But what makes a skilled negotiator? Richard Shell outlines a systematic and thoughtful framework for successful negotiation strategies based on insights into human psychology Purchase this.
We all have to negotiate at. A look at how relationships can drive successful negotiation, from an award-winning faculty member at the Wharton School of Business. Contrary to conventional wisdom about what makes a good negotiator - namely, being aggressive and unemotional - in Bring Yourself, Taheripour offers a radically different perspective. In her own life,.
We all negotiate on a daily basis. We negotiate with our spouses, children, parents, and friends. We negotiate when we rent an apartment, buy a car, purchase a house, and apply for a job.
Your ability to negotiate might even be the most important factor in your career advancement. We all want to get to yes, but what happens when the other person keeps saying no? How can you negotiate successfully with a stubborn boss, an irate customer, or a deceitful coworker?
Explains that the selling of ideas is a matter of encouraging others to share one's beliefs in a guide for salespeople that invites readers to self-assess their persuasion personality and build on natural strengths. As I will detail in the chapter on information exchange, North Americans and northern Europeans tend to focus more quickly on the transactional aspects of the deal, whereas most Asian, Indian, Middle Eastern, African, and Latin American cultures focus more intently on social, relational aspects.
Cultures may vary in the degree of formality they associate with prewedding festivities, but families in all cultures use these events to thoroughly size up and woo their new, would-be relations. If you want to be successful negotiating in a relationship culture, therefore, be patient and realize that the contract if one comes is just one part of a much bigger picture. But effectiveness is as much a matter of attitude as it is of ability. The best negotiators exhibit four key habits of thought that everyone, regardless of their style, gender, or culture, can adopt to improve their negotiation results.
Nearly every research study on negotiation has confirmed its importance. Here is an illustration. Several years ago, a colleague and I were investigating the use of computer networks as a method for negotiation. We designed a network computer system to help parties reach better agreements and then set out to test it.
We gave the same four-issue, buy-sell exercise to hundreds of MBA students. We instructed half the pairs to read the problem and negotiate whenever they thought they were ready— some face-to-face, others using e-mail. They usually took about ten to fifteen minutes to prepare, then they negotiated. We required the other groups to go through a structured, individual preparation process on the computer that usually took about thirty to forty minutes. Some students then negotiated the buy-sell exercise using our computer network system while others bargained face-to-face.
We were surprised by the results. Our fancy, computerized method of negotiation did not matter much. But the preparation process did. The students who used the formal preparation system reached better agreements in both the face-to-face and the computer network conditions—not just for themselves, but for both sides. I will discuss the best way to set goals in Chapter 2.
To acquire high expectations, you must combine specific goal setting with a personal commitment to performance. Expectations come from your overall attitude about what you are trying to achieve and derive from unstated, sometimes unidentified, beliefs about what is fair and reasonable. You can always tell, when a negotiation is over, where your expectations were really set. If you feel genuine disappointment that you fell below a certain level, that is where your expectation was set.
If you feel genuinely satisfied, you met or exceeded your expectation. The goal of an effective negotiator is to have expectations that are high enough to present a real challenge but realistic enough to promote good working relationships.
Information-Based Bargaining begins with the idea that information is power. Listening enables you to get information. If having high expectations is sometimes a problem for cooperative people, listening requires special effort for competitive types. Aggressive bargainers spend most of their time at the bargaining table either talking about what they want or thinking of something clever to say next that will put the other side on the defensive.
As we shall see, the best negotiators follow a different practice: They ask questions, test for understanding, summarize discussions, and listen, listen, listen.
They keep their promises, avoid lying, and do not raise hopes they have no intention of fulfilling. The research on this is reassuring.
Skilled negotiators prize their reputations for straightforward dealing very highly. That makes sense. Given a choice, would you want to do business with someone you could trust or someone who might be trying to cheat you? This sounds good, but does it really pay to be honest in bargaining? Does personal integrity require you to reveal your bargaining position? What if the other side fails to ask an important question?
Do you have a duty to volunteer an answer? I will address these and similar issues in Chapter It is, like high expectations, an attitude. Relationships, social norms, culture, and bargaining etiquette all make a difference. Therefore, when I speak of a commitment to personal integrity in negotiation, I mean that effective negotiators can be counted on to negotiate consistently, using a thoughtful set of personal values that they could, if necessary, explain and defend to others.
