Managing Leadership^®

In a conversation a few days ago, Liz Strauss told an important story about a contract that proved unequal to carrying its burden alone. It seems that there were several parties to this agreement, and everyone had approved the wording as it was set down. They then went about their business, but as time went on, they became puzzled to find misunderstandings and discrepancies cropping up during execution.

How could this be? Everything was clearly written down for everyone to see!

The answer is that while they shared the wording of the contract, they didn’t share the meaning they each attached to it. They assumed they did, congratulated themselves on negotiating a mutually acceptable document – and then they stopped talking.

But, as Liz was illustrating, the contract is a foundation document of – but not a replacement for – a business relationship. And relationships are built, maintained, and thrive on communication. Where there is such a dialogue, even if the contract winds up having to be re-written, the relationship, which is what produces value, survives – even thrives.

Consider this item from a recent WSJ, about some difficulties a key defense contractor for the US Navy is having with a project to build a new model for the Marine One helicopter, used to transport the president. The program is turning into a test of the company’s continuing ability to perform its core function in its core market; the piece indicates that the firm has already suffered the loss of some other contracts. The following, from the referenced article, highlights Liz’s concern about overreliance on written documents:

Lockheed may not have understood some parts of the Navy acquisition community. . . There was an official description of what the Navy wanted that was a pale shadow of all the things the Navy eventually intended to ask for.

Conversations may have shed some light on those expectations lurking in the deeper shadows. They may have resulted in a better contract together with a better relationship – or even no contract in this instance, but the maintenance of a good relationship based on trust and respect for mutual frankness. After all, on examination, not all projects make a good fit – best not to pretend they do, only to eventually prove otherwise by failing, and seeing your reputation and prospects for future work degrade.

Conversations keep projects alive. Relationships help you understand what might warrant talking about in the first place. Without conversations and relationships, contracts really aren’t worth the paper they’re written on.

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Note: Due to an anomoly that occurred during (unexpected) maintenance conducted Sunday by engineers at our hosting service, the blog underwent a short period of time that day during which it was not visible, or only partially visible and with editing code appearing in the posts. Unfortunately, the latter situation obtained when the feeds were captured and delivered to subscribers. Should any of you who received such feeds wish clean versions of the Memorial Day post, please contact me and I will have it sent directly to you by email.

Technorati Tags: WSJ, US Navy, Marine One, Conversations, Relationships, Liz Strauss, Military, Contracts, Communication, Teamwork