The 3 Biggest Mistakes People Make During Negotiations

J:
Welcome to the BiggerPockets Business Podcast show number 92.

Kwame:
The number one thing that people need to recognize when it comes to negotiation is that negotiation is everywhere. That’s one of the biggest barriers people have, is that they have low negotiation awareness. They don’t know when they’re negotiating and if you don’t know you’re negotiating, then you don’t know to use the skills.

Speaker 4:
Welcome to a real world MBA from the School of Hard Knocks where entrepreneurs reveal what it really takes to make it. Whether you’re already in business or you’re on your way there, this show is for you. This is BiggerPockets Business.

J:
How’s it going everybody? I am J Scott, your co-host for the BiggerPockets Business Podcast and sitting in front of me on the screen is my lovely wife and co-host, Miss Carol Scott. How are you doing today Carol?

Carol:
Doing really well, but I got to tell you, I am not quite sure what has happened with the boys these past several weeks, right? Our guys are one of them just turned 11 and the other one turned 10 just a couple weeks ago, both double digits and I love all the boys, all three of you in this household big time; however, now that the other two are double digits as well, it’s like I am dealing with three of you. It’s the craziest thing. I thought I was a good… I don’t know, I was good at negotiating stuff, keeping everything rolling, and I don’t know what has happened, but they are absolutely your children and the negotiation level in our household has been turned up to a level four billion. Everybody out there, wish me luck with the three boys in my house.

J:
Yeah, wow. Three of me, you are lucky, lucky woman.

Carol:
Yeah. Am I so lucky, luckiest person ever?

J:
Well, that was a good lead-in to our show today because today we are talking all about negotiation and whether it’s negotiation in your business, negotiation in your real estate investing if you’re a real estate investor, or just negotiating with your husband wife or children or anybody else in your life, we have the perfect guest today. His name is Kwame Christian. He is an attorney. He’s a best-selling author of the book Finding Confidence in Conflict: How to Negotiate Anything and Live Your Best Life. He is the director of the American Negotiation Institute. He’s a TEDx speaker. He’s a professor at Ohio State University, and he has the number one top-ranked negotiation podcast in the country.
When I say he is the person, the guy to talk about negotiation, I mean it literally and on today’s episode, we talk about everything negotiation. We talk about how to prepare for a negotiation. We talk about hostile negotiations. We talk about negotiating with people that are close to you, negotiating through intermediaries. We talk about negotiating with family members. We talk about negotiation in business and real estate. We even get into a little bit of relationship counseling in this episode because when it comes to relationships, much of it is about negotiation. This episode is for anybody that wants to learn how to negotiate to be a better negotiator, or if you’re already a good negotiator, to turn those negotiation skills into master negotiation skills.
Honestly, we had such a fun time talking to Kwame and this was just an awesome episode and everybody’s going to love it. If you want to learn more about what we talk about in this episode, including a whole bunch of free stuff that Kwame gives away on his website, make sure you check out our show notes at biggerpockets.com/bizshow92. Again, that’s biggerpockets.com/bizshow92. Okay. Without any further ado, let’s welcome Kwame Christian to the show.

Carol:
Kwame welcome to the BiggerPockets Business Podcast. We are huge fans of yours. We know that you have so many just absolutely awesome tips for our community, and we’re so looking forward to learning from you, so thanks for being with us here today.

Kwame:
It is my pleasure, and it’s an honor to be here because I know both of you are very, very well-versed in negotiation. I’m a bit nervous, I’m going to have to bring it today.

J:
Oh, it’s funny because I’m the one that’s nervous. We talk about negotiation all the time, and now we have the expert in negotiation here with us. I want to start by letting you introduce yourself. You’re an attorney, you’re a best-selling author, you’re the director of the American Negotiation Institute, you’re a TEDx speaker, you’re a professor. You have the number one negotiation podcast in the country. I guess I started introducing you there, but I would love to hear just your back story. How did you get to where you are today? How did negotiation become a major facet of your professional life, and I assume your personal life as well? Just give us a little bit of backstory

Kwame:
Well, J you described a stereotypical Caribbean American, multiple jobs, just can’t stop working, but my background is in law. That’s my foundation from the outside, but really for me, it all comes from psychology. My undergrad degree is in psychology and this really informs my approach to negotiation effectively. I have a law degree with a master of public policy, and then I’ve been practicing as a business lawyer and a mediator, but my passion has always been about negotiation and what I’ve recognized is that yes, I love negotiating myself, that’s fun. I enjoy the strategy, I love the game about it and creating relationships, but even more than that, I love teaching people.
That’s what I do with the American Negotiation Institute as a professor and with the podcast too. For me, my belief is that the best things in life are on the other side of difficult conversations. What I want to do is try to make those difficult conversations easier for everybody.

Carol:
Excellent. Talking about those conversations, making them easier, just full-on tactical ways to do that, we think when you take a step back, negotiation really is the sum of maybe thousands of different skills and tactics, but there are plenty of people within our community who might just be getting to starting working on their negotiation skills. What would you say Kwame is the one single most important thing that we need to know to become a better negotiator?

J:
Basically sum up your entire world in one sentence here I guess is what we’re asking.

Kwame:
Easy, easy. You’re always negotiating, that’s really it. The name for my podcast is Negotiate Anything for the reason that I want people to recognize that they’re constantly negotiating. The definition I like to use for negotiation is anytime you’re in a conversation and somebody wants something, and so constantly negotiating. Whenever I’m doing these trainings and I ask them when they’re negotiating, they always start off with family first, then friends and then people at work. Then even if it’s procurement people who are negotiating deals or real estate folks, then it gets to those type of external negotiations. The people we’re going to negotiate with the most are the people who are closest to us.
The number one thing that people need to recognize when it comes to negotiation is that negotiation is everywhere. That’s one of the biggest barriers people have, is that they have low negotiation awareness. They don’t know when they’re negotiating and if you don’t know you’re negotiating, then you don’t know to use the skills.

J:
I love that because I know so many people that we talk to and they’re like, “Well, how do I practice my negotiation? I don’t get into enough situations like with contractors or with business partners or with vendors that I feel like I can practice enough.” I think you just said it perfectly there. It’s you should be practicing every day, whether you’re talking to your kids, whether you are at a restaurant and trying to order something that might not be on the menu. Any time you’re talking to somebody and either side wants something, it’s a great way to put that you’re always negotiating, so there’s always the opportunity to practice. You just have to put yourself in the mindset that everything is a negotiation.

