Spreadsheets don’t seal deals. People do. I’m still not sure who came up with the term soft skills, but they probably didn’t work in business development.
Building relationships, listening, and showing empathy aren’t just soft skills. They are essential abilities for getting the job done. You won’t get far without them. Disregarding the power of soft skills is a costly oversight. Soft skills are the basics of human connection which make them the foundation for anything remotely business related. The basics will:
Enable you to form mutually beneficial agreements,
Improve your luck and ability to gain new opportunities, and
Facilitate more productive negotiation (an ability that most parents would like in dealing with their children howling for sweets)
If you want to be a scientist an astronaut, there are many basics you need to master. An understanding of rocket propulsion will be essential for your survival. Yet, if you fail to be a good communicator, you will eventually crash and die.
An understanding of Chinese culture is paramount if you want to secure an industrial manufacturing deal. Yes, these things seem basic, but they will take you further than anything else. Continue to practice the basics.
Soft skills, like hard skills, can be learned one step at a time: initiating meaningful conversations, nurturing relationships, employing active listening techniques to actually understand other people on a deeper level. Most of the time we are all running around in our daily lives and not actually listening to what people are saying. That’s why most of us feel like negotiation situations are an up hill battle, that we would rather avoid.
A while ago, a friend of mine introduced me to an incredible blog written by Ketil A. Wig — a seasoned financial engineer in Norway. Ketil has put an admirable effort into organising his expertise on finance in bite sized and understandable chunks. His article on Strategy and tactics in negotions highlights the critical role of soft skills in making things happen:
“Negotiations, negotiation strategies, and negotiation techniques are particularly fascinating topics because they combine hard skills — for instance, about strategic alternatives – with soft skills – for instance, about processes and behavioural psychology. In addition, negotiation strategy is a subject with obvious game theory characteristics, meaning situations where one actor’s behaviour is influenced by other actors and how they interpret each other. This has clear parallels to the part of the strategy field that deals with competitive strategies, for example, how existing suppliers in an industry react to a newcomer — depending on their signals and actual behaviour (think, for example, of Tine vs. Synnøve Finden, or SAS vs. Norwegian). This can be seen as business development where negotiation strategies are used as tools to support a competitive strategy in the form of market entry.”
I can highly recommend reading his entire website if you are hungry for more specifics on negotiation, mergers and acquisition, corporate finance, restructurings, and turnarounds. Succeeding in these areas requires an elegant mix of hard and soft skills.
When time permits, I shall write some more detailed examples quantifying the capital value of soft skills and what kind of effort goes into developing them. It is long process to realise and hone them, but an investment in your own life that exceeds the value of any measurable business metric. In the mean time, which “soft skills” would help you build a stronger and more authentic position?