This approach obviously leaves a lot of room for individual interpretation about what is right and wrong. But such differences are an inevitable part of human interaction. The main thing is to attend to your reputation and self-regard. Be reliable. Both worked out. We left each story as the parties began to share information with each other. Smith gracefully accepted both the watch and the tacit admission that Smith had most of the bargaining leverage with reciprocal signals of cooperation.
The initial meeting between the two men and their advisers went on through the evening and into the night. Within days, they created an outline of a merger agreement to create a new company: Harcourt General Inc. Back in the shadow of Mount Meru, the two farmers went back and forth all day. At length, one of the elders proposed dividing the disputed land along a prominent footpath that formed a natural boundary. The farmers huddled with their bargaining teams.
The social pressure for an agreement intensified. The farmer who had demanded the meeting in the first place the one whose son had been beaten then stepped into the center of the circle. He, too, would honor the new arrangement. They had a deal. These public declarations and a ritual feast that followed served to commit the parties. Everyone in the community would remember the agreement and help enforce it if necessary. Summary All negotiations begin with you.
The First Foundation of Effective Negotiation is therefore your preferred bargaining styles—the ways you communicate most confidently when you face a negotiation. Your success depends on candidly assessing your strengths and weaknesses as a communicator. They can adapt easily to many different situations and opponents.
Others are more limited in their range of effective action. They may be quite strong in situations requiring competitive instincts but weak when it comes to accommodation or compromise. Or they may be strong in cooperative skills and weak if the situation calls for hardball tactics.
Many negotiation experts try to teach people a single, all-purpose menu of bargaining moves. I do not believe this is either helpful or realistic. People and situations are too varied for such mechanical advice to work. Rather, your job as a negotiator is to understand your style preferences, see how they match up with the situation more on this in Chapter 7 , plan your path through the four steps that negotiations follow, and try your best to be effective by preparing, forming high expectations, listening to the other party, and acting with integrity in the process.
Information-Based Bargaining proceeds from the assumption that you will get better results for yourself and achieve more for others who depend on you by tirelessly searching for key information about the parties and the situation. Your success then turns on using this information skillfully as bargaining goes forward. It is time to explore the Second Foundation, your goals and expectations.
I believe in always having goals, and always setting them high. He quickly ran into a problem: The tiny radio was unlike anything Americans had ever seen. As Morita would later write, many U. Everybody in America wants big radios. Bulova offered to buy , of the radios for distribution through its strong U. Morita was stunned by the size of the order.
This was the deal of a lifetime. This condition conflicted directly with an important long-range goal Morita had set for his firm: to establish Sony as an independent, global brand name based on its innovative, quality products. Morita cabled his executive board at Sony headquarters in Japan for instructions. The board enthusiastically cabled back its response: Forget about the problem with the brand name and take the order. Morita thought it over carefully for a week, then returned to Bulova to continue the negotiations.
He told Bulova he would like to make a deal, but he could not accept the condition. Why not take advantage of ours? I am here with a new product, and I am now taking the first step for the next fifty years of my company. Fifty years from now I promise you that our name will be just as famous as your company name is today. Indeed, his board was shocked when he reported his decision and told Morita that he was being foolish.
Shortly thereafter, Morita received a more modest order from another American distributor, but this one let Morita keep the Sony name on the radio. But his bargaining stance reflected the strength of his vision for Sony. Morita had a goal: to make the name Sony a household word for quality electronics throughout the world within fifty years.
He achieved that goal with time to spare—and made himself a business legend in the process. The Second Foundation of Effective Negotiation focuses on your goals and expectations. And research on setting goals discloses a simple but powerful fact: The more specific your vision of what you want and the more committed you are to that vision, the more likely you are to obtain it.
But you do not need to be the next Akio Morita to draw a lesson from his story. Research on negotiation confirms that anyone who is willing to take the time to develop higher expectations will do significantly better and do so without putting his relationship or reputation with others at risk. To become an effective negotiator, you must find out where you want to go—and why.
That means committing yourself to specific, justifiable goals. It also means taking the time to transform your goals from simple targets into genuine—and appropriately high—expectations. What is the difference between a simple goal and something that has matured into a genuine expectation? Basically one thing: your attitude. Goals are things we strive toward that are usually beyond the range of our past achievements. Such things as investment goals, weight loss goals, and athletic goals are typical.