Kwame:
Absolutely, and I remember I was listening to one of your episodes before. I think it was on the flagship BiggerPockets episode, and Carol one of the things you mentioned was that the simplest thing you can do to practice your negotiation is to just practice listening, not talking in a conversation. It’s really hard to do, and it’s so hard that I’ve created a challenge just for myself. Maybe I’ll make it public or something like that, but it’s just the listening challenge. I remember I have a 5-year-old and around the holidays, my son was acting up a bit in school. I said, “You know what, I’m going to take him to work with me, and I will bore him to death and then he will appreciate school a lot more.”
My mom thought it was a horrible idea. She started off the conversation just criticizing me and I said, “Oh, this is an opportunity to practice.” Okay, so for 15 minutes straight, 15 minutes straight, I didn’t say anything other than summarizing what she said, asking if I understood it correctly, and then asking what else. Fifteen minutes straight, didn’t say anything and I was dying inside. I want to make it abundantly clear this was not easy, not easy at all to do. We got to that 15-minute point and she’s like, “Are you going to say anything?” I said, “Listen mom, I just want to listen. I am here to just hear your perspective. What else do you want to say?”
Then once I got to the point where she said, “Nope, that’s it,” I said, “Okay, would you like to hear my perspective?” “Sure,” and then I gave my perspective. She agreed, right? Now if you think about that conversation, if I would have started off more combative, if I would have started off defensively, that conversation would not have gone very well, but I went through that painful process of listening for the moment because it was effective in the moment, but also thinking long term this is a practice opportunity. If I can do it in this moment, it’ll be a lot easier in the future and then at the end of the conversation, I asked her for feedback.
I said, “How did you feel during this conversation? What could I have done differently? What could I have done better?” I’m seriously thinking about every single conversation, whether it’s with my 5-year-old, my wife, my mom, whoever it is as a practice opportunity because it makes those bigger, more transactional negotiations a lot easier.

J:
I want to suggest that everybody just hit rewind 90 seconds or 120 seconds and listen to that again, because if you learn nothing else from this episode, that’s going to change your negotiation ability right there. That’s going to take you 10 times better. I heard a quote the other day and unfortunately, I can’t remember who said it and show who to attribute it to, but there’s something along the lines of most of us when we are listening to somebody else talk, we’re thinking most of the time about what we’re going to say next, as opposed to what they are saying. When we do that, we don’t really get the other person’s viewpoint.
We don’t really comprehend what they’re saying we’re just thinking about how we’re going to argue it, and how we’re going to get our point across, and so what you said was so important. I do want to go back to one thing because you had an amazing nugget in there that you glossed over, but I think is super important. I’d love for you to expand on it if you don’t mind, but you talked about during that 15-minute conversation with your mom, you were reiterating back to her your interpretation of what she was saying, and that wasn’t just I assumed time filler. It wasn’t just for you to have something to say. What was your reason for taking the time and reiterating back to her what you thought she was saying?

Kwame:
It’s called the empathy loop. What you do is you summarize what the person says, and you do it by saying this. It’s a really simple format. “Correct me if I’m wrong, but it sounds like you’re saying X, Y Z. Is that correct?” Then you give them the opportunity to correct you. This serves two purposes. Number one, it shows that you’re listening and number two, it gets you points for listening. I think about it in terms of a game, where the other side is the referee. It doesn’t matter if you’re listening. They don’t believe that you are in fact listening, right? What I do there is, I say, “Yeah, am I right there?” Then they could either say yes or no, and the added psychological bonus is this.
People feel like they are in control when they have the opportunity to correct you. Think about it as a child and a parent, who’s correcting who? In school, teacher versus a student, who’s correcting who, right? I’m saying you correct me. I’m giving you the power in this interaction. Makes them feel safer, makes them trust you more, and makes them feel more in control, even though I’m not really conceding anything by doing that.

Carol:
I love that, I love that and I also want to make sure we touch upon even more, and I keep coming back to these different strategies. I’m not going to call them tactics because this is with your mom. I don’t want to say we’re using tactics with your mom, but these overall strategies that you’re using in the context of speaking with your son, with your wife, with your mom, with other family members and in the whole context of practicing, negotiating is with every interaction you have. What I want to talk about specifically Kwame is a lot of people, they hear the word negotiation, they’re automatically assuming a battle one against the other, a me versus you, a negative connotation.
However, clearly if we’re talking about practicing negotiating with all of these different parties, people who are near and dear to your heart, that clearly is not what negotiation is. Can you speak some more to that and specifically, how we can adjust our mindsets to realize that negotiation is not a you versus me?

Kwame:
Negotiation has a branding issue. That’s what we’re realizing here. Negotiation has a serious branding issue because it’s exactly what you said, we’re negotiating all the time. It’s not a matter of whether or not you’re negotiating. It’s just a question of whether or not you’re doing it well. Really, bias is everywhere. Their bias is about everything. That’s just the way the human brain works. There’s a negative bias toward negotiation in the majority of situations because people think about the media representations, “Okay, this is a negotiation, I saw that on TV. Whoa that was intense, that’s crazy. Wait Kwame, you’re negotiating with your mom? What?” I think we have to rethink our approach to negotiation.
We have to think about it more broadly, and then we also have to think about what the purpose is of the interaction because again, it’s any conversation where somebody in the conversation wants something. What do we want? Well, for me, I see it in three different domains. Number one, I think offensively. How can I get more of what I want? Number two, I think defensively. How can I avoid things that I don’t want? Number three and most importantly, how can I strengthen the relationship through the process? I want to think about all three of these pillars of negotiation as I enter the dialogue. Okay, I’m a trained negotiator. My mom is a nutritionist. She did not negotiate.
Yeah, I could bully her using attorney and negotiation skills, and get what I want. For the audio listeners out there, I’m using air quotes. Get what I want out of this situation, how’s she going to feel about that? How’s the relationship going forward? Even though I won in that short term, I lost in the long term. That’s why we have to think more strategically about it, because strategy is about how I can win in the long term, and I think that’s really the difference between thinking strategically and thinking tactically.

