How to Negotiate to Achieve
Your Goals in the Real World
GETTING MORE
(Stuart Diamond/Crown Business/
December 2010/416 Pages/$26.00)
GETTING MORE
How to Negotiate to Achieve Your Goals in the Real World
MAIN IDEA
No matter what you do in life, you can get more of whatever you want by becoming a
better negotiator.
Many people make the mistake of trying to go from the picture they have in their head to
their goal in one step. That usually doesn‟t work because it‟s too big a step to take.
Instead, when negotiating, always try and be incremental. Figure out the answers to four
key questions along the way and you then know what it will take to move them there
bit-by-bit.
About of Author
STUART DIAMOND is a negotiation teacher and adviser. He teaches a negotiation
course at The Wharton School and Penn Law School where he is an adjunct professor.
Mr. Diamond is president of Global Strategy Group, a consulting company which
advises companies and governments on negotiating foreign investments and other
persuasion skills. He specializes in cross-cultural negotiations and has advised more
than half the Global 100 companies and a quarter of the Global 500 companies. Mr.
Diamond was previously a journalist at the New York Times where we won the Pulitzer
Prize as part of the team which investigated the space shuttle Challenger disaster. Mr.
Diamond is a graduate of Columbia University, Harvard Law School and Rutgers
University.
The Web site for this book is at www.GettingMore.com.
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Goals specify everything you want to be in place by the end of the negotiation which is
not there at the beginning. The whole object of entering into a negotiation is to realize
your goals so it makes good sense to take the time and effort to pause and clarify
precisely what your goals are fbefore you begin.
It‟s amazing how many people get mad at themselves over the course of a negotiation
because they‟re so busy thinking about other stuff they end up taking actions which are
counter productive to their own goals. That can easily happen. Don‟t pursue other
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interests or relationships just because you‟ve heard they are an effective tool to use
during a negotiation. Do only those things which will explicitly move you and the other
party towards your shared goals. Make realizing those mutual goals what you live for.
“Think about the worst thing that could happen to you in a negotiation. If you can
withstand it, you will be more confident. If you can‟t, this is probably a bad negotiation
for you to attempt. Find someone else to conduct the negotiation; prepare more, change
the perceived risk, or examine opportunities elsewhere. Get yourself more mentally
ready.”
– Stuart Diamond
“Your ability to meet your goals, and your confidence level, is often in your mind. As
Henry Ford once said, „Whether you think you can or you can‟t, you‟re right.‟”
– Stuart Diamond
You won‟t be able to persuade anyone else to move towards their goals or your goals
until you know and understand the pictures in their heads. You need to know:
■ Their perceptions of the overall environment in which the negotiation is taking place.
■ Their needs and sensibilities.
■ How they prefer to make commitments.
■ Whether or not they are trustworthy.
■ Which third parties they know and respect and whose aid you may be able to enlist.
■ How they like to form and maintain relationships.
The reality is in any negotiation, you are the least important person involved. You have
to reverse roles and put yourself in their position and see the world from their
perspective to get anywhere. And forget about forcing them to do something. Ask:
“What do I have to do here to get people to want to do things which will help us move
forward?”
The world is not a rational place. It‟s completely and irrevocably irrational. And often, the
more important the negotiation is to an individual, the more irrational they will become.
For example, when your child wants an ice cream cone, nothing else matters. The same
phenomena crops up time and again even in multi-million-dollar deals (although
probably not over an ice cream cone.)
When people are irrational, words don‟t count. Emotions do. When people are
emotional, they can‟t even listen, and if they can‟t listen, then you won‟t be able to
persuade them even if you have the most logical arguments in the world. When
someone is emotional, they can‟t think “win-win” either – that takes a level of reasoning
and rationality which will be absent.
As a result, to move any negotiation forward, be prepared to make emotional payments
whenever and wherever required. When they‟re thinking irrationally, you can get
through to them by using empathy, apologies if appropriate, and most of all by showing
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them you value them. Be prepared to offer them things that will get them to think more
clearly.
