12 AUGUST, 2016

When "No" is Your Friend... or Your Enemy

When “no” isn’t effective.
Copyright Bill Watterson. Image comes from:

Power comes in many forms, but the most obvious form is based on “no.” The less you need the other person (you can say “no” easily), the more you can ask for. The same is true when the other needs your cooperation a lot (i.e. it’s difficult for them to say “no”).

There are several mistakes that negotiators make around this form of power. First, they take it for granted by assuming they either they have it or they don’t. Second, when they do think they have it, they  use it like a blunt weapon: “take my offer or I walk.” Third, when they don’t have it, they assume that the negotiation is over. Talking about these three mistakes and how to avoid them requires that I explain a bit about “alternatives” and how they impact your potential to say “no.”

Alternatives is a common negotiation term in the field that refers to the possible outcomes one can achieve without the cooperation of your negotiating counterpart. The best of these alternatives is commonly called a BATNA (best alternative to a negotiated agreement). Your BATNA is the best possible outcome for you should no agreement be reached with your current counterpart. The same is true for your counterpart. (Go here for a more academic description of BATNA.)

So, before you decide whether to say “yes” or “no” to an offer, I should compare it with my BATNA.

So, the first mistake I mentioned earlier (either I have ‘no’ power or I don’t) is based on the assumption that you cannot improve your BATNA. This is not true. Skilled negotiators will spend time assessing their alternatives and then seeing how they can improve them. Let me give an easy example. Let’s say that I work at a government agency and I want a raise. I prepare for that negotiation by writing down all the reasons that I deserve a raise. Then, I enter that negotiation, present my reasons, and my boss says, “no.” Have I done the best that I can?

Many negotiators already know that one additional strategy here is to look for other jobs before entering into this negotiation. If you can show your boss another offer that presents you with a better package of pay and benefits, then there is a greater push for him to grant you a raise. If he doesn’t, then you can always go to the other job which is better. So, this is a simple example of how one could improve your BATNA to get a better result from a negotiation.

On the other hand, it is also an example of the second mistake I mentioned earlier (using your alternative like a hammer). Bosses may take your job-seeking as a sign of disloyalty and it is unlikely that they will appreciate being pushed into giving you a raise. So, we need to find a better way of using our BATNA so that we don’t harm relationships.

The first way to do that is to build the best possible relationship with your counterpart before or during the negotiation. (Before is better especially with bosses as I mention in Getting Past ‘Yes, Boss’.) A second method is to explore all possible means of meeting your needs before you bring out your BATNA. Using our example, if the boss can’t give you a raise, can they improve your health plan, give you a housing, car, or education allowance, fund training opportunities for you, and so on? The point is to try your hardest to find a solution that is better than both your BATNA and that of your counterpart. Doing so keeps the interests of the organization at the same level as yours so that they know you’re being caring as well as selfish. It’s always important to have consistent and visible intentions.

The third mistake (I give up because my BATNA is not good) is more difficult. Sometimes, your BATNA just isn’t strong and you can’t improve it very much. However, this doesn’t mean that you just have to say “yes.” The key here is to remember that your negotiating counterpart will always say “yes” to a deal that gives them more value than saying “no.” So, as above, building up a good relationship and exploring different possible options is always a good route to follow.

Finally, when your counterpart doesn’t want to negotiate, sometimes you can change their mind by lowering their BATNA so that they are more likely to say “yes.” A union’s ability to go on strike is one such example. When workers strike, the company loses money, so it makes it more desirable for the company to negotiate to avoid the strike.

Again, this should be used as a last resort because everyone loses when there is a strike and sometimes the results can be disastrous for all parties. The story of the labour strikes at Hostess provide a good example. Read this analysis of the strike and why it went bad as well as this story about the final result of the bankruptcy that followed).void the strike.

To summarize then, develop your ‘no’ power by improving your BATNA. While it establishes the minimum you can expect from your negotiation, don’t use it like a hammer. Always start by building relationships and exploring possible deals that are better than both parties’ BATNAs. Using your hammer, or shrinking the other side’s hammer, can work but it can also make the negotiation more adversarial and result in all parties losing.

This impulsive strategy does not work for most of us when we’re “negotiating” with our boss.
Copyright Bill Watterson. Image comes from:

If you want to negotiate with your boss, start with “Yes, Boss, and…” Using those words will help you set up the right relationship and communication with your boss so that they are prepared to deal with you when you introduce more difficult discussions.