J:
Yeah, and I’d love to really dig in there a little bit more because I know many people when they think about negotiation, and I’ve actually asked this question, what do you think about when you hear the word negotiation. Oftentimes, I get a response like you think about being in a board room and you think confrontation, and you think it’s hard-nosed and people staring each other down, but as you’ve already described it’s not. We need to be thinking offensively and defensively, but I want to touch more on your third point there, which is it’s about building long-term relationships. A lot of that goes back to when we negotiate with somebody, it’s often not just a single negotiation, right?

Kwame:
Exactly, yeah. It’s very rare that we’re going to have these negotiations that exist in a vacuum, where it’s purely transactional, the relationship ends after this. Maybe if you’re in a marketplace in a different country, maybe if you’re negotiating for a used car or something like that, but for the most part, the majority of these times, these negotiations are going to follow us in some way, somehow. Even if you don’t interact with that person directly, your reputation is something that you need to guard with your life. Your reputation, your credibility, those two things are two of the most persuasive things that are out there. You think about somebody with a great reputation, they say something.
Somebody with a bad reputation, they say the exact same thing, the exact same way. Which one is more persuasive? We know the answer. We have to make sure that again as part of our relationship management strategy, we’re making sure that we are guarding our reputation because even if we don’t get what we want in this situation, we can’t win them all, right? We have to make sure that we’re positioning ourselves for success in the future.

Carol:
I love it. In that relationship building, in that positioning ourselves for success in the future, in keeping the dialogue open, it sounds like a lot of preparation is just absolutely critical to the whole process. Can you talk to us more about that?

Kwame:
Yes, and I come bearing gifts even though it’s after the holidays. If your listeners go to Americannegotiationinstitute.com/guide, they can get access to not one, not two, not three, but over 15 free negotiation guides how to negotiate, just business negotiations, conflict resolution, salary negotiation, how to have difficult conversations about race and/or politics, how to negotiate as an introvert, all there because the single best thing that you can do to improve your outcomes in negotiations is preparation. That’s the best thing. They did a study. They analyzed over 200 negotiations in a laboratory setting. They had one group that just went into the negotiation, and they measured those outcomes.
Then they had another group that did one thing that was different. They didn’t get new training. They didn’t get new strategies or tactics. All they did was they took the time to prepare thoroughly before the negotiation. The difference was the group that prepared was able to create 11% more value for themselves and at the same time, create 7% more value for the other side. Not only did they win more for themselves, but by using creativity and negotiating collaboratively, they were able to find ways to create value for the other side. Preparation is a critical part of this process, not only for your sake, but for your partner’s sake because it’s not about winning at their expense. If you can find ways to help them throughout the process, it’ll make your life a lot easier too.

Carol:
Talk to us more Kwame about yeah, I understand that these studies have been done, and I understand that there are better outcomes when this preparation has been done, but tactically, so for those of us who don’t know, we hear yeah, we need to prepare for the negotiation. What exactly am I supposed to be preparing?

Kwame:
Yeah, and I think it’s important to recognize this. There’s a distinction between research and preparation. Research is just gathering information. Preparation is more strategic. We’re talking about what we’re going to do, how they might respond, and what we might do in response to that response, right? I think one of the most important things that we need to do during the preparation process is come up with a list of open-ended questions that we want to ask during the conversation.
The framework that I’ve created for negotiation and conflict resolution is called the compassionate curiosity framework, where we acknowledge and validate emotions to overcome the emotional challenge, get curious with compassion where we’re asking open-ended questions with a compassionate tone, so they don’t feel like it’s a threat. Then joint problem solving which is just collaborative negotiation, but in the title of it, compassionate curiosity, it’s really pushing for the fact that one of the most persuasive things that you have at your disposal is a great open-ended question. A lot of times in my difficult conversations, I’m not advancing many positions.
Even though I’m a lawyer, I’m not creating all these persuasive arguments. That’s usually not what wins the day. It’s usually asking the right questions at the right time in a way that allows them to convince themselves, and the way that I look at it, I don’t believe I can convince anybody of anything. I think they can convince themselves. If I put the right questions together and sequence them the right way, it puts me in a much better position for success. I think that’s one of the most important parts of the process when you’re actually preparing for the negotiation.

J:
I love that, and we talk about that a lot, not asking the yes and no questions, but asking the questions that actually further the dialogue. I’ll probably go even a step further and Carol will agree with me because I like to play devil’s advocate and debate. When we’re asking those open-ended questions, oftentimes we think of it from a Socratic method standpoint, where you’re trying to trap the other person, you’re asking a question that you know the answer that they’re going to talk themselves in the corner, but you’re not saying that.
You’re saying basically ask the question that allows them to self-reflect on what they’re asking for, allows them to clarify, not just for you what they want out of the negotiation, but also clarifying for themselves what they want out of the negotiation because I found that a lot of times people will come into negotiation thinking they want something. They want X. Real estate, we talk about a lot because a lot of our listeners are real estate investors. A lot of times, we go into a negotiation thinking the seller just wants to get the highest price. I need to pound them down on price. I need to get the price lower, but at the end of the day, if you have that really sincere compassionate discussion with them, what you find is often it’s not about price.
There’s something else. Maybe they’re terrified to move because they haven’t left that house. They grew up in that house, and they’ve never moved before. Perhaps they just need money to pay for their daughter’s wedding, perhaps whatever and a lot of times, it doesn’t just come down to getting the highest price, it’s solving some other problem. Can you talk to us a little bit about that?

Kwame:
Yeah, absolutely, and I think this really comes down to the distinction between interest versus positions because to your point, we have this assumption that oh, they want to maximize value and not only that, they want to maximize value at my expense, right? That’s the adversarial type of mindset we often bring to these discussions, but we have to shed those assumptions. We have to think deeply within ourselves and say, “How do I know that to be true? Do I know?” Yeah, I don’t know and so I’m going to ask these genuine, open-ended questions. I think to your point J, we have to be able to hold back that desire to persuade. There are persuasive questions that you can and should ask, but you need to do it at the right time.
At the beginning of the conversations, these are genuine, open questions to figure out how do you think about this. I think oftentimes, it’s the questions that might seem dumb, or stupid that get us the biggest return to your point. Sometimes, it’s not always money, so what is the biggest driver for you right now? What are your biggest concerns? Okay, now we’re going to get to those interests. A position is what somebody says that they want, and interest on the other hand is why they want it.
If you focus on the position, then you say, “They want this, I want that. This is a zero-sum negotiation. It’s going to be a tug of war and it’s going to be painful for both of us,” but then if you take the time and become a little bit curious, now you understand the why behind the what, and now you can find creative solutions to give them what they really need, even if it’s not what they’re asking for in this moment.