Negotiation is never one-size-fits-all in the real world. Every new situation is unique.
Even negotiating with the same people on different days can be an entirely different
situation. Therefore, you have to analyze every negotiation on its own merits.
Forget about averages, trends and statistics as well. They won‟t have any relevance to
getting more from the people you will be negotiating with today and tomorrow. You may
have heard blanket rules-of-thumb like “Never be the first party to make an offer” which
you try and follow religiously. Forget about it. Every situation has so many wrinkles you
cannot afford to be rigid in your thinking.
When the party you negotiate with says “I hate you,” your response should be “Tell me
more.” Learn what they are thinking or feeling and you stand a better chance of moving
things forward. Get offended and cut discussion off and you‟ll miss out.
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The number one reason why negotiations fail is because the people involved ask for too
much all at once. It‟s not a smart way to operate. Big steps scare people, make the
negotiation appear riskier than it is and magnify rather than resolve differences.
Remember, when negotiating, you‟re trying to lead people from the picture they have in
their mind to accepting a shared goal. Encourage them to move from the familiar to the
unfamiliar one step at a time. Make a little progress, test that step, resolve any
differences while they are minor and then take the next logical step after that. Repeat
over and over. Closing gaps incrementally is a much better way to operate.
“Extreme offers kill deals. The other party usually feels insulted. If it‟s too low, it
devalues the other party. If it‟s too high, often the other party gives up. It risks your
credibility. If you make an extreme offer and then quickly back off, the other party thinks
you‟re trying to take advantage of them. Mistrust ensues. Extreme offers also violate
one of the fundamental negotiation principles: being incremental. Almost by definition,
an extreme offer is the opposite of incremental. So the chances of the other party
accepting it are much less. In a meeting, if someone is extreme, you might turn to the
other members of that person‟s team and say something like, „Do you all agree with
each and every word that was just said?‟ If there is any hesitation, ask for a break.
Maybe they can talk some sense into the person being extreme.”
– Stuart Diamond
Wherever feasible, find things to trade which you value differently to the other party. All
parties value the same items using different value systems. To use this to your
advantage, find out what each party cares about and also what they don‟t really care
about. Look for big or small items, tangible or intangible, and items which are inside the
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deal or outside the deal. You then set up trades that match items one party values
highly but which are inconsequential to the other party.
For example, employees may be willing to trade working on public holidays for more
vacation time later in the year. Kids may trade TV time in exchange for doing more
homework. A retailer may give you a bigger discount if you will supply two or three
referrals from your friends or acquaintances. Any time you incorporate items of unequal
value to the parties into a negotiation, you expand the pie and create more opportunities
for everyone. This is well worth doing.
“All parties value things differently, and often unequally. Once you find out what they are,
you can trade them. In the process, you will get what you consider valuable things for
yourself. Trading items of unequal value will cause the overall number or value of items
in the negotiation to rise, making more available for all. The other party will become less
price-sensitive, the relationship will get better, trust will be higher, and your own value to
the other party will increase – whether in business or personal life. First, you find out the
pictures in their heads. Then you have to find the pictures in yours. You find out which
ones don‟t cost one side much but are valuable to the other side. Then you trade them.”
– Stuart Diamond
In a negotiation, you‟d better figure out right away what the other person‟s policies,
exceptions to policies, precedents and preferred ways of making decisions are. Why?
These are what you must use to get more of what you want.
Your standards are important to you but in a negotiation, you have to use the standards
of the other party if you want to get anywhere. Find out or figure out for yourself:
■ When have they allowed exceptions to their stated policies and procedures in the
past?
■ Do they let speakers have the floor without interruption or does the loudest voice win
out?
■ What are their feelings when it‟s possible innocent people will have their interests
harmed as a result of the negotiation?
■ Are high levels of customer service a part of the promise they make to their
customers?
“It is a fundamental tenet of human psychology that people hate to contradict
themselves. So if you give people a choice between being consistent with their
standards – with what they have said and promised previously – and contradicting their
standards, people will usually strive to be consistent with their standards.”
