How to Negotiate

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October 23, 2005

Examples of Leadership Skills

Leaders emerge from the ranks of men. Why they become leaders when others do not probably has been studied and observed since men and women began to merge into tribes and clans.

Newsweek ran a story about George Washington in the May, 23, 2005 issue. They observed, "What was the hold he (George Washington) had over men? There was nothing foreordained about george Washington's success a general. But he saw things as they were, and he saw himself as he was. As subject as any man to moments of doubt and uncertainty, he managed to summon the self-confidence necessary to persevere amid diseaster. He was committed heart and soul to the cause, resilient, open to new ideas and seldom failed to learn from his mistakes. Through the often dark year of 1776, he would not only overcome his own fears but help his countrymen conquer theirs, too - a supreme act of providential leadership."

To negotiate well one must lead those involved, especially their opponents, to reach a mutually viabable agreement.

Being passionate about the negotiation establishes one's conviction and commitment to the process. No argument is properly delivered without conviction and passion. If you are not prepared or if you do not believe in what you are asking it will be evident unless you are very, very fortunate. Don't rely on luck to see you through.

When you enter the room do so with zest. This energy is contagious. It is a positive force. It shows that you are confident, focused, and passionate about what you are about to do; fight for your cause. It bgins to set the attitude of the small group thay will have ot work together.

Develop ways to telegraph this personal attitude:

- Check your tiredness or personal problems at the door. Actually take a personal moment before entering the room to consciously do this. If you are with a team, step aside to make sure you are mentally ready to enter. If you are leading the group, you should do this before even meeting up with your teammates.

- Enter the room boldly. Make an entrance, don't just enter.

- Make it a big deal to meet someone foe the first time. Recognize personally each of the people in the room. Pause when shaking hands and mentally register the person's name and facial features. Make good, firm, direct, in-control eye contact with each person observing how they react.

- Make it a point to see if everyone has everything they need, even if it is not your office. Take control of the environment. Be assertive in seeing to the needs of others.

When everyone is ready to start the negotiaitons, reinforce your positive attitude with a positive statement. Something a simple as "I'm ready to do this!" sends a very clear message across the table.

Understanding the dynamics of influence or leadership will help you to initiate and maintain control over the discussions. Resolving conflict requires garnering the support of two or more opposing forces to move forward together. Leadership can play a large part in this process.

Posted by Bill at 9:00 AM | Comments (1)

October 17, 2005

Corporate Team Building in Negotiations

There are times when having a negotiating team is appropriate.

In corporate environments this is often the norm. You have the executive responsible for solving or managing the situation, the corporate counsel who may be involved or may enlist out-house counsel to litigate the matter, the staff insurance or risk manager, and the insurance carrier's representative. This core team may then add professionals or experts depending on the complexity of the matter. There may also be other corporate representatives involved.

In effect all corporate negotiations are team negotiations no matter who arrives at the settlement conference.

Like any other aspect of negotiations, teams need to be properly managed.

If you are heading up a corporate team, you are responsible for that team no matter to whom the individuals report. You are responsible for its preparation, research, and the role each member will play. This is especially important if there are ‘professionals’ on your team. Too often clients delegate the preparation and research aspects of a settlement conference to their legal staff. This would be fine if the issues were legal details. But when it comes to other issues and overall strategy, the responsibility should be vested solely with the lead negotiator.

You need to build your team based on the needs of the occasion and not the desires of political factions within the company. Representation at each meeting is not a requirement for each member of the team, especially if that individual proves disruptive to the settlement process. In establishing the team, make sure everyone knows their role, is prepared, and most importantly, that you have set the goals and objectives for the team.

If you are not used to working with the members of your corporate team, take steps to establish your role as team manager.

Corporate Team Building Tactics:

- Welcome them to the planning session and indicate your appreciation of what they can lend to the team.

- Source the pecking order of the individual team members and see if there are potentially conflicting internal goals and objectives to be resolved.

- Discuss with each new member of the team their role, qualifications, and specific areas of expertise.

- Ferret out areas where the other team members appear to not agree fully with you. Monitor closely the non-verbal reactions to the discussions to note any unvoiced discord. You want your team to be focused and mutually supportive.

