The first thing to remember is that while there are certain elements of each “deal” that are similar; no two deals are alike. Getting to the final agreement is a process with unlimited possibilities as there are no hard and fast rules or magic formulas that fit all deals in exactly the same way. It is not science; it’s an art. It is where creativity comes into play far more than during the analytical phase of making a “deal”.

While I have successfully put together many deals around the world,I have learned something new from each and every one of them. Yes, I have made my share of mistakes too, but I have learned from those mistakes,chalked them up to experience, and to my knowledge never made the same mistake again.

In simple form here are some of the key insights that will lead you to better outcomes:

1. Everything in life is negotiable and whether you realize it or not, you are negotiating throughout each and every day.

2. If you don’t ask, you don’t get. You won’t necessarily get what you deserve in life; you only get what you negotiate.

3. Don’t ever give something away without getting something in return.

4. Do not focus on the person; focus on the “deal.” Don’t personalize the negotiating process.

5. Do not react to the other party’s offer, rephrase or restate it as a response while providing time to think.

6. For a successful outcome, both parties to the negotiation must feel satisfied. Do not hammer the other party into submission as they will spend their time and their energy getting even sometime in the future to the detriment of both parties.

7. Do not agree to something too quickly or the other party probably will feel as though they “left something on the table.”

8. For both parties to win, you need to “make the pie bigger” before you cut it in half.

9. “Information is power.” The more you have, the better the outcome. Ask open ended questions and let the other party talk.

10. Don’t play into the stereotypical North American image at the negotiating table. In other words, don’t fall into the habit of “splitting the difference” just to make the issue go away.

11. When dealing with other cultures, don’t overestimate English comprehension based on English speaking skills. Also try and understand some of the other party’s cultural and linguistic nuances.

12. Remember that negotiating can be a lot of fun, and that most people enjoy the “game” once they get into it.

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The point here is that if the federal government could not make a go of a legal business entity whose principal products were prostitution and liquor, what is their real motive for getting into the banking, automotive and health care industries? It certainly can’t be profit motivated! Are we now looking at using our taxpayer dollars on a continuing basis to provide ongoing bailouts to industries where the federal government has increased their involvement and gained more control? Is this the beginning of another giant chicken dance, where we the taxpayers are being dragged to the dance floor involuntarily, or is it something more in line with what used to go on at the Mustang Ranch?

From where I sit, the conclusion is pretty obvious. If you cannot make money at the oldest profession in the world, you have no business running any other enterprise!

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So, here are some questions to ask yourself. How well did you do at your last negotiation? Was it successful in terms of your desired outcome? Did you feel good after the “deal was done?” How can you become a more successful negotiator? What tips can be learned to achieve more satisfactory and longer lasting results so that you do not have to confront the same hurdles over and over again?

Well, to begin with you need to understand some of the fundamentals. The starting point is your own approach to negotiations. If you view negotiations as “win-lose” transactions, they may feel good to you in the short term if you are the “winner”, but over time reality will set in that the outcome was unbalanced, and not necessarily fair to the other party. You soon will come to the realization that the other party was not satisfied, and as a result, they will continue to negotiate with you to gain back what they think they have lost. If you do not believe it, just think about bedtime negotiations with your children. How often do they try to gain additional leeway? How about the last time there was a decision to be made about which movie to see? Still cannot relate? Think about the last time you tried to get your pet to do what you wanted. How many attempts did that take before your pet agreed or you just gave up?

The key to a successful negotiation is to ensure that each party recognizes they have had to make concessions and that they have gained some concessions from the other party. In other words, at the end of the day, both parties should feel as though they may have given up some things, but they also have gained some concessions in return. Only then will you have the foundation for a long lasting successful relationship that benefits all involved parties.

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1. It will help you eliminate surprises
2. It will help you further develop your skills
3. It will help you achieve better outcomes
4. It will help you better understand yourself, and how you may be perceived by the other party
5. It will help you develop a comfort level with the issues at hand
6. It will help you better understand other peoples’ body language signals
7. It will help you better understand the signals you may be sending to other people via your verbiage and your own body language
8. It will provide the opportunity to critique your skills as well as your negotiating positions

Role playing is like rehearsing for a show. The person who has the lead at the negotiating table should sit with a few people and outline their position on each major negotiating point. The other people should offer counter proposals that might be anticipated from the other side. As these practice sessions proceed, positions and responses need to be critiqued constructively by the group so that the lead negotiator develops a comfort level with the positions and the alternatives. I used to try and get people that had been involved in similar situations, including a lawyer or two, to participate in the role playing exercises.

Even before you do the role playing, do your homework. Outline the key topics for negotiation. For each topic, outline your negotiating position as well as what you believe to be the other party’s position. At this juncture, you should set up a meeting with all of the affected business disciplines in your organization to get a good read on their reactions and responses to the various topics and positions. In addition to better preparing yourself, this approach will help you develop a unified stance on your side of the “deal,” and it will help preclude “second guessing” at the conclusion of the negotiations.

By reviewing each topic in this manner, you also should be able to uncover any sensitive areas that may not have been obvious to you. Further, you may uncover some “deal breakers” for the other people on your side of the “deal.” Finally, the group may provide you with some new negotiating strategies and/or alternative positions to further assist you in reaching a satisfactory agreement.

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Imagine a pie in the center of the table with the objective of dividing it up between the parties. If the parties are sitting opposite one another staring at the pie, each will be thinking of ways to cut that pie in such a way to ensure that their “half” is bigger than the other party’s half. To achieve true success, that thinking has to change. In other words, the objective has to change from getting a “bigger half” of an existing pie, to an objective to work together to make the pie bigger so that both parties end up with a bigger piece of the pie than they could have on their own.

