Never Split the Difference: Negotiating as if Your Life Depended on It
Chris Voss
How to Become the Smartest Person . . . in Any Room
For more than three decades, Harvard had been the world epicenter of negotiating theory and practice. All I knew about the techniques we used at the FBI was that they worked. In the twenty years I spent at the Bureau we’d designed a system that had successfully resolved almost every kidnapping we applied it to. But we didn’t have grand theories. Our techniques were the products of experiential learning; they were developed by agents in the field, negotiating through crisis and sharing stories of what succeeded and what failed. It was an iterative process, not an intellectual one, as we refined the tools we used day after day. And it was urgent. Our tools had to work, because if they didn’t someone died.
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But why did they work? That was the question that drew me to Harvard, to that office with Mnookin and Blum. I lacked confidence outside my narrow world. Most of all, I needed to articulate my knowledge and learn how to combine it with theirs—and they clearly had some—so I could understand, systematize, and expand it.
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Their system was easy to follow and seductive, with four basic tenets. One, separate the person—the emotion—from the problem; two, don’t get wrapped up in the other side’s position (what they’re asking for) but instead focus on their interests (why they’re asking for it) so that you can find what they really want; three, work cooperatively to generate win-win options; and, four, establish mutually agreed-upon standards for evaluating those possible solutions.
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How to Quickly Establish Rapport
Good negotiators, going in, know they have to be ready for possible surprises; great negotiators aim to use their skills to reveal the surprises they are certain exist.
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In negotiation, each new psychological insight or additional piece of information revealed heralds a step forward and allows one to discard one hypothesis in favor of another. You should engage the process with a mindset of discovery. Your goal at the outset is to extract and observe as much information as possible. Which, by the way, is one of the reasons that really smart people often have trouble being negotiators—they’re so smart they think they don’t have anything to discover.
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Too often people find it easier just to stick with what they believe. Using what they’ve heard or their own biases, they often make assumptions about others even before meeting them. They even ignore their own perceptions to make them conform to foregone conclusions. These assumptions muck up our perceptual windows onto the world, showing us an unchanging—often flawed—version of the situation. Great negotiators are able to question the assumptions that the rest of the involved players accept on faith or in arrogance, and thus remain more emotionally open to all possibilities, and more intellectually agile to a fluid situation.
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Students of mine balk at this notion, asking, “Seriously, do you really need a whole team to . . . hear someone out?” The fact that the FBI has come to that conclusion, I tell them, should be a wake-up call. It’s really not that easy to listen well. We are easily distracted. We engage in selective listening, hearing only what we want to hear, our minds acting on a cognitive bias for consistency rather than truth.
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Most people approach a negotiation so preoccupied by the arguments that support their position that they are unable to listen attentively. In one of the most cited research papers in psychology,1 George A. Miller persuasively put forth the idea that we can process only about seven pieces of information in our conscious mind at any given moment. In other words, we are easily overwhelmed.
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There’s one powerful way to quiet the voice in your head and the voice in their head at the same time: treat two schizophrenics with just one pill. Instead of prioritizing your argument—in fact, instead of doing any thinking at all in the early goings about what you’re going to say—make your sole and all-encompassing focus the other person and what they have to say. In that mode of true active listening—aided by the tactics you’ll learn in the following chapters—you’ll disarm your counterpart. You’ll make them feel safe. The voice in their head will begin to quiet down.
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The goal is to identify what your counterparts actually need (monetarily, emotionally, or otherwise) and get them feeling safe enough to talk and talk and talk some more about what they want. The latter will help you discover the former. Wants are easy to talk about, representing the aspiration of getting our way, and sustaining any illusion of control we have as we begin to negotiate; needs imply survival, the very minimum required to make us act, and so make us vulnerable. But neither wants nor needs are where we start; it begins with listening, making it about the other people, validating their emotions, and creating enough trust and safety for a real conversation to begin.
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Going too fast is one of the mistakes all negotiators are prone to making. If we’re too much in a hurry, people can feel as if they’re not being heard and we risk undermining the rapport and trust we’ve built. There’s plenty of research that now validates the passage of time as one of the most important tools for a negotiator. When you slow the process down, you also calm it down. After all, if someone is talking, they’re not shooting.
