Win-win is the way. When both sides win and meet some of their goals, musts, and wants from the negotiation, then the process goes faster, easier, and usually comes out better for everyone. When one side plays to win it all at the other’s expense, it creates short-term pain and damages the long-term relationship.
Successful public speakers will tell you that the best way to overcome fear in speaking is preparation. Know your stuff, be prepared for the unexpected, and boost your confidence through knowledge. Be prepared. With enough preparation, no one will be able to trip you up.
Much of the bargaining we do is with people we seldom or never had to negotiate with before. Negotiation has replaced a hierarchical order that was once much more dominant in families and in our personal lives.
Simply put: Selling the act of persuading someone to buy your product or idea, while negotiating is the act of working out the details of the deal.
Negotiating takes in all attributes of a deal. Delivery, timing, extras, the right to negotiate a future deal, a relationship all are likely to be included — and in many cases, there’s no financial transaction involved at all.
In contrast to bargaining, the outcome in a negotiation is usually multidimensional — as are the strategies and tactics you deploy to get there.
But often — too often, really — one side takes, and tries to keep, a tough position for personal reasons: ego, a “win-at-all-costs” or “win-lose” mentality, sheer habit, or even sometimes just because they took and held a particular position successfully last time around. You should always avoid the temptation to take and hold a position in a positional negotiation for personal reasons — always ask yourself: “Is there a business reason why I’m doing this?”
You may win a few negotiations in the short term with a steadfast winner-take-all positional strategy. But you’re likely to lose in the long term, as it takes more time and energy. And your opponents will be forced to negotiate to win as well — throwing a possible win-win out the window.
Take time-outs. When basketball coaches sense things are becoming too emotional and personal, they call a time-out to take players’ minds off the game at hand. If you sense tension or interpersonal conflict, don’t let it overheat. Instead, take a break so that everyone can cool off.
Listen actively, and talk when it’s your turn. Don’t use harsh or bullying language, and don’t react or respond to theirs. While you might put them on the defensive insofar as your problem is concerned, don’t put them on the defensive personally. Never talk down to anyone, and if they talk down to you, just ignore it.
Public speakers say that the secret to success is preparation. Their advice: “Prepare one hour for every minute of the speech.” Not only to know the material but also to build confidence. You benefit when you channel all that loose energy and nervousness into confidence. And then when you deliver your speech you appear “better” than the audience because you know your stuff.
This can’t be stressed enough: prepare, prepare and prepare.
This in turn requires preparation. It’s not just about the rules of the game per se. It’s about developing a thorough understanding of the question at hand, the topic of the negotiation. It’s about knowing the facts, understanding the nuanced “gray areas” and unknowns around the facts, understanding your team, understanding your counterparty, and even being familiar with the very “ground” or venue in which the negotiation will occur. Any shortfall in preparation in any of these areas can create awkwardness — which in turn may create weaknesses your opponent can exploit.
Whatever you’re negotiating, you should have at least one Plan B that’s as beneficial as your original plan — else your effort to move the negotiation forward turns into a simple concession and you may not be content with the outcome if Plan A fails. Plan B should be carefully cultivated under the assumption that it’s actually an A Plan. The same amount of research, prodding, and strategizing should occur so that you can spring right back into action if your original plan falls through.
As you might imagine, the “prepare” stage can go quite deep, and it may require a lot of time. But remember — a prepared negotiator has a huge advantage over an unprepared negotiator.
They employ tactics that may not seem fair to you, because they try to keep you off balance and prevent you from thinking clearly. They want you to feel as if the negotiation is personal — and if something goes wrong it’s your fault. They put you on the defensive and try to separate you from you rational self. They hope your bruised ego will prevent you from looking objectively at the negotiation as it unfolds.
Is this psychological warfare? You bet! Intimidators take advantage of your human side, focusing less on the business aspect of what you’re trying to accomplish and more on the personal side. They hope you’ll do anything — give anything — to seek balance and find balance in the negotiation, even if it means your side has to cede ground.
