Beware of hiring someone to negotiate for you. Too often hired negotiators are little more than mediators. Their reward stems from the reaching an agreement rather than the actual terms of the agreement.

Companies who hire real estate negotiators and reward them based on performance are asking for trouble. The very people who should be protecting the operating viability of the company are rewarded for something else, making the deal. People are human and incentives are important. Attorneys pose a different challenge to their clients. Some attorneys enjoy the process, the fight. They would rather fight to the end then compromise and settle. This is good for their egos and billable hours!

Knowing your bottom line is important. The bottom line is the point that you should either be prepared to walk away or to start bluffing seriously. In most cases, you should walk away. The deal was not meant to happen. When you walk away the other party may reach out to bring you back to the table. That is when you know they want the deal more than you do and that you might be able to agree on your terms.

Do not confuse goals with bottom lines. Your goals are what you want to achieve while your bottom line is what you need to achieve.

Your bottom line has little to do with your cost in acquiring the item. It is the lowest price you would be willing to accept. This might include among other things:

• The actual acquisition cost.

• The interest on the money invested while you owned it or the “carry cost”.

• The value of improvements you made to the item.

• The fdiscounted uture value you think the item may have were you to keep it.

• Any other cost you expended to acquire, hold or sell the item.

This is not your asking price. That is negotiable. This may not even be your non-negotiable bottom line. This is your frame of reference when setting your bottom-line before the negotiating gets hot and heavy. In the throes of the bid and ask you do not want to have to decide a that time what your bottom line is. It is too easy to miss something or make a mistake when calculating under duress. Do it in the quiet of the preparatory period when emotions are in check and you have ready access to files and records.

Creating value is work. It requires knowledge, preparation and inspiration. The benefit, however, can be a mutually satisfying resolution.

Conflict occurs when two or more people compete over a commodity. This can be anything. Land, money, a woman, a man, the baseball bat or the last piece of cake are all commodities likely to cause conflict.

The solution to conflicts other than by brute force is the realignment of interests through the exchanging of concessions. If the focus of the conflict is very narrow, like the wallet in your coat in a dark alley, the opportunity to align interests is very limited. Your best option is to tender it and hope that you will gain the option to walk away unscathed.

When the focus is widened, then there are opportunities to create value through the redistribution of assets or concessions that are valued differently by the parties.

The disparity of valuation is the key to value enhancement. Because we are all unique, we value things differently. The differential allows for the creative realignment of interests to maximize the potential value of the aggregate commodities.

Sex sells. The age old profession repeatedly validates this. The professional knows that she can up her price by adding feigned affection and personal involvement in the basic act. The cost to her is little in tangible assets but the reward can raise the price of a furtive back alley service to a lucrative remuneration for an ego (his) satisfying performance. The act has not changed. The perceived value has.

Similarly in a dispute over a minor issue between a contractor and the customer, a simple apology by the contractor may yield a significant concession by the customer. The cost of the apology to the contractor is a bit of ego; the reward is incremental cold, hard cash.

The chimps diligently tried to open the devices. They applied their proven skill of random experimentation. The children, on the other hand, applied what they had been shown and tried to open the device with that technique. The children were far more successful.

We, humans, learn through socializing. We observe others, collect those observations and store them away to use in the future. Chimps, on the other hand, attack each new task with vigor but with little application of what they have just observed in fellow chimps.

Negotiators need social skills to capitalize on the preliminary social interaction. Insights potentially useful in the actual negotiation are gathered and stored for future reference.

In today’s fast paced environment building a relationship is often neglected in the interest of saving time and getting to the point. This can be a costly mistake. Negotiators are humans and humans respond to the personalization of any situation. It is our nature as social beings.

Any negotiation, no matter how insignificant, is based in conflict. Those involved are competing to protect or advance their respective interests by depriving another of his or her expectations. Negotiation is the settlement of conflicting interests without resorting to force.

