#180: How to Negotiate (And Win) When the Odds Are Against You

Manage episode 198239499 series 68993
By Discovered by Player FM and our community — copyright is owned by the publisher, not Player FM, and audio streamed directly from their servers.

Imagine you're dealing with a terrorist or hijacker who has captives and threatens to blow up everything if you don't agree with his demands. How would that knowledge help when negotiating with a boss, a client or perhaps your own kids?

And how are you supposed to remember the negotiation steps? That's exactly what we'll cover in this episode—you'll get to hear how we applied the negotiation skills we learned (and got to a perfectly great settlement). Listen away!

Read the episode online: https://www.psychotactics.com/negotiate-win/


“The auction's on,” said the auctioneer, “would you give $520,000”?

“I've got $520, now $525. The bid is at $530 would you give $550?”

The year was 2005. We had decided to buy a three-bedroom house in Auckland to separate our work from our home. It seemed like a good idea to have a separate residence and a dedicated workplace. We thought it might even be a good idea to hire staff. And that's how we were in the middle of this auction.

Except for one tiny fact

The auctioneer wasn't having a good time. It seemed like just one person was bidding. For about 5-7 minutes, there was a spurt of bidding—many voices—and then suddenly, the only voice you could hear repeatedly was my own. The situation might have seemed bizarre to anyone who was standing around because I was bidding against myself.

“$565”, said the auctioneer. I nodded and added “$567”.

Then before he could recover, I shouted out, “$567,500. No sooner had those words come out of my mouth than I was off, but this time not in multiples of thousands, but in $500. Potential buyers must have been in a tizzy. Only a fool would keep increasing his own price; they must have thought to themselves. But there I was, moving steadily ahead, bidding $500 at a time.

At one point, the auctioneer realised that the price was moving up in smaller multiples than he expected, but there was simply no opposition. As far as the assembled crowd was concerned, they were dealing with an escapee from the mental asylum. Pretty soon, the negotiation was over, and the house was ours (at a price very marginally over our initial budget).

The auctioneer had been out-negotiated.

Instead of the auction being a battle between two or more parties, it fizzled off at a much lower price than he might have normally received. But why did that occur? In every negotiation, both parties have information. The core of what makes one party gain the upper hand isn't logic. Instead, it's emotion.

Emotion and information

Two weeks ago, I started listening to a book that I'd bought way back in late November. We went on our vacation to Sri Lanka shortly after and I had a bit of catching up to do. However, I heard an interview with the author, Chris Voss, and I was taken with the concepts he brought up on the call. I was so excited that I started listening to the book shortly after.

And that's what this series is all about. It's a look into “Never split the difference: Negotiating as if your life depended on it”, by Chris Voss and Tahl Raz. It's important to mention both Voss and Raz because they're both outstanding. Voss has a wealth of experience, and this is real-life experience with murderers, bank robbers and terrorists. They're the kind of people who demand a ransom and casually murder people. Voss walks us right through this minefield of ego and terror.

However, Raz, Tahl Raz is the writer, and as a result, the book is spectacular. I rarely marvel at a book's structure, because by and large books tend to be more about information, which can get tedious. However, this book is masterful in the way it has been constructed. It brings up a concept, explains the concept, tells a story, gives examples and then goes on to succinctly summarise the contents of the chapter.

I love this book for two reasons

It's elegant in its construction and detail. But more importantly, negotiation is part of our lives. If you want to get a better price from clients, a higher salary, or even want your kid to go to bed, you've got to negotiate. But negotiating is one thing: winning is another.

In this book, you're going to find out how to win without the other person feeling bad. No, it's not win-win in any way. You go in wanting a specific solution to the problem, and you win. And the other party doesn't feel like it has lost. How's that possible? I know, you're itching to know what makes this book so cool. In fact, you're probably trying to ditch reading this and go and read the book yourself.

Well, hang in there

What you don't know yet, is that I've read this book once, listened to it twice and listened to a couple of interviews as well with Voss. This piece will distil the core stuff that makes the difference. Instead of leafing through the entire book, you'll get a few core concepts that you can use right away. And then you can go and read the book and the concepts will be more enduring. Sound good? Well, keep reading.

The three concepts we'll cover are:

1) Going too fast—and why you need to slow down and listen. 2) The power of labelling—and why it validates emotions. 3) Calibrated questions—a way to completely remove the attack mode and get the opposition to give you vital information.

1) Going too fast—and why you need to slow down and listen.