Be aware that not all intimidators are loud and blustery. Some may take the quiet approach, shrewdly manipulating you with a barely recognized yet penetrating insolence. Their ploy may even be delivered more through body language than verbal antagonism. Condescending by nature, they know how to crawl under your skin with just a look, hand gesture, or blink of an eye. They may not intimidate you with brazen scare tactics but may instead act as if they’re far above you in every way.
Never shout or use abusive language. That only escalates the conflict and takes you away from the issue at hand. Instead, stay calm, focused, and in control. Avoid emotional involvement and work to get the focus back on the issues at hand. Ask open-ended questions to avoid being brushed off with simple yes-and-no answers. Your goal is to force your counterparty to talk about the issues, the real reasons you’re both there. In so doing the intimidator might cool down and realize you aren’t playing his game.
The point of this ego stroking is to appeal to your emotional side, to give you a false sense of security. For example, the flatterer may try to make you believe that you have the upper hand — that you’re “winning” the negotiation — so why not “give us a break” and offer a few minor concessions?
Another tactic is to involve a third party, either one present at the negotiation or brought in for the task. Getting a manager or technical expert involved can help — it takes the focus off you and once again redirects the negotiation to the facts and to the results. When you get flattered by a car salesperson, it’s time to bring in your spouse or grown child to diffuse the flattery. In business, bringing in another party, especially a manager or other authority, will help.
Don’t just listen — listen actively.
No matter the negotiation, and no matter the style of the negotiators, your job doesn’t end at simply being there, hearing, or even passively listening. You must listen actively. Paraphrase a few of the counterparty’s key points to show empathy and a correct understanding of their situation.
When something seems too good to be true, it usually is. Statements unsupported by facts or supported more by pomp and ebullience than facts are dead giveaways. Large quantities of superlatives can also tip you off — most, best, least, cheapest. Loss of eye contact, a change in a speech pattern, and general nervousness can all indicate a lie or exaggeration.
Logical thinkers, naturally, can be quite reasonable to work with. However, in some cases they tend to overanalyze issues and linger on them too long. They often nitpick and bring up valid points that you might acknowledge but not necessarily agree with. If you don’t agree, they probe your reasons why. If you do agree, that encourages them to probe some more.
The main problem with logical thinkers is that through this constant questioning of details they create a lot of what should be “parking lot” discussions that sidetrack the negotiation. The challenge is to keep focus and avoid going off into the weeds to overanalyze minor issues.
The logical thinker deals in facts and figures. Most are naturally skeptical, and most ask a lot of questions. They emphasize detail.
The best approach is to try to ignore the unpleasant aspects of your counterparty’s personality or style. If he’s loud and aggressive, don’t respond; stick to business and a normal level of aplomb for the situation. If he’s evasive and passive-aggressive, don’t take the bait.
Second, stick to business. Focus on the task at hand, on the problem, not the people. Stick to the facts, stick to the agenda. This is part of why it’s so important to come prepared with the facts and an agenda.
Use the clock effectively. Take time-outs to regroup or to ease the tension. You can use those breaks from the negotiation table to establish some informal rapport with you counterparty so as to diminish some of your differences.
The bottom line is preparation. Visualize the negotiation, including your response to the difficult personalities you may encounter. And be prepared to separate the people from the problem.
Subtle is best — you don’t want to gain the reputation of being a manipulative negotiator. The idea is to manipulate without your counterparty being aware of it.
You won’t have a lot of time to analyze; rather, you’ll have to know negotiating types and their tactics so well that you can instinctively recognize them as they occur over the board. During a negotiation, you’re not studying the pitcher or taking batting practice — you’re up at the plate for real.
- Say you want to negotiate with the good cop only.
- Call out the counterparty. Let them know you’re onto the ploy.
- Play along. Pretend to be alarmed by the bad cop position and statements. Threaten to end the negotiation. The bad cop may back down, and the good cop may take over.
- Roll out the same ploy. Bring your own bad cop into it. Tell them you’d be more than happy to agree to their demands, but you have a superior who never bends the rules.
- Speak to the good cop privately. Once alone, tell him you’re about to walk away from this negotiation because of the bad cop’s behavior, position, or even lack of professionalism.