If you are convinced that you are right, if you think you deserve to win, if you know that you are in the right, your passion colors your arguments and strengthens your statements. Conviction is contagious. Others will be persuaded to at least consider your position if your passion is obvious and sincere.

If you have doubts, you will be less than convincing. Self-doubt will undermine your arguments and encourage others to resist and fight back. Before getting involved in a settlement session resolve your doubts and mentally prepare to win. If necessary, adjust your position to be more realistic and, thereby, increase your own expectation of prevailing.

• Visualize Winning. When considering strategies and tactics before a meeting envision winning with each tactic. Actually imagine and savor the moment of victory. This mental exercise sets in your mind the feeling or the gestalt of deploying the strategy or tactic successfully. When the time comes to actually use it, your actions will be more natural.

• Deserve to win. When setting your objectives and primary goal, test the terms against what you know to be reasonable. If they are reasonable you can set aside doubts that you will be rejected on the facts or “found out”. Before the meeting mentally contemplate the other person acknowledging the reasonableness of your argument and amending his position towards yours. Focus on actually convincing the other person. This form of mental preparation serves to establish your expectation that you deserve to prevail, that you should prevail. You are empowering yourself to prevail.

• Prepare to Win. As the start of the meeting approaches, plan how you will enter the room. Remind yourself to stand tall, make direct eye contact, offer a firm handshake, and emit confidence. Dress for the meeting. Pick your clothes to reflect this confident demeanor. Remember, you can always dress down during a meeting but you can’t dress up. Typically I over dress to insure I am the power figure in the room. I can always take off my coat and loosen my tie to make others comfortable.

The power of persuasion comes from within.

Bartering is about trading between equals. Negotiating is all about leadership. Attaining your goal requires your convincing another person to do something they prefer not to do. In the work environment managers entice workers to come to work and perform to certain standards. They do this through offering to pay the employee. This gets reasonable performance. To get exceptional performance managers must develop and apply leadership techniques. Negotiators must do the same. They must motivate exceptional performance on the part of another person or group.

If you don’t need the help of others there would be no reason to negotiate. You would simply do what you wanted to do with pure power.

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

Those involved in negotiations essentially are dysfunctional small groups. Negotiators should look at the various people around the table 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.

We are a competitive species. It is natural to get caught up in the give and take of the negotiating process. When we are in the trenches it is often easy to lose sight of our objectives. This is especially true in personal relationships where emotions can cloud our judgment.

Throughout any negotiation take breaks to regroup and refocus on your objectives. Think through how things are going and where they are headed. Get control of your emotions and assess how your tactics and strategies are working. Most important, make sure you have not lost sight of your primary goal and objectives.

In personal disputes it is acceptable to call for breaks. This is especially important when engaged with a child. Before you let their tactics get you emotionally out of control, call for a break and send the child to his or her room to think about what they are saying or doing. This gives them a chance to become less emotional and focused on simply winning. It also gives you time to catch your breath, get your bearings, and plan a solution that will defuse the argument.

As a parent it is your responsibility to lead the way out of arguments. You children need to learn this from you so they, later in life, can do the same thing with their spouses or children. Everything you do with your kids as a parent is part of your role as a teacher and mentor. They are always watching and will later mimic your behaviors.

Understanding the currency of a specific negotiation enables you to focus on satisfying the wants and needs of each other rather than simply trying to win. Expanding the negotiation discussion to include these alternate currencies provides additional incentives for the parties to agree on a myriad of terms rather than disagreeing on one major point. Diluting the importance of the primary term may convert a troubled situation into a mutually beneficial accord.

By incorporating ancillary currencies, you will increase the opportunity to craft an agreement that yields a greater return on your investment than merely bartering dollars. Often it enables you to garner value from the other person for something that you intended to provide anyway. Dollars are only one measure of value. Feelings, recognition, success, inclusion, service, image, ego and future opportunities are less measurable currencies but often they are more important than the dollars.

