WIN-WIN

by David Goldwich

  Keep personality issues separate from substantive ones

  It is easy to let our like or dislike of our counterpart influence the way we deal with him. If we like him, we may allow him more generous terms than we might otherwise. If we don’t like him, we may let our feelings distract us from our interests. If we are intimidated by him, we may make concessions on some issues in the hope of winning his approval.

  Separate the people from the problem. Do not let personality factors influence you. When a charming counterpart asks you for a concession, ask yourself whether you would make this concession to someone you don’t like. Your response should be the same. Focus on the substance. A good deal is a good deal, regardless of the personality of your counterpart.

  Do not make concessions on substantive issues in exchange for concessions on personality

  Imagine you are negotiating with an intimidating counterpart. You might be tempted to offer a concession on price (substantive) in the hope of pacifying him. This will backfire. Instead of easing up, he will continue to be difficult in order to extract more substantive concessions from you, because you have shown him that it works! Rather than try to appease him, stand firm. Negotiate on the issues and focus on your interests. Tough negotiators respect strength and despise weakness. Do not make concessions on substantive matters to buy approval or make the relationship smoother. Trade substantive concessions only for other substantive concessions.

  Say no to the request, not to the person

  Bear in mind that people do not always distinguish the messenger from the message. Even though you may not intend for your refusal to be a personal rejection, some people will take it that way. Help them maintain perspective by being clear that you are rejecting the request and not the person making it. For example, say “I cannot agree to that condition” rather than “I cannot help you with that.”

  Give reasons

  When rejecting a proposal, first say what you like about it. Look for common ground, a point of agreement. Then explain what you do not like about it, or what you would change, and why. People like to know why. Explaining your reasoning helps the other party to understand.

  Avoid negative words and characterizations

  Strong negative words are highly charged. Their impact can spread from the problem to the people. For example, using strong negative language to refer to a proposal may be taken personally by the speaker. Your characterization of their idea is taken as a personal slight or insult. In addition, if you use negative words they will make you appear as a negative or unlikable person. Stay neutral or positive.

  BUILD TRUST

  The foundation of any good negotiating relationship is trust. Negotiators who have a trusting relationship are able to reach better agreements in less time and with less formality. They are less likely to have disputes, and are more likely to resolve the disputes amicably when they do arise.

  You can build a trusting relationship by getting to know your counterpart as an individual. Spend time socializing and getting to know one another informally. In some cultures this getting acquainted process is critical, and they won’t get down to business until they feel comfortable with their counterpart.

  Getting to know one another socially is not enough. You must also be trustworthy. You must earn and deserve another person’s trust. This can be conceptualized in the form of an equation, where your trust quotient is a function of credibility, reliability, intimacy, and self-orientation:*

  Credibility refers to your knowledge, expertise, qualifications, and how effectively you communicate them to others. Why should the other party believe you or view you as an authority? Credibility is largely a matter of perception, and can be enhanced in the moment by how you dress, speak, and carry yourself. How can you appear more credible to your counterpart?

  Reliability is about being able deliver what you promise. Are you able to exceed (or at least manage) your counterpart’s expectations? Do you deliver what you promise? Better yet, do you have a reputation for under-promising and over-delivering? Note that you represent your organization. If your organization has a strong reputation, it may transfer to you and vice versa. A sterling reputation can do wonders, but a poor one can be hard to shake.

  Intimacy refers to whether the other party feels comfortable or secure in dealing with you. It is a function of likability, rapport, and the quality of your relationship. How can you build your relationship so that your counterpart feels at ease with you?

  Self-orientation is a matter of focus and intent. Are you clearly motivated by money and your own advantage? Does your counterpart feel you are there for them, or for yourself? How can you minimize the appearance of self-interest and temper it with empathy and concern for your counterpart’s interests?

  In order to increase your trust quotient, you can increase the values in the numerator (credibility, reliability, and intimacy), decrease the value of the denominator (self-orientation), or both. Here are some ways to develop your trustworthiness:

  • Be honest—Keep your word and maintain a reputation for truthfulness.

  • Be transparent—Being open and above board will allow others to trust you. This does not mean you have to tell them everything; it is perfectly acceptable to tell your counterpart that certain information is confidential.

  • Be consistent—People are more comfortable with those who have a clear set of values and follow them without fail. Always under-promise and over-deliver.

  • Value the relationship—In an ongoing relationship with a valued partner, the future of the relationship is more important than the outcome of any single negotiation. Make sure your counterpart knows you feel this way.

  • Be trusting—Trust is a two-way street. If you want people to trust you, you have to show you trust them. You need not trust them blindly of course, but be willing to give them the benefit of the doubt (at least until they show you your trust in them is misplaced).

