Wet feet, humility and working together to manage price increases

I learned the story of King Cnut when I was a kid. As it turns out the story I learned wasn’t entirely correct, but the lesson of the story is still relevant.

In the version I heard as a child, King Cnut was a Danish Prince who became King of England early in the 11th Century, CE. He was vainglorious and arrogant, believing his orders should be followed not just by his subjects, but by all of creation (including nature). In this version of the story, to demonstrate his power, Cnut commands that his throne be set up on the beach at low tide. He then sits on the throne and commands the tide to not come in. Unsurprisingly the tide disregards Cnut and comes in anyway, soaking his feet and delivering a lesson in humility and the limits of power. The story functions as a fable, the moral of which is to know your limits and remain humble.  

The story of King Cnut has come to mind a lot over the past eighteen months as I have helped clients to pass price increases on to their customers. Inflation is like a force of nature, just like the rising tide. Anyone who thinks they can hold that back is kidding themselves and yet, time and time again, my clients find themselves talking about inflation with clients who’s attitudes seem very much like King Cnut’s. They command the tide to stay out.

It’s hard not to see this as unreasonable and conclude that these clients need to learn the same lesson as Cnut; that there’s a limit to their power! But if we look again at Cnut’s story there are different lessons to take away.

In the more accepted telling of the story, Cnut knew the futility of commanding the tide to stay out. He set his throne up on the beach and commanded the tide to stay out to demonstrate the limits of his power after he became worried that his courtiers were comparing his power to the divine. After the tide came in and covered his feet, Cnut is said to have leapt to his feet and declared;

 “Let all men know how empty and worthless is the power of kings, for there is none worthy of the name, but He whom heaven, earth, and sea obey by eternal laws….”

Cnut then took off his Golden throne and hung it on a crucifix, never to wear it again (according to the story). There are two lessons from this version of the story;

 1.       A wise leader knows their limits and retains humility; and

2.       No-one can fight the rising tide.

Whichever version of the story you prefer, it has relevance to your client conversations about inflation.

EITHER they are demonstrating the arrogance of the first version of the story, believing that they have the power of an arrogant King to fight a force of nature through a simple expression of their will; OR they are like humble King’s courtiers, mistakenly believing that you have some supernatural power to protect them from the rising tide. In either case the second lesson applies; No-one can fight the rising tide.

Which brings me to my last point; working together. You and the people you negotiate with are subject to the same rising tide. The only way we don’t all drown is to work together. It’s not an easy conversation to manage, but that’s where getting professional advice will help.

If you’re struggling to negotiate the rising tide of inflation with your counterparties, drop me a DM and let’s talk about how we can keep your feet dry.