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Everyone Negotiates

Introduction To Negotiation

You are at the car dealership.  You found the car that you’ve always wanted.  It’s perfect:  the right color; the right interior, the right options.  Now all you have to do is buy it.  But, there are so many questions.  Invoice price, sticker price, the trade-in value of your car, financing, payments, cash discounts, and the list goes on and on.  Then, there is the process.  The negotiation.  You have to talk to the salesman and he or she plays the game of going back and forth between you and the manager until….until, what?  You can’t take it anymore.  “All right already.  Just buy the damn thing,” your brain says.

Does this sound familiar?  This is just one scenario in which learning the skill of negotiation can save you a great deal of money.  Oh, there are others too: buying a wedding ring, a house, a TV, negotiating a hotel room, an airline ticket upgrade, a raise or even a deal with your mechanic.  Yes, my friend, negotiating could probably be the most important skill that you ever learn.  And if you know more about it than the other person – your counterpart, your adversary, your opponent – well, chances are that you will get a more favorable result.  You will be in control.  You will know where you are going, and will feel such power, that you will look forward to the next opportunity to negotiate all over again.

This brings me to the concept around which this book is written: the win-win negotiation.  You see, people negotiate when they need something from each other.  And, if both parties need something, why not let both parties get something from each other, as long as it doesn’t hurt either party?  Let each party win.  This means that you work with the other party to find solutions that will help both of you feel good about your agreement with each other.

I want you to put out of your mind all of the notions that you have ever had that in a negotiation there is a winner and there is a loser.  If this is the way that you have negotiated in the past, I will bet you that you are the loser.  Oh, sure the negotiations may have worked once or twice or even a few times, but at what cost?  Your reputation?  A good long term deal?  Do people even want to deal with you?  Would more people want to deal with you if they felt that you treated them as an equal winner?  My experience says that the answer is “yes” and that win-win negotiators do better over the long run.

What do I mean by win-win?  In any negotiation, the parties will find that they always get a better deal for all parties if they are willing to work together to find that better deal.  A deal in which they can both walk away and boast to the significant people in their lives that they negotiated a great deal – not always the best deal, but a great deal.  One obvious quick example is a salesman for Company A selling widgets.  Company B buys the widgets under two scenarios:

  • Company A’s salesman gouges Company B on price, provides little follow up after the sale, and really takes advantage of Company B’s need to have your widgets.
  • Company A’s salesman works to negotiate a win-win deal with Company B. One in which they pay a fair price, and the salesman agrees to perform reasonable services after the sale.

In the first scenario, the salesman may get the initial order, but as soon as a competitor comes along with a better price, service, color, or whatever, he has just lost a customer.  In the second scenario, a competitor doesn’t stand a chance because Company B is so happy with Company A, the service, and frankly with the salesman, that they don’t even entertain going anywhere else. 

If you have studied business, then you know that it takes about 14 times more resources, time, and money to acquire a customer, than it does to keep one.  One other note, in the first scenario, Company B was charged so much for the widgets, they may not have made enough money to even stay in business.  So, in that case, where would Company A stand?

 

In win-win negotiating, everyone walks away satisfied that they played a good poker hand with the cards that were dealt.  Will they second-guess themselves?  Sure, but they would have anyway.  And the post-negotiation remorse will be mild compared to if they were on either side of a win-lose negotiation.

The perception of a win-win deal is the key to success here.  Remember that a “win” is not always how you define it, or even how the other side says that they define it.  A win can be an outcome that the other person feels good about although it was not his desired outcome.  The same goes for you.  Yet I can guarantee you one thing: if you follow the six steps to a successful negotiation, and utilize some of the techniques laid out in this book, your desired outcome will be pretty reasonable when compared to your actual result.  That will make you satisfied and happy knowing that you did the best job that you could for yourself or your organization.

Win-win negotiating does not mean that you give the other side what they want at the expense of getting what you want – contrary to the opinions of most people polled at the beginning of our negotiating seminars.  It does mean that you do whatever you can to further your cause, while fitting it into your adversary’s cause, and remaining flexible enough to find an outcome that is agreeable to all parties.

I have negotiated for millions and millions of dollars in my business and personal life.  I have yet to see a win-lose negotiation that doesn’t have long-term negative consequences.  On the other hand, I have seen hundreds of win-win negotiations end up in quality, lasting arrangements that carry on for years.  Work to create a win for your side, but remember the other side.  There are people over there.  People with families and desires and a need to feel like they won too.  Work to create a win for them.  You won’t regret it.

The focus in a negotiation should be on people and not on the issues.  If you do this right, you can focus on your adversary AND their position.  Learning how to probe and read your adversary is more important than tackling all of the issues.

Now, there are certain negotiations where a win-win is pretty easy to see: a negotiation for a television, for example.  If you come to an agreement on price, delivery, and service, then most likely, all parties win since they are getting what they want – a television for you and money for the store that sold it.  Yet more often, negotiations can be complicated so the solutions aren’t quite as obvious.  You might have to use creativity and you might have to cajole your counterparty to use his imagination to go below the surface to uncover win-win solutions.