The shill can consist of “expert” testimony by a current user of the product who appears happy (and may well be) with the deal he got.
Most straw man opportunities will appear as “over the board” — that is, at the negotiating table in real time — items that can be made seemingly important to get the other party to reconsider or make a concession.
Don’t overuse straw men. The tactic is a stretch of the truth, if not an outright lie, to gain power in the negotiation. If you use it repeatedly and the counterparty figures out the pattern, your straw men will become in effective; worse, they’ll label you as dishonest and manipulative.
In an otherwise smooth discourse, the counterparty suddenly shifts the message or tactics, bringing up new information or displaying a surprising new behavior in hopes of arousing an emotional response or reaction from you. You’re caught off guard and often put on the defensive. You see this tactic in TV courtroom dramas all the time.
Expect a certain amount of surprise, and try to “see” your way through it in advance. Mentally prepare yourself for surprises by visualizing your response and your efforts to redirect the focus back to the negotiation. A surprise that you anticipate and deal with effectively isn’t a surprise.
This new person may then (intentionally or unintentionally) wear you out with requests for information and to be brought up to speed. The hope is that you’ll be thrown off balance or even induced to “help” this replacement — and be more likely to give concessions just to get things going again.
Add-ons and nibbling are 2 commonly used tactics you’ll see over and over. An add-on is a small incremental point or concession that a negotiator adds to the end of a larger concession that’s already being discussed. Nibbling is a variant of the add-on, usually saved for the end of the negotiation, the “one last thing” asked for after a mutually beneficial agreement is reached.
Like most ploys, they only work if used sparingly — if you add on heaps of requests, your counterparty will bolt and you may have to start over. Subtle and sweet is best; not too much or too obvious, and always with plenty of manners and grace. Don’t let add-ons or nibbling get in the way of the win-win.
Simply put, if you’re not ready to negotiate, don’t. Maybe you need more time to prepare, or maybe you need more information from the other party; whatever the reason, do what you can to avoid putting yourself in a position you’ll regret later.
When you feel as if the Socratic method is in play — that is, unending leading questions designed to manipulate you into a trap — stop! Redirect every question to a main objective, asking how the question pertains to the goals you are both trying to reach. Keep your answers short to deflect further questioning.
3 types of questions: vague, loaded, and leading.
More ingenious and dangerous than the vague question is the loaded question. A loaded question is more like a judgment wrapped up in a nice package topped off with a question mark bow. It sounds like you’re being asked a question, but you’re really being led to a conclusion — usually a negative one.
So the best way to handle this question is not to answer it directly. You can instead answer the question with another question. “When did you see any evidence of my staff being disorganized?” or “When is the last time you spent any time with my staff?”
The shoe will shift to the other foot.
Lawyers use leading questions frequently, and when they do, an objection from the opposing lawyer is usually quick to follow. A leading question tries to get a specific response, usually to prove the asker’s point.
Examples might be, “This price is really high, isn’t it?” or “Isn’t your delivery schedule substantially slower than those of your competitors?”
One feature of many leading questions is the interrogative tacked on at the end: “isn’t it?” “doesn’t it?” or “don’t you?” and so on.
In the courtroom, a leading question may be used to create a dramatic presentation for the jury. The opposing lawyer objects to a leading question because it tries to trick the witness into agreeing.
Few dramatic moments perk up one’s ears more than being shouted at. Shouting makes us feel uneasy or even embarrassed, especially if others can hear. Shouters know this and may choose to use this discomfort to their advantage.
There are different reasons for shouting. We shout out of fear, out of aggression, or as an attempt to manipulate, keeping the counterparty off balance and insecure about how the negotiation is proceeding. Not everyone shouts for the same reason, so listen carefully to what the other party is saying (or shouting) to pick up on the cues.
Generally — as with most other acts of theater — the best countermeasure is to maintain your composure and proceed with professional aplomb. Ask for explanation in a diplomatic, calming way; try not to be defensive.
Becoming fluent in body language requires time, effort, practice, and application, but it’s worth the effort. Body language skills will help you uncover hidden agendas, discover a person’s true feelings, gain insight into someone’s character, predict reactions, and become aware of your own nonverbal behaviors.