Ancillary currencies may seem to have little or no value to you but may be vitally important to the other person. It is the disparity of value that makes converting idle currencies into valued commodities in a transaction the creation of value. Bartering is the exchange of like value for like value. Negotiating is the creation of value and is more art than discipline.

Fear of failure, however, can paralyzes otherwise competent negotiators. That is a major problem in that we must face and embrace the act of negotiating in every aspect of our public and private lives.

We are taught to win in America and almost any cost. Winning is what we are about as a culture, a society and as a nation. The problem is that everyone can't win. In fact, most sports teams don't win their conference titles. Only one team prevails.

So if we are expected to win but reality mandates that only a small percentage of us can actually be winners how are we to handle coming in second best?

In a good poker game the worst thing that can happen is to draw a hand that is second to the best possible hand. In a game like Omaha you can see from the board what the possibilities are. If there are three diamonds showing but no pair on the board you know that a flush is likely but a full house impossible. Your king high flush is so good, the second highest possible hand, you have to stay in and match all bets. But, if others are betting aggressively, you know someone else likely has the ace high flush. But you are not sure. And, as they always say, to win you have to play.

Second best hurts simply because there is no reward for being second across the finish line on in poker. But there is comfort in knowing that all of us lose from time to time. The key is to win more than we lose. That means learning from our mistakes.

Mistakes come in varying sizes. The bigger the mistake, the more likely it will be noticed. If, in that poker game, you are beat by several other players, then you need to assess how you are calculating the odds. Obviously you are not reading the hands right.

In a negotiation small errors are recoverable and forgivable. Large errors implying deceit or ignorance can prove very costly. How to handle mistakes made in a negotiation:

If it is an innocent error, admit it and move on. Do not offer to compensate the other for the faux pas. It was unintended. Everyone makes mistakes. What's the big deal? It can be blamed on moving too quickly, not catching a minor change in a document, or simply a typing error. Don't give it any more attention than you would a clerical error. Be willing to do the same if the other person slips up. If it is not material move on.

If it was a tactical blunder or bluff that was called, assess the real damage. Some compensatory groveling may be in order. You may be able to ease the situation by suggesting that you had to try it, even though you knew it would not fly. Or that you were not sure how firm he was in his position and had to test the waters. You can even feign humor asking the other person if he really thought you were serious. If really desperate you could claim that you knew better but your boss made you to try it. The bottom line is that you will have lost ground and will need to redouble your efforts to make it up. You credibility, at a minimum, will be diminished.

If the mistake involves a lie or falsehood and it is discovered you have a significant problem. Your integrity in on the line and the other person has every right to walk away. Before you can get back into the negotiation, you need to repair the relationship. Be prepared to take the brunt of the other's wrath. You deserve it. Depending on the extent of the damage, you may have to suggest replacing yourself as negotiator. This is best done if the situation is very important. You can and should fall on your sword and tell everyone the deal is too important to be jeopardized by a stupid act on your part, then bring in a new face to handle the salvage operation.

Your word is or should be sacrosanct. Do not soil your good name to win a battle. You will place the war in jeopardy. Innocent mistakes or mistakes made in haste are forgivable. Lies and deceit erode your ability to negotiate effectively.

If you studiously avoid filling the lapses in a conversation or discussion you will notice something interesting. Others will nervously try to fill the verbal void. It is these comments that provide interesting factoids and give you power.

Take a day to demonstrate this to yourself.

Spend the day not making small talk with anyone outside of your family. When you go to get you cup of coffee and pastry don’t respond verbally when the clerk asks how you are. They don’t really care. They are programmed to ask. Simply nod and observe how they react.

Typically if you answer, they have already looked away and are preparing to ask what you would like. If you don’t verbally respond they will likely hesitate and look at you intently waiting for a response.