We set goals to give ourselves direction but we are not greatly surprised or disappointed if we fall short. An expectation, by contrast, is a considered judgment about what we can and ought reasonably to accomplish.
If we fall short of our expectations, we will feel sincere loss and disappointment. It will hurt. We may set a goal of having our children attend an Ivy League college, but we have an expectation that they will attend college somewhere. Our expectation about college affects the way we communicate about the subject with others, including our children.
They begin to share our assumption that college is in their future, and their behavior reflects that assumption. And guess who in fact expects to go to college? Kids of parents who went to college. The same pattern holds all the way up to the children who expect to obtain doctoral degrees. So it is with negotiation.
Our goals give us direction, but our expectations are what give weight and conviction to our statements at the bargaining table. We are most animated when we are striving to achieve what we feel we justly deserve. As his goal matured into a solid expectation, he was able to communicate this vision more clearly to his own board of directors and to potential customers.
What you aim for in negotiations often determines what you get. The first reason is obvious: Your goals set the upper limit of what you will ask for. You mentally concede everything beyond your goal, so you seldom do better than that benchmark. Sports psychologists, salespeople, and educators alike confirm that setting specific goals motivates people, focusing and concentrating their attention and psychological powers.
Third, we are more persuasive when we are committed to achieving some specific purpose, in contrast to the occasions when we ask for things half-heartedly or merely react to initiatives proposed by others. Our commitment is infectious. People around us feel drawn toward our goals. Wayne Huizenga, an energetic American entrepreneur, maintains that one of the secrets of success in business negotiations is having a passionate commitment to ambitious goals.
This trait enables effective negotiators to communicate enthusiasm and direction at the bargaining table. Huizenga should know, having built three successful megacorporations from scratch at the same time he was buying or founding three professional sports teams—the Miami Dolphins football , the Florida Marlins baseball , and the Florida Panthers ice hockey. Negotiators striving to achieve concrete goals are more animated, committed, prepared, and persistent.
Nor is this effect limited to experienced deal makers. Everyone gains a significant psychological edge when he or she is working to achieve a specific target in bargaining.
By definition, if you cannot achieve your bottom line, you would rather seek another solution to your problem or wait until another opportunity comes your way. A well-framed goal is quite different from a bottom line. For example, in the case of the used CD player illustrated in Figure 2.
Bottom lines are vitally important to negotiation theory, but setting and negotiating toward a legitimate goal is the key factor in most bargaining success stories. Let me explain why. The seller is selling a used CD player. Researchers have discovered that humans have a limited capacity for maintaining focus in complex, stressful situations such as negotiations. Consequently, once a negotiation is under way, we gravitate toward the single focal point that has the most psychological significance for us.
They measure success or failure with reference to their bottom line. And we know that avoiding losses is a powerful motivating force. This power is not working as strongly for you when you focus solely on your bottom line.
You can now end your search for a buyer and begin mentally possessing the other item you want. If the buyer is alert and most are when it comes to money , he will sense your relaxation and stop the bidding.
What is the practical effect of having your bottom line become your dominant reference point in negotiations? Over a lifetime of negotiating, your results will tend to hover at a point just above this minimum acceptable level. For most reasonable people, the bottom line is the most natural focal point. Disappointment arises if we cannot get the other side to agree to meet our minimum requirements usually established by our available alternatives or our needs away from the table , and satisfaction arises just above that level.
Meanwhile, someone else who is more skilled at orienting himself toward ambitious goals will do much better. Not surprisingly, research shows that parties with higher but still realistic goals outperform those with more modest ones, all else being equal. To avoid falling into the trap of letting your bottom line become your reference point, be aware of your absolute limits, but do not dwell on them.
Instead, prepare your bottom line, then set it aside while you work energetically on formulating your goals. Then, if you must, gradually reorient toward your bottom line as that becomes necessary to close the deal. With experience, you should be able to keep both your goal and your bottom line in view at the same time without losing your goal focus.
Research suggests that the best negotiators have this ability. If setting goals is so vital to effective preparation, how should you do it? Use the following simple steps: 1.
Think carefully about what you really want—and remember that money is often a means, not an end. Set an optimistic—but justifiable—target. Be specific. Get committed. Write down your goal and, if possible, discuss the goal with someone else. Carry your goal with you into the negotiation.
What Do You Really Want? Begin your preparation for negotiation by considering your own underlying needs and interests. But it is easy to forget that price is often a means to an end, not an end in itself. The goal is to achieve more value or profit, not a victory on the price term.