– Stuart Diamond
Conventional negotiation methodologies focused on getting more for yourself and let the
other party look out for their own interests. That‟s okay but people can detect fakers.
They can tell for themselves when you‟re just putting on a tough guy act for
appearances alone. Therefore, forget trying to be something you‟re not.
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Being real is highly credible – and in any negotiation credibility is your biggest asset.
You‟re always going to get much more accomplished if you openly admit you don‟t know
something, you‟ve been too aggressive or you‟re in a bad mood for entirely unrelated
reasons. Candidly admit things and be genuine.
“Done right, there is no difference between „negotiation,‟ „persuasion,‟ „communication,‟
or „selling.‟ They should all have the same process. That is, they should start with goals,
focus on people, and be situational.”
– Stuart Diamond
“The most important asset you have in any human interaction is your credibility. If
people don‟t believe you, it‟s hard to convince them of anything. Your credibility is more
important than your expertise, connections, intelligence, assets, and looks.”
– Stuart Diamond
“People appreciate it when others are straight with them, no matter what „straight‟ is.
This should lift the burden of having to be someone you are not. This means, if you are
very aggressive, warn people in the beginning. „If I get too aggressive, let me know.‟
What does this do? First, it takes away the issue by resetting expectations. Second, it
makes you more real; it increases your credibility. Third, it eliminates the need for you to
do any sort of dance, to act in a way that is unnatural to you. Now you can focus on
meeting your goals.”
– Stuart Diamond
The number one reason why negotiations fail is bad communication. Never walk away
from a negotiation unless everyone has agreed to take a break – or unless you want to
end the negotiation and go in a different direction. A negotiation can only occur when
information is flowing both ways.
Good negotiators know better than to threaten the other party. In fact, it‟s good practice
to state the obvious: “We don‟t seem to be getting along here at the moment. Is there
something we can do to get on the same page. Let‟s start with this. Is it your goal to
make your customers happy?” Light the way forward and frame the vision for all to
understand and agree to.
“My most commonopening in a negotiation is, „What‟s going on?‟ Seems like an ordinary
question. But there are at least four tools folded into that question. First, it helps to
establish a relationship with the other person – you start out informal and chatty.
Second, it is a question – questions are a great way to collect information. Third, it
focuses first on the other party and their feelings and perceptions, instead of on „the
deal.‟ Fourth, it consists of small talk to establish a comfort level between us.”
– Stuart Diamond
“Talking is a sign of strength. Not talking is a sign of weakness. Yet that is exactly the
opposite of conventional wisdom. I‟m amazed at the number of labor-management
negotiators, sports negotiators, attorneys, diplomats, and leaders of all sorts who, when
things are not going well, walk out. That guarantees that things won‟t go well. How does
that make any sense at all?”
– Stuart Diamond
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Comparatively few people address the real or underlying problems in a negotiation. Get
into the habit of stating: “What is really preventing me from meeting my goals here?”
Then try and figure out whether the other party shares that problem or if they have a
different one altogether. Sometimes it won‟t be obvious so keep probing.
Negotiation success is usually dependant on your ability to walk in the other person‟s
shoes. Uncover the true underlying reason for why they think the way they do and you
have a golden opportunity to transform that problem into an opportunity to move your
negotiation forward. View every problem as an opportunity and you‟ll become a great
negotiator.
“Bob Woolf, the retired sports-agent superstar, essentially said to others in a negotiation,
„I have one thing that‟s not negotiable. I demand that we meet your interests.‟ When the
other person expressed surprise, he would say something like, „The reason we need to
meet your interests is that if we don‟t meet your interests, you won‟t meet mine. And I‟m
a real selfish guy. I want my interests met.‟”
– Stuart Diamond
“Role reversal will give you a better idea of the other person‟s perceptions, of the
pressures they may be under, of their dreams and fears. In other words, to understand
people, you have to try to feel their pain, their happiness and uncertainty, and address it
in your negotiation strategy. And you have to let them know you are trying.”