Loud tones can be used to get someone’s attention or to make a point, but they may sound threatening and filled with anger and thus detract from the point. Soft, quiet tones make people feel relaxed and safe, and as a result they’re more likely to listen to the point.
One technique to decipher body language is to get your counterparty to talk about something he’s happy about — like his significant other, children, pets, or cars. Since he’s not pretending to be happy about his favorite things, you can not his body language while he’s talking about Fluffy, and then look for those “happy” cues later in the negotiation.
Music is the silence between the notes.
Those with extensive experience at almost anything soon realize — and will often advise — that the best way to learn what to do in a particular situation is to consider what not to do.
For many of us, nature often kicks in in the drive to “win” as we approach most problems in life. We strive to come out on top, to come out ahead. At all costs, we want to avoid losing.
The bottom line is simple: If you try too hard to make them a “loser,” you’ll eventually lose as well.
The following word choices can help to avoid sounding too aggressive:
- “I” versus “you.” Instead of saying, “You still didn’t answer my question,” rephrase the statement: “I’m sorry, I still don’t understand. I think a few examples can give me a better idea.” By placing the blame on yourself, you make it clear that you’re not criticizing — and your counterparty will be more willing to communicate.
- Negative versus positive. Words such as “can’t,” “won’t,” “shouldn’t,” and “don’t” should be used sparingly. Instead of saying, “I can’t do that” try, “I have a few other options I’d like to get your opinion on.”
- Watch the “buts.” Think of the word “but” as a cutoff point, a negative road sign, beyond which your counterpart may stop listening to what you’re saying. “Our production costs are high, but the materials you’re requesting are expensive.” To the person on the defensive, this can sound like an attack on the original idea. Try removing “but” from the sentence: “Production costs are high; the supplier charges X amount for these materials.”
I can sum up the best antidote for stress and anxiety in one word: preparation. When you’re prepared, you know what you’re talking about, and when you know what you’re talking about, you deliver it well. When you deliver it well, the anxiety goes away. This cycle of confidence does more to alleviate stress than any breathing exercise, handholding, medication, or any other tool or crutch possibly can.
Remember — when making concessions, always ask for something in return. And remember, timing can be everything.
You might think it to be a good gesture to give away something because you figure you can ask for something in return later. Problem is, the later never really happens, or you feel compelled to give away something else when it comes.
When there’s an error, bring it up immediately, even if it’s embarrassing. The longer you wait, the more it becomes permanent. Worse, it may seem like you planted the error as part of a ploy.
Making decisions because you feel pressured is one of the worst mistakes you can make, particularly during the closing.
Additionally, realize that most deadlines can be negotiated.
A good rule of thumb for risk that works well, especially for investors, is this: Invest only what you can afford to lose.
You really can’t go wrong if you always keep a clear view of your main goals. If you and your team hew close to the original sets of goals and objectives, then emotions like anger, anxiety, or the feeling of being overwhelmed won’t distract you or throw the negotiation off track.
As with most ploys, the best defense is to see it coming, take the time to understand what’s going on, ask questions, and make your decision calmly and professionally.
One of the best ways to defuse the delay-of-game bomb is to ask for specific time commitments for how long the counterparty will leave the negotiation. If the reason for the delay is real, she’ll come back right away with something specific.
People are naturally more willing to compromise when facing time restraints. When too much is coming at us all at once, it’s easier to get rid of the most immediate and stressing factors than to take the time to work them out.
Most concessions are made toward the end of a negotiation’s deadline, if there is one. The explanation is simple. The more time the 2 parties invest in the negotiation process, the less likely they will be to backtrack or pull out.
If the deal negotiated so far stops short of win-win, there may be more work to do. It’s usually okay to come out a little ahead, but when the deal seems too one-sided, problems will creep in, ranging from immediate (dis)approval from superiors, advisors, or legal teams to damaging the long-term relationship between you and the counterparty.
