a few moments to construct, and they can be redrawn as quickly to incorporate new information, which is one of their strengths as influencing tools. If you are drawing any diagram with sensitive information on it, remember to dispose of it sensitively and, if you keep it, to keep it securely.
The best way to cope with embarrassment from unintended disclosure is to avoid it in the first place.
The essence of changing behaviour is to practise the behaviours. Trying to recall distant memories of fishing, wallowing, suggesting and so on is futile because you won’t, and will probably muck it up. Take some time to write out
‘scripts’ of question interchanges and try them out on people. See how long it takes you to fish for something in common with a stranger, how long you can keep somebody in a wallowing spiral, and how assertive you can be when it is appropriate. Next time something goes wrong that inconveniences you, tell them what you want done about it without uttering a single complaint or raising your voice.
Practice and more practice is required to change behaviour permanently. Of course, there will be setbacks. You may hesitate outside a senior manager’s door for fear of disturbing her, but what is the worst that can happen? She can tell you to leave her office, which places you back in the corridor. But that is where you were before you entered her office. So what have you lost?
I recommend that you practice because that is the best way to understand what influencing is about. Doing it is a better school for understanding than merely reading about it. This is true for influencing, negotiating and also so-called hard sciences such as mathematics. Reading a book on calculus without working through examples and applying those examples to realistic problems is not recommended as a sound approach to proficiency.
For those who find influencing too complex, too manipulative or too close to the borders of personal ethics, an acknowledgement of your concerns is in order. This is not an untypical reaction by a minority of people. I do not think a cynic’s sneer is acceptable or adequate. Cynics often make poor influencers, incidentally, and I think they do so because a degree of enthusiasm for the game is necessary and cynicism drains enthusiasm and energy away in equal measure.
It is perfectly sensible to do only what you are comfortable doing. Complexity is bearable if you can divide the difficulties into manageable pieces. The simple tools we have discussed should help you manage this task. As for manipulation, almost all social encounters have some degree of manipulation in them. Only the rude and the ignorant refrain from the social courtesies that make interactions at work, at home, at the dinner table, on the road and in general free from strife.
Observing the social courtesies is manipulative. To observe the difference they make, try a day – even an hour! – without them.
As for your ethics, these are personal and I hope they include recognising that other people (the overwhelming majority) are ethical too. Some people (West Point cadets, Trappist monks, sectarian fundamentalists and so on) observe the strictest of codes; some are more relaxed. A few apparently have abandoned all semblance of ethics (guard bullies in the camps in Nazi Germany, the Soviet Gulag, parts of the former Yugoslavia and other notorious places across the world).
What distinguishes the influencer from the unethical bully is the difference in means. Influencers affect the thoughts, feelings and behaviours of others over whom they may have limited or no formal authority or power. Their tools are persuasion, information, advice, communication and social exchange. They do not physically coerce, they do not make war on the innocent, and they do not bully.
In that difference there is a world of room for ethical conduct. Do what you feel comfortable doing to get done what you want done or prevent happening what you do not want to happen. Remember the iron law of influence: influence or be influenced.