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When deliberating on a negotiating strategy or approach, people tend to focus all their energies on what to say or do, but it’s how we are (our general demeanor and delivery) that is both the easiest thing to enact and the most immediately effective mode of influence. Our brains don’t just process and understand the actions and words of others but their feelings and intentions too, the social meaning of their behavior and their emotions. On a mostly unconscious level, we can understand the minds of others not through any kind of thinking but through quite literally grasping what the other is feeling. Think of it as a kind of involuntary neurological telepathy—each of us in every given moment signaling to the world around us whether we are ready to play or fight, laugh or cry. When we radiate warmth and acceptance, conversations just seem to flow. When we enter a room with a level of comfort and enthusiasm, we attract people toward us.
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There are essentially three voice tones available to negotiators: the late-night FM DJ voice, the positive/playful voice, and the direct or assertive voice. Forget the assertive voice for now; except in very rare circumstances, using it is like slapping yourself in the face while you’re trying to make progress. You’re signaling dominance onto your counterpart, who will either aggressively, or passive-aggressively, push back against attempts to be controlled. Most of the time, you should be using the positive/playful voice. It’s the voice of an easygoing, good-natured person. Your attitude is light and encouraging. The key here is to relax and smile while you’re talking. A smile, even while talking on the phone, has an impact tonally that the other person will pick up on. The effect these voices have are cross-cultural and never lost in translation.
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When people are in a positive frame of mind, they think more quickly, and are more likely to collaborate and problem-solve (instead of fight and resist). It applies to the smile-er as much as to the smile-ee: a smile on your face, and in your voice, will increase your own mental agility.
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Mirroring, also called isopraxism, is essentially imitation. It’s another neurobehavior humans (and other animals) display in which we copy each other to comfort each other. It can be done with speech patterns, body language, vocabulary, tempo, and tone of voice. It’s generally an unconscious behavior—we are rarely aware of it when it’s happening—but it’s a sign that people are bonding, in sync, and establishing the kind of rapport that leads to trust. It’s a phenomenon (and now technique) that follows a very basic but profound biological principle: We fear what’s different and are drawn to what’s similar. As the saying goes, birds of a feather flock together. Mirroring, then, when practiced consciously, is the art of insinuating similarity. “Trust me,” a mirror signals to another’s unconscious, “You and I—we’re alike.”
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While mirroring is most often associated with forms of nonverbal communication, especially body language, as negotiators a “mirror” focuses on the words and nothing else. Not the body language. Not the accent. Not the tone or delivery. Just the words. It’s almost laughably simple: for the FBI, a “mirror” is when you repeat the last three words (or the critical one to three words) of what someone has just said. Of the entirety of the FBI’s hostage negotiation skill set, mirroring is the closest one gets to a Jedi mind trick. Simple, and yet uncannily effective. By repeating back what people say, you trigger this mirroring instinct and your counterpart will inevitably elaborate on what was just said and sustain the process of connecting.
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I only half-jokingly refer to mirroring as magic or a Jedi mind trick because it gives you the ability to disagree without being disagreeable.
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If you take a pit bull approach with another pit bull, you generally end up with a messy scene and lots of bruised feelings and resentment. Luckily, there’s another way without all the mess. It’s just four simple steps: 1. Use the late-night FM DJ voice. 2. Start with “I’m sorry . . .” 3. Mirror. 4. Silence. At least four seconds, to let the mirror work its magic on your counterpart. 5. Repeat. One of my students experienced the effectiveness of this simple process at her workplace, where her impulsive boss was known for his “drive-bys”: an infuriating practice by which the boss would suddenly swing by one’s office or cubicle unannounced with an “urgent,” poorly thought out assignment that created a lot of unnecessary work.
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Popping his head into her office, the boss said, “Let’s make two copies of all the paperwork.” “I’m sorry, two copies?” she mirrored in response, remembering not only the DJ voice, but to deliver the mirror in an inquisitive tone. The intention behind most mirrors should be “Please, help me understand.” Every time you mirror someone, they will reword what they’ve said. They will never say it exactly the same way they said it the first time. Ask someone, “What do you mean by that?” and you’re likely to incite irritation or defensiveness. A mirror, however, will get you the clarity you want while signaling respect and concern for what the other person is saying.