- Collectively establish the goal of the team and the negotiating parameters.

- Prior to each formal negotiating or settlement session meet with the team doing the negotiating and establish the goals and objectives of the day’s discussions.

- Decide prior to meeting with the other side if you want to reveal your leadership role during the meeting or let someone else lead the dialogue. There are times when it is beneficial to use a straw man while you observe the interaction of the other team.

Negotiating teams are no different than other teams. They need good leadership. They need direction. And they need to be managed so they function efficiently and constructively.

Posted by Bill at 11:33 AM | Comments (0)

October 15, 2005

Business Management Skills in Negotiations

In any dispute those involved make up a small group and are subject to traditional group dynamics. Groups need to be lead or managed. Filling this role is what makes mediators effective at resolving disputes.

Similarly, negotiators who take the initiative to become informal group leaders are most likely to have the best track record of achieving their goals.

Negotiations essentially are dysfunctional small groups. All small groups need to be lead to achieve their goals. Group leaders establish objectives and set a course to obtain the desired results. Negotiators should look at the various people at the table, from both sides, as a small but dysfunctional group in need of leadership.

The challenge is to motivate the group as a whole to focus on mutually beneficial goals.

Mediators, trained to manage such small groups, have the benefit of being assigned the role of leader. Negotiators must acquire the role through application of management skills to capture the respect and attention of their opponents. Demonstrating expertise, professionalism and passion are common traits of strong business leaders. These traits also serve the negotiator well when establishing a position of group authority.

A manager and a mediator have their positions established by others. Negotiators have to earn theirs without directly confronting the other person. Collaborative managerial styles are excellent means of subtly establishing a role of leadership. Such styles include:

- Establish a Common Goal: By giving each person a vested interest in the outcome of the negotiations you establish a common cause that should underscore the reasons behind each collective decision the parties make. Identifying a common goal is the first step towards establishing an informal, small group which can be lead.

- Parity of Power: By recognizing the power bases of the parties, you can dissolve misconceptions about who has the most power and create an environment where both parties need each other to resolve the situation.

- Persuasion: Mediators are masters of group persuasion. They must get warring parties to set aside their differences and reach an accord. Most people are used to being told what is right to do. A mediator is unable to make the decision for the group. He does not function as a judge or jury. He must encourage each of the parties to set aside their animosity and strive to work out a solution. He may have to persuade a recalcitrant party to let go of their emotional baggage and focus just on the settlement terms. He can do this by re-stating the other person's position or proposal in a more favorable light. He may remind the disgruntled party of the time and expense of pursuing the matter in court and point out that settling during mediation might cost less in the long run. What the mediator needs to do is get the party to soften an absolute rejection so some dialogue can start.

Making others want to do things they don't initially want to do is what successful mediators and negotiators do. Hitting the other person over the head with facts and demands is a good approach if you have power and authority on your side. If not, you must resort to the basics: inform, educate, and enlist.

Inform - By informing the other person of salient facts, tangible information and logical arguments, you are providing reasons for the person to reconsider their position without losing face.

Entice - By creating alternative and/or innovative incentives for the other person to reconsider their position, you are expanding the negotiating arena to include other commodities that may make an otherwise untenable accord viable.

Enlist - By seeking the other person's help in solving the dilemma, you are cashing in emotional concessions in return for advancing your cause.

All three approaches are basic management tactics designed to get the other person to do what you need him to do. They work as well in the negotiating arena as they do in the business environment. Essentially they are non-threatening management styles designed to motivate another person to action.

Being able to capture a leadership role within a negotiating small group environment is a management challenge. If you can achieve it, you will be in an excellent position to also broker a settlement or construct a viable accord.

Posted by Bill at 4:21 PM | Comments (0)

October 11, 2005

Interpersonal Communication Skills

A negotiator needs to be skilled at two things. Delivering and receiving messages. Unlike a postal carrier, he must make sure his message is heard and understood. Unlike a court recorder, he must understand as well as hear.

Learning to listen pro-actively and observing while you speak is just the beginning. Negotiating is an art form. Communicating is nothing less. Mastering the ability to reinforce what you are saying with your actions and demeanor allows you to more effectively communicate your point.