– Stuart Diamond
How do you view someone who is “different?” Someone who is different may strike you
as being risky or annoying. They may make you feel uncomfortable but when it comes
to negotiation, different is better. When two completely different parties negotiate, ideas
will come out which are more creative and ultimately more profitable for everyone
involved.
Great negotiators love differences. They‟re the breeding ground for original ideas and
follow-on opportunities to create more value than ever before. Resolving those
differences usually produces more trust and better agreements to boot so don‟t hold
back when differences emerge. Treat them as opportunities to do great stuff.
“Companies can effectively choose a strong negotiating team based on the styles of the
people on the team. Aggressive, goal-directed people are good closers. They will make
sure the deal gets done. Accommodating people, who are often much better listeners,
are good openers. They help connect with the other party. Compromisers are good in
an emergency; they can make decisions quickly. Collaborators make good facilitators;
they consider the needs of all parties.”
– Stuart Diamond
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Kids may seem like effective negotiators but the reality is this is not something you‟re
born with. To get better at negotiating, you have to practice using all the various
negotiation strategies, tools and mental models which are available.
To do this systematically well, make a list of what you might try when preparing for a
negotiation. Think through all the various approaches you might use. Admittedly things
will crop up from left field that you can‟t anticipate but that should not discourage you
from doing all the preparation you can. Practice using these tools before the negotiation
and then hold a debrief later where you review how things went. Do that for an extended
period of time and you‟ll get better at negotiating. It isn‟t rocket science – just applied
common sense really.
“People do some of the most important things in life not for money, not for rational
benefits, but for how it makes them feel. The emotional and psychic rewards they get,
and the anguish, must be part of the negotiation process.”
– Stuart Diamond
“The people involved in a negotiation, and the process they use, comprise more than 90
percent of what is important in a negotiation. The substance, the facts, and the expertise
make up less than 10 percent. This is quite counterintuitive for most people.”
– Stuart Diamond
“Start with the easy things in a negotiation, and scale up from there. If you can increase
your success by even a few percent in your negotiations with others, you will be
fabulously more successful. John Carlson, the legendary European SAS Airline
executive, once said, „The difference between success and failure is two millimeters.‟ In
other words, it‟s something as seemingly insignificant as a turn of phrase. A look. A
small gesture. The tools that work are very small, subtle, and yet very effective.”
– Stuart Diamond
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10
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The first and vital step in any negotiation is to figure out what you‟re after and then what
problems are likely to crop up as you go for it. Getting to the real problem at hand is vital
because it will color and influence everything else you do.
To illustrate, your goal might be: “To get to New York for my job interview.” The
immediate and obvious problem could be: “My flight has been cancelled because of
snow at JFK.” However, once you‟ve gone through all the other steps of the negotiation
model, you might realize your real underlying goal is: “I want to get a job at this firm.”
Similarly, your real problem might be better expressed as: “How can I give this firm
enough information about me so they will hire me?” Perhaps you can use the closed
airport to show them your ability to adapt and think creatively when things go wrong.
When you state the real problem clearly, other options for achieving the same thing will
come into view. Clear statements of problems have a way of generating equally clear
options for fixing them.
Once you‟ve got goals and problems on the table, you can then turn your attention to
the key parties in the negotiation – the decision makers. To negotiate effectively, you
have to know who will make the decision and who can and will influence the decision
maker. Be careful in compiling this list. If you leave out someone, they may become
upset because they‟ve been slighted and throw a spanner in the works. Similarly, you‟ve
got to be aware there may be other third parties who come into the picture as well. Try
and anticipate who these people might conceivably be and prepare accordingly.
Step 4 means you figure out what will happen if a deal can‟t be put together. You have
to focus here on your WATNA – your worst alternative to a negotiated agreement. This
is the risk you run if you can‟t bring together an agreement that suits all parties. Be
realistic about what the end result will be if you cannot agree to terms in your negotiation.
Don‟t forget to look for opportunities to trade-off items that the parties value differently.