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Mirroring will make you feel awkward as heck when you first try it. That’s the only hard part about it; the technique takes a little practice. Once you get the hang of it, though, it’ll become a conversational Swiss Army knife valuable in just about every professional and social setting.
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■ Mirrors work magic. Repeat the last three words (or the critical one to three words) of what someone has just said. We fear what’s different and are drawn to what’s similar. Mirroring is the art of insinuating similarity, which facilitates bonding. Use mirrors to encourage the other side to empathize and bond with you, keep people talking, buy your side time to regroup, and encourage your counterparts to reveal their strategy.
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How to Create Trust with Tactical Empathy
Most of us enter verbal combat unlikely to persuade anyone of anything because we only know and care about our own goals and perspective. But the best officers are tuned in to the other party—their audience. They know that if they empathize, they can mold their audience by how they approach and talk to them.
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Empathy is a classic “soft” communication skill, but it has a physical basis. When we closely observe a person’s face, gestures, and tone of voice, our brain begins to align with theirs in a process called neural resonance, and that lets us know more fully what they think and feel.
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We spotted their feelings, turned them into words, and then very calmly and respectfully repeated their emotions back to them. In a negotiation, that’s called labeling. Labeling is a way of validating someone’s emotion by acknowledging it. Give someone’s emotion a name and you show you identify with how that person feels. It gets you close to someone without asking about external factors you know nothing about (“How’s your family?”). Think of labeling as a shortcut to intimacy, a time-saving emotional hack. Labeling has a special advantage when your counterpart is tense. Exposing negative thoughts to daylight—“It looks like you don’t want to go back to jail”—makes them seem less frightening.
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Once you’ve spotted an emotion you want to highlight, the next step is to label it aloud. Labels can be phrased as statements or questions. The only difference is whether you end the sentence with a downward or upward inflection. But no matter how they end, labels almost always begin with roughly the same words: It seems like . . . It sounds like . . . It looks like . . . Notice we said “It sounds like . . .” and not “I’m hearing that . . .” That’s because the word “I” gets people’s guard up. When you say “I,” it says you’re more interested in yourself than the other person, and it makes you take personal responsibility for the words that follow—and the offense they might cause. But when you phrase a label as a neutral statement of understanding, it encourages your counterpart to be responsive. They’ll usually give a longer answer than just “yes” or “no.” And if they disagree with the label, that’s okay. You can always step back and say, “I didn’t say that was what it was. I just said it seems like that.”
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The last rule of labeling is silence. Once you’ve thrown out a label, be quiet and listen. We all have a tendency to expand on what we’ve said, to finish, “It seems like you like the way that shirt looks,” with a specific question like “Where did you get it?” But a label’s power is that it invites the other person to reveal himself.
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What good negotiators do when labeling is address those underlying emotions. Labeling negatives diffuses them (or defuses them, in extreme cases); labeling positives reinforces them.
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Try this the next time you have to apologize for a bone-headed mistake. Go right at it. The fastest and most efficient means of establishing a quick working relationship is to acknowledge the negative and diffuse it. Whenever I was dealing with the family of a hostage, I started out by saying I knew they were scared. And when I make a mistake—something that happens a lot—I always acknowledge the other person’s anger. I’ve found the phrase “Look, I’m an asshole” to be an amazingly effective way to make problems go away. That approach has never failed me.
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the beauty of going right after negativity is that it brings us to a safe zone of empathy. Every one of us has an inherent, human need to be understood, to connect with the person across the table. That explains why, after Anna labeled Angela’s fears, Angela’s first instinct was to add nuance and detail to those fears. And that detail gave Anna the power to accomplish what she wanted from the negotiation.
