The Uncontained Outbreak of Deal Anxiety

An instructor in Law School was the first to explain to me the nature of  'deal anxiety' as a problem for business; now I know that  it is a problem for governance reform as well. For a lawyer 'deal anxiety' manifests when a client - usually a business executive - is so anxious to close a business deal she ignores the need for her attorney to exercise due diligence over the contract. For instance, what happens if there is a dispute? What dispute resolution mechanisms might be needed? What about conflict of laws if it is an international contract? Are we going to use the laws of the domicile of Party A or Party B? And so on. You'd be amazed how many business leaders just want to shake hands on the deal, and get on with 'the real business of making money', until something goes wrong and both sides reach for their lawyers ...as cowboys reach for  guns. Then you have a shoot out.

In international development, 'deal anxiety' manifests as the pell-mell rush to get a (reform?)  project going. Whether in grant making donor agencies or in multilateral lending institutions there is a tendency to rush to close the deal, get the partner government to sign the relevant documents, get the internal approving authorities to say Yes. The attitude is: Let's keep this moving folks!

Now, there is nothing wrong with a brisk pace. It can even be justified as rushing to get help to the needy. The problem arises where deal anxiety leads to a failure to think through what it will take to achieve change in the specific context. Are all the risks, especially political risks, fully analyzed? Are realistic mitigation steps in place? More important, are these mitigation measures components of the project, fully planned and budgeted for? 

I know from our work in communication around reform initiatives that it is rare to find an initiative that has actually thought about the communication influence challenges - for instance, the coalition building challenges -  that reforms face, planned a response and budgeted for it... unless and until the natives get restive. Then you are asked to not only come in to help but to find the money that the communication intervention will need! You read project documents that are so unrealistic in their assumptions you are horrified. Yet you know that those documents were produced by smart, highly educated and serious professionals.

What, then, is the problem? I believe it is deal anxiety. You want to get your project approved, you want the kudos and you want to move on. So, you play down the risks associated with the project. You design it and get it approved, and you move on. Those who have to implement the project design under real-world conditions? Well, they have a problem, or two or three. Who cares...

Reform initiatives will keep running into roadblocks more often than not until senior managers in international development institutions clamp down on deal anxiety; and until they re-arrange the incentives that project managers have to simply get the deal agreed and move on without any pressure to be accountable for real development impact.

Photo Credit: Flickr user thinkpanama