Step 5 is to do your homework so you can be prepared for anything and everything. It‟s
in your best interests to help the other party prepare to negotiate as well because they
won‟t agree to anything worthwhile if they are stressed, overly emotional or less focused
on their goals than they normally would be. Great negotiations are always completely
transparent so help the other party prepare thoroughly. This doesn‟t mean that you
become a pushover and give away the store for peanuts. Rather, you want the other
party to leave the negotiation with something they are satisfied with today, tomorrow
and next week.
“Goals are not just another negotiation tool to use. Goals are the be-all and end-all of all
negotiations. You negotiate to meet your goals. Everything else is subservient to that.”
– Stuart Diamond
“I knew an executive who was hired as vice president of strategy at a leading U.S. firm.
Just after she arrived, she wrote a note to the other twelve senior executives, inviting
them to a meeting, asking them to bring their goals for the company. After receiving the
note, the company‟s CEO called her up and said, „Wait a minute. You just got here.
We‟ve been working here for years – we know our goals for the company.‟ „Fair
enough,‟ the new vice president said. „But you asked me to work on corporate strategy. I
promise you that if you let the meeting happen, it will be worthwhile. And it won‟t take
very long.‟ The CEO said okay. The other twelve senior executives came to the meeting
with their goals for the company. The strategy vice president wrote them up on the
board, one by one. At the end, the twelve executives saw that they actually had not one,
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or two, or three, or four goals. They had fourteen different goals. And most of these
goals contradicted each other. „Oh,‟ they said.”
– Stuart Diamond
“Even in a short negotiation, you should know specifically what you are going to talk
about. That is, what subjects will be covered, and in what order. Get an agenda that
both parties agree to. This will help the parties get back on track if they get lost. It will
also help organize things. If several people bring agendas, it‟s that much better! Now
you have surfaced most of the issues to discuss. Start with the easy things. It gives the
parties a sense of accomplishment and progress as they agree on them. Tell people as
soon as you can in the negotiation what you can‟t agree to. That way, people don‟t
waste their time.”
– Stuart Diamond
Who are they,hat do they want?What aremy goals?
1234
1
Focusing on goals (steps 1 - 5) sets the stage on which you can negotiate. To get more
out of every negotiation, however, you need to know more than the basic facts. You also
need to be aware of the pictures which exist in the heads of the people you‟re
negotiating with. Steps 6 - 10 are how you do that.
First, as step 6 you identify the needs and interests of each party.
This will include becoming aware of everything:
• Long-term needs and preferences
• Short-term requirements
• Shared needs which everyone has in common
• Conflicting needs which different people may have
The more you knowabout each party in a negotiation, the greater the odds become that
you will find things you can trade. Before you do that, it‟s helpful to understand how the
other person views the world and what their perceptions are. Thus in step 7, you put
yourself in their shoes and try to visualize what you‟d think. Step 8 is where you
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communicate with them to verify and validate your conclusions. To increase what you‟ll
learn, you need to tailor your communication to the style or mode they prefer.
Step 9 is all about understanding their standards – what they‟re willing to accept and
what they will not accept under any circumstances. Gy getting to know this, you have a
rough idea of what an acceptable deal will look like.
Step 10 is a checkpoint where you pause and take stock of everything you‟ve learned.
You find the answer to a simple question: “Why do I now think the other person will say
yes or no to my proposal? Do I need to adjust my goals in some way in order to increase
the likelihood they will agree?”
“From time immemorial, people have come to negotiations armed with their lists of
topics to push from the start. Here are my issues. Here is myproposal. Wrong! Unless
you connect in some way with the people you are negotiating with, you won‟t get a deal.
Or, if you do get a deal, it won‟t be a good one, or it won‟t stick. Even if you hate the
other side, you need to connect with them. Remember, you are the least important
person in the negotiation. The most important person is them. And the second most
important person is a third party important to the negotiators. If you don‟t accept this,
you won‟t persuade many people of anything.”
