This is the final column in our series
dealing with effective negotiation strategies.
When evaluating the
issue to be negotiated, always look below the surface. The inexperienced
negotiator will invariably always focus on the facts, or dollar amounts,
or legal issues, or personalities. While the experienced negotiator
understands that every negotiation is a combination of all these
factors, and others. The experienced negotiator realizes there is more
involved than just opening offers, counteroffers, and closing moves when
they are sitting at the bargaining table. They see both the
psychological and strategic opportunities that are hiding below the
surface. They take notice where the parties stand in terms of the
reciprocity norm, people feel obliged to give back to others who have
given to them. They look for opportunities to use the consistency
principle to commit other parties to standards and then hold them to
their prior statements and positions, and they know that the timing of a
proposal is always as important as its content.
So when we begin to
formulate our goals, we should consider carefully what really matters to
us. In collections, certainly, the money is important. But we need to
identify also our underlying interests and needs clearly and those of
whom we are in negotiation.
One way to achieve
this is to reduce the problem into issues. Every negotiation involves
one or more issues, which can be sub-divided when necessary, to make the
negotiation more manageable and to allow for partial agreements which
eventually will lead to a resolution of the problem. When
negotiating multiple issues always look for trade-offs. We will
gain consensus for our inflexibility on a few choice issues by our
willingness to give ground on others. Many skilled negotiators
believe that a principled negotiation is by far superior to the
traditional method of positional bargaining whereby the parties take
positions and then make concessions to reach agreements.
negotiation was developed by the
Harvard Negotiation Project and is based on a philosophy of deciding the
issues on their merits rather than through the haggling process that is
focused on what each side says it will and won't do. It suggests that we
look for mutual gains wherever possible, and that where our interests
conflict, we should insist that the result be based on fair standards
that are independent of the will of either side. The method of
principled negotiation therefore remains focused on the issues and
merits of the problem and not on the people involved in the negotiation.
The experienced negotiator
always brings multiple solutions to the table. They are not concerned
with what is the truth or the correct answer, but rather explore
options. They know that there are usually a number of workable solutions
to the problem being argued. Identifying what those solutions are
usually takes some work, and, even though a solution may be workable, it
will not necessarily be palatable to everyone. Nevertheless, the
experienced negotiator knows that, once they get an understanding of the
whys and wherefores of each party's positions, more often than not,
there will be several options for resolving an issue or solving the
problem. Effective negotiators are those who care about being not
only fair, but also assertive about their goals. Effective negotiators
push the other party to find the best solutions, not just the simplest
negotiator will always take into account and evaluate people. their
interests, the other party's and their options, along with the criteria.
The characteristics of a principled negotiation are:
- Separate the
people from the problem;
- Focus on
interests, not positions;
- Identify options
and generate a variety of solutions before deciding what to do;
- Insist that the
results of the negotiation be based on objective standard that
everyone agrees to before they begin negotiating.
negotiator always begins their preparation for negotiation by
considering their own underlying needs and interests. The majority
of people fight over money. But, money usually symbolizes something
else. When negotiating a money matter always look beyond the money
and we should find numerous solutions.
negotiator also evaluates the leverage. The first basic skill of
smart negotiating is an awareness of the leverage factors at work, plus
the ability to apply leverage when it's in our favor and make do when
negotiating power, plain and simple. When we have no leverage, we
are at the mercy of our opponent. The experienced negotiator
understands leverage. They know how to develop it and use it to maximum
advantage. They know that if they do not use it when they have it, it
may not be worth as much tomorrow as it is at the present time. Leverage
has a way of evaporating. The experienced negotiator understands that
leverage is powerful, but when it is not used, then it will usually be
The most common of
the leverage factors are: necessity, desire, competition, and time.
These factors usually come along with the deal; they are intrinsic to
it. If someone steals our car, and we need another right away, we have
less leverage than the person who can wait a month or two to see if the
market price will fall. If three people want to buy our house, we have a
lot more leverage than if there is only one interested buyer.