Actors practice or rehearse their lines in front of mirrors to get their entire persona to deliver the "feeling" as well as the line. Attorneys preparing opening and closing arguments do the same thing. Why, then, should not other professionals take the same care to insure they are optimizing the impact of what they are going to say? In fact, most mediation and negotiation professionals do go through various types of rehearsals and dry-runs before important meetings.

Prepare, review, and practice for the meeting so that you have mastered the subject matter and know what your objectives are before you sit down to do battle. If you are not adequately prepared you may find that the discussion is being controlled by the other person and that it is being channeled where they want you to go rather than toward your goal.

Knowing the material and being prepared is the first step to good communications. Taking responsibility for delivering the content is the second. Most people will not be convinced through a verbal presentation. Likely they will be spending more time preparing their response than listening to you. That is why you need to shoulder the responsibility of making them actually hear and understand what you are saying as part of your role as an effective communicator and negotiator.

When speaking, you are responsible for making sure what you are saying is being understood. Verify this by:

- Asking follow-up questions to make sure you were understood.
- Repeating salient points two or three times.
- Seeking input on your comments.
- Repeating key points one more time for effect!
- Observing the non-verbal reactions to what you say. *

* By observing you are trying to see if they are thinking of something else, if they are planning what next to say, or if they are just asleep!

Conversely, as an effective negotiator you have to train yourself to be a good listener. We all have bad habits. Many of them apply to how we listen. Our minds can handle much more activity than mere listening. Because of this, we are apt to be subconsciously trying to frame a response to the last point made, figure the odds on the baseball game this evening, concocting a strategy to get a raise at work and worrying about last night's fight at home; all the while also listening to the other person making a point. With all this concurrent activity, actually hearing what is being said is at best difficult. Hearing the subtle nuances within the context of the remarks is next to impossible.

When listening, you are responsible for making sure what you are understanding what is being said. Verify this by:

- Observing the non-verbal signals of the speaker.
- Asking follow-up questions to make sure you understood what was said.
- Repeating back the salient points for affirmation.
- Seeking clarification on complex points.
- Make sure you are not thinking about something else!
- Make doubly sure you are not thinking about what you are going to say next!

Don't sell short the need to improve your communication skills. They can always be improved. The discipline of leaving one's baggage at the door is the most touted and least observed. After all, it is your baggage, you can handle it! But like alcohol and drugs, personal baggage in a negotiation can take your edge or focus away.

Posted by Bill at 9:11 AM | Comments (2)

October 9, 2005

Organizational Communication

Communicating is a key aspect of conflict resolution. It occurs in all human interaction in some fashion. During any conflict listening is typically impaired. To agree, the parties need to be able to communicate effectively.

Listen: Everyone should work at developing effective, interactive listening skills. When the other person is talking, you have the chance to learn something,--if you are listening to what they are saying rather than thinking about what you are going to say.

Observe: When speaking, you are responsible for making sure the others are listening. Verify this by observing the non-verbal reactions to what you say.

Signs of discomfort at what you are saying:

- A furrowing of the brow.
- Tensing of the upper body.
- Clenching of the hands.
- A set jaw.
- Leaning forward suddenly.
- Looking away, closing a portfolio or folder, or packing a briefcase.

Most important, watch the other person's eyes. When you are pressing too hard they will harden and stop focusing on you. What you are seeing is the other persons thinking about his response or how to end the discussion rather than listening to what you are saying.

Take Responsibility: Make sure you are being heard and understood. The other person will likely have to review what was said today with others. Make it your goal that he or she be able to clearly restate your case as you intend it to be heard.

There are simple ways to keep the other person interested and attentive to you.

1. Pepper your comments with questions designed to draw them into the discussion. By being involved in the dialogue, they will have to consider what they are saying. And when they speak, it is your turn to listen. They may reveal something of value.

2. Use silence to draw their attention. Pause before an important point you are about to make and let the silence grow until they take notice. Then proceed knowing you have their attention at the moment.

