Whether it comes to selling a new customer, persuading a boss, or doing a deal, negotiation is involved to drive a meeting of the minds towards agreement. Many books have been written on this topic. Over the years with both the empirical experience in the marketplace and numerous books I have read, here’s my take on the topic.
Winning Has To Feel Good
Winning a negotiation with one party feeling bad is not a win. If the goal is to only get your way, then there is a deficit that is left on the table. Someone felt like they lost, and it comes out later. This is especially true for anything beyond a mere transaction. Doing business with your negotiating counterpart needs to incentivize both parties and emotionally feel like a win.
A deal is such a fascinating and thrilling dynamic to me. There is drama, emotion, facts, positioning and interplay which fills the ritual with living color. I like to approach a negotiation thinking a lot about what the other person cares about. Some of this can be gleaned by focusing attention key questions:
- What does this person care about?
- What is their current position?
- What is their risk tolerance?
- What is keeping them up at night?
- What motivates them?
- Are they generous or scarce? Fair or self-seeking?
These kinds of questions may take a lot of thought and may be incomplete. However, thinking through them helps to put yourself in the other person’s shoes. Everyone is different, and the answers will vary. Get as clear as possible on what the other person would want. You will know what you want pretty often – usually that is pretty clear, but not always. Getting inside the mind and emotions of the other person helps frame what is reasonable and feasible. Then think about how you can help them get what they want.
Winning Together Takes Collaboration
The forethought of what the other person cares about is a precursor to the eventual discussion. Dialogue helps to hash out desires and details. Look for body language and response to both offers and gestures.
Here is what is important during this time as you seek to discuss what doing business might look like.
- Speak in terms of the other person.
- Ask, “What is important to you about achieving this goal?”
- Ask, “If I can help achieve X, what would be the value to you?”
- Ask, “If I can help you achieve X, would you be open to paying Y?”
- State, “I have some ideas to help you achieve X, Y and Z. Do you mind if I come back to you with a concrete strategy?”
The goal here is to hone in on what truly matters to the other person. Write it down. Make sure you read body language and feel that what they are responding with truly is the answer. Help to surface concerns. If the other person is sharing a lot, this is good. It means their concerns and what matters to them is real and is coming out. Now it is time to marry your goals with theirs.
Something To Say “Yes” To
Now that you have what is truly important to the other person, it is time to think about what you want. Get clear about the compensation, reward and other benefits that get you excited about the deal. Match up how what you can do will make their goals happen. Put this in writing and get as concrete as possible. Your proposal should have the following:
- A clear definition of the other person’s challenge
- Statement of what they said is important to them
- A vision of what a new reality could look like if you helped
- Specific strategies you will use to get to the goal
- Compensation based on meeting expectations. A threshold, target and superlative set of goals would be ideal.
- A way to measure success.
Present this in a clear and concise format, likely a proposal which speaks to their pain (The What). Show you understand, and then share the strategy (The How).
There should be a way to measure the agreement. Make it transparent. Show the cause and effect, and ensure that your counterpart believes and buys into the relationship between the strategy and the outcome. If you do certain activities, then the outcomes should occur. Break these activities and outcomes as a set of quantitative metrics that help communicate the effort and the results. This justifies the reward in the agreement.
In the end, you are leading the thought process for how both parties win. It not only builds trust, but it helps to create good agreements which lead to great relationships.
How have you approached negotiations?