The Flexibility of the Master Negotiator
Returning to the last bit of the previous chapter ... to master negotiation means learning a variety of tactics and using the correct one in any given situation. Your first task in any situation is to know what type of negotiation you are entering.
They present a sample schedule for an executive, and shows how this person will, in the course of a single day, find themselves in a variety of situations that will require different negotiation strategies. They go into perhaps a little much detail, but here are some of the situations:
- Meeting with a politician about getting permits to build a facility - The executive must be flexible, willing to compromise and perhaps make a small "donation"
- Conference call with an attorney representing an employee who is claiming age discrimination - The executive must be very careful about what information is disclosed and exactly what is said, and probably won't make concessions
- A celebratory lunch for the sales staff - The need to be very positive, but guardedly so, as the next meeting is from a manager who probably intends to use their success as a basis for obtaining more budget dollars
- Meeting with a manager who wants a budget increase - The need to gather some information in advance to assess whether the request is reasonable, but coupled with the possibility that it may be warranted
- Review proposals from vendors - Attempting to discover the goals of each vendor, to know whether the vendor is interested in supporting the business or merely maximizing their own profit
- Discuss a joint venture with a competitor - A very early-stage conversation in which the approach is simply to learn more about the proposal rather than making any firm commitments
In each of these situations, the strategy and tactics must be tailored toward the situation.
Assessing Outcome and Relationship
These are the two most important factors in assessing a negotiation: how important is each of them? Is one more important than the other? He plots them on a quad table, but it comes out to this:
- LOW-LOW - AVOIDANCE - If neither the outcome nor the relationship is important, there is nothing to be gained by entering this negotiation.
- HIGH-LOW - COMPETITION - If achieving the outcome is important, but maintaining a positive working relationship is not, you can turn to hardball tactics to get what you want.
- LOW-HIGH - ACCOMMODATION - If the outcome is unimportant, but you want to develop or maintain a good relationship, your goal should be on accommodating the person, not achieving the objectives.
- HIGH-HIGH - COLLABORATION - Where both the outcome and the relationship are important, it's necessary to work together to achieve common goals: you can't afford to damage the relationship to get what you want, or sacrifice desired outcomes to preserve the relationship.
Note that the author lists a fifth style of negotiation, "compromise," but the way in which this differs from accommodation is unclear.
Relationship Concerns
One of the key factors in deciding on a negotiation style is the value you place on the relationship. In a fundamental sense, the question to ask is how likely you are, in the future, to have to negotiate with that same person again. The author also lists a handful of more detailed considerations:
- If you have had negotiated with this person in the past, was the experience positive or negative?
- Are you likely to encounter with this person in the future?
- How committed is each party (yourself and the other person) to establishing or fostering the relationship?
- How much interdependence is there? Does each party benefit from the relationship?
- How free and open is communication between the parties? Can it be improved?
- How much influence does the other person have (their ability to affect your reputation with others)?
The author elaborates a bit on how the answers to the questions above affect your negotiation style, but it should be fairly self-evident that a relationship is going to be close, ongoing, and productive is far more valuable in the long run than a negotiation with a person you probably won't see again who wants more than they're willing to give in return.
The author speaks of "relationship building" in advance of negotiations, but what he says seems a bit unctuous to me: trying to buddy up to someone in order to curry favor in negotiations. I'm sure there's a certain level at which it is appropriate and ethical, but the distinction isn't made here.
As for how to preserve relations in the negotiation process, there are a few tips - but it largely comes down to taking a collaborative approach - understanding the other person's goals and helping them to achieve them inasmuch as you can afford to and still accomplish your own.
Outcome Concerns
The author suggests that you have a clear idea of what you want to achieve from a negotiation, and considering what is really necessary or essential (versus the "nice to have" features).
There are few instances in which something cannot be negotiated at all, and many instances in which the majority of time in negotiation is spent on matters that are largely inconsequential.
He meanders a bit, provides some examples of negotiations that should be considered important (which are all price negotiations).
Choosing a Strategy
The author returns to the five styles mentioned before and elaborates a bit:
- Avoiding - When neither the outcome nor the relationship is important, there really isn't any point in actively negotiating.
- Accommodating - Where outcomes don't matter but the relationship does, the proper strategy is to accommodate the other party
- Competing - When the outcomes matter and the relationship doesn't, you can play hardball and try to get what you want
- Collaborating - When both the relationship and the outcome matter, a its' necessary to work closely with the other party to achieve both sets of goals
- Compromise - Is defined as a middle ground where both factors are in the "medium" area between high and low importance. In this space, trade-offs are made so that you get some of what you want and still preserve the relationship. The decision over what is most important can be difficult.
Matching and Meshing Styles
The authors suggest that you "won't go wrong" with the two-dimensional model of outcomes and relationships, but suggests there may be other factors to consider.
Personal preferences come into play: an aggressive person might not wish to take on a passive negotiation style even when it is inappropriate; a person who values honestly and fair play will negotiate differently from one who does not. These preferences may stem from the person's psychology, ethics, or culture.
Another consideration is the negotiation tactic that the other party brings to the table. The authors provide a table that show some of the possible consequences, though it seems to be pretty predictable and not very illuminating (if one side is competitive and the other is accommodating, the competitor gets what he wants without resistance; if both sides are avoiding, the negotiation probably doesn't take place; etc.).
The "No Strategy" Choice
The authors mention that some of the people they've coached have insisted that strategy isn't necessary - that you can get good results by being reactive and tactical. The authors find this doubtful - since you had no goals for the negotiation, there's really no way you can say that you achieved them in the end.