They are actually seeing you for the first time; really looking. They will also likely be notching up their respect for you. The unknown or unpredictable is always note worthy. This simple change in the typical protocol of social interaction has elevated you with the power of mystery. Do this all day long and observe how differentially you are treated by clerks, peers and even your supervisors.

Your silence denotes confidence, control and focus. It can be very intimidating.

In a negotiation you can and should use silence the same way. When entering the room and everyone is shaking hands and discussing the weather try stand slightly apart and silent. When people greet you, simply nod. Take a seat while others are still standing and shuffle through your papers.

Note how the others begin to react to you. Typically your opponents will become more wary having taken note of your serious demeanor, your sense of purpose, and your self confidence. They may even try to reach out to you to break the silence.

You are having an impact on them. That is the genesis of informal leadership power.

When you are negotiating, having almost any conversation with anyone else, it is not your words that are being listened to as much as how you are phrasing them and the intonation of your delivery. And we, as adept social animals, often hide our true meaning with oblique comments and inflections so as not to expose ourselves unnecessarily.

The equation is simple: Language + Delivery = Intent x Obfuscation.

As the recipient of such an offer understand the intent. The person using humor as a delivery tactic is likely fishing to see how you will react. By listening to the meaning behind the words, you will be better able to respond strategically rather than emotionally. If the offer is ridiculously low, you can choose to walk away or respond. If you are serious about making a deal, an effective response would be to calmly inform the other party of the value of the commodity, the basis for that valuation and ask them to reconsider their offer and do better. What you have done is delivered the message that you are informed; that you know the value of the commodity; that you are not desperate; and, that you are serious about reaching an agreement; if they are.

Recently when negotiating for a property in Beverly Hills, the other person threw out some obscenely high comparables. The numbers were astronomical. He did not say that he expected us to pay that amount. He did say that is what “others” were getting. My response was a civil recap of actual comps for like property and the flaws his site had as compared to them. Much later, after he had done his research (validating the information I had provided him), we were able to reach an accord. Had I simply reacted to his initial overture assuming he was serious, we would likely have parted company on the spot.

Learn to listen and observe and then, most important, think about the information you have just gathered before reacting.

To be a power negotiator limits your ability to openly communicate with others. The school yard bully has the respect of a small group of peers but the ire of the rest of the student body and faculty. When the time comes to matriculate and join the adult world, the bully will find few friends from school he can call on to open doors or otherwise help him.

The second rule of power negotiations is to not reveal your needs, wants, objectives and goals; to keep your foe guessing. The bully cannot reveal his real feelings, even to his peers. So he becomes isolated and ill informed. When corporate CEOs, intoxicated with their power, become bullies around the office they quickly cut the lines of communication that served to get them to the top. These short-lived tours of duty are excellent examples of the Peter Principle.

The effective negotiator views power negotiations as a tactic, not even a strategy. They use it to amplify an argument or capture a concession. They do not abuse it to the extent that it damages the relationship or jeopardizes future opportunities.

The chimps diligently tried to open the devices. They applied their proven skill of random experimentation. The children, on the other hand, applied what they had been shown and tried to open the device with that technique. The children were far more successful.

We, humans, learn through socializing. We observe others, collect those observations and store them away to use in the future. Chimps, on the other hand, attack each new task with vigor but with little application of what they have just observed.

Negotiators must develop the social skills to promote social interaction as part of the early negotiating process. From this interaction will come insights useful in the actual negotiation discussion. In today’s fast paced environment, too often building a relationship is omitted in the interest of saving time and getting to the point. This can be a costly strategic error.

This intimidation forced many law abiding citizens to pay for protection from the Mafia.

In the 21st Century Muslim extremists are using the same concept. They are trying to invoke fear into the western population to advance their cause. They cannot hope to confront most of the world’s military power or even their own countries head on, so they resort to attacking the mass population in the name of Allah and their cause. If the masses become too fearful they will either promote aggressive retaliation or elect acquiescence candidates to avoid personal harm. Either way, the terrorist gains strength and power by usurping control of the population.