3. Use questions to reinforce their understanding of what you have said. Ask their opinion of a point you just made. If they have missed the point, restate it. You won't have as good a chance to reinforce what you have said once they leave the meeting.

Once two people are focused on each other and listening, communications can become intense. A mediator, while working to get the parties to discuss their respective issues, also monitors the reactions and interjects as required to keep the tone of the exchange productive. He may also use caucus sessions to separate the parties briefly to keep them from becoming too agitated.

In managing a negotiation you typically need to serve as both a mediator and negotiator to lead the discussion towards resolution. Don't be hesitant to ask for a short break to let things cool down or to simply get up. This will break the tension and allow everyone to take a breath.

Posted by Bill at 3:15 PM | Comments (0)

October 8, 2005

People Skills and Negotiations

Managing any group of people or even another person requires well-honed people skills. Managing the people involved in a negotiation requires exceptional ability to influence and motivate others.

As all human interaction is a form of conflict resolution, enhancing your people skills is a sure way to improve your ability to negotiate successfully.

To manage people you have to first understand them. Negotiators are people and people are individuals. To reach them through a debate of the issues it is best to present your case in terms they understand and with which they are comfortable. The time spent informally talking before a negotiating session serves the purpose of providing insights into how you might phrase your arguments. Researching the other person before the meeting may also provide information on his or her background, professional and scholastic. Talking to associates who know the person is another way to develop a dialogue strategy.

Develop a style that allows you to be assertive and not aggressive in your communication with the other person. The "3-Rs" to accomplish this are: Rehearse, Repeat, and Request feedback. To lead an informal group you must assert yourself. Being assertive does not also mean being demanding, rude and egotistical. Being assertive is a management style to enable you to control the actions of the group. In a negotiating setting, this needs to be very subtle. The 3-Rs approach is an effective way of taking control without grasping it from the other person.

The process of preparing children for life is a complicated mix of coaching, demanding, directing, disciplining, dreaming, educating, encouraging, entrusting, informing, loving, mediating, negotiating, nurturing, philosophizing, training and trusting. Unlike most management situations, it is unique in that neither party has the option to quit without devastating consequences. There are some well-known parenting situations that can help managers understand and improve their management behavior.

Parents, like all people, react when challenged. This reaction is not the best of management styles, even for parents. Among other common mistakes, parents are apt to resist allowing their child to grow and assume additional responsibility as fast as the child would like. Parents tend to thwart blatant independence at a young age by saying "No!". Unfortunately "no" creates frustration rather than redirecting activity. In a negotiation "no" has a similar impact on the atmosphere between the negotiators. It can be frustrating to the point of distraction. If your intention is not to stop the dialogue in its tracks, be judicious using the word.

Parents also tend to concede too soon and then spend the night worrying if it was the right decision, often with good reason. Negotiators who preempt the other person by negotiating against their own proposal often wish they had just been patient. Cognitive dissonance is often referred to as buyers remorse. After a negotiation you do not want the other side thinking they gave away too much. You want to make sure you have reinforced their decisions as being well made and in their best interest. By building up their egos you are cementing the deal so it will stand the test of time.

Managing others is a design on your part to influence how they will act or respond. Before getting them to act, you have to first impact how they think. Few people can be persuaded to change how they think through a verbal debate. Bring data sheets, diagrams, experts, and other tangible support for your arguments to help educate, inform and influence the other person. Remember also that attitude and setting can influence the other person's mood. Take the initiative to make the initial few moments of any meeting positive and upbeat. Make it a personal challenge to get the other person to smile at least once before sitting down to start the formal dialogue.

To create change in another person, you need to make them uncomfortable and then lead them toward a comfortable resolution. One technique used is to change the topic abruptly to throw the other person off balance. This is especially useful when the discussion is heading into 'troubled waters' for you. Use any transitional thread to shift away from the sensitive area. Most people do not want to be rude and openly object. And example of how this might be done is to interject an observation about how difficult it is to work with city planners when an aspect of the lease negotiations is going against you. There are few people involved in developing commercial properties who won't readily vent about past problems with planners or planning commissions. Use the diversion as a chance to mentally regroup and find a way around problems the other discussion presented.