Carol:
Great. Speaking of this whole notion of confusing interest with position a mistake people often make of making assumptions about what the other person wants to accomplish, what are some of the other big mistakes you see people regularly making in the negotiation process?

Kwame:
Yeah, I mentioned trying to persuade too soon, that’s one. The myth of rationality is another one. I mean we’re all business people here, right? We want to make money, and there are rational logical choices that can be made that could maximize our returns. We assume that the other person is going to try to do something similar, and the reality is that when you look into the psychology about it, the majority of times, people will make decisions with their emotions and then subsequently justify it with their logic. What’s funny to me is as a mediator, I get to be literally in the middle of a conflict, and the way that I would do it is I would use shuttle diplomacy.
I would talk to one party in private, so they can share with me instead of posturing and posing for the other side. Okay, great, I get their information, then I go to the other side, do the same thing. I cannot tell you how many times I talk to one side and they say, “These people are lunatics, absolutely crazy, completely irrational. There’s no logic to be found in there.” Then I say, “Okay, thanks for sharing,” and then I go to the other side and they’re like, “These people are lunatics, absolutely irrational.” I said, “Well, who’s rational here?” The answer is nobody. When it comes to these business negotiations, one of the biggest mistakes that we make is that we are trying to make logical, rational decisions based on data and information, right?
We’re trying to make those arguments at a time where their brain is not capable of processing those things at a high level. If they’re in a highly emotional state, they can’t think in that type of way. Whether we like dealing with emotions or not, those emotions are going to play the role of hidden, and sometimes not so hidden barriers in these negotiations. If we’re not able to wrestle with those emotions and get them out of the way, then we’re going to struggle in these conversations.

Carol:
Okay, awesome. Kwame, people love, love, love a good story and I’m particularly interested in an example of what you’re talking about now, where there are two different parties who are being very emotional in the whole process and feeling like there’s not a lot of rationalism, is that a word, going on. Do you have any great case studies or stories that you can share with us about that type of situation?

Kwame:
Absolutely, and this is why I still practice law. It’s story collection, so I could use it to teach. In the past a few years ago, I was dealing with a situation where it was a family business. A father got sick, we were representing the children and it’s a situation where the family is not on the same page. They don’t like each other and the relationship has really, really fractured. What we’re recognizing is that sometimes on one side, we don’t feel like they have any case at all, like no case at all, but then on our side, we’ve been hurt. When people are hurt, they want to hurt other people. You probably heard the saying hurt people, hurt people, right?
It’s a situation where I have to negotiate with my clients because I say, “Hey, I think settlement is a good move here. They might want to go to war.” I have to negotiate and overcome their emotional barriers to settlement to show them that this works, but I can’t just say, “Hey, statistically settlement works. Most cases settle anyway. If we go through this litigation process, you’re just going to pay me tens of thousands of dollars, and then settle down the road.” That might be factually correct. It doesn’t mean it’s persuasive, right? I have to go through this process, understand their emotions, process it by using the compassionate curiosity framework.
Remember, it’s acknowledge and validate emotions, get curious with compassion and joint problem solving. I’m asking those questions, “Okay, so tell me more about how you’re feeling. Okay, it sounds like you feel as though you’ve been taken advantage of in this situation. Is that right? Yeah, no, that makes sense, it makes complete sense. Great.” I’m going to work through those emotions then bring them toward rationality with questions, then joint problem solve to see what the solution is. Ultimately, they were on board with what I did, but it took 60 minutes and sometimes, what we have to do is we have to go slow to go fast because we might want to get into that debate mode, but if the person’s not ready, it’s just going to be a war of attrition.
Even if they admit that you’re right in that moment, did they commit to doing what you said they were going to do? Probably not. Even if you win, you lose. I have to be more patient in that situation. Again, it shows a great example of how with these negotiation skills, you’re negotiating with the people who are closest to you. I haven’t even talked about the negotiation for the other side. I have to go and get everybody aligned internally first using these exact same negotiation skills, and then I need to negotiate with my lawyers and the legal team to get them on board with the negotiation strategy. Then we need to execute said negotiation strategy with opposing counsel.
You’re seeing how it’s negotiation upon negotiation, upon negotiation, but each one is critical and you have to move through it differently, depending on who’s on the other side.

J:
Yeah, that makes so much sense, but I do want to talk about, so obviously we’re emotional creatures. People are emotional creatures, and obviously being rational during a negotiation is probably long term better than being emotional, but I assume that there’s a middle ground there, and I want to bring up a topic that I hear about a lot when we talk about negotiation, that’s mirroring. Basically, acting in a way that helps the other party relate to you, or you relate to the other party, sending the message that we’re very similar. People talk about mirroring, talking cadences and accents, mirroring postures, mirroring phrases, things like that.
Basically, not just putting yourself in the other person’s shoes, but acting like the other person to build empathy. I’d love to talk about mirroring in general and get your thoughts there, but how about mirroring from the perception of rationality, versus emotion if we’re dealing with somebody? Carol and I have this a lot. Carol is a very emotional person, I’m a very analytical and rational person, not that she’s not rational, but she tends to be…

Carol:
[Spread 00:29:37] politely my dear.

J:
Yes, absolutely.

Kwame:
[Crosstalk 00:29:39].

Carol:
Proceed really… Proceed.

Kwame:
Taking that hole.

Carol:
Just keep talking.

J:
When we have arguments or debates or fights or whatever you want to call them, oftentimes things go wrong because one person is so emotional, and one person is analytical. What is the right thing for that analytical person because typically the emotional person isn’t thinking about it from an analytical standpoint? What’s the right thing to do to bring the sides together? Should I be more emotional? Should I ask her to be more analytical? How do we get through that impasse?

Kwame:
I dare you to ask somebody to be more analytical.

Carol:
Right?

J:
I know, I know.

Carol:
I’m like, “Oh, let’s go. You just tell me to start being more analytical and see how that works out for you.”

J:
I realize that as it was coming out of my mouth.