The best defense against a terrorist is to not change dramatically our daily routine, our perspective on life, and our willingness to do what we want to do. Add to this a little caution, some extra vigilance in being aware of what is going on around us, and not changing our basic beliefs will declaw the attempt of the terrorists to control us.

In a negotiation fear plays a large, strategic role in the outcome. Fear of failing, fear of the unknown, fear of not being helpful, there are many fears that can be used to advance a negotiator’s cause. One of the most powerful tactics that few think to use is the fear of not being helpful.

How does fear serve the negotiator in this context? By becoming a silent motivator to get the other person to do something that he or she does not want to do. A sociopath has no regard for the feelings of others. He does not relate to others. The rest of us do. In the business environment, many try to be non-emotional. They get away with this sociopathic approach if the other person does not build a personal “bridge”. Bank lending officers, credit managers, retail clerks all fit this mold. But who gets the best service at a store? Not the dour patron but the person who reaches out with a smile or kind remark. That is the person the clerk relates to and gives just a little extra. Why? Not because they have to but because they want to. This is a basic demonstration of the application of fear in a negotiation. The customer who has made the effort to build a personal bridge to the clerk has subliminally made that person concerned that they do not want to offend the person in some way. So they try to accommodate the patron.

When the group is involved in the negotiation process becomes much more challenging. The group has its own structure and objectives. Individual members of the group will typically have differing personal objectives and opinions. The negotiators challenge is to decipher the leaders in the group and the protagonists. Each will have to be dealt with to achieve an agreement that will survive the test of time.

It is important to 'hear' the content and observe the delivery. A CFO can speak in deference to his CEO but the message can carry the import of the Board of Directors. Conversely, others speak to be heard and recognized by those in power. Differentiating those who want power and those who enjoy it will improve your ability to target the right person with whom to forge a consensus.

Group negotiations are most challenged when there are opposing views and power factions within the group. As an outsider and the ‘opposition’ it helps to ferret out such discord to decide if the group can reach an accord or if you are wasting your time and theirs.

When you run into a fractured opposing group dynamic you may be able to divide and conquer. But such power tactics have their limits:

• Pushing the primary negotiator to make a commitment contrary to the rest of his team may be successful during the meeting but fall apart as soon as the meeting ends and his or her associates speak up in private.

• Pressing too soon may cause the other team to postpone making any decision until they can agree among themselves thereby costing you the benefit of their fractionalization.

• Choosing the wrong negotiator to whom to play may back fire when the real power on the team emerges in opposition to the way you have lead the discussion.

The best advice when facing a dysfunctional team of negotiators is to go slow, increase your awareness of non-verbal signals and verbal intonations, and pace yourself not to be overcome by the varied and oblique affronts frequently used in group negotiations, and keep the discussion focused on where you want it to go. Don’t let it become distracted or fragmented by allowing everyone on the other side to derail the process by talking just to be heard.

Strong negotiators must also be strong leaders. Controlling the content of the meeting and the direction of the discussion comes from the deft application of informal leadership skills. Sharpen these skills and you will improve your negotiating results.

Other people presume to have power over us. Be they attorneys, accountants, doctors, clerks, teachers, or spouses who can make our lives miserable the power they presume to hold over us is based solely on the power we allow them to have.

Surviving is getting along and accepting the status quo. Conquering is overcoming and prevailing. When we negotiate, the goal is to reach an agreement that meets our needs and advances our cause by satisfying some of our wants. As conflict is a constant part of our lives, it should be conquered rather than merely survived.

Conquering conflict does not necessarily mean crushing the other person. It means dispatching the negative connotation of conflict in your mind, the fear if you will, so that you can focus on resolving issues to advance your interests rather than merely preserving them.

The reality is that fear makes us act defensively, being defensive shuts down our ability to communicate. Lack of communication stymies negotiations.