From securing a business contract to buying your dream home, all of us encounter situations in which we need to negotiate. To navigate our way through life with our own ambitions and objectives, and to interact with those who might have a whole different set of ambitions and objectives, requires us to have some skills in this area.
Negotiation can be defined as ‘a process designed to extract value from, or create value with, other parties.’ Or, to put it another way, ‘negotiation is the art of letting the other party have it my way.’
There are some assumptions that we make when we talk about negotiation: that the buyer wants to buy, and that the seller wants to sell. The difficult part of negotiation of course, is the wrestle in-between.
In this article we take you through the fundamentals of negotiation, outlining four mindset shifts to make you a better negotiator.
Mindset 1: Approach Negotiation Like a Game
Have you ever found yourself daydreaming about paint colours and room layouts in a potential new home before your offer was even accepted?
It’s easy to do. We let our minds wander down the path of desirable outcomes, and so we become emotionally invested in our negotiations.
If not kept in check, emotions can impair our ability to arrive at the best possible deal. The best negotiators understand that negotiation isn’t about you, it is about focusing on the matter at hand and arriving at the best possible outcome.
One useful mindset to adopt is to approach negotiation like a game. This is not to trivialise it but rather to detach yourself emotionally from the outcome and give yourself permission to play by a new set of rules.
When it comes to negotiation there is no right or wrong, nothing is inherently good or bad, there is just appropriate or inappropriate for a given space or time.
Recognising this is liberating. It allows us to be bold and try out tactics depending on what’s required by the particular circumstances we find ourselves in.
It also enables us to realise that the other side are playing a game too, and that we can choose to accept or reject the rules they are playing by.
Have you been set a false deadline by which to get your offer in? Call their bluff and don’t abide by it. Maybe you’re being asked questions that you’d rather not answer; you don’t have to.
Mindset 2: Effective Negotiation is Not Selling
Whilst selling and negotiating share similarities, it’s important to distinguish between the two. When we are selling a product or an idea, we tend to take a fixed position and then passionately fight for it.
Imagine you are conveying your choice of destination for the next family holiday to your spouse. You find yourself explaining, persuading, and justifying why the all-inclusive cruise is the right choice. You are making a case for something.
However, when we are negotiating, we should be aiming to put aside those actions associated with selling. Effective negotiation should look much more like:
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Stating facts which will elicit a response from the other person
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Questioning to gather information
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Listening so we can fully grasp the other person’s position
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In this sense, the goal of the negotiation should be about gathering information and establishing where the other party’s interests lie.
Be wary of slipping into justifying in a negotiation. We tend toward this behaviour when we present information that we think might be bad news for the other person. In the scenario of persuading your spouse to take an all-inclusive cruise, the cruise is more expensive than the usual self-catering holiday. It is human nature, then, to begin to justify the higher cost to your spouse. However, in a negotiation this will only weaken your position. You can end up digging yourself into a hole. Instead of justification we need to be thinking how we can influence others.
Mindset 3: Don’t Accept the Power-Balance; Control It
Picture yourself in a tricky negotiation at work. You’re having a discussion with your employer over your redundancy package; it’s you sat opposite the big corporation. Who has the most authority and influence here? It’s easy to assume that you are the weaker party. You perceive the other side as holding all the cards.
Perceived power refers to the extent to which people believe that an individual or group has the authority and ability to control their behaviour or influence their actions. The way you and your negotiating party view each other’s strengths can have a big influence over the course of your discussions.
The good news is you don’t have to accept the power-balance in a negotiation. In fact, you ought to try to control it. Here are three easy ways you can help shift some of the power back to you:
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Use Questions as a Tool
Knowledge is power, and so arming yourself with more knowledge can be a useful way to position yourself as an authority in a negotiation. This is where asking questions can be a useful tool. Ask good questions to gather information about the other side which in turn can inform how you position yourself in the negotiation.
Try to establish what lies in your favour but doesn’t in theirs. Do they have deadlines they have to meet that you don’t? Use this information to your advantage.
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Give Them the Feeling of Satisfaction
How would you feel if you put an offer in on a new home under the asking price and it gets immediately accepted? Do you feel satisfied? Not really, you think you could have got an even better deal.
You want your counterpart in a negotiation to feel satisfied but not at your expense. Position yourself further back in a negotiation than you actually are, so the movement you do make in your position leaves the other party with the sense of satisfaction that comes from feeling like they’ve won.
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Be Mindful of Your Words
Watch the words you use in a negotiation. If you feel like the weaker party and start acting like it, you are only enforcing the power balance. If you use phrases such as ‘May I…’ or ‘Can I…’, even if it is just to ask to pause discussions long enough to go to the bathroom, you are giving the other side the power over you to say no.
Mindset 4: Be a Collaborator and Not an Adversary
Arguments have no place in negotiations. In fact, if you find yourself arguing, it is a sign that you are getting entrenched within your position.
Your mindset should be that of a collaborator and not an adversary. You are aiming to create a warm environment, one in which everyone can have a good conversation. In a functional conversation both sides need to hear and be heard.
Neutral tones can be a challenge when you have strong feelings but using them will keep things calm and move the conversation along.
When NASA’s Apollo 13 experienced an explosion on board their spaceship, astronauts called Houston to report the problem. The phrase, “Houston, we have a problem” has gone down in history as it reveals the unbelievable ability the teams, in space and on the ground, had to keep calm and perform under the pressure of life-threatening circumstances. This calmness facilitated an environment of problem-solving and clear thinking.
On the other hand, phrases like, “I’ll call my lawyer”, whilst popular on TV shows, are inflammatory and may end up provoking the other side and bringing the conversations to a halt.
For this reason, we also like to stay away from questions that start with ‘Why’ because they can be seen as accusatory and judgemental. Good open questions start with ‘What’ and ‘How’ and are less likely to provoke an emotional response in the other person.
In the same way, it can be helpful to know how you react under pressure. Do you fight, flight or freeze? The better you know yourself going into a negotiation the stronger you will be. Prepare by getting to know your weaknesses so you can be ready with a calm response when someone accidentally or intentionally pushes your buttons.
Our Final Thoughts
Negotiation doesn’t always come naturally. If we’re being honest negotiation can make us feel a bit uncomfortable at times. It requires us to put down some of our default behaviours, shift our mindset and learn new strategies and tools. The good news is by giving negotiation some thought, and taking on these 4 mindset shifts, ahead of time you can improve your skills and hopefully feel confident the next time you find yourself at the negotiating table.
If You Want to Learn More…
There is always more to learn. We run an hour’s seminar based on this blog which you can sign up to as an individual, or we will happily run bespoke for a team. To find out more, email [email protected].
For a more in-depth understanding, one resource we’ve found instrumental as we’ve sought to improve our own skills in this area as a team, is this course on Negotiation by Bridge-ability.
