Friend and Foe: When to Cooperate, When to Compete, and How to Succeed at Both (17 page)

Laci Peterson was last seen alive Christmas Eve in 2002. She was seven and a half months pregnant.

When her husband, Scott Peterson, returned from a fishing trip one evening, her car was in the driveway and her purse, keys, and phone were in the house, yet Laci herself was nowhere to be found. So he called Laci's mother and asked if Laci was there. When Laci's mother replied that she wasn't, Scott calmly said, “Laci's missing.”

Tragically, three and a half months later, Laci's body and the fetus washed ashore in San Francisco Bay. Laci had been murdered, and her body had been dumped in the bay.

To investigators, there were several clues from Scott's behavior following her disappearance that made them highly suspicious. The first was the fact that Scott's behavior was highly inappropriate for a distraught husband. Stop for a moment and try to imagine how you might behave if your pregnant wife had just gone missing.

Would you be calm during the search, chatting away on your cell phone? Would you go out and play golf? Would you add not just one, but two pornographic channels to your cable account just days after your wife's disappearance? Would you sell her car? Scott did all of these things.

Remember our discussion of baselines—we need to know what is normal for a particular person. Take the routine task of baking. A college student (who will remain unnamed) was home on a break from college. He asked his father to borrow some butter because he was going to his friend's house to make brownies. This might seem like a fairly innocent request, but his father immediately became suspicious and directly asked his son if he was going to make pot brownies…and he was! How did his dad know? Because his son had
never
made brownies before! The son's behavior deviated from the baseline and therefore was uncommon and unusual for him.

So, the first clue for detecting deception is whether the behavior is unusual, uncommon, or inappropriate. Scott's behavior clearly was.

During a family press conference, a reporter asked Scott if he was a suspect in the case. In response, he stormed out of the press conference.

When we lie, we often feel anxiety at the prospect of getting caught. When we feel anxiety, we seek to relieve it by exiting the situation, as Scott Peterson did. This is exactly why liars frequently look at the door, check their watch, and express eagerness to get out of the interview. Some lean toward the exit or engage in “eye blocking,” closing their eyes imagining being somewhere else.

So if you ask someone a tough question and their eyes start darting to the nearest way out, there is a chance that they could be lying.

As President Clinton faced allegations of having a sexual relationship with one of his interns, he famously stated on camera, “I'm going to say this again. I did not have sexual relations with that woman, Miss Lewinsky. I never told anybody to lie, not a single time—never. These allegations are false. And I need to go back to work for the American people.”

In this statement, you probably noticed his eagerness to get “back to work” (Red Flag #2). But there is a second clue in this statement: the over-the-top repetition, “I never told anybody to lie, not a single time—never. These allegations are false.” And by overdoing it, we see Red Flag #3.

Motivated by a desire to appear credible, liars tend to go overboard. They might overuse phrases such as “To be honest.” They might refer to their religious upbringing, or continuously reference their credentials or friends to bolster their status and credibility.

For example, there have even been cases of criminals who tip off authorities by overcompensating and appearing
too
relaxed during questioning, even resorting to medication to gain this effect. Yet by trying to create the impression that everything is normal, they often go too far and give themselves away.

Similarly, by working hard to create the right impression, cheaters often overcompensate as they try to craft the “perfect” lie. Consider this example from a few years ago. Dirk Smeesters was a rising star in academia at the prestigious Erasmus University in the Netherlands. He was publishing articles at breakneck speed. He was promoted quickly and he received accolades for his research.

So it was hardly a surprise that one of his papers caught the attention of one of our colleagues, Uri Simonsohn. As scientists, we are routinely asked to share the results of our studies. So when Uri asked Smeesters for his data, Smeesters passed them right along. As Uri puzzled through the numbers, he knew something wasn't right.

In one of Smeesters's studies, he had asked people how much they were willing to pay for T-shirts with different designs on them. It turns out that many scholars have conducted studies like this one. Uri looked at the distribution of responses when people were asked how much they would pay for a T-shirt and found that about 80 percent of these other studies were in
multiples of five
. Yet, if the data were
randomly
generated, only about 20 percent of the data would be in multiples of five. What Uri noticed was that this is exactly how Smeesters's data looked. Smeesters had made up his data but he tried to make it look “normal” by making it appear random. He had overcompensated.

Of course, the broad investigation into Smeesters's work hinged on much more than this, but these data were a red flag for Uri. In an effort to appear credible, he had purposefully avoided round numbers and tried to make the results look as though they were generated by real participants. Ironically, this effort made his data less likely to look like they came from real participants.

As we look for flags, we also need to pay attention to the match between what people are saying and
how
they are saying it. At Jerry's trial, the jury found Seemona credible because of the match between what she said and her physical impression. As the jury forewoman, Caryn Eyring-Swick, explained, this was one of the reasons why the jury believed Seemona: “She didn't fall apart or crumble on the stand. You could see her jaw tighten. We knew that Ramrattan had done something that would affect his victims forever.”