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keep in mind these lessons from the chapter you’ve just read:
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■ Imagine yourself in your counterpart’s situation. The beauty of empathy is that it doesn’t demand that you agree with the other person’s ideas (you may well find them crazy). But by acknowledging the other person’s situation, you immediately convey that you are listening. And once they know that you are listening, they may tell you something that you can use. ■ The reasons why a counterpart will not make an agreement with you are often more powerful than why they will make a deal, so focus first on clearing the barriers to agreement. Denying barriers or negative influences gives them credence; get them into the open. ■ Pause. After you label a barrier or mirror a statement, let it sink in. Don’t worry, the other party will fill the silence. ■ Label your counterpart’s fears to diffuse their power. We all want to talk about the happy stuff, but remember, the faster you interrupt action in your counterpart’s amygdala, the part of the brain that generates fear, the faster you can generate feelings of safety, well-being, and trust. ■ List the worst things that the other party could say about you and say them before the other person can. Performing an accusation audit in advance prepares you to head off negative dynamics before they take root. And because these accusations often sound exaggerated when said aloud, speaking them will encourage the other person to claim that quite the opposite is true. ■ Remember you’re dealing with a person who wants to be appreciated and understood. So use labels to reinforce and encourage positive perceptions and dynamics.
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How to Generate Momentum and Make It Safe to Reveal the Real Stakes
We have all these negative connotations with “No.” We talk about the rejection of “No,” about the fear of hearing it. “No” is the ultimate negative word. But at the end of the day, “Yes” is often a meaningless answer that hides deeper objections (and “Maybe” is even worse). Pushing hard for “Yes” doesn’t get a negotiator any closer to a win; it just angers the other side. So if “Yes” can be so damn uncomfortable, and “No” such a relief, why have we fetishized one and demonized the other?
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I’ll let you in on a secret. There are actually three kinds of “Yes”: Counterfeit, Confirmation, and Commitment. A counterfeit “yes” is one in which your counterpart plans on saying “no” but either feels “yes” is an easier escape route or just wants to disingenuously keep the conversation going to obtain more information or some other kind of edge. A confirmation “yes” is generally innocent, a reflexive response to a black-or-white question; it’s sometimes used to lay a trap but mostly it’s just simple affirmation with no promise of action. And a commitment “yes” is the real deal; it’s a true agreement that leads to action, a “yes” at the table that ends with a signature on the contract. The commitment “yes” is what you want, but the three types sound almost the same so you have to learn how
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Gun for a “Yes” straight off the bat, though, and your counterpart gets defensive, wary, and skittish. That’s why I tell my students that, if you’re trying to sell something, don’t start with “Do you have a few minutes to talk?” Instead ask, “Is now a bad time to talk?” Either you get “Yes, it is a bad time” followed by a good time or a request to go away, or you get “No, it’s not” and total focus. As an exercise, the next time you get a telemarketing call, write down the questions the seller asks. I promise you’ll find that your level of discomfort correlates directly to how quickly he pushes you for “Yes.”
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“No” is not failure. Used strategically it’s an answer that opens the path forward. Getting to the point where you’re no longer horrified by the word “No” is a liberating moment that every negotiator needs to reach. Because if your biggest fear is “No,” you can’t negotiate. You’re the hostage of “Yes.” You’re handcuffed. You’re done.
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let’s undress “No.” It’s a reaffirmation of autonomy. It is not a use or abuse of power; it is not an act of rejection; it is not a manifestation of stubbornness; it is not the end of the negotiation. In fact, “No” often opens the discussion up. The sooner you say “No,” the sooner you’re willing to see options and opportunities that you were blind to previously. Saying “No” often spurs people to action because they feel they’ve protected themselves and now see an opportunity slipping away.
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How to Gain the Permission to Persuade
As you’ll soon learn, the sweetest two words in any negotiation are actually “That’s right.”
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How to Shape What Is Fair
prospect theory describes how people choose between options that involve risk, like in a negotiation. The theory argues that people are drawn to sure things over probabilities, even when the probability is a better choice. That’s called the Certainty Effect. And people will take greater risks to avoid losses than to achieve gains. That’s called Loss Aversion.