For this outcome to have a chance of happening, the physical set-up has to change. In those cases where I had the opportunity to arrange the setting, I made sure that the table was round where the parties had an opportunity to act as equals – no head of the table and no arbitrary “line in the sand.”

In those cases where a rectangular table is the only available option, ask the other party to make room for you on hi side of the table so that you can work together toward a better outcome for both parties. Explain that your hope is to combine your talents and resources and “make the pie bigger” so that when you cut it in half, both parties end up with a bigger half!

At first this approach may not be credible to some people because of their perspective of negotiations as strictly transaction type events. So, in fact, your first negotiation may be to convince them that you are sincere, that you are honest and that you really are trustworthy. In other words, you will need to convince them that this approach is not some kind of negotiating tactic or trick to win something from them.

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Following is a summary of all we have been discussing. I hope you use the tips in your daily negotiations and I wish you continued success in all of your negotiations.

NEGOTIATING POWER TIPS

DO (The 5 Rʼs)
1. Recognize that everything in life is negotiable.
2. Realize that you only get what you negotiate.
3. Request information; ask open ended questions.
4. Refrain from “splitting the difference” just to make it easy.
5. Read the body language of others.

DONʼT (“GAFFS”)
1. Give something away without getting something in return.
2. Accept the first offer.
3. Fill every void in the conversation.
4. Focus on the person; focus on the “deal.”
5. Set arbitrary deadlines.

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There are real deadlines that need to be met in some negotiations, butarbitrary deadlines will weaken your negotiating position. What I mean by arbitrary is taking a position, whether shared with the other party or only in your own mind, that the negotiations must be done by a certain time or date for personal reasons. For example, you have been away from your family for several days and have decided that you want to be home with them next weekend. The deadline may be set by someone else. Your boss could give you an arbitrary completion date just because they want to be able to look good at an upcoming meeting.

Either way you will have an arbitrary deadline or a “drop dead date”. Your willingness to concede on certain points will increase as you approach that deadline, and my best guess is that the other party will soon recognize that you seem to be “caving in.” You will have established a pattern and the other party will take advantage of the circumstance.

In contrast, if you ever have been in a casino, you know there are no clocks anywhere. Why do suppose that is? You think they just forgot, or is there a reason? It is very simple from their perspective. You are not negotiating, you are gambling and time puts the odds in their favor. It is completely opposite to negotiations. When you are gambling, the longer you play the higher the probability you will lose. The casinos do not want you to set arbitrary deadlines because unlike when you are negotiating, it could be better for you to set a time limit for your play.

Simply put, if you let the clock work against you, you will lose each and every time. You just have to decide whether you want to negotiate or gamble!

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Oftentimes, due to the stress of negotiating, emotions can run high. Without realizing it, personalities enter the equation and can slowly creep into the bargaining equation. I honestly cannot say that everyone I ever had the opportunity to negotiate with has been my “new best friend.” I will say, however, that each time I let personal feelings enter the equation, I ended up with less than an I otherwise could have by focusing on the business rather than the person.

Let’s be realistic. You will not necessarily enjoy the company of everyone with whom you negotiate. And, you need to recognize that in the eyes of every other person you encounter during negotiations, you will not be the person that makes them happy.

The key is to recognize when the other party is getting to your emotions and take a break. I found that if I could caucus with my team and tell them what was bothering me about the other party, we often ended up laughing about it before returning to the negotiating table. In many case, it was a function of stress and diminished energy that was interfering with my thought processes.

The key here is to defuse the situation before continuing with the negotiations. The worst thing you can do is display your emotions with an outburst of words that can never be retracted. In some cultures it could be such an embarrassment that the other party might reconsider whether they want to continue to negotiate with you personally. They even may go so far as to question whether they want to do business with your company.

In summary, focusing on the person instead of the “deal” only serves to weaken your position. The problem is you’ll never know by how much!

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There are two very key points to remember when you think about this tip.

First, when you are talking, it is pretty obvious that the other party will be listening and gathering more information. In other words, the more you talk, the more information you provide. Remember the third of the 5 R’s to “request information.” The more you have, the stronger your negotiating position and the better the final outcome.

Second, if you remain silent and refrain from filling every void in the conversation, eventually the other party more than likely will offer additional information to clarify their position.

I am by no means suggesting that you turn your negotiating session into a contest to see “who blinks first,” but the old adage that “silence is golden” has a lot of value at the negotiating table when utilized properly.

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In one store, we went up to a table with a large sign announcing “Selected Items 60% Off”. As the table contained some candles that my wife was specifically looking for, she thought that she would be saving a significant amount of money by buying ahead for next year. My spin was, “this is how you go broke saving money”, but just to keep the peace, I kept that thought to myself.

When the clerk began to ring up the candles, the discount was only 25%. With a smile on my face, I asked the clerk to accompany me back to the table. I then asked that she read me the sign as I must have misread it or had a “senior moment” as I thought the items on the table were “60% off”. She pointed out that only “Selected Items” were 60% off.

Again, with a smile, I said, “That’s what I read too”, and I “selected” these items, so don’t you think I should get 60% off? Actually, I was joust having some fun, as I was getting bored. When she stopped laughing, we returned to the register at which point she took another 25% off the candles.

Not a bad return for a bit of humor. More importantly, however,once again it supports my negotiating tip, “You only get what you ask for or If you don’t ask, you don’t get”.

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