About a year ago, our hedge was the bone of contention with the neighbours.

Sure, we'd got the house for a very decent price at the auction, and with it came a hedge that four of five metres high. Every now and then, we'd get the hedge guys to trim the hedge, but it was always a respectable height. That gave us our privacy, but more importantly, we could look into a sea of green, instead of another house, with a grungy shed on the other side of the fence. And about a year ago, on two separate occasions, something happened that would permanently change our view.

At first, the neighbour cut down the trees near the far side of the fence

To come back and watch the trees hacked was an incredibly rough moment, but it chopped down while we were away on vacation and there was little benefit in getting into a war over trees that were gone forever. However, the next time we were away, the entire hedge was reduced to the legal height of just two metres, and that's the way it seems likely to stay.

What's interesting about this whole hedge and tree episode is that the neighbour wasn't aggressive, to begin with. If anything, she was overly helpful, calling us to let us know when our TV antenna had gotten ripped off in a storm. How did someone who was on our side, literally move to the other side of the fence and declare a “hedge-war” of sorts?

Author, Chris Voss would say: It's a listening problem.

Back in 1979, in Cambridge, Massachusetts, the Harvard Negotiation Project was formed. The goal was to improve negotiation results so that people could be in a better position to take on stuff like peace treaties, business mergers and I suppose, the occasional hedge. As a result of the discussions at Harvard, the co-founders of the project came out with a book—and idea—called “Getting to Yes”. They mostly seemed to discard the unreliable, primal animal instinct and espoused a more rational, “let's be friends and fix this together” type of approach.

And yet the FBI, who Chris Voss was a part of, wasn't getting consistent results in their negotiations.

Even if deals seemingly worked out in the boardroom, the idea of a rational approach was ending up in a bloody mess when it came to terrorists and hostage situations. Which is when two of the most decorated FBI negotiators, Fred Lanceley and Gary Noesner, started asking a simple question.

Their question was directed to 35 of the most experienced law enforcement officers, and the question went like this: How many had dealt with a classic bargaining situation where problem-solving (or logic) was the best technique?

Not a single hand went up.

Then came the follow up question…

How many had negotiated an incident in a dynamic, tense, uncertain environment where the hostage taker was in emotional crisis and had no apparent demands?

Every hand went up.

What this informed the FBI negotiators was pretty clear. Emotions are the key drivers of our behaviour, not logic. It's the frustration of some factor that caused the trees and the hedge to be hacked in the way it was. Instead of silly logic and defining our position, we have to step over and listen.

Listening, says Voss, is the cheapest, most effective concession we can make to get the other person on our side.

When people feel listened to, they listen to themselves more carefully. Notice that line again? They listen to “themselves” more carefully. They almost do a double take evaluating the strangeness of their demands. The jagged defensiveness goes down, and they're keen to help, instead of simply barging in with their demands.

The goal of negotiation is to stop acting like a goat

Instead, always move towards the other side. What does the other side need? What are their monetary, emotional or other needs? Who do they need to report to? What constraints are they working with? Being angry and emotional will merely get them to mirror your behaviour, and you get to a situation of mistrust, which often leads to a standoff.

The way to get control is to give the client the illusion of control. It isn't to suggest you're conning them in any way. However, when the chips are not in your favour, you want to even the odds and get the client to start thinking of you. And the only way to get that going is to start listening.

When both parties want to row the boat in opposite directions, it looks like there's absolutely no solution

However, experienced negotiators (like my 8-year old niece, Keira, for instance), knows that's not true. Her mother will be all upset, refuse to give her what she wants and threaten to ground her for a week. Keira switches from “whiny mode” to “listening”.

She says: If I do this, that and the other, can I get it? And almost instantly you are taken back to negotiations you've had with your nieces, nephews or children. They know their position is pretty hopeless, and they turn from tiny little devils to skilled negotiation experts. They listen and turn things around in their favour.

And that's what we need to do as well if we want to get anywhere, let alone get the negotiation in our favour.

We need to listen. Slow down and listen. However, that's just one piece of the negotiation puzzle. Listening alone will pay huge dividends, but we need to get the person to realise that we understand.

So we do the most obvious thing of all: we use labelling. What is labelling and how can we quickly use it in our negotiations?

2) The power of labelling—and why it validates emotions.

Ever seen how some presenters start their speech when they get on stage.