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MENTOR Remember the idea of figuring what the other side is really buying? Well, when you are selling yourself to a manager, sell yourself as more than a body for a job; sell yourself, and your success, as a way they can validate their own intelligence and broadcast it to the rest of the company. Make sure they know you’ll act as a flesh-and-blood argument for their importance. Once you’ve bent their reality to include you as their ambassador, they’ll have a stake in your success. Ask: “What does it take to be successful here?” Please notice that this question is similar to questions that are suggested by many MBA career counseling centers, yet not exactly the same. And it’s the exact wording of this question that’s critical. Students from my MBA courses who have asked this question in job interviews have actually had interviewers lean forward and say, “No one ever asked us that before.” The interviewer then gave a great and detailed answer. The key issue here is if someone gives you guidance, they will watch to see if you follow their advice. They will have a personal stake in seeing you succeed. You’ve just recruited your first unofficial mentor.
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■ All negotiations are defined by a network of subterranean desires and needs. Don’t let yourself be fooled by the surface.
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■ Splitting the difference is wearing one black and one brown shoe, so don’t compromise. Meeting halfway often leads to bad deals for both sides.
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■ Approaching deadlines entice people to rush the negotiating process and do impulsive things that are against their best interests.
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■ The F-word—“Fair”—is an emotional term people usually exploit to put the other side on the defensive and gain concessions. When your counterpart drops the F-bomb, don’t get suckered into a concession. Instead, ask them to explain how you’re mistreating them.
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■ You can bend your counterpart’s reality by anchoring his starting point. Before you make an offer, emotionally anchor them by saying how bad it will be. When you get to numbers, set an extreme anchor to make your “real” offer seem reasonable, or use a range to seem less aggressive. The real value of anything depends on what vantage point you’re looking at it from.
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How to Calibrate Questions to Transform Conflict into Collaboration
Most important, we learned that successful negotiation involved getting your counterpart to do the work for you and suggest your solution himself. It involved giving him the illusion of control while you, in fact, were the one defining the conversation. The tool we developed is something I call the calibrated, or open-ended, question. What it does is remove aggression from conversations by acknowledging the other side openly, without resistance. In doing so, it lets you introduce ideas and requests without sounding pushy. It allows you to nudge. I’ll explain it in depth later on, but for now let me say that it’s really as simple as removing the hostility from the statement “You can’t leave” and turning it into a question. “What do you hope to achieve by going?”
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It’s a natural and normal question, not a request for a fact. It’s a “how” question, and “how” engages because “how” asks for help.
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Now, think about how my client’s question worked: without accusing them of anything, it pushed the big company to understand her problem and offer the solution she wanted. That in a nutshell is the whole point of open-ended questions that are calibrated for a specific effect. Like the softening words and phrases “perhaps,” “maybe,” “I think,” and “it seems,” the calibrated open-ended question takes the aggression out of a confrontational statement or close-ended request that might otherwise anger your counterpart. What makes them work is that they are subject to interpretation by your counterpart instead of being rigidly defined. They allow you to introduce ideas and requests without sounding overbearing or pushy. And that’s the difference between “You’re screwing me out of money, and it has to stop” and “How am I supposed to do that?”
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But calibrated questions are not just random requests for comment. They have a direction: once you figure out where you want a conversation to go, you have to design the questions that will ease the conversation in that direction while letting the other guy think it’s his choice to take you there. That’s why I refer to these questions as calibrated questions. You have to calibrate them carefully, just like you would calibrate a gun sight or a measuring scale, to target a specific problem.
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The good news is that there are rules for that. First off, calibrated questions avoid verbs or words like “can,” “is,” “are,” “do,” or “does.” These are closed-ended questions that can be answered with a simple “yes” or a “no.” Instead, they start with a list of words people know as reporter’s questions: “who,” “what,” “when,” “where,” “why,” and “how.” Those words inspire your counterpart to think and then speak expansively. But let me cut the list even further: it’s best to start with “what,” “how,” and sometimes “why.” Nothing else. “Who,” “when,” and “where” will often just get your counterpart to share a fact without thinking. And “why” can backfire. Regardless of what language the word “why” is translated into, it’s accusatory. There are very rare moments when this is to your advantage. The only time you can use “why” successfully is when the defensiveness that is created supports the change you are trying to get them to see. “Why would you ever change from the way you’ve always done things and try my approach?” is an example. “Why would your company ever change from your long-standing vendor and choose our company?” is another. As always, tone of voice, respectful and deferential, is critical. Otherwise, treat “why” like a burner on a hot stove—don’t touch it. Having just two words to start with might not seem like a lot of ammunition, but trust me, you can use “what” and “how” to calibrate nearly any question. “Does this look like something you would like?” can become “How does this look to you?” or “What about this works for you?” You can even ask, “What about this doesn’t work for you?” and you’ll probably trigger quite a bit of useful information from your counterpart.
