Negotiation strategies that make money

Whether in business or in private life, we are all dealing with people, people are emotionally charged and don’t always look at issues and situations rationally. In business everyone will encounter issues, conflict and difficult situations at some point.   You really get to know someone in a difficult situation. How are they handling the situation and how are they conducting themselves? It is therefore so important to learn how to handle such situations as it is not only about future business and long-lasting relationships, it is also about reputation. Do people want to come and do business with you or are they afraid that if there is a problem you become emotional, angry and difficult to deal with? Here are a few lessons that can be learned from difficult conversations: Don’t procrastinate Having a difficult conversation is uncomfortable, but avoiding a conflict situation is just making it worse and the situation will become even more emotionally charged. Once a sit

To great extent personality traits contribute to questions of why some people are more effective negotiators than others. Surely, there are more factors to a negotiation than personality, such as specific contexts, individual strategies and the emotional interpretation of the process. However, to better understand the causes of successful negotiation outcomes, a deeper understanding of the personalities involved is vital. Here we will discuss three important negotiation traits that will take your negotiation game to the next level. Assertiveness Assertiveness is the ability to stand up for your own rights in a calm and proactive way by articulating the necessary steps and demonstrating confidence and control. Take charge of the negotiation by positioning yourself first. Discuss an agenda and set deadlines in a respectful and composed manner. Be creative – Think outside the box. Being creative in a negotiation means to take everything into consideration and to identify other v

Every negotiation will be peppered with some tactics. Tactics help us pretend that we have the power over the other party so we can achieve the best deal possible. Here I discuss 4 common negotiation tactics and show you how you can counter them. Tactic #1: High ball – Low Ball The offer of the other party is either extremely high or extremely low. The purpose of this is to make you re-consider your own point of maximum or minimum acceptance. It also serves to shock you and even throw you off making you think that you might have made a mistake. If you are not prepared and have not done your research, then you might fall for it.   The best way to navigate this situation is to call them out and tell them that you feel insulted by their offer. Tell them that unless they revise their offer you are willing to walk away. This forces the other party to revise their offer straight away and continue the negotiation on your terms. Calling this out also shows them that you are aware

Sharing information builds trust which is the basis for any long term relationship and good outcomes. The art is to understand what information is appropriate to share, what should be kept for a later time and what information can’t be shared. Sharing information also calls for reciprocity meaning that the other party feels obliged to give something in return, in this case also share information. Social psychologists call it The Law of Reciprocity, meaning that when you get something you have the urge to reciprocate and give something in return which in many cases can be far more generous. While information sharing builds trust and appeals to the law of reciprocity it is important that before going into a negotiation one must calculate the risks and benefits of sharing information with their counterpart. A common mistake people make is that they share too much information.  Sharing too much information can damage your position of power because information is power and the more t

Most people think that they can’t negotiate when they are shopping online. They believe the advertised price is the expected price you pay. I just ordered a printer online and managed to get a 20% discount plus free shipping. It was not that difficult to obtain. All I did was talk to the customer service person via their chat and asked for the discount. Since you don’t negotiate face to face; you are removed from the other party hence it feels then easier to ask for more. The barrier to ask someone for a discount face to face seems higher than asking for a discount online. One advantage of negotiating online is that the online chat is monitored for quality control and training purposes which means that the person on the other side is generally very friendly. Of course, you need to be friendly and polite too, as this builds rapport and will get you to your goal. When I ordered my printer today, I said that I want to make the purchase today and asked what discount code she cou

On the weekend I  had a conversation with a friend who told me that she felt really bad that she had quit her gym membership. I thought she felt bad because she realised that she never goes and all the good intentions did not work out. However that was not the case. She has not been to the gym for the last 4 months but had continued to pay 60$ per week.  She knew that she won't go back and that she needed to cancel her membership. She felt bad telling the owner of the gym that she wants to cancel her membership as she felt that she was taking money from them. That is an interesting way of looking at it; she has never considered the other side, the gym owner. I am looking at it from the other side, they should feel bad as they have not contacted her during the four months asking her and motivating her to come back. All they were interested in was her money nothing else. She clearly showed the gym owner how bad she felt that she had to cancel her membership. I then asked he

