Negotiation strategies that make money

We live in strange times and our lives have been turned upside down. We need to adjust to new social norms, social distancing. We feel that our freedom has been taken away. We can’t travel, can’t meet with friends and family we can’t even just go to the supermarket and buy staples like flour, toilet paper or canned tomatoes. The way we work has changed; the way we interact with each other has changed.  The way we negotiate should also change in these strange and challenging times. While we negotiate to get the best deal possible and don’t want to leave money on the table; this does not necessarily apply in these circumstances where we are all affected in some way or another. What is important now is that we work together, find solutions together and help each other out. I have seen many acts of kindness lately. It’s these times that bring us together. The same goes when you negotiate. These are extraordinary circumstances, and people still need to make deals but it is not

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 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 the other party knows about you and your p

I recently had to get an arborist to do some tree pruning at our house. An arborist is not someone that I would call on very often hence I wondered how do I know that I got the best offer? Yes, you can get a comparison quote, which I did get, but then again was this the best offer I could get? Here are 5 steps that help to get a better deal. 1)      Build rapport People like to deal with people they like, so why burn your bridges and play hard ball.   People like to be of help so assume good intentions build rapport and trust. 2)      Reject the offer politely Tell the other party that their price is too high. While you would like to consider them for the job you would like them to review their offer. 3)      Think about their motivations Put yourself in their shoes. What motivates them to get this work? Is it money, is it the prospect of more work or do they need the job because business is slow at the moment? People have different motivations and it is impo

We live in highly uncertain times; social distancing and working from home is now the new normal. This also means more e-mails and more phone calls. In this post I want to share some tips on how you can nail your communication via email. Albert Mehrabian’s rule of 55-38-7 means that 55% of our communication is through our body language and facial expression, 38% comes from our tone of voice; how we say something; and only 7% comes from our words. This shows that it is even more important to carefully plan and write an email, making sure we get across what we want and how we want it. 1)      Be precise and concise and keep it short Have you ever received and email that has 3 paragraphs or more? Most people don’t read long emails to the end. In order to not lose their attention, bring your point across in a short and concise message. 2)      Make it easy to follow You want the receiver to read your email and remember the key points. Structure your email in a way so t

We now live in uncertain and crazy times which has shown that it is difficult for some to cope and know what to do. People fall into panic buying and supermarket shelves are emptied out. There is psychological reasoning that helps us understand why people become irrational and stock up on food stuffs and toilet paper unnecessarily. David Rock, the Co-founder & Chief Executive Officer of the NeuroLeadership Institute, developed a model which provides an understanding of the true drivers of human social behaviour. The SCARF model consists of five domains: Status, Certainty, Autonomy, Relatedness and Fairness. Status is about my own importance in relation to others. If my status it threatened; for example, due to a job loss I am trying to do anything to change that. Certainty is about knowing what comes next and being able to predict the future. We now live in highly uncertain times. We might be in lock down tomorrow; we don’t know when we will be able to travel aga

In these unprecedented times of lock downs, working from home and travel bans, most families are now pushed into new situations that they have to get used to. In a globalised world where we are required to travel frequently; either domestic or international; many of us have developed a healthy balance of when we are apart and when everyone is back home. The Corona Virus has now forced many of us into new situations where suddenly the whole family sits together every night for dinner. In the long term this new situation can lead to new family dynamics and will require some sound negotiation skills. Here are some tips that might help get through these times with your family intact. 1)      This is new situation for everyone, try and look at the issue through the lenses of the other party. Do this by asking questions that reveal why this is an issue and/or why this is important. 2)      Separate the issue from the person, never make anything personal. 3)      Stay calm

With 2020 being the year of social distancing due to Corona Virus, we can no longer take a face to face negotiation for granted. We must adapt to negotiating via e-mail, video conferencing or over the phone. This is of course all possible and with the right preparation we can be as successful. A skilled negotiator understands the most important attributes to a successful outcome. These are body language, tone of voice and reactions to their proposals by the other party. A skilled negotiator can read the other party through these attributes which assist in determining the next move. This is of course limited during a negotiation via video conference.  Heightened Awareness While you will never be able to look the other party in the eye and vice versa, you can see yourself . This creates more awareness to oneself but it can also be a distraction if you are too focused on your own facial expressions. A skilled negotiator wants the other party to see what they want them to see