In contrast, consider the former Olympic hero Marion Jones. She won five medals at the 2000 Summer Olympics in Sydney, Australia, but was later accused of having used performance-enhancing drugs. When she called a press conference to refute the charges, she
said
she was furious. But her demeanor and vocal tone only suggested sadness. What she said did not match how she said it.

So we should look carefully when people make claims about how they are feeling. If they say they are happy, do they really look happy or do they look upset? If they say that they are enthusiastic, do they really look bored?

Finally, rather than asking yourself if someone is lying, our advice is to ask yourself the following question: Are you completely comfortable with their answer? If you have a nagging suspicion that something isn't quite right, probe further. Sometimes, outside of our conscious awareness, we have seen a red flag.

So we've seen that if we trust too much, our foes can exploit us. But if we trust too little, we will fail to make friends and reap cooperative rewards. To find the right balance between cooperation and competition, we need to make ourselves vulnerable, but at the same time guard against exploitation.

Ronald Reagan famously quoted the Russian saying “Trust but verify.” He recognized that we need to trust people, but that we must also have some process to protect ourselves from being deceived.

Let's consider this challenge within the context of online dating. As we saw earlier, many of the claims people make online are false. If we trust the information we receive too much, we will believe that people are taller, thinner, and younger than they really are. However, if we trust too little, we might never go out on a date.

We need to strike a balance to resolve this tension. We need to rely on what we read (with a grain of salt), but we also need to collect additional information. Sometimes this involves checking out someone's social media profiles; other times it involves reaching out to a mutual acquaintance, or—in some cultures—hiring a private investigator to research a potential romantic partner.

Another way we find our balance is by following protocol. Though sometimes they can be aggravating, policies, procedures, and protocols are
designed
to raise our guard and save us from exploitation.

And what happens when we fail to follow protocol? Tragedy can strike.

After the 9/11 attacks, the CIA faced intense pressure to produce actionable intelligence on al-Qaeda. And by 2009, they had begun to gain solid, human intelligence which ultimately enabled the United States to target al-Qaeda in Pakistan. Speaking to this issue, Richard Barrett, head of the UN's al-Qaeda and Taliban monitoring group, said, “Human sources have begun to produce results.”

One of their sources was a doctor named Humam Khalil Abu-Mulal al-Balawi. Al-Balawi had posted extremist views on the web, and the Jordanian intelligence agency had told al-Balawi that they would end his medical career and put him in jail for his posts unless he agreed to cooperate with the agency.

And so the Jordanians sent al-Balawi to Pakistan, where he infiltrated al-Qaeda. According to a U.S. intelligence official, “First, the guy had extremist credentials, including proven access to senior figures. Second, you had a sound liaison service that believed they'd turned him and that had been working with him since. And third, the asset supplied intelligence that was independently verified.”

When al-Balawi promised to provide information that would lead to Ayman al-Zawahiri, the deputy leader of al-Qaeda, CIA officials were excited.

They arranged a face-to-face meeting with al-Balawi, and on December 30, 2009, an Afghan driver drove al-Balawi to the CIA's forward base near Khost, Afghanistan, Camp Chapman.

According to CIA protocol, he and his car should have been searched. But al-Balawi wasn't searched as he entered the base. Perhaps the CIA operatives were confident in al-Balawi, perhaps they didn't want to offend him, or perhaps it was some combination. Whatever it was, the effect was devastating. As al-Balawi stepped out of the car he detonated his explosive vest, killing seven CIA officers, a Jordanian officer, and the driver. What had just minutes earlier seemed like a promising lead turned into one of the worst single-day losses for the CIA.

In hindsight, clues had been missed. Some CIA and Jordanian intelligence officers had serious concerns about his intentions. In fact, one Jordanian official had even passed along a concern to the CIA that al-Balawi might be trying to “lure Americans into a trap.”

Why were the CIA agents too trusting? Several psychological forces conspired against them. First, they were under intense pressure to produce results. Second, like so many other victims of deception, the CIA
wanted to believe
that al-Balawi had actionable information.

Finally, al-Balawi had credentials: The Jordanian service vouched for him and al-Balawi had given them enough information in the past to appear credible. The CIA trusted the credentials and put too much stock in the information they could observe.

But the key lesson we want to draw is this: To guard against exploitation, we need not only to
establish
protocols, but to follow them—even when they are inconvenient.

And finally, we must remember that deception is everywhere. From online dating profiles to criminal investigations, deception is a part of our social world. We need to appreciate and prepare for it in order to compete and cooperate more effectively.

When deception is discovered, trust is broken and relationships are shattered. When this happens, what can we do to restore trust and put the pieces of the relationship back together? We turn to that question next.