This is not as paradoxical as it sounds. If you are on the buy side, you want to make sure that you get a specified level of quality for the money you spend, not just a low price. And sellers need to be careful that their sales create the conditions for future business.
Canceled orders and one-time sales do not make for a profitable enterprise, even if the price achieved on any given sale looks good. The founder of CBS, William Paley, was having a hard time making money in the radio broadcast marketplace in its early days. He was negotiating with local stations over prices for CBS shows the local stations would run, and the stations had all the power. They did not have to buy and often did not.
Paley revolutionized radio and created the modern network by realizing that the price for his shows was a means, not an end in itself. The strategy earned him millions. Later, in the s, Paley took the U.
Experienced negotiators often report that price can be a relatively easy term to resolve compared with less obvious but more explosive issues such as control, turf, ego, and reputation.
So when you formulate your goals, consider carefully what really matters to you. Sure, money is important. But identify your underlying interests and needs clearly. Once negotiations start, it is all too easy to become preoccupied with competitive issues such as price and forget what you are really trying to accomplish. Set an Optimistic, Justifiable Target When you set goals, think boldly and optimistically about what you would like to see happen.
In one classic study, psychologists Sydney Siegel and Lawrence Fouraker set up a simple buy-sell negotiation experiment. In other words, Siegel and Fouraker gave their subjects both concrete incentives for hitting a certain specified level of performance and, perhaps unintentionally, a hint that the assigned target levels were realistically attainable why else would subjects be told about the bonus round?
Both sides had the same bottom line: They could not accept any deal that involved a loss. In our experiment, unlike the one Siegel and Fouraker conducted, negotiation subjects set their own bargaining goals.
The result was the same, however. Negotiators who reported higher prenegotiation expectations achieved more than those who entered the negotiation with more modest goals. Why are we tempted to set modest bargaining goals when we can achieve more by raising our sights? There are several possible reasons. First, many people set modest goals to protect their self-esteem.
Modest goals thus help us avoid unpleasant feelings of failure and regret. This usually means we have failed to prepare well enough.
Third, we may lack desire. If the other person wants money, control, or power more urgently than we do, we are unlikely to set a high goal for ourselves. Why look for conflict and trouble over things we care little about? Research suggests that the self-esteem factor plays a more important role in low goal setting than many of us would care to admit.
I see further evidence of this in negotiation classes. As students and executives in negotiation workshops start setting more ambitious goals for themselves and strive to improve, they often report feeling more dissatisfied and discouraged regarding their performance—even as their objective results get better and better.
That way you can maintain your enthusiasm for negotiation as you learn. Research shows that people who succeed in achieving new goals are more likely to raise their goals the next time. Those who fail, however, tend to become discouraged and lower their targets. Once you have thought about what an optimistic, challenging goal would look like, spend a few minutes permitting realism to dampen your expectations. Optimistic goals are effective only if they are feasible; that is, only if you believe in them and they can be justified according to some standard or norm.
As I discuss more fully in Chapter 3, negotiation positions must usually be supported by some standard, benchmark, or precedent, or they lose their credibility. No amount of mental goal setting will make your five-year-old car worth more than a brand-new version of the same model.
You should also adjust your goal to reflect appropriate relationship concerns, a subject I address in Chapter 4. With the preliminary work done, you are ready to enter the negotiation process and encounter the values and priorities the other side is bringing to the deal. Until you know for sure what the other side has for goals and what the other side thinks is realistic, you should keep your eyes firmly on your own defendable target.
Be Specific The literature on negotiation goal setting counsels us to be as specific as possible. Clarity drives out fuzziness in negotiations as in many other endeavors. With a definite target, you will begin working on a host of psychological levels to get the job done.
Your specific goal will start you thinking about other, comparable jobs that pay your target salary, and you will begin to notice a variety of market standards that support a salary of that amount. But effective negotiators do not let these feelings get in the way of setting specific goals. There are several simple things you can do that will increase your level of psychological attachment to your goal.
First, as I suggested above, you should make sure it is justified and supported by solid arguments. You must believe in your goal to be committed to it. Second, it helps if you spend just a few moments vividly imagining the way it would look or feel to achieve your goal. Visualization helps engage our mind more fully in the achievement process and also raises our level of self-confidence and commitment. He then kept that picture over his desk for several years as he directed all his professional energies toward gaining admission.