Kwame:
Oh, it’s funny. Listen, I’m much the same way and the story I have is from my relationship with Whitney. Yes, Whitney is more emotional and I am more rational or strategic, but here’s the thing though. I had to do a little bit of introspection. The beautiful thing about the compassionate curiosity framework is that it’s not just used for external conflicts and negotiations. It also helps you with your internal negotiation to get you clarity too. Exact same way, acknowledge and validate your own emotions, get real with yourself. How do I feel? Get curious with compassion. Why do I feel this way? Joint problem solving, reconciling the differences between our hearts and our minds.
What would satisfy me emotionally and what would satisfy me substantively? Even though I thought I was being really rational, what I recognized is that for me as a lawyer, the way that I cover my emotions is with rationality. I get more robotic, the more emotional I am. It’s not that I’m not feeling those emotions. It’s that I’m manifesting it in a different way. What I had to do is I had to let Whitney know, “Yeah, I do feel emotional about these things. I just don’t show it in the same way that you do.” One of the things that was easier for me to do was handle… and this is uniquely, I want to make it clear to everybody that’s listening. This is uniquely with me and Whitney.
I was able to handle those negotiations more effectively via text message. That sounds shocking, because the general rule that I give people is that the more emotional the conversation, the more personal the contact needs to be. Email’s not going to cut it, try to get on the phone. Video chat better. In person, even better, but with Whitney, it was a lot easier via text message because I could communicate the fact that I was feeling emotions using words in a way that she could understand and appreciate. Whereas if she actually saw me and I seemed really stoic and unemotional, she wouldn’t appreciate it. A couple things on this. First J, you’re right. You need to show that you care.
If people don’t believe that you care, they’re not going to be persuaded by you. Showing that you care and showing a hint of emotionality at times strategically is sometimes the best strategic thing to do. You also have to be real with yourself and know who you are and how you appear to other people. In that situation, the best strategy for me and Whitney was text message. Oo other relationship do I have where that holds true. I’m always better in person, but with Whitney, slowing it down was better because it gives her time to think through it as well, so her heightened emotionality isn’t causing her to say things that she later regrets because she’s like, “Oh man, I didn’t know I was that mean.”
I was like, “Yes, you hurt my feelings.” That was the medium that works the best You have to figure out who the other person is, who you are and create strategies and tactics for that unique situation. Context is everything, and so that needs to be part of the analysis as well.

J:
This is huge and so eye-opening Kwame, and there are so many things within this discussion that I think are just like sitting back here at stuff we should know, but we’ve never really formally explored it. Of course, I’d like to explore it more. I’m finding it really fascinating that you’re talking about the best way for you to communicate negotiate with Whitney is through text messages, and I’m thinking about all of these real estate negotiations a lot of our listeners are a part of. A lot of just everyday negotiations, different entrepreneurs and business people are a part of and of course, we’re always struggling to figure out when do we communicate face to face?
When is email the best if do people still use email, right? When is text the best? How do we determine what is the best communication method so that we can achieve what the best solution is for all parties in a negotiation? How do we just tactically go about doing that?

Kwame:
I have another gift. If you go to Americannegotiationinstitute.com/virtual, you can get access to our virtual negotiation handbook. I think what we have to do is we need to analyze again our own strengths, analyze the other person, and then just analyze those best practices. People might say, “Never negotiate via email.” First of all, that’s not possible. If a negotiation is defined by any time you’re in a conversation with somebody and somebody wants something, yeah, you’re going to negotiate via email. At some point, if you’re at all communicating with them via email, that is incorporated in the negotiation by definition. You have to use an email in the right way.
Email is a tool of… It’s like a setup tool, not a setup in terms of like ha, gotcha set up, but it’s like something that you use to set the stage for the conversation. You frame things via email. You’re letting people know what the storyline for the conversation is, who are you, who am I, why are we having this conversation. It’s not me versus you. It’s, “Hey, you have a problem, I have a problem. Let’s work together to find a solution.” You can set the tone really well via email, and you can also set the agenda which is an incredibly powerful strategic tool to ensure that we’re talking about things that matter to you, right? That’s very important.
Then during the conversation, you have the conversation. Then after the conversation, you follow up via email. You always want to create a paper trail, letting people know what they agreed to, what next steps are, those type of things because number one, people could forget about their commitments. Number two, people could conveniently forget about their commitments, right? It’s about using the right tool at the right time. Email is good at the bookends of a conversation and during the negotiation if it’s longer just to confirm things, a quick call is nice to just touch base. If there’s something a little bit more serious that needs to be discussed, than hopping on a video chat or in person if possible would be the best way to do it.

J:
What about a situation, and this is probably… I mean you’re an attorney that helps business owners that with their business issues, and so I’m sure this is issue that’s very near and dear to your heart, at least your client’s hearts. What about when we can’t get face to face with the other person. In the real estate world, we often work through real estate agents and brokers and other fiduciaries that represent us. In the business world, we often work through business brokers if we’re buying or selling a business. In the legal world, we’re often working through our attorneys. How many times do people hear yeah, don’t talk to me, you have to talk to my attorney?
How do we effectively or more effectively negotiate when we’re not getting face to face with the other party, and we have to go through an intermediary? Are there any tips there that you can help us with?

Kwame:
I think what’s important to recognize is the constant tension between agent and principal in that situation, right? Who is the client? Who’s the representative? What authority do they have in that moment? What incentives perhaps, perverse incentives does the agent have that might be contrary to what the principal wants, right? As you go through the preparation after you download those free guides of course, you strategically think through all of the players because we often make the mistake of assuming that the other side is a monolith. Yes, they think this, “Okay no, no, no, let’s slow it down a bit. What do you think the principal wants? What do you think the agent wants? What’s in their best interest?”
We communicate to those people differently. For instance, for me as a lawyer, sometimes what I would say is, “I’m assuming you’re working on commission here, right? It’s not an hourly type of situation. If we proceed down this route, you’re going to have to log a lot more hours and the settlement is about going to be approximately the same. Listen, I’m hourly. I don’t work on commission. I am cool with logging these hours, okay, but for you, your hourly rate diminishes the more work you do. I’m willing to have a conversation about settling. Are you open to it now?” He’s like, “Oh, yeah. Now I am,” but in that situation, her client for instance might be of the mindset of, “No, we’re going to go all the way. We’re going to take this to court. It is the principle notes.”
Okay. If you’re in a negotiation and somebody says it is the principle, just know your life got a lot harder because if somebody is negotiating based on their own principle here, then that they’re saying principle when they are saying emotionality, just throwing that out there. What I want to do is I want to make clear to the other side the distinction between agent and principle. As a lawyer, the code of professional responsibility precludes me from talking to the client. I cannot ethically talk to the client. I need to communicate to the client through the lawyer in a really specific type of way.
I think really when it comes down to it, you just need to be mindful about the tensions and mindful about the different interests for the parties at the table, because everybody has different interests. If you understand that, you can adjust your strategy accordingly.