– Stuart Diamond
“Small talk is big talk in a negotiation. It helps to make a human connection. And
humans are social beings, with few exceptions. Even discussing differences is a
connection. It‟s an act of interacting. Studies have shown humor (if they recognize it as
such), small gifts („Want a mint?‟), or a comment about something interesting that
happened today are all key in setting a more collaborative tone.”
– Stuart Diamond
Negotiation Case Study #1
The Writer‟s Guild in Hollywood in early 2008 had been on strike for three months. John
Bowman, the Guild‟s chief negotiator and now its president, asked for advice. It was a
Tuesday afternoon. Bowman had a breakfast scheduled for Thursday morning with
representatives of the major Hollywood studios to talk about the dispute. He had a
number of substantive issues and wanted to know the order in which to bring them up –
royalties, basic compensation, etc.
“I told him to put aside these issues, at least for now. That‟s not the problem. The real
problem is that everyone is mad at everyone else and everyone is losing money,” said
Stuart Diamond. “Make small talk. Ask them, „Are you happy?‟ They will not be happy
and they will admit it. Commiserate with them. Ask: „If we had to start over, what
process would you like to see?‟”
Although Bowman was highly skeptical, he decided there was nothing to lose so he
gave this new approach a shot. He also acted on advice to get rid of the two
confrontational negotiators the Writer‟s Guild had bought in from the New York garment
district who were irritating the laid-back Hollywood studio executives who were involved
in the negotiation.
The result? At the breakfast meeting, the parties agreed to restart negotiations after
months of deadlock. Bowman managed to get an agreement both parties could live with
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in just another couple of days of discussion and almost immediately the strike ended.
Negotiation Case Study #2
A student went to a major department store in Philadelphia to buy a suit for a job
interview. He found a $500 suit reduced on sale to $350, and brought the suit to the
counter. There, a harried salesclerk was fielding all sorts of demands and complaints by
other customers. The student waited until all the other customers cleared out and the
salesclerk had some time.
He started a conversation with her by apologizing for everyone else‟s behavior. He then
noted she must be tired after a full day of work. He said it wasn‟t fair that other
customers had taken their problems out on her. The student was fairly certain he was
the first person all day who had treated her kindly.
The student then noted the discount already marked on the suit and asked if there was
anything else that could be done – such as an additional discount for using a store
credit card, or for making payment in cash, and so forth. The salesclerk noted none of
these programs applied in this case. Finally, the student said, “Can I suggest this. I
amprobably the first person in a while who is at least trying to understand how difficult
your job is. Could I have a nice guy discount?” The salesclerk smiled and said, “How
about $50?”
“Now, granted, this is a little thing. But the student received a 14 percent discount just
because he made himself a person to the clerk. He made a people connection. It‟s not a
fancy technique, but it is invisible to most people. And there will be times when it will be
a big deal in a negotiation. How would you feel about increasing your annual disposable
income by, say, 10 percent? Understanding the picture in the head of the other party is
the single most important thing you can do in trying to persuade another person. If you
try and understand the pictures in their heads, you have a starting point for changing
their minds.”
– Stuart Diamond
By the time you complete steps 6 - 10, you will have a list of questions and issues which
need to be addressed. The way forward now is to develop some options for solving
those issues and then prioritize everything. This is what steps 11 - 15 are all about.
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Step 11 involves brainstorming. You might best do this alone or with colleagues –
whatever works best for you. The whole objective here is to generate lots of ideas –
smart, contradictory, silly or trivial. Various studies have shown the most innovative
ideas tend to sound rather silly at first so don‟t be too quick to shoot a suggestion down.
Even a half-baked idea can act as a trigger for someone else to come up with a game
changing concept. Or put another way, sometimes bad ideas prime the pump for better
ideas to come forward. Write everything down on a piece of paper, on a whiteboard or a
blackboard or even on a napkin if that‟s all there is around.
Steps 12 - 14 then involve helping improve your decision-making processes. You figure
out whether you can reduce your risks by making what you want to do incremental (step
12), by involving third parties (step 13) or by framing your idea in such a way it will
become more appealing to someone influential and persuasive.