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The first and most basic rule of keeping your emotional cool is to bite your tongue. Not literally, of course. But you have to keep away from knee-jerk, passionate reactions. Pause. Think. Let the passion dissipate. That allows you to collect your thoughts and be more circumspect in what you say. It also lowers your chance of saying more than you want to.
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Another simple rule is, when you are verbally assaulted, do not counterattack. Instead, disarm your counterpart by asking a calibrated question. The next time a waiter or salesclerk tries to engage you in a verbal skirmish, try this out. I promise you it will change the entire tenor of the conversation. The basic issue here is that when people feel that they are not in control, they adopt what psychologists call a hostage mentality. That is, in moments of conflict they react to their lack of power by either becoming extremely defensive or lashing out.
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■ Don’t try to force your opponent to admit that you are right. Aggressive confrontation is the enemy of constructive negotiation.
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■ Avoid questions that can be answered with “Yes” or tiny pieces of information. These require little thought and inspire the human need for reciprocity; you will be expected to give something back.
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How to Spot the Liars and Ensure Follow-Through from Everyone Else
The point here is that your job as a negotiator isn’t just to get to an agreement. It’s getting to one that can be implemented and making sure that happens. Negotiators have to be decision architects: they have to dynamically and adaptively design the verbal and nonverbal elements of the negotiation to gain both consent and execution.
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As Julie did, the first and most common “No” question you’ll use is some version of “How am I supposed to do that?” (for example, “How can we raise that much?”). Your tone of voice is critical as this phrase can be delivered as either an accusation or a request for assistance. So pay attention to your voice. This question tends to have the positive effect of making the other side take a good look at your situation. This positive dynamic is what I refer to as “forced empathy,” and it’s especially effective if leading up to it you’ve already been empathic with your counterpart. This engages the dynamic of reciprocity to lead them to do something for you.
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A deal is nothing without good implementation. Poor implementation is the cancer that eats your profits. By making your counterparts articulate implementation in their own words, your carefully calibrated “How” questions will convince them that the final solution is their idea. And that’s crucial. People always make more effort to implement a solution when they think it’s theirs. That is simply human nature. That’s why negotiation is often called “the art of letting someone else have your way.”
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There are two key questions you can ask to push your counterparts to think they are defining success their way: “How will we know we’re on track?” and “How will we address things if we find we’re off track?” When they answer, you summarize their answers until you get a “That’s right.” Then you’ll know they’ve bought in.
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When other people will be affected by what is negotiated and can assert their rights or power later on, it’s just stupid to consider only the interests of those at the negotiation table. You have to beware of “behind the table” or “Level II” players—that is, parties that are not directly involved but who can help implement agreements they like and block ones they don’t. You can’t disregard them even when you’re talking to a CEO. There could always be someone whispering into his ear. At the end of the day, the deal killers often are more important than the deal makers.
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UCLA psychology professor Albert Mehrabian created the 7-38-55 rule. That is, only 7 percent of a message is based on the words while 38 percent comes from the tone of voice and 55 percent from the speaker’s body language and face.
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In a study of the components of lying,2 Harvard Business School professor Deepak Malhotra and his coauthors found that, on average, liars use more words than truth tellers and use far more third-person pronouns. They start talking about him, her, it, one, they, and their rather than I, in order to put some distance between themselves and the lie. And they discovered that liars tend to speak in more complex sentences in an attempt to win over their suspicious counterparts. It’s what W. C. Fields meant when he talked about baffling someone with bullshit. The researchers dubbed this the Pinocchio Effect because, just like Pinocchio’s nose, the number of words grew along with the lie. People who are lying are, understandably, more worried about being believed, so they work harder—too hard, as it were—at being believable.