  • Temper your self-interest with fairness—While everyone is expected to negotiate for their own benefit, pursuing only your interests to the exclusion of fairness will make you seem less trustworthy. Show a healthy regard for the interests of your counterpart as well.

  While trust is a big plus, it is not essential in a negotiation. Even though you may not trust your counterpart, you can still negotiate fruitfully if you trust the process. Nations often negotiate with one another even when there is low trust because they trust the institutional framework of the international community. Similarly, your bank won’t allow a lack of trust to stop them from giving you a loan. They have faith in the banking system, the credit reporting system, and the legal system. But as business and negotiation continue to become more relationship-oriented, trust will become increasingly valued.

  NON-VERBAL COMMUNICATION

  Non-verbal communication is often more important than words alone. Is your counterpart open and approachable, or defensive and secretive? Is he honest, or deceptive? Is he interested, eager, desperate, confused? Pay attention to the body language, tone of voice, and facial expressions of your counterpart. Much of this is intuitive, and you can improve your reading of basic non-verbal signals with awareness and practice. However, I believe the 80/20 rule applies here. For most everyday negotiators, it is not realistic to expect to become an expert at reading body language. You don’t need to decode thousands of micro-expressions. You only need to be good enough. Most of your time and effort should be devoted to preparing for your negotiations.

  However, it is useful to have a sense of whether your counterpart is uncomfortable, lying, or behaving in a way that is incongruent with what he is saying. If you do suspect something isn’t right, try to find out why. You might try to label their emotion by saying something like:

  • “I sense that you may not be comfortable with this term …”

  • “I may be wrong, but you seem to be unhappy about …”

  • “Did I say something to upset you?”

  Your counterpart may or may not be
forthcoming in his response. You can’t control that, but it doesn’t help to ignore the elephant in the room. In fact, he is likely to deny your suggestion to save face, but he may moderate his behavior in response.

  In any event, it is up to you to decide whether to accept an agreement, regardless of whether you believe your counterpart lied about something or seemed to be acting funny. Your final agreement may take the form of a written contract with black-and-white language and no non-verbal communication whatsoever within the four corners of the document, but having some understanding of body language and facial expression can make getting there easier.

  Non-verbal communication is a two-way street. Be aware of the non-verbal signals you are sending to others. Drumming your fingers on the table might suggest you are nervous or impatient. Arms crossed across your chest can signal that you are defensive or uncomfortable. Lack of eye contact suggests lack of confidence or deception. Avoid body language and facial expressions that convey weak or negative qualities. Use body language that suggests the qualities you want to project: confidence, competence, preparedness, and professionalism. The right body language can help keep your halo polished and gleaming.

  Non-verbal communication is a field of its own, and it is extraordinarily difficult to master. It certainly cannot be covered in a few paragraphs. Those who do succeed in mastering it take years to learn the art. Rather than attempt to decode the nuances of other people’s body language, it is more productive to focus on your own non-verbal communication. Ask a few close friends or colleagues to candidly assess you on your facial expression, gestures, and mannerisms. Have them video record you in a negotiation or meeting and watch yourself in action. It may not be pretty but you need to know the unvarnished truth. Are you unwittingly sending out the wrong signals? Are there any glaring deficiencies? Work on improving in those areas.

  CULTURAL ISSUES

  There are additional points to keep in mind when negotiating with people from other cultures. You need to be aware of cultural differences, but treat them as a working hypothesis rather than a given. You may have heard that Japanese businessmen do not like to say no, and often say yes when they have no intention of agreeing, but that does not mean your particular Japanese counterpart will follow that pattern. Avoid stereotyping. Also, remember that personality factors may or may not be in line with culture-based expectations. Treat each counterpart as an individual.

  Globalization has had a homogenizing effect on many cultural elements. People are more aware of many cultural differences and tend to be accommodating. For example, in the past, a Japanese businessman would bow when greeting a counterpart, and a well-informed Western businessman would know enough to bow rather than shake hands. Today, most Japanese would shake hands, but if you bow, that would also be acceptable. You could do either or both without causing an international incident.