If you want to be a respected negotiator build long term relationships and create value for both parties then you need to build trust first. Trust is earned and can be lost easily. Only when the other party trusts that you are genuine and don’t use dodgy means to come to the best deal then you will be taken seriously; and you will earn the trust of the other party. Trust is the foundation of a collaborative negotiation whereby both parties will feel that they got a good deal in the end. A trustworthy relationship is important to your reputation and it will allow for more negotiations and more deals with that party. We build trust trough ‘relatedness’ (David Rock). Once we find some similarities, we build rapport and feel ‘related’ to each other which builds trust. Robert Cialdini describes in his book ‘Influence’ that similarity builds rapport which results in trust. The law of liking and the law of similarity It is no surprise that we like to deal with people we

There is a saying that goes “withstand the silence”, which means be silent to let the other party talk.  In a negotiation you want to gain as much information as possible from the other party as it gives you more power. By understanding the perspectives of both parties you have a better chance to analyse the issue more holistically and to plan your strategy in much greater detail. How cool, you can use that proverb to your advantage. Here is how it works. Enduring that moment were nothing is said can be pretty uncomfortable. To silence doesn’t mean you are not saying nothing. You are just not engaging in talking. If you are in desperate need of information or credit the other party with more power you should use two silence behaviour. At the start of a negotiation begin by asking an open question first. When listening repeat the last phrases as it heats up further commenting by the other party exposing more information that may be useful for you. Continue listening as the other

There is a school of thought that believes that certain types of negotiations are fixed pie or zero sum negotiations. Meaning that what I win you lose and the other way around. A fixed pie assumption leads us to believe that there is a finite resource and both parties are now competing for the bigger piece of it. This assumption is destructive, leads to unreasonable means and unpleasant behaviours.   In some instances this approach can lead to deadlocks and it damages relationships. Once a negotiator has abandoned the fixed pie assumption and starts to concentrate on the opportunities on how to create value and grow the pie for both parties the negotiation becomes more complex but also more rewarding for both parties. In order to create value the negotiation parties need to be interested in each other and understand each other’s interests, pain points and goal. The following steps will assist with achieving this: Find a common ground – build rapport Find something th

Interpersonal Orientation (IO) provides an insight into social interaction between two individuals. People with high levels of IO are interested in building relationships with others. People with low levels of IO are less interested are less interested in building relationships, but more interested in what advantages they can get out of it. The degree to which a negotiator operates interpersonal orientation depends also on the context of a negotiation. Whenever two negotiators with the same level of IO meet, there is less chance of the other being exploited. High levels result into high cooperative behavior and personal relations, whereas low levels result into self-oriented behavior and low trust between the parties. If your levels of IO are too high, meaning you are too friendly and want to be friends with everybody, you are in danger of making a bad deal. You will feel bad asking for more and you won’t be able to drive a tough negotiation. When meeting a low IO negotiator, it

As consumers we often find it hard and difficult to change banks, mobile phone providers or energy suppliers despite being able to get a better deal elsewhere that could save us money. We all know that changing a service provider requires effort. You need to do your research, compare prices and services and trust that the new provider offers you the same or better service for a better price. That can be daunting, and we tend to become complacent and procrastinate. Big business are aware of our switching inertia and this can be exploited. Think about the Royal Commission Inquiry into the banking sector in Australia in 2019; I know of many people who wanted to change from the Big 4 to another smaller bank that was not involved in the banking issues. Others wanted to use the circumstances to get better deals from their existing bank. A year later hardly anyone did what they said because it is just 'too hard'! There is also another factor that stops us from making th

You finally found the perfect job and you really want it! But you are not the only one, there are many others who are thinking the same and want this job as much as you. This is always the case, when applying for a job there are so many competitors, so many other applicants. So you need to stand out of the crowd and apart from having the right skills and experiences there is the following strategy that you should use. To have a greater impact on the long term memory two effects come into play which you can use to your advantage. These are the primacy and the recency effects. The primacy effect suggests that information that is mentioned in the beginning of the process is better remembered than later down the track. The recency effect has the same application, only that information is mentioned at the end of the process. For a job applicant this means that you should always try to get the first or last interview in the process as this means that you are most likely to be reme