By Soydash / for Turkey

What Corporate managers can learn from the animal kingdom.

Forbes Magazine, Sept. 19, 2005

Bosses often think the only lesson they can learn from animals is how to roar louder. So here’s a surprising idea: Animal behavior can teach you how to resolve conflicts and drastically cut your company’s legal costs. In fact, on the question of tort reform, chimpanzees have a better answer than politicians.

Chimps are masters of reconciliation, a behavior first witnessed by primatologist Frans de Waal in the 1970s, after a raucous fight between two high-ranking chimps. The dust slowly settled—and then one male reached out to his rival, fingers extended, palm upward, an offering of peace. The two apes embraced. It was a reconciliation.

A stereotype about animals is that they spend all their time snapping at one another (a lot like some office workers). But researchers have lately identified dozens of species, from dolphins to hyenas, that also kiss and makeup. Scientists have begun to recognize the importance of reconciliations for people, too. In the past, social psychologists often studied human behavior in laboratory situations, so they hardly ever saw postconflict rapprochements. The idea that it could be a natural behavior defied conventional wisdom. Corporate executives built careers on the motto, “Never apologize, never explain.”

But apologies are serious business. Corporate managers wouldn’t be spending 42% of their time mediating workplace disputes if their fellow workers understood the natural healing power of the words “I’m sorry.” An apology can also miraculously transform a client’s hostility into honey.

For instance, the Veterans Affairs Medical Center in Lexington, Kentucky, has a policy of admitting medical errors, apologizing for them, and initiating a claim—even when the family itself has no idea medical error contributed to a patient’s death. Skeptics predicted that “extreme honesty” would be a liability nightmare. But legal costs at the hospital are now among the lowest in the VA system. An honest apology apparently relieves suspicion and a sense of injury in the hearts of malpractice victims and their families.

People may hesitate because they equate the words “I’m sorry” with a guilty plea. Under U.S. law, an apology is protected from use as evidence in only one circumstance--when directly linked to a cash settlement offer. This encourages only those apologies that are “least therapeutic or sincere,” according to Daniel W. Shuman, a professor at Southern Methodist University School of Law. The structure of compensation for lawyers, who typically take a percentage of any legal settlement, also discourages apologies. One-third of “I’m sorry” will not buy the lawyer a tuna sandwich for lunch.

On the other hand, many states have recently passed laws making an apology or a statement of sympathy or benevolence inadmissible as evidence against the defendant, in at least some circumstances. And despite the legal risk, some companies now recognize the redeeming character of a good apology—not least because victims and juries often accept it as grounds for reducing any damage award.

The Toro Company, a Minnesota manufacturer of snow blowers and lawnmowers, used to follow standard “deny and defend” practice, and its product liability costs soared. But in 1991 it switched to a more conciliatory approach. Now, when the company hears about a product-related accident, it immediately sends staff to visit the family. They begin by expressing regret: “Setting aside the question of who’s at fault, we want you to know that we feel terrible that this happened. We’re going to do our best to resolve this thing and make sure it doesn’t happen again.” Toro says the conciliatory approach has halved the time it takes to settle a claim and cut the average cost from $115,620 in 1991 to $35,000 in 2004.

Politicians want to limit a victim’s right to sue. But smart companies will pay attention to chimpanzees instead. By 1999 an intuitive understanding of the natural history of “I’m sorry” had saved Toro $75 million—and earned the considerable goodwill that comes when you do the right thing.