When you and I negotiate with our bosses, we know that Calvin’s strategy of raising his volume is risky. Our bosses has significant negative power, meaning that she can make our life worse (fire us, give negative performance reviews, etc.). While we can try to pressure or threaten our boss too (go over his head, give negative feedback, etc), normally we will be less effective than our boss and we will harm our relationship with them.

Luckily, there are far more positive skills, resources, and strategies (other forms of power) that we can draw upon. Some of them can be developed far ahead of any real negotiation with our bosses, especially our relationship and communication with our boss. And those are best built by using “Yes, Boss, and…”

Your relationship with your boss will always depend on what she can expect from you.  “No, Boss” is not something your boss wants to hear very often, if at all. On the other hand, just saying “Yes, Boss” doesn’t help matters too much because it  reveals little about your intentions. You could be avoiding confrontation, going through the motions, or genuinely trying to be helpful. In other words, neither “no, boss,” nor “yes, boss” are very helpful in the long-term.

On the other hand, saying “Yes, Boss, AND…” can tell your boss a lot about your intentions. Consider an example. Your boss asks you to prepare a report on the performance of a recent program that your boss will present to his boss. You might say, “Yes, Boss, and is there a particular format that will work best for your boss?”

Using the “and” to gather a bit more information can not only show your boss that you care about making her job easier, but help you do a better job. Both the question and the result will build that relationship you need later.

Of course, that will go even better if you do some research ahead of time so that you can anticipate some of his needs and concerns. Bosses like to help out, but they’ll like it more if you’ve done your homework. It’s important to remember that your boss has a lot of activities, concerns, and needs to balance. The easier you can make it for them to manage their time and resources, the better.

If you consistently seek to understand what your boss needs and what her constraints and concerns are, your boss will know that you always seek to make his job easier. That will make your life a lot easier when you approach her with something surprising or potentially confrontational. After all, you boss’ interpretation of our requests will be coloured by his perceptions of you.

The second reason to say “Yes, Boss, and…” is improving your communication with your boss. We all have different communication styles. Some people prefer written communications and reports, others like verbal, face-to-face discussion, and some will not understand what you are talking about until they can get physically get their hands on it through a field visit, a physical model, or some other tangible representation of the subject.

If you just say “Yes, Boss,” then there is no back and forth discussion through which you will improve your communication. If you don’t ask around and find out what kind of communication your boss prefers, you may continue to choose the wrong method. Work on that communication when the issues are easy so that it is well established for the difficult conversations. Or, in other words, so that good communication becomes a positive habit between your boss and you.

So, if you want to be able to negotiate with your boss, prepare the table long before you ask for something potentially difficult. Use “Yes, Boss, and…” to build a positive relationship and improve your communication so that these become positive resources for you to draw upon when you really need them.

10 JULY, 2016

Habits: Friend and Foe

The 7 Habits of Highly Defective People from 

In this blog, I will talk about different strategies and behaviours you can adopt to do better in negotiations. One of the fundamental challenges you will face in these experiments is your negotiation habits.

For good and ill, habits often drive negotiation behaviour. Negotiations, once started, are intense affairs. You have to pay attention to what the other is saying. You have to think of questions you need to ask. You need to keep track of their body language and of course, your own emotions may move up and down depending on your perceptions of how the negotiation is going or how the other is treating you.

This list of tasks, which is incomplete, can already be overwhelming (especially in a multiparty negotiation). So, we tend to develop routine behaviours and assumptions that help us to reduce the number of things we have to plan.

Habits make life easier… and they can also lead you into traps. In negotiation, it is easy to follow habits because there’s so much going on, it’s hard to pay attention to what we are feeling and how we are acting.

Most, luckily, just lead you to so-so outcomes in your negotiations. Unfortunately, others can produce much worse outcomes, including relationships and misunderstandings that can get worse, violence, and all those other things that we find all over the world when people are unable to decide how to co-exist.

So, if you don’t want habits to drive your behaviour, what can you do? The first step is to recognize them.

Let me start the conversation rolling. The first thing that I believe you need to do is to become more self-aware of your own habits in thought, emotion, and behaviour. That means that you have to accept that you are not in control much of the time. Instead, your habits, and mine, govern our behaviour in many situations.

