High Stakes Negotiation: How to Win With Persuasion with Michèle Flournoy

Hello my friends and welcome to another exciting episode of Negotiate Anything. This show is produced by the American Negotiation Institute and with over 5 million downloads and listeners in over 180 countries, listeners just like you have made this the number one negotiation podcast in the world. Hi, my name is Kwame Christian and I am the founder and CEO of the American Negotiation Institute here at A&I we believe that the best things in life are on the other side of difficult conversations and we are passionate, passionate about providing you with the best content that will help you to make your difficult conversations easier both at work and at home. Lastly, I want to remind you that we offer consulting and conduct trainings both virtually and in person all around the world. Our focus is in three main areas. First, negotiation and conflict resolution. Second, leadership and lastly, diversity, equity and inclusion. Check the link in the description below to learn more about how we could work with you and your team.

And now, without further ado, let's jump.

Into the interview.

Everybody. We have a very special guest with us today. We have Michelle Flournoy. She is the former Under Secretary of Defense for Policy in the Obama administration and the co founder and managing partner of WestExec Advisors. Michelle, thank you so much for joining us today.

It's great to be with you Comey.

Yes, it's great to have you. So we went over your resume a little bit, but let's go a little bit more in depth. Tell us about a little bit about your career before we jump into the episode.

Sure. I've spent my career across three different sectors. The first part of my career was mostly in the think tank world doing policy related research and analysis, trying to come up with good ideas for the U.S. government and national security. And then I had a chance to serve in government first in the Clinton administration and then later, as you mentioned, in the Obama administration administration, both times in the Pentagon working on defense strategy and policy. Then I've also had some private sector experience. I spent three years with Boston Consulting Group trying to understand what good looks like from a business and change management perspective in large organizations because I certainly didn't see that in the Pentagon in terms of how the business enterprise was run. Then I started West Exec Advisors about three years ago with a group of partners really trying to bring a new approach to geopolitical risk and strategic advisory work for mostly US Companies working overseas.

That is fantastic. And the word that kept on coming up was strategy. And that's one of my favorite words. And I can see throughout your career how you've been able to implement that Successfully. And then here in these conversations that we're going to analyze in this episode, I can see as well how strategy played a big role. And so for the listeners, this is just a little bit of an outline of what we're going to do. We are going to go through four case studies of difficult conversations that Michelle has gone through throughout her career. And so we're going to analyze what was done well, what could have been done differently. And we're going to learn a lot through this. And so the first story is really exciting. It's the difficult negotiations and difficult conversations that occurred around the bin Laden raid and the decisions that had to be made. So, Michelle, can you tell us a little bit about that?

Sure. When the intelligence community identified information that said they might have located bin Laden, one of the things that's important to remember is almost all of that intelligence was circumstantial. There was no direct evidence that it was in fact bin Laden in the compound. But a lot of different things suggested that or pointed to that or made it clear that it's hard to explain it any other way. But there was a lot of debate about whether he was really there. And so when President Obama came time for him to make a decision, he did not have a unified recommendation from his Cabinet. You had some people saying, don't do it. It's too risky. We're not sure he's there. You have some people say, we think he's there. You should do it with the SEAL team, the raid, others that said, that's too risky, putting Americans on the ground. They could get stuck there. What if the Pakistanis respond? Blah, blah, blah. We should use a small experiment drone and try to strike him if and when he comes outside to walk, which was his habit. So anyway, Secretary Gates, in weighing in along with the different cabinet members, he was initially in the school of, we should take the risk of going after him. This is our best shot, but too dangerous to put the seals on the ground. We should use this experimental drone. And when he came back from the White House, White House, and I and my colleague Mike Vickers, who was then Under Secretary for Intelligence, heard that that's how he had advised President Obama. We were both really concerned because we felt that there was a lot of risk using a system that had never been used before, had to be perfectly accurate the first time, and that a lot of work had been done buying down the risk, planning plan B, plan C, plan D, all kinds of contingency planning to buy down the risk associated with putting the seals on the Ground. And so we sort of looked at each other and said, okay, you know, this is why they pay us the big bucks. Haha. You know, this is one of those speak truth to power moments. You know, he's not going to be happy, but we got to go talk to him. So we asked to see the secretary, we went in, we laid out in detail again why the raid made more sense, would give us higher chance of success, all the ways in which the risk had been bought down to a reasonable level. And he listened. This was a great leadership trait. He listened, he took it all in, he changed his mind, he picked up the phone, he called the national security advisor to say, I want to change my advice to the President. That was a moment where taking some risk to have a conversation that was not going to make your boss very happy initially really was the right thing to do. I felt happy in the end that we did it. But also, I think there's a lesson there though. Sometimes you really have to take the risk to have those hard conversations, particularly if you think someone's going to. A consequential mistake is about to be made.