To Arthur Andersen, his reputation was paramount. Since the founding of his accounting firm in 1916, he did everything he could to build a reputation for honesty and integrity. As legend has it, early in his career, when a railroad executive purportedly insisted that Andersen certify a flawed accounting report or lose a major client, Andersen replied that there was “not enough money in the city of Chicago” to tempt him to certify a false report. Famously, Andersen's motto was “Think straight, talk straight.”

By the end of the twentieth century, Arthur Andersen had grown to become one of the dominant accounting firms in the United States. Unfortunately, as Arthur Andersen grew, the culture changed. Though Arthur Andersen himself had resisted the temptation to certify flawed statements, decades later partners at his firm did certify flawed statements. In 2002, in one of the biggest corporate bankruptcy cases in the history of the United States, Arthur Andersen surrendered its license to practice after being found guilty of shredding documents related to its accounting practices at Enron.

In 2005 the Supreme Court reversed Andersen's conviction, enabling Arthur Andersen to resume operations. However, by that time people had lost trust in the firm. Even though it was legally allowed to resume operations, Arthur Andersen collapsed.

Eliot Spitzer is another man who invested heavily in his reputation early in his career. As an attorney general, he vigorously prosecuted a wide range of cases, from white-collar crimes to prostitution rings. Indeed, his sterling reputation for being tough on crime helped him become the 54th governor of the state of New York. Just one year later, his world came crashing down. Investigators discovered a money trail revealing that in spite of his vigorous prosecution of prostitution, Spitzer had patronized the Emperors Club VIP prostitution service—to the tune of at least $15,000!

By participating in the very criminal activities he had worked so hard to prosecute, Eliot Spitzer shattered his reputation for integrity. He was exposed for being both unethical and hypocritical. He had violated the trust that the people of New York had placed in him, and within a week of the news breaking, Spitzer resigned from office.

Five years after leaving the governor's office, Spitzer tried to rebuild his political career by running for the relatively obscure office of comptroller of New York City. In an effort to win back the trust of his constituents, Spitzer employed the same technique that Baptist Children's Hospital had employed; he apologized: “I'm hopeful there will be forgiveness, I am asking for it.” Spitzer never made it past the first round of the electoral process, losing to a relatively unknown candidate in the Democratic primary.

Like Arthur Andersen, Eliot Spitzer was unable to rebuild the trust he had violated even after extensive efforts to atone for his transgressions. Why? Because he hadn't just committed an ethical violation, he'd committed a very particular type of trust violation: a
core
violation.

To understand trust, we need to distinguish between two types of violations: core violations and noncore violations. Core violations are breaches of trust within the most relevant, reputational domain. Noncore violations are breaches of trust in peripheral domains. Core violations can be devastating to reputations. But noncore violations cause surprisingly little long-term harm. This was certainly true for Martha Stewart.

In the 1990s, Martha Stewart became a household name, building a media empire that included several bestselling books, a highly rated television show, a ubiquitous magazine,
Martha Stewart Living
, and a popular website.

Martha later became infamous for something very different: a stock trade she made on December 27, 2001. That day, Stewart sold all of her 3,928 shares of ImClone Systems stock. Of course, lots of people sell stocks every day. But this sale was different. The day after the sale, ImClone reported that the FDA had refused to review their cancer drug, Erbitux, and their stock tumbled as a result. By selling her stock a day earlier, Martha saved tens of thousands of dollars. The coincidental timing of the sale caught the eyes of investigators from the Securities and Exchange Commission. Suspecting that she had received an inside tip, investigators pointedly asked her why she decided to sell her shares. Through the course of the investigation, she insisted that she had simply been lucky, that she had not learned about the FDA review ahead of time. This denial would cost her five months in prison. In a very public trial, a jury concluded that she had lied to investigators, and Martha went to prison for perjury.

At the time of her conviction, pundits wondered what would become of Martha Stewart once she was released from prison. After all, her media and marketing empire revolved around her public image. Almost every facet of her business was branded with her name: Martha Stewart. After a very public conviction and prison sentence, could Martha Stewart, at age 63, revive her media empire?

To many people's surprise, Martha Stewart came roaring back. Less than six months after her release from prison,
The Martha Stewart Show
debuted to high ratings, and she was soon even starring in a second show,
The Apprentice: Martha Stewart
. Over the next several years, Stewart launched almost a dozen bestselling books, plastered her face on a wide range of products sold at Kmart and Macy's, and even launched a line of houses branded “Martha+KB Home” in “Martha Stewart communities.” Anyone who wondered what would become of Martha Stewart had their answer. She was back in business!

After committing a violation, why did Martha succeed in winning back the public's trust when Arthur Andersen and Eliot Spitzer failed? It has to do with the nature of the violation.