Posted by Bill at 8:55 AM | Comments (0)

October 6, 2005

Basic Management Skills in Negotiations

Any situation involving two or more people is a management opportunity. Those who take the initiative will typically prevail whether it is a physical confrontation or simply deciding which movie to see. Negotiations are only slightly more complicated management opportunities. Unlike a fight where blows are thrown, the combatants must feign civility and control. Initiative and leadership, however, are the most reliable tactics to be used to prevail.

Those involved in a dispute make up a small group and are subject to traditional group dynamics. Groups intrinsically need to be managed. This is what makes mediators effective in settling disputes. They are adept at taking control and managing the mediation process. Negotiators can benefit from learning mediating techniques. Parents, too, benefit from approaching family disputes as a group dynamic situation in which each family member has a role and voice. Using the mediation technique of inclusion to integrate everyone's needs into the solution can provide a mutually agreeable group decision.

How does one take control of an informal group?

By exerting influence and demonstrating leadership traits. In a negotiation, there are some ways to take the initiative:

- Initiate the call to arrange for the meeting.
- Host the meeting where you will have the ability to perform administrative tasks through your staff for the group.
- Prepare and present (or have on the table) an agenda for the meeting.
- Acting as the host, introduce everyone to each other and make sure they have coffee, water or anything else they may need.
- Position your pad and pen at the head of the table before the others arrive.
- Before someone else suggests it, call the meeting to order.

These seem like small things but they demonstrate your confidence, your can-do attitude, and your control of the environment. All that is left is for you to control the discussion. That is not as easy. But you will have made a good start.

Managing implies taking responsibility for the actions of others. A negotiation leader or a mediator delegates responsibilities not only to his co-negotiators, if any, but to the other side. This delegation of assignments serves not only to get the job done but also to give everyone a vested interest in the outcome. A mediator advances the process by directing and delegating the participants in a mediation. This process serves to make both parties valuable to the process, more equal in their respective statures, and, ultimately, more likely to be able to come to reach an agreement.

In a negotiation, group participation can have a similar impact. By getting both sides involved in working together, the resulting 'attitude' should be more supportive of reaching a mutually viable accord.

Two ways to get two people openly at odds to work together include:
Start with simple tasks that are unrelated to the primary issue.

1. Suggest the other person come with you to the coffee room to help get the coffee, cream and sugar.

2. Suggest methods of sharing information. "If I can explain to you how I have valued the property will you demonstrate to me your cost basis?" This is a tactic to get the parties involved in valuing a piece of real estate by working together. It calls upon each to be an expert in their own right. It also allows you to gather essential information.

Disorganized groups without leadership quickly collapse into chaos. Chaos rewards the stronger of the parties; it does not yield a negotiated settlement. Chaotic situations offer opportunities for someone to intervene and bring some order to the situation. Effective negotiators seek to control the environment and manage the process. It is better to be deciding what is going to happen next than to be told what to do.

Don't relinquish your role to another unless doing so tactically serves your ends. There are times to defer to another person to advance your cause.

Posted by Bill at 9:38 AM | Comments (0)

October 4, 2005

Using Time as a Negotiation Tactic

Whether we are talking about one's personal or professional life, time is a precious commodity. Appreciate the time you are investing in resolving a dispute or negotiating an issue. Make sure your time is warranted before over-investing in a minor issue's resolution. Unlike money, wasted time is not recoverable. It is a limited commodity that should be wisely rationed.

In addition to the currency of a transaction, time is likely to be the second most important commodity in a settlement conference. To use time strategically it needs to be understood.

Examples of how time impacts a negotiation or settlement conference include not only the time taken to attend a conference or meeting but also the actual time of the meeting plus the preparation time, the travel time to and from the meeting, and the time to prepare and review the documents required to memorialize the meeting.

You can manage the time consumed by a settlement conference by:

- Hosting the meeting at your office. This eliminates travel time and time lost in traffic.
- Setting the agenda to keep the meeting dialogue focused.
- Allow the other party to draft the settlement documents. This allows you to only review the documents.
- Send them edits to be incorporated into the draft document.
- Establish a set time when your secretary is to interrupt your meeting for a "urgent" matter. If the meeting is not making good progress, you will have an excuse to cut it short. If progress is being made and your continued participation is warranted, you can always make the meeting a higher priority.
- Add negotiating team members to assist in the research and preparation for the meeting.