Many of our habits are deeply embedded in our bodies and brains. Sometimes these habits become part of our bodies right from the beginning and sometimes they are developed over time and through experience. Either way, unless you learn what they are and how to stop them from driving your behaviour, they can control you. Think of all those angry and crazy drivers out there. How many would be embarrassed if they acted in the same way when someone accidentally cuts across their path while they walk through a crowded party?

Let’s look at this a bit more deeply by using an insight I received from Jonathan Marshall. Imagine that our brains are split into two parts. One part is new to the human race and it is the centre for most of our “civilized” behaviour. The other part is the part humans started with and is mainly concerned with our immediate survival. So, when we are threatened or stressed, it is this older, more primitive section of our brain that first reacts and it only has four, basic reactions: flee, fight, freeze, and fornicate.

So, how does this apply to negotiations? Well, think for a moment about an old family member, colleague, or even friend who you often get angry at or frustrated with. Now ask yourself, what is it that they are doing that makes you angry or frustrated? Is it often the same thing – e.g. not listening to you, saying certain things about you, leaving the dishes undone, or something else like that? And each time that this happens, do you react in the same way? How many times have you stopped to really try to understand your behaviour, your relationship with the other party, and how you can change it? Or do you just react by smiling politely and trying to forget the moment or saying something angry that starts a fight?

The worst aspect of habits is that other negotiators can use them to manipulate you. Some use artificial time deadlines or an uncomfortable setting to make you hurry your decisions. Others might try to make you angry or uncertain to muddy your thinking.

I said the first step to managing your habits was recognizing them. The best way to do that is to start paying attention to your emotions, attitudes, and behaviours in low risk negotiations and even everyday conversations. As you get more comfortable with this “mindfulness,” you will be more prepared to apply it to your more difficult negotiations, and then choose which habits you want to change or keep.

10 JULY, 2016

The False Paradox Between Selfishness and Caring

Smart selfishness at least!

If you think it’s impossible to be both a caring negotiator and a selfish one, think again!

For a wise negotiator, there is no paradox between the two. If you want to get more for your organization or yourself, then it helps to spend time figuring out what the other party wants and helping them where it benefits you too.  If you want to be caring, then be honest about your concerns so that they can be too. Great negotiation is about moving forward through a series of steps in which the benefits to all parties are seen as growing.

To move past the false paradox of selfishness and caring requires some fundamental changes in your assumptions. First, we see the choice between caring and selfish as either/or because we assume the other person is one or the other. If they are selfish, then we must either choose to be nice (thus preserving the relationship) or combative (thus protecting our wants). If they are nice, then the opposite happens: accept their kind offer or argue pleasantly with them about who gets to give up something for the other.

Now imagine that the other person, me in this case, is both selfish and caring. First, I want to get the best result possible for my organization. Second, with this new attitude I also want you to get a really good result too. I’m not being nice just to improve our relationship. Quite selfishly, I also want you to consider this new idea I have which will increase my profit. I know that you are more likely to do so if the same deal has some (caring) measures that increase your benefits too. Likewise, I also want you to be as committed to implementing the agreement as I am. (Many agreements are broken because one party no longer sees value in it.)

Let’s take this farther. As a smart negotiator, I know that it’s easier to find a good deal when I have more information about what you can give. I also know that you are more likely to share that information when you believe the quality of your outcome also matters to me. And you are even more likely to share that information with me when I likewise share my real concerns and wants. Ironically, if I am transparently selfish in presenting what I really want (as opposed to the typical prepared positions that focus on telling others why they want my position while hiding my real wants and concerns), I make room for you to express your selfish desires.

Ironically, the selfish-caring is even more important in intra-team group work. When interacting with other members of the same group, people usually avoid any appearance of selfishness (or negotiation) because that would be against the “group interest.” The ironic paradox here is that hiding your interests stops others from doing the same. In other words, your “caring” sacrifice for the group’s sake actually makes your partners’ situation worse! The worst part is that the group then spends lots of time pursuing the “group’s interests,” which is usually vague or even undefined because no one has shared their real wants and concerns.

This is why students in the Lee Kuan Yew School of Public Policy once designed a commemorative T-shirt with the logo, “Death by Group Work.”

So, if you care about your partners, be selfish so that they can be too and so that you can all get to the business of “squeezing every last bit of value” from your cooperation. And if you’re selfish, try spending a little time to learn about and take care of the other people’s interests so that you can get more information on the table and have partners who are more willing to listen to your ideas about how you (and they) can get more value.