A deadlock occurs when negotiations come to an impasse. Both parties have dug in on a point and / or have used up all their concessions. Progress seems out of reach; no matter how many reviews or revisits of the issues, favorable resolutions are nowhere in sight. At the moment, both parties lose because neither accomplished their goals. Furthermore, the emotional response to such a stalemate can be anger and blame, and potentially a communication collapse. Both parties withdraw from the discussion and perhaps, wanting to save face and not budge, they refuse to go back and break off the talks.
I call it the “one in ten” syndrome, and it happens a lot in business. For every one individual moving things forward with positive energy, there are 9 other people questioning tactics, finding faults and errors, even nitpicking the PowerPoint presentation. It’s a truth in human nature and especially of bureaucracies that it’s easier to find fault with someone else’s work than to do constructive work of our own.
When team members get fixated on finding fault, it becomes a vicious cycle; everyone starts doing it. It is very difficult to move forward. As a leader, or a leading team member, try to redirect this energy toward the positive.
The first step is to review — to take inventory — of where you are so far. Clarify or “add color” (that is, detail) to points that need more detail or clarity. When you’re in the thick of a negotiation, it’s easy to get caught up swapping concessions and making offers and counteroffers. You’re concerned about everything from the details of what you’re getting and giving to deciphering the other person’s body language, mood, and sincerity all at once. Step back, taking a break if necessary, to review all points of the negotiation against your list of goals, musts, and wants.
A first step for both parties is to review notes made throughout the course of the discussion. In a slower, deeper negotiation this is important because you may not remember every detail, or you may remember too many details, and lose the strategic forest among the tactical trees. Likewise, reviewing notes is important in a fast-paced negotiation because everything happens so fast.
From a legal standpoint, closure occurs when all the agreed-upon terms are finalized into a clear, binding, signed contract, witnessed and verified by all parties. Read the entire agreement, and sign only when you’re ready. The less you can leave open to interpretation, the better.
- Overcome fear by preparation; if still worried, take time out to prepare more.
- Control doubts about details by writing down the details and reviewing them.
- Don’t drag your feet. You may lose your counterparty’s respect and possibly the deal.
Leadership is getting people to want to — and to be able to — do something important.
Beyond leadership, another vital key to fast, friendly, and effective negotiating is integrity — the ability to make a commitment and to follow through on the promises you make. In the interest of this, it is very important that you understand all of the terms you’re agreeing. Don’t kick the can down the road by making sloppy agreements. It will come back to haunt you later; your next negotiation could turn out to be a nightmare.
Assuming that you’re not a practicing attorney, your job as a negotiator is typically to develop the agreement. You should then let the lawyers and / or contract specialists massage the details, finalizing the language, and prepare the final documents.
Deal. Agreement. Contract.
Don’t get caught up in trying to make them too complex and wordy — your goal is to document the deal so that:
- Both parties can perform with little ambiguity.
- Both parties know what constitutes nonperformance.
- Both parties, when necessary, know the remedies if one side doesn’t perform.
The set-in-stone appearance of this type of contract may seem intimidating, but you can change the form, to add or delete items as needed, so long as both parties agree and accept the changes.
At its root, a contract has 3 major and clearly identifiable parts: the offer, the consideration, and the acceptance.
The offer is straightforward: “We at Company A will produce and deliver 1K widgets per month for the next 6 months.” The consideration is the payment: “Company B will pay $25 per widget.” The acceptance is the signed return of that agreement with any other agreed-to terms that come in along the way.
Many contracts can come about from a simple phone call or golf course conversation. State laws vary, but the baseline answer is “yes,” verbal contracts are enforceable in most states. If there is an offer, consideration, and acceptance, the contract is generally enforceable, with certain exceptions such as real estate contracts.
Consideration is a fancy term for tangible compensation or promises.
Failure of consideration signifies the contract is breached; you or the other party didn’t hold up your part of the bargain. For example, if you don’t deliver a required deposit payment, the contract technically becomes null and void, and the person who has been wronged can withhold making good on her considerations and / or take legal action against the other party.
Contract law holds parties accountable for neglecting to satisfy their part of the deal.