Carol:
Awesome. I’m trying to process so many interesting things in here that I want some even more tactical tips around when there’s a lot of tension, let’s be real, in a lot of negotiations, right? In the front of this episode in the beginning, we’re talking about the concept of negotiating with people who are near and dear to your heart, and it doesn’t necessarily feel like that poorly branded, the brand of negotiation, but when you come back to I guess this more typical branded negotiation where some things are sometimes going to get a bit hostile with all of that tension floating around there, what are some things we can do to move through it, to move past it, to work through the tension in hostility and get everybody to a place where they need to be for an effective result?

J:
What would you recommend to members of Congress today?

Kwame:
Quit.

Carol:
You had to go there. It was just a matter of time.

Kwame:
Yeah. For me, the messier, the better, the more emotional, the better. It’s always a game to me because I’m a recovering people pleaser. I talk about that in my book Finding Confidence in Conflict, and the TED talk with the same name and because I like to test the skills. We have to remember, it’s a skill, these are skills. Let’s use an analogy from sports. Kobe Bryant was talking about how when he made the transition from high school to the NBA, one of the most challenging things was the fact that he was going from a 20-game season to an 80-game season. He said, “Even though when I was shooting, the ball was on track, I was missing shorts like I never had before. I was missing short in air balling.
That’s when I realized my legs weren’t strong enough, right?” The thing is your form is going to break down due to exhaustion. You’re going to get more exhausted because of heightened emotionality. One of the most important things for us to remember is maintaining our form throughout the discussion. The messier it gets, the more emotional, the more hostile it gets, the closer you need to stick to your form. You do not get style points in negotiations, okay. You do not get style points for negotiations. You don’t need to come up with something incredible. No, the nastier it gets, the stronger you hold to the compassionate curiosity framework. I just go straight to the fundamentals.
Okay, yeah, it sounds like you’re really frustrated about this situation. Can you tell me more about that? “Yeah, I’m frustrated because your client is completely loony.” “Ah, I can understand why you feel that way that, but it makes sense given your perspective. What do you think could get this over with?” “Okay. Well, if your client got reasonable again, yeah, I think…” “That’s a good point, all right. What does reason mean to you in this situation? What do you think could work? You notice I am not mirroring that level of emotionality in that situation. What I’m doing is I’m just sticking really closely to the framework. I’m still using their emotionality as an opportunity to gather more information, information that I can then use to transition into joint problem solving to see what works.
The thing is a lot of times, we don’t even get to high-level negotiation techniques, especially when it gets messy because we’re not doing a good job of addressing the emotionality in that moment. We have to really stick really closely to the form in order to make sure that we don’t make a mistake in that situation because again, it’s like any other sport. Arthur Ash, for instance, in tennis said for the novice tennis player, you are going to be incredibly successful if you are not a professional, if you can simply keep the ball in play five times. That’s it, five times and in a negotiation, most of the time, especially when it gets ugly, your success or failure is going to be predicated more on the mistakes that you don’t make, or do make.

Carol:
J, write that one down. Your success or failure, I’m going to say it again. Your success or failure is based on the mistakes that you don’t make. Did I say it properly? Did I do it a little bit of justice?

Kwame:
Yeah.

Carol:
That is phenomenal. Love, love, love, love, love that piece of advice. That’s fantastic.

J:
I love any Arthur Ash quote because a lot of people don’t know, I was a serious tennis player growing up. I met Arthur Ash when I was young, and he was always-

Kwame:
Oh, wow.

J:
… he was always a role model about it.

Kwame:
That’s incredible.

J:
Love any Arthur Ash quote.

Carol:
Love it.

Kwame:
Fantastic.

Carol:
Let’s say though Kwame because I’m in a little contradictory mood today here, let’s say that we are sticking to this framework. We are practicing the negotiation skills that we’ve learned, and there comes a point in a negotiation when nothing’s moving forward. How do we know when it’s just time to walk away and more importantly, how do we walk away? How do we figure it out and what do we do to make that happen?

Kwame:
Oh, great question. Okay, so here’s what we need to do. First of all, it’s a matter of circumstance. A classic lawyer response, it depends, right? It depends, and so here’s a simple rule to follow. You say no to any deal that is not better than your BATNA. BATNA is a fancy negotiation term for best alternative to a negotiated agreement. You are only as strong as your next best option, right? When you’re going into these negotiations, you have to ask yourself, what do I do if I don’t get this deal? Okay, that’s my alternative and if my alternative is here, this deal needs to be at least there or better. If it’s not, then the answer is no. Now the question is how do we say no? We can’t just say forget you and walk away.
There’s an art to that too, and it comes down to saving phase. With saving phase, what we’re doing is we’re giving the other side an opportunity to leave this interaction with their dignity in place. What I say is this. Listen, as the deal stands right now, this isn’t going to work for us, but here’s the situation. If something changes on our end, we’re going to come back to you and we’ll let you know. If something changes on your end, you come back to us and let us know. The magic in that is that let’s say they’re bluffing, let’s say they’re bluffing and I just say listen that doesn’t work. It’s a situation where they could go back and take some time and say, “Hey Kwame, by the way, something changed. Okay, adjust my position.”
They can do that without looking like a loser, but instead, I’m not going to end the conversation and say, “I know you’re bluffing, I know you have more. All right, so I’m going to walk away until you get your mind right.” Okay, then they can’t come back and look okay. Now, they have to look like a loser if they come back to me, right? What strategic benefit does that have for me? When we walk away, we want to make sure that we’re leaving the door open for further negotiations because things legitimately could change on your end, and things could legitimately change on their end. Even if it is a legit and illegitimate bluff, they can still come back under the guise of something changing on their end.