Right. And so when I think about negotiation, we often, I recognize that a lot of times we focus on the external conversation with the other person. But even before that we have to have that internal negotiation.

Yes.

And so we're thinking about it from a national security perspective, risking in that regard. But there's also risk to you personally in having this conversation at all. And so for you, before having the conversation and broaching this topic, how did you get the confidence necessary to take that risk personally?

Well, I think I sort of personally catalog the risks that I felt. Obviously there's the risk of making your boss angry. Okay, that should be man, you gotta stand up and be willing to do that if it's for higher cause, there's the risk of what if we advocate for putting the seals on the ground and we're wrong and they get in trouble and you're the one who helped push for that position, That's a lot of weight on your shoulders. Hold yourself accountable for that. But there's also the risk of the incredible, all the capital that President Obama was putting on the line to do this, even in the absence of absolutely conclusive intelligence. This was going to be, if this went south, it's going to be a terrible blow to his presidency, terrible blow to us credibility and perception around the world. So this was a high risk operation and also high benefit if we were right and if it went well. But at the Time you had to figure all of that. But at the end of the day, to me, doing what I really believed was the right call for the President and the country outweighed every everything else in terms of including my own personal, you know, discomfort of walking and, and having an angry boss.

That makes a lot of sense. And now let's actually go to the conversation. When you talk to your colleague, Mike Vickers, and you came up with a strategy for this conversation, what was that discussion like? What was the strategy that you used? And then how was the execution?

Well, we first both heard about the decision or the meeting that had happened at the White House, and we got together and sat down and went through checking each other out of like, how do you feel? Do you feel the same way? Yes. You do? Okay, what can we do together that might make a difference? Should we go in to talk to Secretary Gates? How will we make our case? What are the critical persuasive points that we want to make? What's best coming from you? You. What's best coming from me? We sort of coordinated a game plan, if you will, and then to collectively asked for some time on an urgent basis, which is very unusual. I can't remember another time where we ever did that together. And so that was like raising the, okay, something's going on here. They really need to see you urgently. But it helped to have a wingman, have someone by your side who was going to go in and share the burden of that conversation together.

Absolutely. And so with this strategy, there are a couple of important layers here that we can all learn from. So the first one, you had a strategy.

We did have a strategy. We didn't just go barging in. Right, exactly.

You have to take some time and think about it. Secondly, you recognize that it's more likely to have an impact when you came together, blending your political capital and your reputations, to say, both of us need some time urgency. So that in itself created a little bit of persuasive juice.

And then, and I'll just say, I mean, Mike, you know, he had years in intelligence, he's a former special operator himself. So the credibility that he could bring to speak to the intelligence, to speak to the operational details was higher than mine, for example, as the policy person. So we really tried to sort out where, you know, who should speak to what based on that extra measure of credibility for each of us in different areas.

Yeah, that's so smart. Because in those types of situations, when you're essentially tag teaming a negotiation, and a lot of people can relate to that situation where it's you and a colleague or maybe several colleagues in a meeting trying to push forward a specific agenda or something like that. It's so important to have that alignment so everybody knows who is saying what at what time. So people are not stepping on each other's toes.

Yeah, absolutely.

Yeah. This is fantastic. Well, I feel like we could spend all the time on that story alone, but we still have three more stories to get to.

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This one is honestly my personal favorite. And so this is advocating for what you need at work. So can you tell us about that conversation with Secretary Gates?

Sure. I had co led the Obama transition team at the Department of Defense. I didn't know Secretary Gates well before, but through that experience working on the transition team and when he was selected to stay, I was really excited that he asked me to stay on and be the Undersecretary of Defense for Policy. At the time, a couple things were going on. One is I had three children under the age of 10. So lots of demand at home. I also have a husband who has a career in his own right, and he was being asked at the same time to be the Deputy Secretary of the VA under General Shinseki. He had run the Veterans Policy Group for President Obama during his election campaign. Anyway, so I really wanted to take this job. This was a dream come true. But I also knew that my family couldn't survive me never being home. And so with a little bit of trepidation, a lot of trepidation, I walked into the job interview with Secretary Gates and after all the substantive discussion, what the job is, what he would expect of me, all that, when I said, look, I really, really want to do this, but I have to tell you, I do have a family situation, that means I need some support for you to occasionally be able to count on being home to Actually see my young children. And it would be great if we create some predictability. I can either come in early and then have to start the day with you and your intelligence brief or whatever, and then leave by a certain time so I can actually get home when I'm not traveling to have dinner, read the bedtime story, put them to bed, and then I can be available again once they're go to sleep. I can get back on the phone, back on the video conference. I can drive to your house if you need me. I mean, I can be present to work in the evening again, or we can do it. I can come in later and stay later. But what would work? I need some help in managing this. He was great. He immediately said, I've been there. When I was deputy National Security Advisor for Brent Scowcroft, my kids were young, I had the same conversation. I was like, wow, that's awesome. Meanwhile, my husband was having the same exact conversation with General Shinseki, who was becoming secretary of the va. And again, it went much better than either of us anticipated. And that clarity and understanding really enabled us to manage these two very big jobs while having young kids at home. Obviously, we had a lot of help as well, but I was really glad that we both had the courage to speak up because it made all the difference.

