About the Author: Roger Dawson
Roger Dawson was born in England and came to this country in 1962. He became a US citizen in 1972. His business background includes being president of one of California's largest real estate companies, with 28 offices, five hundred and forty sales associates, and a volume of over $400 million dollars per year.
Basic Principles Make You a Smarter Negotiator
The way that you conduct yourself in a negotiation can dramatically
the outcome. I've been teaching negotiating to business leaders
throughout North America since 1982 and I've distilled this down
to five essential principles. These principles are always at work
for you and will help you smoothly get what you want:
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Get the Other Side to Commit First
Power Negotiators know that you're usually better off if you
can get the other side to commit to a position first. Several
reasons are obvious:
o Their first offer may be much better than you expected.
o It gives you information about them before you have to tell
them anything.
o It enables you to bracket their proposal. If they state a price
first, you can bracket them, so if you end up splitting the difference,
you'll get what you want.If they can get you to commit first,
they can then bracket your proposal. Then if you end up splitting
the difference, they get what they wanted.
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The less you know about the other side or the proposition that
you're negotiating, the more important the principle of not going
first becomes. If the Beatles' manager Brian Epstein had understood
this principle he could have made the Fab Four millions more on
their first movie. United Artists wanted to cash in on the popularity
of the singing group but was reluctant to go out on a limb because
United Artists didn't know how long the Beatles would stay popular.
They could have been a fleeting success that fizzled out long
before their movie hit the screens. So they planned it as an inexpensively
made exploitation movie and budgeted only $300,000 to make it.
This was clearly not enough to pay the Beatles a high salary.
So United Artists planned to offer the Beatles as much as 25 percent
of the profits. The Beatles were such a worldwide sensation in
1963 that the producer was very reluctant to ask them to name
their price first, but he had the courage to stay with the rule.
He offered Epstein $25,000 up front and asked him what percentage
of the profits he thought would be fair.
Brian Epstein didn't know the movie business and should have been
smart enough to play Reluctant Buyer and use Good Guy/Bad Guy.
He should have said, "I don't think they'd be interested
in taking the time to make a movie, but if you'll give me your
very best offer, I'll take it to them and see what I can do for
you with them." Instead, his ego wouldn't let him play dumb,
so he assertively stated that they would have to get 7.5 percent
of the profits or they wouldn't do it. This slight tactical error
cost the group millions when the director Richard Lester, to every
one's surprise, created a brilliantly humorous portrait of a day
in the group's life that became a worldwide success.
If both sides have learned that they shouldn't go first, you can't
sit there forever with both sides refusing to put a number on
the table, but as a rule you should always find out what the other
side wants to do first.
Act Dumb, Not Smart
To Power Negotiators, smart is dumb and dumb is smart. When
you are negotiating, you're better off acting as if you know less
than everybody else does, not more. The dumber you act, the better
off you are unless your apparent I.Q. sinks to a point where you
lack any credibility.
There is a good reason for this. With a few rare exceptions, human
beings tend to help people that they see as less intelligent or
informed, rather than taking advantage of them. Of course there
are a few ruthless people out there who will try to take advantage
of weak people, but most people want to compete with people they
see as brighter and help people they see as less bright. So, the
reason for acting dumb is that it diffuses the competitive spirit
of the other side. How can you fight with someone who is asking
you to help them negotiate with you? How can you carry on any
type of competitive banter with a person who says, "I don't
know, what do you think?" Most people, when faced with this
situation, feel sorry for the other person and go out of their
way to help him or her.
Do you remember the TV show Columbo? Peter Falk played
a detective who walked around in an old raincoat and a mental
fog, chewing on an old cigar butt. He constantly wore an expression
that suggested he had just misplaced something and couldn't remember
what it was, let alone where he had left it. In fact, his success
was directly attributable to how smart he was-by acting dumb.
His demeanor was so disarming that the murderers came close to
wanting him to solve his cases because he appeared to be so helpless.
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The negotiators who let their egos take control of them and come
across as a sharp, sophisticated negotiator commit to several
things that work against them in a negotiation. These include
being the following:
o A fast decision-maker who doesn't need time to think things
over.
o Someone who would not have to check with anyone else before
going ahead.
o Someone who doesn't have to consult with experts before committing.
o Someone who would never stoop to pleading for a concession.
o Someone who would never be overridden by a supervisor.
o Someone who doesn't have to keep extensive notes about the progress
of the negotiation and refer to them frequently.
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The Power Negotiator who understands the importance of acting
dumb retains these options:
o Requesting time to think it over so that he or she can thoroughly
think through the dangers of accepting or the opportunities that
making additional demands might bring.
o Deferring a decision while he or she checks with a committee
or board of directors.
o Asking for time to let legal or technical experts review the
proposal.
o Pleading for additional concessions.
o Using Good Guy/Bad Guy to put pressure on the other side without
confrontation.
o Taking time to think under the guise of reviewing notes about
the negotiation.
I act dumb by asking for the definitions of words. If the other
side says to me, "Roger, there are some ambiguities in this
contract," I respond with, "Ambiguities . . .ambiguities
. . . hmmm, you know I've heard that word before, but I'm not
quite sure what it means. Would you mind explaining it to me?"
Or I might say, "Do you mind going over those figures one
more time? I know you've done it a couple of times already, but
for some reason, I'm not getting it. Do you mind?" This makes
them think: What a klutz I've got on my hands this time. In this
way, I lay to rest the competitive spirit that could have made
a compromise very difficult for me to accomplish. Now the other
side stops fighting me and starts trying to help me.
Be careful that you're not acting dumb in your area of expertise.
If you're a heart surgeon, don't say, "I'm not sure if you
need a triple by-pass or if a double by-pass will do." If
you're an architect, don't say, "I don't know if this building
will stand up or not."
Win-win negotiating depends on the willingness of each side to
be truly empathetic to the other side's position. That's not going
to happen if both sides continue to compete with each other. Power
Negotiators know that acting dumb diffuses that competitive spirit
and opens the door to win-win solutions.
Continue to to: Part II: Basic Negotiating Principles