J:
It works both ways. I mean I like to think I’m a pretty good negotiator, but I’m the first to admit, I have a lot of issues with my negotiation. One of the big ones is that sometimes I let my emotions get a hold of me and if a negotiation goes bad, instead of walking away the right way the way you just expressed, which is let both parties save phase, I’ll walk away with the screw you, this is done, I never want to talk to you again. Obviously not that bad, but I will send the message that this negotiation is over, as opposed to sending the message this negotiation’s over for now, let’s come back when the time calls for it. When I do that, I basically close the door on myself.
If it’s a deal that a week later, two weeks later, I decided okay, maybe my motivation is higher than I had realized, and I really want to come back, I’ve now made it more difficult for myself to save phase, not just the other person, and now I’m less likely to open up that negotiation. Basically, I’ve hurt myself by not walking away in a way that allows for us to easily come back to the table if and when something changes.

Kwame:
Exactly and again, this isn’t natural. What we’re doing is we’re creating unnatural responses to these situations because again, it’s nice to talk about these things in a really safe environment, “Hey, we’re just chatting, you, me, we’re all chatting here,” but then we put it out into the wild. How does this work? It’s like, “I am under duress. What do I do?” Pushing people to that point where they have to walk away. How do they walk away under the fire and heat of hostility from the other side, while still giving me the opportunity to maintain my dignity, especially when I’m not doing anything to earn that right with the way that I’m acting?

J:
Awesome. I want to go back to something you said earlier. You talked about BATNA, the best alternative to a negotiated agreement and you talked about it from our perspective, which it’s funny because I’ve never articulated it this way, and I love basically say no to anything that is less than your best alternative to coming to an agreement. If something isn’t as good as your second best choice, obviously you don’t say no to. It could you go with your second best choice, but it also works the other way, a great strategy to become a better negotiator is to figure out what the other side’s BATNA is.
In the real estate world, we often talk about if you’re talking to a seller that is going to get foreclosed on in three days and if they don’t sell their house in the next three days, they’re going to go through a foreclosure, their second best option to coming to an agreement with you is much different than if they’ve got 12 other offers on their house. Can you talk to us about how important it is, and how you go about figuring out what the other party’s BATNA is so that you can figure out how much leverage you have in that negotiation?

Kwame:
Yeah, this is important and it has hints of game theory in it, because you’re thinking about the moves you’re going to make, you’re thinking about the other side’s moves, and what happens if they make certain moves. It gets really fun during the analysis. Again, that’s why you have to download the guides and go through it, and think through this very systematically. If this, then, what, right? In that situation, what we want to do is do some research to figure out what most likely is their best alternative. During the conversation strategically, what I like to do is very tactfully let them know why their best alternative isn’t really that great.
If I know that their best alternative isn’t that great, that means in this situation, I have power, I have leverage, and people throw away their words, power, and leverage all the time, but they don’t really think about what that gets them. What power and leverage gets you is the ability to receive concessions from the other side without needing to give commensurate recessions to the other side, right? Yeah, you’re going to give that to me because you need to. I don’t feel like I need to give you much right now, because I know right now, most likely I’m still better than your best alternative. When you have power, a lot of times that will manifest itself in the form of time, right?
It’s going to be a lot of different ways. There’s going to be concessions from them, but you can hold your position because you say, “Yeah, my alternatives are pretty sweet, so you need to give me something good to get me away from that.” One of the things that a guest came on the show and said and it’s so great is that the person who needs the deal the least is the person who’s probably going to win the negotiation because they don’t need to give up as much because their situation is pretty good.

J:
I absolutely love that. I have one more question, then I want to go on. I want to talk a little bit about your book and your podcast, but I do have one more question because this comes up in well most negotiations in our space, in the real estate space. Okay, I make an offer to the other party, or maybe the other party makes an offer to me, or counters an offer to me and their offer or counter offer is unreasonable. Basically, it’s not in the ballpark of anything we’re willing to accept. That is the right response? Do I continue a negotiation when I get an offer that isn’t even in the realm of possibility? Do I counter it? Do I walk away? What is the right response in that situation because it happened so, so often?

Kwame:
Yeah, there are a couple ways that you could approach it. I’ll go with the simplest way. It’s not the most strategic, but it is an option. They give an extreme counter, then you give an extreme counter, right? That is re-anchoring, so they come up with an anchor, an aggressive response, and then you respond aggressively, that often leads to deadlock though. Usually, that’s an unproductive situation. In most situations, like why would I put myself in that situation? It’s just going to be an ugly negotiation that is more likely to end in failure. Again, let’s go back to the fundamentals because this is nothing more than data.
If we think about it more in terms of data and versus something that is offensive, then we’re going to think a little bit more strategically about it. Because if we think about it in terms of offensive like, “How dare you do that to me? Do you know who I am?” “Okay now, we’re not thinking clearly.” Okay. I say, “Hmm, okay, either one, this is a strategic move that they’re making or two, there’s a significant need behind it.” Psychologically, the more you talk about something, the realer it becomes. The more you talk about something, the realer it becomes. I will never say what they said. Their anchor, I will never repeat that number, I will never repeat that offer, I will not write it down.
I don’t want that to become more real than it already is. At the very beginning, I’m going to set expectations and listen, because I want to be a straight shooter here. I’ll say, “Listen, I want to be honest with you, maybe save you some time and save me some time, that offer is it’s not something that we can do. It’s not something we can do.” Again, pay attention to the semantics here. “That offer, I’m not repeating it. That offer isn’t something that we could do. However, I am interested to know what it is that you need in this situation. Tell a bit more about it,” because there is this unwritten rule in negotiation that if you make an offer, you must then justify that offer.
I can’t just say. “Yeah, I’m looking for $500,000.” “Okay, why?” “Well, I’m not telling you.” That doesn’t make any sense, you have to explain why, explain yourself. It’s a data point, a singular data point. I want more data to understand why, right? It’s again understanding the distinction between interests and positions. They just provided you with an extreme position. I’m not playing that game. I’m going to figure out what it is that you really want, and then I’m going to come up with more of a creative solution and counter that in that way, but before I do that, what I like to try to get people to do, especially when they anchored really, really outside what’s possible, I just say, “Listen, if that’s the starting point, I don’t think there’s really much sense.”
I want them to take two steps, instead of one. With the negotiation dance, it’s I make an offer, you make an offer, I make an offer, you make an offer. There is another strategy where you are trying to get the other person negotiate against themselves. They make an offer, not good enough, make another offer, and I am going to play that game as long as you let me. No, that’s not good enough either, okay, make another offer, right? If I’m really content in my position, I’ll end the negotiation there. I just say, “Listen, I appreciate the offer. Again, it’s not something that is even close to something that we can do. Based on that alone, I think we should just step away and then consider our other alternatives, but if something changes on your end, let me know.”
Then they come back and they say, “Actually, you know, maybe we could start here,” and I think that’s a more strategic way of going about it.