Absolutely. And I think this is such an important story to focus on here because a lot of the people in the audience are busy professionals. And I think a lot of times we create this false dichotomy. Either we could be really great career driven professionals, or we could have time at home, meaningful time at home with our families. And what this story shows is that it doesn't need to be an either or in that extreme of a case. If you want to have that kind of balance, you can use the tool of negotiation with your boss in this case, to set aside those barriers, those boundaries, so you can protect that time with your family while still demonstrating your commitment to the organization.

Yeah, it wasn't ever really balanced, but it was limiting the degree of sacrifice I was asking of my family. It made it sustainable for a longer period of time that we could count on that predictable time together in the evenings. And the fact that kids are incredibly resilient things that I remember as traumatic moments where I couldn't make the school event, or someone was in tears. Now that they're young adults and teenagers, they have no recollection of that whatsoever. It was heartbreaking for me. I'm scarred for life, but they don't even remember it.

Well, that's good. Now here's an interesting question for you. Let's say the conversation go as well as it did. Let's say there was resistance and maybe he said no. Would that have been a breaking point for you?

I don't know. I would have had to really think about it. And it gets to the point of when if you're going to have a conversation like this, you have to start by assessing the person you're going to have the conversation with. Because there are certain people who you could probably guess from the outset this is not going to go well. They're not interested, they're not going to be helpful. And in that case, you have to ask. Ask is that a boss I want to work for? I always say choose the boss, not the job. And sometimes we choose that an opportunity is so important we're going to tolerate a suboptimal boss. For me, again, I was lucky in that I thought Bob Gates was going to be a great boss. And this just elevated my opinion of him even higher from the get go that he was willing to have this negotiation with me.

That's fantastic. And I think this also gives us a good opportunity to transition into the work that you did at the Pentagon, specifically with the human capital strategy, right? Yeah. And so with this one, the interesting thing was addressing culture within the Pentagon. Can you tell us a bit about that too?

Sure. So when I came into the office of the Secretary of Defense, I found a workforce. I had about a thousand people, plus oversight of three defense agencies. And I found a workforce that was incredibly mission driven, but also incredibly burnt out and exhausted. No one had been to professional development or training for years. There was all kinds of very uneven management practices. No real effort to ensure people were getting feedback and support and support in managing just incredible hours and demands. We did a survey, really trying to identify what the pain points were. One of the things we found was that there was no predictable time off. There was just. No people felt that they were just at the mercy of the demands of work. Granted, this was a very intense time in the Pentagon where the Obama administration had inherited both the Iraq and the Afghanistan wars. There were global counterterrorism operations going on all over the world. Very high op tempo. But what I realized is that we needed to create a culture that started to invest in the people, take care of the people, so that they could occasionally get a break. Even if they're still going to be working long hours. They could know when they could count on that time off to recharge or to take Care of a family priority or what have you. In one case it might be they have a sick parent and they need every other Friday to know that that's when they can schedule the doct appointments that they need to take them to. For a young person who, you know, their passion is in burning off steam, blowing off steam, it's running marathons. And I just need two mornings a week where I can get my longer run in so I can train for my marathon or, you know, no judgment on what it is. But the key was having team leads sit down with their teams and say for each person, what is that one thing that if we could deliver it for you, would make all the difference in terms of your morale and sense of well being and your ability to sustain this very high tempo. Then the manager's job was to make sure the team was flexing to cross cover each other, that if the Egypt desk guy needed those two later morning arrivals every week, somebody was cross covering that desk. You know that for those two mornings and you know, if they needed the Friday afternoon off every other week to, for the parent and the doctor appointment that, you know, the team was covering them to do that. And it. So it took a lot of management, took a lot of communication, took a willingness of people taking the risk to say what they need. But it was magic. It was like watering the flowers and, and the seemingly dead flowers in the desert and then watching them bloom. And back to Secretary Gates. I remember sitting in his office about six months in and him putting down a memo and say, this work is amazing. Did you fire everybody in this office and hire a bunch of new people? I said no, we just started taking care of them and investing them and giving them a break. So it really had a very high impact, not only on morale, but actually on performance.