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People always talk about remembering and using (but not overusing) your counterpart’s name in a negotiation. And that’s important. The reality though is people are often tired of being hammered with their own name. The slick salesman trying to drive them to “Yes” will hit them with it over and over. Instead, take a different tack and use your own name. That’s how I get the Chris discount. Just as using Alastair’s name with the kidnapper and getting him to use it back humanized the hostage and made it less likely he would be harmed, using your own name creates the dynamic of “forced empathy.” It makes the other side see you as a person.
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■ Ask calibrated “How” questions, and ask them again and again. Asking “How” keeps your counterparts engaged but off balance. Answering the questions will give them the illusion of control. It will also lead them to contemplate your problems when making their demands.
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How to Get Your Price
Now, bargaining is not rocket science, but it’s not simple intuition or mathematics, either. To bargain well, you need to shed your assumptions about the haggling process and learn to recognize the subtle psychological strategies that play vital roles at the bargaining table. Skilled bargainers see more than just opening offers, counteroffers, and closing moves. They see the psychological currents that run below the surface.
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The Ackerman model is an offer-counteroffer method, at least on the surface. But it is a very effective system for beating the usual lackluster bargaining dynamic, which has the predictable result of meeting in the middle. The systematized and easy-to-remember process has only four steps: 1. Set your target price (your goal). 2. Set your first offer at 65 percent of your target price. 3. Calculate three raises of decreasing increments (to 85, 95, and 100 percent). 4. Use lots of empathy and different ways of saying “No” to get the other side to counter before you increase your offer. 5. When calculating the final amount, use precise, nonround numbers like, say, $37,893 rather than $38,000. It gives the number credibility and weight. 6. On your final number, throw in a nonmonetary item (that they probably don’t want) to show you’re at your limit. The genius of this system is that it incorporates the psychological tactics we’ve discussed—reciprocity, extreme anchors, loss aversion, and so on—without you needing to think about them.
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Color: yellow |
How to Create Breakthroughs by Revealing the Unknown Unknowns
That’s why I say that finding and understanding Black Swans requires a change of mindset. You have to open up your established pathways and embrace more intuitive and nuanced ways of listening. This is vital to people of all walks of life, from negotiators to inventors and marketers.
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Color: yellow |
To uncover these unknowns, we must interrogate our world, must put out a call, and intensely listen to the response. Ask lots of questions. Read nonverbal clues and always voice your observations with your counterpart. This is nothing beyond what you’ve been learning up to now. It is merely more intense and intuitive. You have to feel for the truth behind the camouflage; you have to note the small pauses that suggest discomfort and lies. Don’t look to verify what you expect. If you do, that’s what you’ll find. Instead, you must open yourself up to the factual reality that is in front of you. This is why my company changed its format for preparing and engaging in a negotiation. No matter how much research our team has done prior to the interaction, we always ask ourselves, “Why are they communicating what they are communicating right now?” Remember, negotiation is more like walking on a tightrope than competing against an opponent. Focusing so much on the end objective will only distract you from the next step, and that can cause you to fall off the rope. Concentrate on the next step because the rope will lead you to the end as long as all the steps are completed.
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Color: yellow |
first I’d like to examine what makes them so useful. The answer is leverage. Black Swans are leverage multipliers. They give you the upper hand.
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In theory, leverage is the ability to inflict loss and withhold gain. Where does your counterpart want to gain and what do they fear losing? Discover these pieces of information, we are told, and you’ll build leverage over the other side’s perceptions, actions, and decisions. In practice, where our irrational perceptions are our reality, loss and gain are slippery notions, and it often doesn’t matter what leverage actually exists against you; what really matters is the leverage they think you have on them. That’s why I say there’s always leverage: as an essentially emotional concept, it can be manufactured whether it exists or not.