Before moving on from this batch of steps, you pause again to do something of a reality
check. In step 15, you ask whether any better alternatives exist. Or whether or not you
can improve the deal by involving a powerful third party who will change the balance of
power if they join you or at the very least support you. Pause and consider whether
you‟re being smart here.
“If you wait until the end to mention your deal breaker, one of three things usually
happens: (a) the deal falls apart, (b) you lose trust and get a worse deal, or (c) they ask
for much more to compensate them for what you are now asking them to give up.”
– Stuart Diamond
“Try to set a time limit on issues. For example, anything you can‟t solve in fifteen
minutes, go on to the next issue. That way, you get as many issues out of the way as
you can. Also, never try to commit to any one thing until you see the entire package of
points to be negotiated. In lieu of that, make conditional, or tentative, commitments.”
– Stuart Diamond
“If you realize you don‟t have enough time to cover everything, don‟t. Get a couple of
things done very well, rather than a lot of things done poorly. Use all the time you have.”
– Stuart Diamond
Negotiation Case Study #3
U.S. companies doing business in China have found that many traditional Chinese
companies don‟t use contracts to make price commitments. They make commitments
differently. First, the Chinese company will get the basic structure of the deal done in a
contract – supply, delivery length, and so on. Then, they look at the market and propose
pricing based on market conditions. Prices in contracts are viewed by them as being
advisory rather than definite. Westerners who don‟t plan ahead for such a price contract
negotiation are destined to fail.
At one time, a U.S. consulting firm was owed a substantial debt by one of the largest
companies in China. This debt was almost two years old. The U.S. company had tried
attorneys and then diplomats without success. Finally, the Chinese company agreed to
a meeting.
“I suggested to the U.S. Company that its executives meet in person with the heads of
this traditional Chinese company and say something like: „Your not paying this debt has
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dishonored us. It has dishonored us in front of our colleagues. It has dishonored us in
front of our friends. It has dishonored us in front of our families. It has dishonored us in
front of our employees, consultants, customers, government, neighborhood, and
communities.‟ Moreover, the Chinese company should be advised that the nonpayment
has also dishonored them in front of their own government. That‟s because China was
trying for international trade respect. Not paying legitimate business debts for work
performed is against international standards. The Chinese company paid the debt in full
within three weeks.”
– Stuart Diamond
Negotiation Case Study #4
Real estate commissions for brokers across the country vary from 1 percent to 6
percent. Century 21 offered to sell Jay Chen‟s home for a 3 percent commission. He did
some research on the Internet and found ziprealty.com charged only 2 percent. Jay
preferred to sell his house through Century 21 because they were local and therefore
more accessible, but he would do so only if they agreed to drop their commission. He
approached them and they agreed to a 2.5 percent commission rate, saving Jay $2,500
in fees on the sale of his $500,000 home. Total negotiation time was 5 minutes.
You can also get creative in how you structure a real estate transaction. Let‟s say you
and the broker have researched the market and agree your house will sell for $400,000.
You could then offer them 2 percent on any sale up to $400,000 and 20 percent on
everything they get over $400,000. That means if the agent sells the house for
$450,000, they will get a commission of $8,000 for the first $400,000 and $10,000 for
the extra $50,000. The total commission of $18,000 comes to 4 percent overall.
“Does the thought of paying the extra money both you? If so, you have to get out of that
mind-set. The extra $40,000 net that you received is found money. Think about meeting
your goals, not about winning over someone else. The more of a personal connection
you make with everyone involved, the more likely you are to meet your goals. Try to
meet the other party. Make small talk. Find out if they have intangible needs. Introduce
your children to their children. This is also important because if anything goes wrong in
the sale, the relationship is a cushion to prevent the deal from tanking.”
– Stuart Diamond
3
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This last set of steps in a negotiation help you pick the best option or options and turn
them into firm commitments for all parties. How do you do that?