They might say: “Good morning, everyone. It's good to be here. It's a wonderful morning, isn't it?” And while all of this sounds like adorable banter, it's missed out on a significant opportunity to get right into the audience's emotional state. Audience members aren't sitting around to discuss the weather. And neither is the person across the table from you. While you don't have to be all business-like, it's best to get the person across the table to know that you're on their side.

Most people always talk about themselves

And here's where you can run a little test. Tomorrow morning tell your partner how you didn't sleep too well. Almost immediately, he or she is likely to ask you a question or two, but the conversation will swing rapidly to their sleep patterns.

People are so obsessed with their issues that they fail to realise how quickly they take over the discussion. Now imagine you talk about their sleep patterns instead. See what I mean? Immediately two people are talking about precisely the same thing. Suddenly you're the best “conversationalist” ever.

Negotiation pushes that point a little further with “labelling.”

Labelling is a bit like putting a Post-It on a person's forehead. For instance, in early January we got a nasty surprise. There was some development work going on in the plot next door. Three houses were being built, and yes, there was the usual earth-shaking noise.

However, nothing prepared us for what came next. The surveyor's plan indicated that our fence—and the eleven trees on our property, was really within their boundary. As you'd expect, they wanted every inch of their land, and it really did come down to inches. In reality, it was about 12-13 inches at one end and a lot less at the other. Even so, because of the location of the trees, it was about to cause enormous disruption to the landscaping.

How do you get out of a mess like that?

For starters, you listen and keep your cool. Once you've moved into your meditative zone, you label the situation. It was clear from the very start that the builders were not happy with this sudden surprise. On the very day they discovered the boundary problem, they were all raising their hands as if to say, “don't hate us for this problem”. Which is exactly the label I gave the builders when I spoke to them. I called it “messy”. I said: This is a terribly messy situation for you, isn't it?

Think about that label for a minute

Normally we'd be likely to say something like: This is a big issue for us. The trees are getting cut down; the fence is going to be destroyed. We'd go on and on about our own problems, which have absolutely nothing to do with them. No, no, no, no, no—that kind of nonsense won't get you very far. Instead, use the label. What is the situation? Is it messy? Is it noise you're negotiating (and it's noisy?) Does it seem like it's overpriced? (and hence they are already edgy about the price?) Whatever the situation, you can use labels to identify how the other side is feeling.

And this is what author, Chris Voss, suggests

Spot the emotion. Then label it aloud by using either of the following terms:

• It seems like… • It sounds like… • It looks like…

The exact terms are important

You can't go around saying “I'm hearing that…”. The moment you put the “I” back in the discussion, you're talking about yourself. It also makes you take personal responsibility for the discussion that follows. And things may go horribly wrong.

However, “it seems like…” is a very neutral statement that feels almost like you're trying to get to grips on the situation. It also gives the other side a chance to speak. When I said, “It seems like a very messy situation that you want to avoid”, the builder immediately responded to my point explaining what was going on. He told me about their plans, where they were stuck, and what had been discussed with the architects. The information wasn't particularly important to this situation, but in many cases, the smallest bit of information is of extreme value.

But what if the other person disagrees?

What if you said:”It seems like you're uncomfortable with this high pricing”, and they disagree. You can always step back and say, “I didn't say it was that way. I just said it seems like that”. However, in many cases, if not most, the other person will not go on the attack. Instead, they will explain themselves in a fair amount of detail.

There's just one big caveat

Once you've put forward the label, be quiet. Deathly quiet. One second. Two seconds. Three seconds. Four, tick, tick, tick.

Wait for them to speak, because you won't have to wait long

Once you add the label, you'll get the reaction you need. It's almost one of “thank goodness, you know how I'm feeling right now”. Now both parties are seemingly rowing in the same direction. You haven't lost any control. No one is going to eat you for lunch. However, a standoff has not only been averted, but you've got the other side to see you as a partner.

Which takes us to the third part—calibrated questions.

In the first part, we slowed down and listened. We moved from that stage to getting onto the other side's platform. However, there's a third part that gets most of the information you need. And that's really what negotiation is about. It's about information harvesting. The more you know, the more you can move in the direction you need. And what better way to get information than asking questions. Except there are some landmines in the question section. Ask the wrong question, and we're back to square one, or worse.

Let's sidestep that landmine and find out what questions to ask, instead.

Continue listening here: Why Calibrated Questions Enable You to Win Your Negotiation Battle

197 episodes available. A new episode about every 6 days averaging 31 mins duration .