  While gestures, customs, and other behaviors are widely known, there are still many not so obvious cultural differences you should be aware of. We will touch on some of the more important cultural dimensions of negotiating, but this is just scratching the surface. There are many books and even entire series of books on doing business in China, Egypt, Pakistan, etc. If you are going to one of those countries, or negotiating with someone from there, read the book for that country. Know before you go. If you have a colleague or contact from that country, or one who has experience dealing with that culture, ask her to tell you some of the more important do’s and don’ts. It’s also a good practice to learn a few basic phrases in the native language, such as good morning, please, thank you, etc., even if they customarily do business in English. Most people appreciate this greatly and it will help you start off on a positive note. And on that note, here are some of the more important cultural considerations you need to know:

  High context vs low context of communication

  In a high context culture, communication is subtle and highly nuanced. Words often express meaning indirectly, and a great deal of meaning is inferred. You must choose your words carefully, and understand that even precise words often take a back seat to custom, culture, context, and other elements of interpretation. Asian cultures tend to be more high context than Western ones.

  In a low context culture, words are used plainly and directly. While this may support clear communication with other low context negotiators, it may seem blunt or even rude to a high context counterpart. Make sure you understand where your counterpart is on the context dimension.

  Polychronic vs monochronic view of time

  People of different cultures have different ideas about time. Growing up in Miami, I was exposed to the concept of “Cuban time.” If you are thirty minutes late to a Cuban wedding, you will still be the first one there—everyone is expected to be late. Some Asian countries go by “rubber time,” reflecting a more relaxed attitude towards time. Cultures that are more flexible about time and deadlines, and often tend to be slower paced, are said to be polychronic.

  Monochronic cultures, on the other hand, value punctuality as a sign of respect and professionalism. If you are a few minutes late to a meeting, they might hold it against you. You can see how these differences in the way time is perceived could have an impact on a negotiation.

  Formal vs informal

  In a formal culture, protocols regarding title, role, seniority, social class, and even gender are important. Those who are perceived to be higher status have certain rights and privileges that must be recognized. In some of these cultures, younger people are not invited to speak until their elders have had their say, and women may not be a familiar sight in the boardroom.

  In an informal culture, a more casual approach is acceptable. Age, gender, and class are not a major issue, and titles are not deemed important. A young person is likely to be treated according to his role and expertise, and not on the basis of age or inexperience. Think Silicon Valley.

  Individual vs collective focus

  Individualistic cultures have a strong focus on the individual. You are encouraged to go you own way, follow your muse, and selfactualize. Rebels are not only tolerated but encouraged and revered.

  Collectivistic cultures emphasize one’s role in the group, achieving consensus, and conformity. They value humility, and the nail that stands above the rest gets hammered down. Asian cultures are more likely to be collectivist, and in many of them the family name precedes the given name, reflecting the emphasis of the group over the individual. This is also changing quickly, and a new individualistic and entrepreneurial spirit is emerging in many traditionally collectivist societies.

  High negotiation vs low negotiation

  High negotiation cultures often have a pervasive haggling mindset where bargaining is expected. Think of a Middle-Eastern bazaar. People enjoy the thrill of the game, and fixed price transactions are not considered fun.

  In a low negotiation culture, bargaining has a more limited role. Haggling may be seen as undignified. A customer from a low negotiation culture will be eaten alive in a souk.

  The term “culture clash” can mean many things, but a large part of it comes from these five dimensions of cultural context. The situation on the ground is rapidly evolving with globalization, but tradition dies hard. Try to anticipate what cultural issues might arise when negotiating with a particular counterpart. Having said that, don’t put too much stock in stereotypes or cultural caricatures. Individual characteristics are more important than cultural attributes. Intention goes a long way. If you approach your counterpart with universal human values, treat her with respect, build rapport, and seek understanding, you should be able to navigate any cultural differences.

  NEGOTIATING BY TELEPHONE OR E-MAIL

  Many people ask me if they should negotiate face-to-face, by telephone, or through e-mail. In many instances, the answer will be dictated by considerations of cost, location, timing, and convenience. In other instances, you will have a choice.

  Negotiating face-to-face is more formal, but fosters better commun
ication and understanding. It is a richer platform, allowing you the benefit of observing facial expression, body language, and other non-verbal cues. As a result, face-to-face negotiation is more likely to result in a win-win outcome. This makes it suitable for negotiating more substantial matters. The more important the negotiation, the more desirable it becomes to negotiate face-to-face.

  Many negotiations are now conducted by e-mail. E-mail communication is more likely to be misinterpreted than face-to-face or telephone communication, but it might be the best choice for small matters, or where there are time, travel, or cost constraints. It also allows you to think about what you want to say and prepare a solid reply. If you are not quick-witted, assertive, or articulate, e-mail may be a better channel for you. However, negotiating by e-mail is slower, less fluid, and less likely to result in a win-win outcome.

  Negotiating by telephone is a quick, low cost option. This channel ranks in between face-to-face meetings and e-mail exchanges in terms of clarity of communication. It is good for routine matters, or those not weighty enough to justify face-to-face contact.