When you enter into a business contract, a lot depends on what the other party is willing to do. If you want to get out of the contract, the other party might allow it in order to maintain the integrity of the relationship. Maybe there was an oversight or something unexpected happened and your counterparty feels that cutting you loose is a better choice than enforcing the contract. Though your counterparty may empathize with your reasons for wanting to cancel the contract, they’re not obliged to let you do it.
A tort is similar to a breach of contract, but it usually concerns damages beyond the terms of the contract. This damage might relate to reputation of a party, or it might affect the physical ability of one of the parties to do something. It’s a civil wrongdoing requiring a remedy from the court beyond the terms of the contract.
If the other party tells you something he knows is false, and you sign the contract based on your belief that his statement is true, you can have the contract rescinded in court. The same hold trues even if the other party was unaware that the information was false.
Alternative dispute resolutions are, not surprisingly, geared toward resolving the dispute without the time, expense, and possible reputation damage of litigation. Three methods are available: negotiation and settlement, mediation, and arbitration.
Mediation is not a legal proceeding like a trial; the mediator cannot decide on what the parties must agree to. It’s a casual meeting in which the mediator talks to both parties together and separately to refocus their attention on goals and ways to reach them.
Mediators are brought into negotiations and disputes to avoid litigation. If a lawsuit has already been filed, they might be brought in to avoid accruing more lawyer and court costs. Since all parties involved share the mediator’s fees, mediation can often be the most favorable and cost-effective choice.
Like the contract resulting from a negotiation, the mediated agreement is documented, signed, and enforceable by law. If the agreement is reached after a lawsuit has been filed, the court will receive a copy and the case can be dismissed.
Arbitration is similar to mediation in that it is a type of alternative dispute resolution that involves the inclusion of an outside party to help settle the dispute. In this case, however, the arbitrator directs a hearing and then decides the outcome. It almost amounts to litigation but is faster, cheaper, and more flexible. You don’t have to worry about the court calendar and docket, and the parties can decide on the rules in effect throughout the arbitration period.
For example, evidence that otherwise might not be allowed in court can be submitted in arbitration. Moreover, the parties can decide on who the arbitrators will be and whether the arbitration will be binding (parties must follow the arbitrator’s final decisions) or nonbinding (parties take the final decisions under advice but do not have to carry them out). Once the arbitration is finished, the resulting decision cannot be appealed. The conflict is considered resolved, and the case is closed.
Negotiating isn’t just about working out the deal. It is about building and nourishing long-term relationships as well as a long-term reputation as a fair, effective negotiator.
When people don’t do what they say they’re going to do — or don’t state clearly what they’re going to do in the first place (another passive-aggressive behavior observed all too frequently) you lose trust quickly.
Reputation is a fragile thing.
Building trust is about saying what you’ll do and doing what you’ll say. It’s also about doing what you say consistently.
Never forget that trust is an always-on proposition.
Always avoid making promises you aren’t sure you can keep. If someone asks you a question that you can’t answer, say that you’ll look into the issue — and do it. Each time you make good on a promise, whether big or small, it will be remembered.
Never forget that people remember.
Resolving conflicts starts with clearly identifying them. Countless times negotiating teams have wasted time solving the wrong problem, for instance, haggling over price when the real issue was quality.
Loosely defined, power is the ability to influence others and to get their recognition. When I say “influencing others,” I mean it in the leadership sense — getting others to think something or want to do something — not in the control sense. Win-win is leadership, win-lose is intimidating and control.
Even if it doesn’t seem like creating a lasting relationship is relevant, it still pays to do so. You never know whether you’ll work with the same counterparties again; furthermore, your reputation can spread like wildfire. It’s a small world, and news travels fast.
Practice makes perfect, and the only way to become a “perfect” negotiator is to, well, negotiate.
- You “saw” the negotiation: its preparation, start, middle, and finish.
- You prepared the right — and right amount of — information.
- You “knew” the counterparty and what he was looking for.
- You got the deal done.
- You achieved your objectives and goals.
- You came up with a win-win.
- You have a good idea of what went right and what went wrong.
- You learned from your mistakes.
- You advanced the relationship with these negotiators.
- You advanced your personal and professional reputation.