When the negotiator
is willing to walk away from the table if acceptable terms can't be
worked out that gives that person leverage over the other party. Because
leverage is rarely static, we can usually enhance our leverage, or
develop leverage where we had none, through: preparation; information;
number-crunching; understanding our opponent; exploring and developing
other options, timing, and patience.
negotiator knows that the importance of preparation is extensive. The
experienced negotiator is patient, and exercises self-control. The
most common mistake the novice negotiator makes is giving in to a sense
of impatience, satisfying the need for instant gratification.
The best practice is
to anticipate the other side's preferred standards and frame our
proposal within them. If we cannot do this, we should prepare to argue
for a special exception to their standard based upon the special facts
of our case. Attacking their standards should only be considered as a
last resort. Positioning our needs within the normative framework
the other party uses to make decisions, will show them respect
and, as a result, gain their attention and liking.
Standards and norms
are powerful tools in negotiation in part because they carry an
authoritative message about what the market, the experts, or society has
determined to be a fair and reasonable.
In fact, if we were
searching for the definition of the Novice Negotiator, we could simply
say that he is one who ignores leverage. While he knows something about
the problem, he is relatively unprepared. He gives little thought to his
opponent. He fails to explore and develop other options. He does not
consider the timing of his proposals or responding to the other party's
proposals. Or, he does not exhibit the patience required to close the
negotiators understand the "consistency principle, which states that we
all have a strong psychological need to be consistent with our prior
acts and statements. When we are looking for a tactic to manipulate our
opponent, consider trying to hook him with some small commitment and
then following up with a larger request. The goal of the
"consistency trap" is to pre-commit the other party to a seemingly
innocent standard and then confront them with the logical implications
of the standard in a particular case - implications that actually turn
out to run against their interests. This is a form of intellectual
coercion, and we should be ready to defend against it".
For example, a good
friend of ours is a very successful family law attorney. He uses the
following "consistency trap" when negotiating child support for his
clients. "You don't want the children to suffer because of this divorce
you wanted, do you Mr. Trump?" If the spouse takes the bait, the follow
up questions might be: "And, you know how it would affect them if their
lifestyle was substantially reduced?" "And, you know what that lifestyle
costs?" "You've always been generous with them haven't you?"
This often has a
material effect on our friends negotiating strategy. In a fight over
money, when they are not getting as much as they want, Novice
Negotiators often react by accusing their opponent of being a skinflint
or a cheapskate or by threatening him with litigation if they do not
cooperate. Although counter-intuitive, it may be much more effective to
remind the debtor of all of their generous past acts so that he will act
consistently with a pattern of generosity. The consistency principle can
also be invoked in order to persuade an opponent to act consistently
with established standards and norms.
Negotiators know how to close. They consider every element of closure:
when, where, documentation, pending issues. Novices either rush the end
or delay it interminably, with equally bad results. Rushing the end
usually means slapping a contract together with little time or thought;
its ambiguities and deficiencies inevitably result in disputes. Delaying
the end means if you wait too long, something will happen to prevent
closure. Time kills deals.
Any Method of
Negotiation can be judged by three criteria: It should produce a wise
agreement, it should be efficient, and it should improve or at least not
damage the relationship between the parties.
A wise agreement can
be defined as one that meets the legitimate interests of each side to
the extent possible, resolves conflicting interests fairly, and is
durable. Arguing over positions produces unwise agreements. As
more attention is paid to positions, less attention is devoted to
meeting the underlying concerns of the parties.
Lawyers are great at
analyzing legal issues, negotiating agreements, and closing agreements
concerning legal issues. But, in situations where people will
have a relationship after they sign the agreement, they would be smart
to make sure that they have tended to the emotional issues, otherwise
the legal agreement may suffer the consequences of any structure with a
faulty foundation. Many times, especially in money disputes, agreements
addressing emotional issues can be, and should be, intricate and
We have attempted in
this series of articles to identify the differences between the
experienced and novice negotiator and also a successful and failed
negotiation. One does not become a successful negotiator overnight.
The importance is to not only remember the basics but practice them in
every negotiation we are involved with. Below is a re-cap of the
three phases in the negotiation process. Never forget these as they will
guarantee your success in whatever you negotiate.
I Wish You
David Balovich is an author, credit consultant, educator, and public
can be reached at
email@example.com or through the Creditworthy website.