People look to Martha Stewart for fashion tips, recipes, and home decorating advice. In short, people trust Martha Stewart for her style and her taste. The insider trading allegations and her misleading statements to federal investigators are serious violations, but they are
unrelated
to why people turn to and trust her.

In contrast, Arthur Andersen was trusted to certify financial records and Spitzer was trusted to support the rule of law. Arthur Andersen and Eliot Spitzer violated the very principles they were expected to uphold. Their transgressions were core violations.

Let's consider a second example of a noncore violation. Like Eliot Spitzer, David Letterman had a roaming eye. But the nature of David's trust violation is more similar to Martha's. David Letterman had affairs with women whom he worked with. In 2009, things came to a head when a CBS News producer handed David's driver an envelope marked “Privileged and Confidential.” In that envelope was a screenplay containing sordid tales of David's relationships with staffers and a demand for a $2 million payment to keep his affairs secret. It seems that in developing the material he later used to blackmail David, the producer had even gotten hold of the diary of one of David's girlfriends.

How did David Letterman react to the blackmail attempt? He got out ahead of the story. He admitted to having relationships with women who worked in his office, and he used his core talent—comedy—to defuse the situation. In one segment of his
Late Show
, he joked that so many women were mad at him that, “on the drive to work today, even the navigation lady wouldn't talk to me.” As the scandal broke, David's ratings surged. Turned out, viewers were not the slightest bit turned off by Letterman's philandering behavior. Why? Because people turn to David Letterman for his wit and humor, not for tips on marital fidelity. Like Martha, David Letterman committed a violation of trust, but his violation was not a core violation.

So we see that relationships can be easily repaired after a noncore violation. Often, merely expressing remorse will do. But for core violations, restoring trust is much, much harder. Yet it can be done. And in some cases, if handled correctly, such violations even create an opportunity to
build
trust.

The Ritz-Carlton Hotel is renowned for its service. It's the type of place where, if you request something like a wake-up call, you can assume that the phone will ring at the appointed hour. But during Stacey Hylen's stay at the Ritz-Carlton in Tucson, the wake-up she requested never came. When she did wake up and realized how late she was, Stacey was furious! She called the front desk to complain…and then a funny thing happened. Her fury soon dissipated.

How did the agent at the front desk manage that? Upon learning about the mistake, the agent immediately apologized. She then offered to send breakfast to Stacey's room. Stacey had other plans and declined the breakfast. When she returned to her room later, however, she found fresh strawberries, candy, dried fruit, and a handwritten note of apology. As a result of these few small gestures, instead of turning to the Internet to lambaste the Ritz-Carlton, she became an advocate for the hotel and raved about their “5 Star Customer Service.”

Consider another example of how a good apology can earn a company high marks…and even enhance their brand in the process. In 1989, Toyota launched the Lexus brand to serve a growing demand for high-end luxury cars. Yet, just months after the launch of this new brand in the American market, a problem arose. Lexus needed to recall the first model it had released and make repairs. This certainly was a core violation, a mistake that hit at the very heart of the relationship between the brand and its consumers—one built on the expectations of safety and reliability—and it could have had devastating consequences for Lexus.

But what Lexus did next transformed this violation into a marketing coup. They responded to the crisis aggressively. Rather than simply sending out consumer notices and making a public announcement, Lexus called every single owner—yes, individually, on the phone. Then they tried to make the repair as easy as possible; they even flew mechanics to customers if a dealership wasn't nearby. After making each repair, Lexus detailed every car and gave it a full tank of gas. Within three weeks, Lexus emerged from the crisis with an enhanced brand—Lexus was no longer just about quality, they now were also known for their customer service. As one magazine put it, Lexus's response was the “Perfect Recall.”

Clearly, whether it's a missed wake-up call, a faulty car, or even a dislocated breathing tube, violating a customer's trust places the relationship at risk. In the unstable aftermath, former friends can easily become foes. But quick repair efforts can tip the balance back to friendship. Often it is the recovery effort, rather than the violation itself, that matters most. And sometimes an effective apology can actually
improve
your image and your relationships.

If these examples don't convince you, consider a study of German eBay users led by Johannes Abeler of the University of Nottingham. The authors contacted 632 eBay customers who had given feedback that was neutral or negative and asked them to remove their feedback. Along with this request, the scholars gave these customers either money or a verbal apology. Some got 2.50 euros, others got 5 euros, but some only got words: “We are sorry to discover that you were not satisfied with our service…and want to apologize for this.”

Of the customers offered 2.50 euros, 19.3 percent removed their negative evaluations. Of those offered 5 euros, 22.9 percent removed their negative evaluations. But after an apology—without any money—
44.8 percent
of customers removed their negative ratings.

The simple words “I'm sorry” are surprisingly powerful. But how we say them and what we do as we say them can make a world of difference.