J:
I love that. Okay, this has been great. You have an amazing book. You have a book called Finding Confidence in Conflict: How to Negotiate Anything and Live Your Best Life. Can you tell us a little bit about who that book is for? I can guess, but I want to hear you say who that book is for, and what will we get out of that book.

Kwame:
Yeah, the book is designed for the most emotional types of negotiations, the people that are close to us and those heated business negotiations where emotions are going to be one of the central issues. Really, I consider this the first step. The first step in any negotiation, the first step in anybody who wants to learn negotiation, teaching the compassionate curiosity framework, acknowledge and validate emotions, get curious with compassion and joint problem solving because this is something that you can use in every single conversation that you have. It’s just focusing on that, but even before that, it’s focusing on you as the negotiator, how you can overcome your personal, emotional, and psychological barriers to being your best self.
For some people, they’re people pleasers. How can you work through that? For other people, they might be more emotional based on some trauma they’ve had in the past, or maybe they just have a more assertive, aggressive personality. All right, how can you work through that? The first half of the book is all about overcoming those challenges, and then the second half of the book is all about how you can actually put this framework into action into different situations.

J:
Awesome.

Carol:
I just wanted to ask real quick too. I’m so curious, I would love our listeners to know more about your podcast and specifically, your new YouTube channel and what they can expect from those.

J:
Thank you very much. Yes, the podcast Negotiate Anything it’s the top-ranked negotiation podcast in the world. Again, Negotiation Anything, right? We want you to be able to negotiate anything. Whether it’s a business negotiation, we have you there. Whether it’s conflict resolution, leadership, negotiating with family, all of those things because the reality is this. They’re going to be hints from every single walk of life that you can take, right? You can say, “Okay, I might not be a lawyer, but they are interviewing a lawyer, and that negotiation strategy could actually work really well in my real estate negotiation. Oh, this leadership focused one can actually tell me how I can manage my team more effectively and manage them remotely. Okay.”
We’re trying to figure out those commonalities between these various negotiation principles, so people can see how they can apply it in different aspects of their life. Then the YouTube page is new and we’re producing the podcast there as well, but also we’re doing some native content that’s really fun. We have a producer now, and she tries to stump me with reactions. She’ll send me a video that I’ve never seen and have me take a negotiation take. What can we learn from this in terms of psychology, negotiation, relationship building? What do you see here? I don’t know what’s coming. Then I just have to go and do a monologue off the cuff. It’s really fun. I think one of the things that’s most exciting to me is the diversity of content, right?
It’s all about negotiation, but we’re seeing just how we can find it everywhere in every aspect of our life.

Carol:
Cool.

J:
Absolutely love that. I also want to mention you have a TEDx talk. You did a TEDx talk in Dayton called Finding Confidence in Conflict, and you can find that I assume on YouTube. We’ll find it. We’ll put a link in the show notes along with everything else we’ve talked about. Kwame, this has been absolutely amazing. I do want to give you an opportunity to let our listeners know where they can find out more about you, where they can connect with you, anything else you want to talk about, or mention before we wrap this one up.

Kwame:
Yeah. The American Negotiation Institute has a website, Americannegotiationinstitute.com. Seemed like a great URL at the time, but it is incredibly long, so apologies for that, but you can find all of our content there and of course, the podcast and connect with me on LinkedIn. I’m constantly posting things on LinkedIn, trying to stay active there. Of all the social media platforms, that is the best one to reach me.

Carol:
Excellent.

J:
Fantastic. Everybody, check out the show notes because we have a whole lot of great stuff in the show notes, and make sure you check out Kwame’s podcast and book and everything else. This has been amazing, and I’m going to figure out how to negotiate with you to come back at some point because there’s s much more I could learn from you and so much more I’d love to talk about. For the time being, thank you much for being here. We really appreciate you taking the time and you sharing your wisdom and expertise.

Kwame:
My pleasure. This was a lot of fun.

J:
Awesome. Thanks Kwame.

Carol:
Thank you, see you soon. That seriously was such a great episode, so many knowledge bombs dropped by Kwame, excellent information. Every single step of the way, I love how back in the beginning of the show he talked about the fact that negotiation really has some issues around its branding, right? He talked about it doesn’t need to be this hostile you versus me thing, but instead, it’s all about strengthening relationships for effective results in the long term. I think that that was super valuable, and there’s so, so, so many like I said so many great tips, but there’s one that I just can’t get out of my mind, and I don’t think I ever really specifically have put this one into practice consciously before.
It’s that tip that Kwame mentioned about making sure you don’t re-anchor what the other party has offered because the more something is repeated, the more real it becomes. You never ever, ever, ever repeat the other person’s offer because that helps convince them that it is valid. I absolutely love that tip and so many more.

J:
Yep, absolutely. Awesome. I’m not sure if he was saying don’t ever repeat any offer that the other person is making, or don’t repeat an extreme offer, but the nice thing is we’re going to have them back at some point soon, so we can clarify that. He was somebody that I feel like I could have on the show 20 or 30 times. I just want to be friends with him.

Carol:
I know, he was fantastic. He was super great.

J:
He was and I’m going to avoid saying anything else because I know I already stepped into it earlier when I…

Carol:
Oh, what did would you step in, that part when you told me I need to be more analytical?

J:
No.

Carol:
Oh, I have no idea what you’re talking about. Okay, on that note, let’s wrap it up baby.

J:
Everybody, thank you much for tuning in. I’m going to go take my beating now. We will see you next week on another amazing episode of the BiggerPockets Business Podcast. She’s Carol, I’m J.

Carol:
Now go use compassionate curiosity in every one of your conversations today. Beautiful, thank you Kwame for the material. Have a really good week everybody. Thanks for tuning in. We really appreciate you.

J:
Thanks everybody, have a great week.