Negotiation

I’m never totally sure whether I hate negotiation tactics because I am insecure about myself as a negotiator, or I think of negotiation as of my weak spot because I hate negotiation tactics.

Anyhow, knowing how much of my view of the world is shaped by my years in academia, and how I’m fully soaked with beliefs that stand on the very opposite side of what most of negotiation tactics profess, I did my best to put my prejudices aside and read a fair number of negotiation manuals.

I came out of this painful process aware of many tactics, many of which I’ve also tried and saw the limits of. I can now recognize them when people try them on me, and I can laugh. It’s just so ridiculous and amazing.

Now, you can say “why do people use those tactics if they don’t work”? It’s a fair question, and I might be wrong, but I think it has something to do with belief perseverance (maintaining a belief despite new information that firmly contradicts it). It is a very strong cognitive mechanism first discovered by social psychologist Leon Festinger when he infiltrated a doomsday belief cult and showed that belief in doomsday perseverated even after the supposed doomsday event failed to happen.

After all these years I remain unconvinced that thanks to smart negotiation tactics, you can somehow get people to agree to something contrary to their interest.

On the other hand, social psychologists Joule and Beauvois, in their amazing book Manipulation manual for honest people (fr. Le Petit traité de manipulation à l’usage des honnêtes gens), present convincing evidence that you can, in fact, condition people to consent to something that is not beneficial for them and that they wouldn’t want by themselves. Its ground-braking and very useful, especially in marketing, when you want to “create desire”.

However, I think that this approach is quite limited in business negotiation where both parties are aware of the negotiation going on. In other words, if you think that you’ve outsmarted the other person and that you’ve got a deal more in your favour, then the other person is probably thinking the same.

I don’t believe tactics can take you far beyond a mutually beneficial deal. However, I do think that the lack of appropriate negotiation attitude can be an obstacle for you to make the possible deals.

What I found to make a huge difference in my negotiation performance was getting aware about what I wanted and of what I could expect to get, and then adopting an attitude that allows for pragmatic and open discussions. The most valuable learnings for me came from the most unexpected places.

Say what you want

A lot of people are afraid to say what they want. That’s why they don’t get what they want.― Madonna

The most powerful way to open the negotiations is to clearly state what you want to get out of it. After that, you show interest in what is it that the other party wants.

The vulnerability of such an attitude is very likely to open the other person up, so they state what is it that they want. If that happens, the negotiations can quickly converge. Either both parties get what they want, or both agree to get a bit less of something they want in the spirit of a mutually beneficial compromise; or there is no deal possible but at least the waste of time has been minimized.

That is how it looks like if you adopt the Madonna attitude, and you are lucky enough to deal with an experienced deal-maker who doesn’t have time to waste. However, in most cases, what you get on the other side is not such a deal-maker, but a believer in one of the snake oil tactics.

Here are a few examples of such snake oil tactics:

  • If they want 10, they’ll say they want 20, and you’ll have to “meet them half way”. Everybody can counterplay this tactic by also altering their initial ask. I find it time-wasting but sometimes it is cheaper to play along than to walk away. I’ve also met people from other cultures where refusing to negotiate in this way is seen as a lack of respect.
  • They say they care the most about X, and never (or only in the end) talk about the Y that they really care about. This is very easy to spot because Y is usually something you expect them to want. When they don’t mention it and avoid the subject, you can bet that this is what they care the most about.
  • They just say they don’t like what you propose, and keep waiting for you to downgrade your ask without ever making a counteroffer. If you don’t have the luxury to walk away, then you need to be very creative to counter this strategy of exhaustion that can have you stuck for a long time.

Whatever the tactic of the other party, adopting the Madonna attitude and being the adult in the room will always give you the high ground. Also, I’ve noticed, all of the professional relationships that survived for a long time in my life are characterized by everybody saying what they want, and avoiding snake oil tactics.

Leverage analysis

As much as I like to quote scientific sources, my authority sources in this post are quite unusual. The second most valuable lesson for me, came from none other than Donald Trump. I know!

Just for a moment, put aside whatever (good or bad) you think about his politics and him as a person, and bear with me. In his book The Art of the Deal, Trump defines the concept of leverage:

Leverage is having something the other guy wants. Or better yet, needs. Or best of all, simply can’t do without. — Donald Trump, The Art of The Deal

If you think Trump is presumptuous, let me just remind you of what Archimedes said when he discovered leverage: “Give me a place on which to stand, and I will move the earth.

In order to understand the leverage situation of the deal that you are trying to negotiate; you need to ask yourself the following four questions:

  • What is it that I want?
  • What is it that the other party (or as Trump calls them “the other guy”) wants? In case they are not saying it, then what are they likely to want?
  • What is my leverage?
  • What is their leverage?

Leverage is very broad. It can be something tangible: a product or a service, money; but also, something more elusive such as prestige, reputation, advantage. It can be something you can give them, something they don’t want to lose, or a potential obstacle to them getting what they want.

You can realistically expect the deal to be possible when it seems realistic to abandon your leverage for their leverage, and vice versa. However, people are sometimes uncomfortable with the position of equivalence and resort to the following two tactics:

  1. They pretend to have greater leverage than the one they actually have. You can always call their bluff.
  2. They pretend not to know about your leverage. Sometimes they try to convince you how miserable you are and how scarry your situation might be without them. There, you have no other choice but to show the leverage you have. Often it means actually walking away. If your assessment of the leverage situation is correct, they’ll come around.

When you have more leverage than the other party, you are in the power position. You are likely to get what you want, and they are as likely to get as close to what they want as you are willing to let them. The other party knows it and their behaviour might be particularly insecure and explosive. They might also resort to the tactics described above. You get the chance to show who you are, and you get to live your values. A startup is rarely in this situation.

When you have less leverage than the other party, which is a most common situation for a startup, you better not attempt to make the deal, as you are unlikely to get what you want. However, very often, you might have to. In that case, you need to create leverage (something the other wants or doesn’t want to lose) and then attempt to make the deal.

The beliefs around negotiation, and the behaviour of people during negotiations, are among the most ridiculous things I’ve ever seen in my life. When showing leverage and hiding their intentions, people involve in all sorts of theatrical or stereotypical behaviour.

You shouldn’t take negotiations too seriously, because you’d be missing out on the fabulous opportunity to laugh. Laugh at others and laugh at yourself.

And laughter is healthy.

Normalizing negotiation

The key question when trying to apprehend negotiation as natural is “Am I defining negotiation as not-my-thing?”. After you’ve managed to answer “no”, here are some additional questions I find useful to ask myself when negotiating:

  • Am I aware and clearly stating what I want?
  • Am I aware of the leverage situation?
  • What can I do to better understand what the other wants?

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