That's impressive. That's impressive. Especially when you're coming from a inheriting a culture that is so driven, so work oriented and then causing people to realize, hey, there's some actual value in pulling back.

And some of this was, you know, a lot of people thought, oh, this is like a mommy thing, this is like for women with children and we're going to try to be more flexible and blah, blah, blah. I knew that we had arrived when a former Marine who was now a civil servant had gone with me to a speaking engagement on a Friday morning. And I offered him a ride back to the Pentagon, you know, when we were done. And he's like, actually ma', am, I'm taking my predictable time off to go sledding with my son this afternoon and see you later. And I'm like, like a former Marine telling his boss's boss's boss that he's taken the afternoon off to go sledding with his son because he knows that it's. Oh, it's actually okay to do that because I know that he worked, you know, he's working his, you know, butt off and he's delivering and he just created this successful event. Now he was going to go take his time. I thought, wow, if we've got that person and changing with the culture, then we have arrived. We have truly arrived.

Wow, that is a great story. And it also goes to show just that culture where people feel more comfortable expressing themselves more. It's more resilient in the face of difficult conversations for him to feel comfortable saying that to you.

Yes. Yeah.

And I tell you, when you think about the change management, a lot of organizations are going through a lot of changes. I think that's pretty obvious considering the pandemic and everything that we've been through over the past year or so. And yes, we can create these strategies and yes, we can give it to the leaders to execute the strategies. But if you don't have a culture that is one where there's fertile ground for these conversations to happen, then the change is going to struggle to be implemented.

Yeah. And to change the culture and the behavior, you really have to. To realign the kind of incentive structures. And so one of the things we did was we did these sort of spot surveys where 5 minutes survey the organization down at the lowest levels to say, what's happening in your office? Have you heard about predictable time off? Is your team leader sitting down? Has your team leader sat down and asked you what you need? Has that need been met? You could very quickly get the data. The response sources were anonymized, but I could cut the data by office and see which offices were actually walking the walk and which ones were just talking the talk where it wasn't working in an office. Then you could focus some management attention to coach those leaders. What do you not understand about this process then to back that up with. With clear incentives that you, you know, you really recognize the people who are doing it well and hold them up as examples. But you also hold accountable the people who are not and help supervisors understand that. Look, if you can't get with this program, that's going to affect your performance evaluation. So and so what can we do to help you get to where you need to be?

It's smart and so you have incentive structure, but you also have, have real accountability that's governed by the feedback of the people on their team. And again, that speaks to the follow through, which is an important part of.

Yeah, and it's really hard in a large, highly layered hierarchical organization. It's very hard to see more than like two, two layers down. So you've got to find out whether it's management by walking around or pulling junior people into your office and almost like focus groups on occasion or doing surveys, you have got find some way to get ground truth because it won't necessarily come to you. People manage up very well, they know what they should be doing. So that's what they tell you, that's what they are doing. But finding out whether what's actually happening takes some other methods sometimes to really get a picture of ground truth.

Absolutely. And this goes back to what we talked about at the beginning. Strategy. Right. The quality of your strategy is contingent upon the quality of the information that you receive. And so, so if we come up with this great strategy, of course we're going to execute, but then the strategy is going to shift or evolve as we get information through execution. And again, we have to get high quality information. And so I really admire that you had that built into your strategy, how to get ground truth when it's difficult to get the real information organically. Fantastic. And so this gives us time to address the last difficult conversation or negotiation. And this was a real, really interesting one, the post Iraq drawdown negotiation. And so before we get into the nitty gritty of this, because this one's pretty complex, can you tell us just a brief background of what's happening in this scenario?

