VIEWPOINTS : In Business, Just as in Life, Diplomacy, Tact Pay Off

There is an axiom both in business and in life that the most direct approach to a problem is usually the best. I agree, but there are exceptions to every rule. A big mistake I made nearly 20 years ago taught me that diplomacy and tact can be a very valuable tool.

Cardinal James Francis McIntyre, who then presided over the Roman Catholic archdiocese of Los Angeles, invited me to lunch to thank me for running a very successful fund-raising dinner that had raised something like $1.3 million for the Santa Marta Hospital in East Los Angeles. I was in my mid-40s, the new kid in town and had just been named chief executive of Norton Simon Inc. I must admit that I felt pretty good, maybe a little cocky, to be on the receiving end of accolades from such an important man.

Now, a week or so later, I sat beside Cardinal MacIntyre in the chancery dining hall to receive his thanks. The cardinal was 80ish, a gracious man but reputed to be tough and autocratic. He had ruled the archdiocese for some 25 years and was very proud of his accomplishments. As we chatted at lunch, he turned to me and said:

“I have built a new church in California for every month of my tenure as archbishop.”

I made a quick calculation--25 years times 12. That was 300 churches. I thought about that little hospital we had helped to fund and the need for more hospitals and schools like it.

I said, “You know, Your Eminence, that might be too many churches.”

The cardinal looked at me quizzically. He adjusted his hearing aid. I noticed the monsignors up and down the table burying their faces in their soup.

“I don’t think you understood me,” said the cardinal. “I said that I have built a new church for every month I have been archbishop.”

“Your Eminence, I heard you,” I said. “I just think perhaps some of that money could be going for schools and medical facilities and so forth.”

I continued, unabashed: “I sometimes wonder why we need all this church space, which may be used for only a few hours one day a week. When I was in the service, we had one chapel used by the Jews on Saturday and the Protestants and Catholics on Sunday. It worked out just fine. Imagine what could be accomplished if the church sold off all this expensive real estate and used the capital to finance other things.”

Not realizing how distraught the cardinal had become, I went on with my sales pitch, addressing myself as much to the priests around the table as to the cardinal himself. I thought perhaps we could get a little interesting dialogue going.

The cardinal heard me out, but when I had finished he glared at me with cold eyes.

He said simply, “I do not agree one bit with what you have said.”

Almost immediately there was a buzz under the table; a servant arrived and whispered something in the cardinal’s ear. The cardinal rose, said he had to accept an important telephone call, blessed me and excused himself. He did not return.

I had pricked the cardinal’s balloon. When I left the chancery that afternoon, and for some days thereafter, I took some pride in having bearded the lion in his den. It was not until some time later that I realized my mistake and understood what a priceless opportunity I had lost. I had blown the chance to change the cardinal’s mind. Not only had I failed to sell him, I had antagonized him to the point where I would never get another opportunity. The brownie points I had earned with my successful fund-raiser were down the drain.

I learned an important and very valuable lesson from this mistake. Although my ideas were sound enough, my method of presenting them was unsound. I had misjudged badly both my “opponent” as well as the playing field on which we were meeting.

Saving Face Important

Suppose I had used a more diplomatic approach, a selling approach. Suppose I had talked to him about a changing world and the need for every institution, business, government and church to adjust to the times. Suppose I had tried to persuade the cardinal--or better yet, let him persuade himself--that a new need was being faced now, one that required the same kind of skill he had applied to building all those churches. Maybe I could have convinced him. It might have worked. It might have changed things. I could have been on the side of the angels. To this day, I still kick myself for missing that chance.

Using finesse to find subtle and diplomatic methods to solve problems in business relationships is most important. In 1971, when Norton Simon began marketing Max Factor cosmetic products in Japan, a Mr. Hiroischi headed the firm that handled the distribution of the products there. During my meetings with him, it became clear that he was trying to convince me that our success in Japan hinged on him and his company alone.

Though I considered myself very savvy in marketing know-how and strategy, I also knew that things are done differently in Japan; there is a cultural difference in handling relationships. Still, I could not afford to defer to Hiroischi as the all-wise, all-knowing source of wisdom in the Japanese marketplace and let him believe that he was in the driver’s seat.

The answer was an indirect plan of action that would establish unquestionably my position of management strength with Hiroischi, while in no way causing him to lose face, which is very important to the Japanese. I called Akio Morita, the founder of Sony, and Eigi Toyoda of the Toyota car family, both old friends and associates. I asked them to do me the honor of hosting a cocktail party for me and extending the invitation to appropriate guests.

I invited Hiroischi and his key staff members to the party and asked him to stand with me to greet the guests as they arrived. He accepted the invitation, and I believe he probably felt he was lending me his great personal prestige by doing so. We stationed ourselves at the entrance of the club to greet the guests--many, if not most, of the top echelon of Tokyo businessman. As Hiroischi bowed and shook hands with the captains of Japanese business, it was clear that, although he had read about them and seen their pictures in business publications, he had never met them.

Following this party, neither Hiroischi nor I made mention of the impressive guest list; Hiroischi had clearly gotten the message. I had made my point without causing him to lose face, and he became a loyal and supportive member of our team.

The point and the lessons are obvious: Directness does not always work (as it proved with Cardinal MacIntyre) either in business or in life, but tact, diplomacy and finesse often will.