Howard
Perlmutter, Emeritus Professor at Wharton, once
gave a radical assignment to a group of 600 CEOs -
Have a
real conversation with one another; not about the weather
or the skiing at the Swiss retreat where they were
gathered for the World Economic Forum. He arranged to have
them break into random groups and actively discuss ways
they could work together in the next five to ten years.
The executives came from all kinds of industries in all
parts of the world.
Even chosen at random, after a few
hours of discussion 75% found potential alliance
opportunities and 20% actually made plans to follow up.
All it took was the opportunity to engage in a serious,
constructive discussion.
Perlmutter later termed such
discussion a "Deep Dialog." As the global
business environment becomes more diverse and complex,
Perlmutter believes that "Deep Dialog" will be
one of the most important capabilities for organizations.
"The more I study global challenges – from new
product launches to post-merger integration - the more I
see the potential of Deep Dialog," he says.
"If
you are very good at it, it becomes an important
advantage, a core capability for the 21st century firm,
which will be less hierarchical and often involve
electronic networks extending around the world."
Perlmutter,
a pioneer in the study of global corporations, has worked
with managers and companies around the world on improving
the global mindsets of the senior executives and managers
as well as the quality of their cross-cultural
communication. Through these experiences, he has developed
a framework for systematically building dialog and for
diagnosing dialog deficits.
So what is Deep Dialog? It is purposive communication that involves
the exchange of information as well as constructive
feelings and attitudes to reach shared objectives.
Westerners might describe it as an "exchange of
meaning" or "two-way communication."
Easterners might characterize it as "warm
feelings" or "conversation from the
heart."
It is
differentiated from superficial conversations in which
information is exchanged. The issue is, "How do
you move beyond the differences to establish mutual trust,
share knowledge (often implicit) and reach goals none of
the parties could reach by themselves?"
Perlmutter says.
Perlmutter
points out that the process of engaging in Deep Dialog is
not the same as negotiating. Negotiation, as BP Amoco’s
CEO John Browne once put it, encourages a "bazaar
mentality." In contrast, Deep Dialog inspires those
who engage in it to share knowledge and identify processes
that promote or hinder communication. Deep Dialog, in
fact, prompts people to go beyond communication to
communion.
Two studies
in 1997 and 1998 - one of a global insurance firm and the
other of a high-tech conglomerate of entrepreneurial
companies - found that the Deep Dialog process was
extremely helpful. In fact, at both firms Perlmutter found
that the absence of dialog resulted in costs that could
have been avoided if communication were enhanced.
In
addition, Perlmutter discovered that when executives in an
Advanced Management Program in June of 1999 were asked to
compare relatively successful and unsuccessful cases of
new product development and launch, building alliances,
post-merger integration, headquarters-affiliate
relationships, cross-cultural negotiations and even
virtual global team building, the trends were similar:
Successful cases involved Deep Dialog, while in
unsuccessful cases Deep Dialog was absent or
minimal.
In an
earlier instance, when Whirlpool acquired the European
appliance division of Philips Electronics a decade ago,
some 90% of Whirlpool executives had not been outside the
U.S. Managers faced a steep learning curve. Perlmutter,
who worked with the firm on the post-merger integration
issues, said one of the most effective strategies was
simply to bring managers from different parts of the world
together and ask them to engage in real discussions, in
which they got to know each other, not as
"Americans" or "Europeans" but as
unique persons and to look for ways they could work
together.
By the end
of the first such session, managers had identified a
variety of joint projects. "The only way you could
get there is to have a good dialog," Perlmutter says.
As business
operations become more global, virtual teams spanning
continents, whose members communicate primarily by e-mail
and over the Internet, will become common.
Perlmutter says that the emergence of such teams increases
the need for Deep Dialog.
"A
series of steps must be taken to increase trust and
bonding among virtual teams," he notes. The
most important step companies can take is to conduct
regular face-to-face meetings among virtual team members,
so that they have time to bond and band together.
Perlmutter says that an international consumer products
company that tried this approach with its global products
group found that it greatly improved dialog among team
members. "You have to gather people in one
spot," he says. "That investment of face-to-face
time is vital."
While most
managers understand the importance of this type of
connection, few organizations have a systematic process
for encouraging it. Through his work with global
corporations and other organizations, Perlmutter has
identified seven essential processes for successful Deep Dialog.
Many
organizations either stall out in their pursuit of Deep
Dialog, or worse, end up in a cacophony of conflicting
voices. What can go wrong with Deep Dialog? Perlmutter has
identified five "dialog deficits" that are the
most common ways the process is undermined.
Perlmutter
says that in the two studies he conducted recently, both
firms scored high on the frequency of all types of dialog
deficits between the affiliates of the decentralized
global firm or between the high tech entrepreneurial
companies of the conglomerate. When the affiliates were
brought together at a global meeting they could list many
costs associated with these gaps and took steps to
increase their access to each other. The same occurred in
the conglomerate where the heads of the companies found
that the deficits were too costly and were able to define
new channels where dialog would be easier.
"In
our increasingly global civilization, deep, constructive
dialog competencies are essential,"
Perlmutter says. "This is true not only in the world
economy, but also between persons in the political,
social-cultural, scientific, technological, medical and
ecological domains. In business, domestically and
internationally, where the boundaries of markets and
corporations are more fluid than ever and where managers
are thrown together into new international organizations
and alliances, these competencies are vital. Especially in
the political realm, it is dialog or death," he
says.
For
more information concerning Dr. Howard V. Perlmutter, Deep Dialog
surveys, seminars and programs, contact:
Ira Kerns, Principal Consultant at GuideStar (212)
426-2333 or gstar1@guidestarcocom.
GuideStar
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