So the Bush administration had started a phase drawdown in Iraq and Obama continued it. One of the things we had to think through was what's the, what's the end state in Iraq? And not only from a military forces perspective, but from, you know, will we have an embassy, will we have consulates, will there be an intelligence presence, will there be trainers, will there be other military folks? Like what does the, what is the sort of normalized US presence in Iraq look like? And so the National Security Advisor tasked the Deputies Committee, which are all the deputies of the agencies, to work together to come up with some kind of plan. So it started by really kind of putting the State Department in the center. The core of the post drawdown relationship was going to be diplomatic. And so what is the State Department footprint need to be in Iraq going forward. So they came up with a design that had an embassy in Baghdad and then three consulates sort of spread throughout the different regions of the country. And we said, great. So now you're going to have the intelligence community that's working with their Iraqi partners kind of fall in on that structure. And then you have the question of how does the military posture that will be for security assistance and cooperation and training, potentially some contribution to protecting the American presence. How will that be designed based on this State Department and intelligence community lay down? We had this beautifully integrated plan that we are all very proud of, worked very, very hard on in all these interagency meetings. Then we took it up to Capitol Hill as part of the budget request to say, we need you to fund this. At that point point, given the way the Congress is structured, they broke the plan apart into the different agency pieces. So the Defense Department piece went through the Defense Appropriations committees and got 100% funding. The intelligence piece went through the Intelligence Committee committees and got 90, 95% funding. And then the State Department piece went through the State Department committees, who are very budget constrained, and they got got like 50% funding. So now we're like, the whole plan falls apart because now we can only have one or two facilities, and we've just done this whole plan based on a countrywide presence of four. So we had to go back to the drawing board. But it just was not only an interagency negotiation, but then this very complex Hill negotiation where you had to negotiate different parts of your plan with different committees of jurisdiction, which made it very hard to get something coherent out of it.

This is interesting, and I think there's a lot that we can take from this just in our everyday lives, whether people are in the business world or nonprofits or education, because we come up with plans all the time. And sometimes it's us and our team. We're working on a project, we say, this is it. This is what gold. And then we take it to the person who has the budget or the person who makes the final decision, and they're like, I don't think it's gold. It's something, but it's not gold. Then they start tinkering there. And that's really frustrating, especially when you spend so much time doing that, putting it together and creating a cohesive strategy. And so now when you look back on it, in hindsight, what strategic changes would you have made?

I think, you know, there are times when it's really worthwhile to bring the some representation of the ultimate decider, that person's perspective, into the planning process. So if we had. I mean, maybe if we had consulted the different Hill constituencies earlier, made them sort of feel that they had more input to the planning process, maybe they would have had a greater sense of ownership, or at the very least, maybe we would have had some early indicators that there's no way you're ever going to get support for four facilities. So don't plan for that, plan for two, I think so. Bringing in stakeholders earlier in the process would be one thing I would have tried differently. And then you also have had this risk of always things being overtaken by events. So, you know, ultimately the decision was made to pull out of Iraq entirely in terms of the military piece. And we didn't anticipate, and we didn't anticipate that fully when we were planning for this. We had assumed some kind of residual presence. So I think getting maybe more engagement from stakeholders at the start would probably be my principal takeaway.

Yeah. And you know what's interesting? I'd like to get your thoughts on this, too. If we blend this story, some of the key elements from this story and your previous story talking about the human capital strategy at the Pentagon, it seems like getting that ground truth seems to be a major part of it because in the first story you had more of that information and then in this one it seems as though there wasn't as much.

We were really doing kind of a blank sheet of paper exercise that did not. That really started from what are the needs going to be? What are our interests? Support what is the ideal? And you do want to have that. There's room for that kind of unconstrained thinking as part of a planning process. But I think we might have done a better job of trying to anticipate and explore what are some of the constraints that are going to be and how do we develop different versions based on those different constraints.

Yeah, that makes a lot of sense. It makes a lot of sense. And then you could have planned for those contingencies, adjusted the strategy accordingly, and then like you said earlier, too, getting those stakeholders into the discussion. And the thing is, I tell people all the time with negotiation, there's no way to guarantee. So even through this exercise of hindsight, it's still. There's probably nothing that we could do to guarantee that we would have gotten those four posts instead of two. But still, it's a useful case study because when it comes to any kind of strategy, what we're trying to do is put ourselves in the best position for success because that's all we can do given our position.

Yeah. And one of my favorite quotes or ideas as someone who's done a lot of strategies and a lot of plans is from Eisenhower, who used to say something like, like it's not the plan, it's the planning. I mean, the real value in the process is often what you learn in the process of exploring the decision and option space, because that gives you a certain agility to respond to whatever the world throws at you. Which kind of coupled with this notion of no plan survives contact with the enemy in military parlance or reality in general parlance. And so the value of it is this process of having thought through a lot of the issues and being able to adjust quickly to deal with new circumstances as they arrive.

That is fantastic. And Michelle, we really appreciate you coming on the show and sharing your wisdom and experience with us and listeners. If you're interested in getting in touch with Michelle or her team, make sure to check out WestExec.com or send an email to infoestexec.com and of course, both of those are going to be in the description below. Michelle, thank you again for coming on the show, my friend.

A really fun conversation. I enjoyed it.

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