The book influence by Robert B. Cialdini, PH.D. has become an international bestseller. This book on persuasion explains why people say ‘yes’ and how to apply this knowledge. He discusses six common principles which he also calls mental short cuts as we rely on mental short cuts every time we are faced with a decision. He explains how to use these principles, how to become a skilled persuader and how to defend yourself from them. In this post we will discuss the sixth principle – Authority When we were little, we had to learn that we need to obey to authority and that disobeying is punishable. The first lessons come from our parents then we continue to get the messages of obedience at school and it continues through our lives. The power and the value of obedience lies within our culture. How often do we hear someone saying: ‘This is against the law’; or ‘This is not allowed’. We often don’t question it as to why we are not allowed to do something, we just comply. As adults

The book influence by Robert B. Cialdini, PH.D. has become an international bestseller. This book on persuasion explains why people say ‘yes’ and how to apply this knowledge. He discusses six common principles which he also calls mental short cuts as we rely on mental short cuts every time we are faced with a decision. He explains how to use these principles, how to become a skilled persuader and how to defend yourself from them. In this post we will discuss the fifth principle – Liking It is no surprise that we like to buy from people we like and that are similar to us.  This is highly exploited in the market and influences us to buy more than what we initially wanted. Cialdini uses the Tupperware party to illustrate the exploitation of the principle of liking. Tupperware uses all the weapons of influence such as reciprocity , you either win a price or get a gift which makes you feel obliged to purchase something.  Commitment , each party participant is asked to tel

The book influence by Robert B. Cialdini, PH.D. has become an international bestseller. This book on persuasion explains why people say ‘yes’ and how to apply this knowledge. He discusses six common principles which he also calls mental short cuts as we rely on mental short cuts every time we are faced with a decision. He explains how to use these principles, how to become a skilled persuader and how to defend yourself from them. In this post we will discuss the fourth principle –Scarcity – the rule of the few When something becomes scarce then the opportunity or item becomes more valuable. Imagine you are having a face to face discussion with someone and suddenly your phone rings. You now have the choice to not answer the call and continue with the conversation or to interrupt the conversation and answer the call. If the caller is someone who is hard to get and this is your chance to speak to the caller then you will most likely interrupt the face to face conversation and pic

There are several ways in which people are motivated to work harder, be better employees or citizens and make better decisions, which is through incentives.   The first type of incentives one would think of is money. While money can be a powerful motivator, money is not entirely effective as people crave for more than that. “Money never made a man happy yet, nor will it. The more a man has, the more he wants. Instead of filling a vacuum, it makes one.” – Benjamin Franklin In order to fill the vacuum people are not only motivated by money. Yes, money is a necessity and we work to pay our bills; we are also motivated for other reasons. We are motivated by fulfillment of our work, social rewards, social approval and respect. Some might be driven by moral incentives such as doing good by working for a not for profit organisation or an NGO. In behavioural economy these incentives are categorized in either intrinsic or extrinsic motivations. Extrinsic motivations are motivat

The book influence by Robert B. Cialdini, PH.D. has become an international bestseller. This book on persuasion explains why people say ‘yes’ and how to apply this knowledge. He discusses six common principles which he also calls mental short cuts as we rely on mental short cuts every time we are faced with a decision. He explains how to use these principles, how to become a skilled persuader and how to defend yourself from them. In this post we will discuss the third principle of influence – Social proof The principle of social proof works because we are social creatures and we are therefore more likely to do something if other people are doing it too. At the same time, we are also not likely to do something if no one else is. Social proof can come in many ways; we are all influenced by it one way or another. Influencer approval A thought leader or influencer/celebrity approves a product or service. If George Clooney drinks Nespresso, then it must be good. Testimoni