After being turned down once, he was finally admitted. When he arrived on campus, he had another picture taken of himself in the same building, and he now displays the two pictures together with great satisfaction. He credits the visual image of his goal with keeping him on track toward its achievement. The same visualization techniques work for negotiation goals.
To commit yourself even further to your goal, tell another person about it and show him or her your written goal. If other people know about the goal, you begin to feel subtly accountable to them, and research indicates that negotiators bargain harder when they must explain to someone why they failed to achieve a goal.
Labor, sports, and political negotiators go to extreme lengths to mobilize this power: They sometimes announce their bargaining goals to the press, thereby putting everyone including their constituents and the other side on notice as to what they want to achieve.
This sort of public commitment is a powerful way of binding yourself to your goals. Of course, as in all other aspects of negotiation, one should use judgment in committing to goals. If both parties engage in dramatic forms of public commitment, with press conferences and do-or-die statements to their respective audiences, they can paint themselves into a corner from which it is impossible to escape.
Labor strikes, political showdowns, and wars are examples of failed negotiations, not successes. Finally, any type of material investment you can make in the goal that would be lost if you fail to achieve it will add greatly to your commitment.
A major airline recently announced that it had signed a deal to acquire as many as four hundred new planes to expand and upgrade its fleet.
It went on to state that the airline would be forced to cancel that order if it failed to reach a favorable wage agreement with its pilots before the deadline for closing the purchase. With that one move, the airline secured three negotiation advantages: a public commitment to its stated wage target, a credible deadline for concluding negotiations with its pilots, and, most important, a vision of what it and the pilots would lose if the airline failed to achieve its wage goals.
The negotiations ultimately closed by the deadline and within the wage constraints the airline had set. Using this unique theory-into-practice organization principle, the book demonstrates how negotiation works, outlines options and procedures for negotiation preparation, and identifies common negotiating problems.
Read on your PC, Mac, smart phone, tablet or Kindle device. You are about to learn how to increase your negotiation skills.
This information will allow you to bring more positive opportunities into your life. You will learn to find a way to bypass the normal avenues people think they have to take to get what they want in life.
You will learn about why it is important to negotiate in an ethical and professional manner. Unfortunately there are some people who will try to take advantage of you when you negotiate with them.
This book will teach you how to recognize when someone has negative negotiation intentions. Economic bargaining theory seeks to predict the outcomes of bargaining situations. In such situations, govern ments,? A classic ex ample of such a situation is wage bargaining between unions and employers. More commonplace examples also exist.
For instance, a discussion between partners on how to spend an evening can be understood as a bargaining situation. Economic bargaining theory explores the relationship between bargaining situ ations and the outcomes of the bargaining.
Economists have two primary reasons to show interest in this relationship. The second reason is that the understanding of these situations may inform the economic theory of markets.
You will learn to find a way to bypass the normal avenues people think they have to take to get what they want in life. You will learn about why it is important to negotiate in an ethical and professional manner. Unfortunately there are some people who will try to take advantage of you when you negotiate with them. This book will teach you how to recognize when someone has negative negotiation intentions.
This book focuses on economic bargaining theory. Economic bargaining theory seeks to predict the outcomes of bargaining situations. In such situations, govern ments,? A classic ex ample of such a situation is wage bargaining between unions and employers.
More commonplace examples also exist. For instance, a discussion between partners on how to spend an evening can be understood as a bargaining situation. Economic bargaining theory explores the relationship between bargaining situ ations and the outcomes of the bargaining.
Economists have two primary reasons to show interest in this relationship. The second reason is that the understanding of these situations may inform the economic theory of markets. The tool utilized in this study is the mathematical theory of games. Predictions for bargaining outcomes are developed by modeling the bargaining situation as a strategic game and using game theoretic equilibrium concepts in order to solve the game.
In this approach, the speci? The neoclassical and fundamental assumption is that of rational agents—called economic men—who strive to maximize their utility based on stable preferences. Presents a comprehensive guide to the essential skills, strategies, techniques, and creative mindset of successful negotiation, drawing on the latest behavioral research and real-life case studies to explain how to prepare for and execute negotiations, from identifying opportunities to overcoming resistance and defusing hardball tactics.
Unlike studies that examine only what is said and done at the negotiation table, The Art of Bargaining looks at the context in which negotiation takes place - and shows why some of the most critical decisions about bargaining are made even before the parties sit down to talk.
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