In step 16, you pick the best options – whatever you feel is the most likely option the
other party will agree to or which appears to be the least risky or which would be
supported by the most people and so on. Once you‟ve identified your strongest and best
proposal, you figure out what the potential deal breakers are and what specific
giveaways you can build in to offset them.
Step 17 is all about deciding the best way to present your proposal. This will be very
audience specific. Some people will want you to present a detailed dossier of
information to support your proposal whereas others will prefer a succinct e-mail instead.
Some people will want to hash the idea out in face-to-face discussion, others won‟t. It
stands to reason if you format your idea in a way which the other party is most familiar
with, you increase their opinion of the merits of your idea as well.
Once you have a feel for what will be involved, step 18 is where you map out the overall
process for moving forward. It‟s a good idea here to specify the criteria by which
success will be measured and who sets that criteria. This is a very important metric to
have clarified in any negotiation.
Next, you focus on commitments in step 19. Commit time and effort to this. How can you
tell everyone on your own team is onboard and committed? What incentives for success
and potential penalties for failure should be incorporated? How does the other party
prefer to make commitments and how will these be handled?
The purpose of step 20 is to bring everything to a head and to follow up for results. Be
clear who will do what and when. Set deadlines, specify next steps and get everyone
moving forward. If you don‟t do this, then everything you‟ve put into the negotiation up to
this point will have been wasted.
“You are not required to disclose information in a negotiation. You are not on the
witness stand in court. But you shouldn‟t be coy about hiding something, either. If
someone asks you if you have other offers, ask yourself, „Now why would they ask me
that?‟ The obvious reason is they want to know if you are desperate, and if you would
therefore take less. Instead, ask why that‟s important. You could ask tactfully, „What
effect do you think this might have on our discussion?‟ You should tell people if you
think they are playing games.”
– Stuart Diamond
The Getting More negotiation model appears simple but it is deceptively powerful. When
you use it, at least three things will usually happen:
1. You‟ll probably discover the problem you start with is not the real problem. There will
be other underlying issues lurking behind the obvious which are more important. This
is okay because using this model, you‟ll be better equipped to find the solution when
the real problem comes into view.
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2. You‟ll often find this model will generate more solutions that you thought existed. The
model encourages everyone to think differently and that frequently uncovers new
opportunities to do a deal.
3. As you work through the model, you‟ll get a much clearer picture of the personalities
involved and what‟s going on in their heads. By better appreciating how people differ,
you‟ll be able to know what to do to move forward.
The other point of note is working your way through this model is an excellent way to
prepare for a negotiation. You can use the model to replicate what you anticipate will
happen in the real thing. You can simulate a negotiation and pre-arm yourself with
creative strategies for addressing the concerns which are likely to be raised. You can
come up with a game plan for the negotiation.
“The best negotiators are problem-solvers. They find new, creative, and better ways to
solve both their problems and other people‟s problems. They turn problems into
opportunities more often than most people do. And that is the key to negotiation
success. Because you can‟t meet your goals unless you can identify and solve the
specific problems standing in the way.”
– Stuart Diamond
“At the end of the day, Getting More is not about learning how to negotiate; it is about
becoming a negotiator to your core, so these tools become as much a part of you as
your personality. Once the tools are internalized, virtually every interaction you have will
improve.”
– Stuart Diamond
“Negotiation is at the heart of human interaction. Every time people interact, there is a
negotiation going on: verbally or nonverbally, consciously or unconsciously. You can‟t
get away from it. You can only do it well or badly. That doesn‟t mean you have to
actively negotiate everything in your life all the time. But it does mean that those who
are more conscious of the interactions around them get more of what they want in life.
The world is full of negotiation books telling you how to get to yes, get past no, win, gain
an advantage, close the deal, get leverage, influence or persuade others, be nice, be
tough and so forth. Getting More is a technique that you will actually be able to use –
immediately – whether ordering a pizza or negotiating a billion-dollar deal or asking for a
discount on a blouse or a pair of pants.”
– Stuart Diamond
* * *
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