When considering the time investment of taking on a dispute, consider the lost opportunity time to work on other tasks or spend with your family or on a hobby. Time is a consumable. You can't simply go to the bank and get more. Make sure you have prioritized your activities and this dispute merits your attention.

Because time is important to others it can and should be used as a negotiating tactic.

- Extend the time to settle to force resolution: If the issue is a minor irritant for the other person, being openly willing to prolong the time it will take to settle the issue may motivate the other party to settle rather than waste additional time at the negotiating table.
- Compress the time allowed to settle: If the issue is a minor irritant for you, being openly willing to walk away leaving the matter unsettled may motivate the other party to settle rather than risk losing the opportunity. This is especially effective if you have other options and the other party does not.
- Recognize the time being spent on the matter: By acknowledging the investment in time being made by both parties to address the situation you increase its stature or value and make the process more meaningful. This helps at times to get people to become more serious in their roles and diligent in seeking to reach an accord.

Time is a valuable commodity to us all. It is often overlooked. In today's fast-paced world, time is a true commodity to be managed and used as part of any negotiation.

Posted by Bill at 7:52 AM | Comments (0)

October 1, 2005

Decisions and Negotiating

Negotiators must be able to make decisions. Large decisions, small decisions, important decisions and mundane decisions. The process of making decisions is what advances a negotiation to its final outcome. Decision-making requires confidence, awareness, information, and courage. Most of all, it requires being prepared.

Prepare properly and agree to meet only when you are comfortable deciding what to do. Even though you may be meeting to gather information, the other person may present an opportunity for you to make an offer or accept a proposal. Being prepared to consider and act on such an opportunity enables you to take advantage of "The Moment".

There are those times when things just seem to go right and an opportunity to act presents itself. Unless you know what you want and need from a given situation, you will not be in a position to respond. Failing to do so may cost the deal later when the other person discovers other options or rethinks his or her offer.

People naturally resist making decisions. This is especially true when they feel they are being pressured to do so. To be an effective negotiator one needs to know how to prepare others to make decisions and commit. The climate of the negotiation plays a significant role in making everyone comfortable with making important decisions. Mediators work hard at giving everyone at the table a sense of power. They also use caucus or breakout sessions to separate people when emotions become too volatile. A negotiator can assume the role of a mediator in any negotiation by being sensitive to the climate of the discussions. By subtly taking responsibility for the "comfort" of the others, the negotiator assumes the mantle of a small group leader and may gain the ability to direct the discussion without having to force the issues through confrontational tactics.

Preparing for the Moment of Decision Tactics:

- If tempers have flared during the discourse, seek ways to mend the personal fences before pressing for decisions. People need to feel in control to commit willingly.

- As you approach major decisions it is helpful if you have laid the groundwork with small decisions along the way. This gets everyone used to committing and following through on their word.

- Review the terms carefully and solicit edits form everyone. By incorporating their changes they are becoming invested in the agreement.

- Encourage everyone to read the document one final time. You are intentionally slowing the process to ease the stress. Watch how others react to reading the document. If you see a cloud of doubt on someone's face, stop them and ask what is bothering them. You want everyone as comfortable as possible before placing pens in their hands.

- Review the reasons the others are agreeing to the terms and reinforce why their decision is a good one.

- Take a break and suggest a beverage or something to interject a chance to relax before actually sitting down to sign documents. Well timed breathers are a great way to diffuse mounting tension.

Decisions are pivotal moments in negotiations. Treat each decision, even the small ones, with respect. This builds a degree of comfort on the part of the other person in the process. Once a decision is made, reinforce why it was a good decision. It does not hurt to intimate that you may have conceded more than expected to build up the other's ego a bit. You want each decision to become easier as you build toward the really important decisions.

Negotiation, like any other process, can be managed. Who chooses to manage the process will likely prevail at the end of the day.

Posted by Bill at 4:36 PM | Comments (1)