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Color: yellow |
Positive leverage is quite simply your ability as a negotiator to provide—or withhold—things that your counterpart wants. Whenever the other side says, “I want . . .” as in, “I want to buy your car,” you have positive leverage. When they say that, you have power: you can make their desire come true; you can withhold it and thereby inflict pain; or you can use their desire to get a better deal with another party.
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Color: yellow |
Research by social scientists has confirmed something effective negotiators have known for ages: namely, we trust people more when we view them as being similar or familiar. People trust those who are in their in-group. Belonging is a primal instinct. And if you can trigger that instinct, that sense that, “Oh, we see the world the same way,” then you immediately gain influence. When our counterpart displays attitudes, beliefs, ideas—even modes of dress—that are similar to our own, we tend to like and trust them more. Similarities as shallow as club memberships or college alumni status increase rapport. That’s why in many cultures negotiators spend large amounts of time building rapport before they even think of offers.
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Color: yellow |
■ Let what you know—your known knowns—guide you but not blind you.
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Color: yellow |
■ Black Swans are leverage multipliers. Remember the three types of leverage: positive (the ability to give someone what they want); negative (the ability to hurt someone); and normative (using your counterpart’s norms to bring them around).
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Color: yellow |
■ Work to understand the other side’s “religion.” Digging into worldviews inherently implies moving beyond the negotiating table and into the life, emotional and otherwise, of your counterpart. That’s where Black Swans live.
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Color: yellow |
■ Review everything you hear from your counterpart. You will not hear everything the first time, so double-check. Compare notes with team members. Use backup listeners whose job is to listen between the lines. They will hear things you miss.
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Color: yellow |
■ Exploit the similarity principle. People are more apt to concede to someone they share a cultural similarity with, so dig for what makes them tick and show that you share common ground.
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Color: yellow |
Appendix: Prepare a Negotiation One Sheet
Negotiation is a psychological investigation. You can gain a measure of confidence going into such an investigation with a simple preparatory exercise we advise all our clients to do. Basically, it’s a list of the primary tools you anticipate using, such as labels and calibrated questions, customized to the particular negotiation.
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Color: yellow |
In the entertainment industry, they have a single document that summarizes a product for publicity and sales that they call a “one sheet.” Along the same lines, we want to produce a negotiation “one sheet” that summarizes the tools we are going to use. It will have five short sections
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Color: yellow |
SECTION I: THE GOAL Think through best/worst-case scenarios but only write down a specific goal that represents the best case.
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I tell my clients that as part of their preparation they should think about the outcome extremes: best and worst. If you’ve got both ends covered, you’ll be ready for anything. So know what you cannot accept and have an idea about the best-case outcome, but keep in mind that since there’s information yet to be acquired from the other side, it’s quite possible that best case might be even better than you know.
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Here are the four steps for setting your goal: ■ Set an optimistic but reasonable goal and define it clearly. ■ Write it down. ■ Discuss your goal with a colleague (this makes it harder to wimp out). ■ Carry the written goal into the negotiation.
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Color: yellow |
SECTION II: SUMMARY Summarize and write out in just a couple of sentences the known facts that have led up to the negotiation.
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Color: yellow |
You must be able to summarize a situation in a way that your counterpart will respond with a “That’s right.” If they don’t, you haven’t done it right.
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Color: yellow |
SECTION III: LABELS/ACCUSATION AUDIT Prepare three to five labels to perform an accusation audit.
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Color: yellow |
SECTION IV: CALIBRATED QUESTIONS Prepare three to five calibrated questions to reveal value to you and your counterpart and identify and overcome potential deal killers.
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Color: yellow |
Harry Potter author J. K. Rowling has a great quote that sums up this concept: “You must accept the reality of other people. You think that reality is up for negotiation, that we think it’s whatever you say it is. You must accept that we are as real as you are; you must accept that you are not God.”
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Color: yellow |
There will be a small group of “What” and “How” questions that you will find yourself using in nearly every situation. Here are a few of them: What are we trying to accomplish? How is that worthwhile? What’s the core issue here? How does that affect things? What’s the biggest challenge you face? How does this fit into what the objective is?
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Color: yellow |
SECTION V: NONCASH OFFERS Prepare a list of noncash items possessed by your counterpart that would be valuable.
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Color: yellow |