Negotiation skills: Key to success in business and workplace
23rd Jun, 2015

Negotiation skills: Key to success in business and workplace

Dibeyendu Ganguly

('Just because you're smart)

Take a guess, what could be the best place to learn negotiation skills?

Home, says Wharton School's Stuart Diamond. If you want your kids to do something they don't want to do, it helps to offer up some incentives, like toys. And if you want your spouse to leave you alone to watch a ball game on television on Sunday for three uninterrupted hours, you have to be prepared for a quid pro quo. In Diamonds case, it's spending time with his wife, gardening, which he detests."Negotiation is everywhere, it can't be avoided. Like math is to science, negotiation is to society. It's the basic process that supports everything else,'he says.

Alas, it's a process not many understand. Many intelligent people are given to approaching negotiation with a sense of power, as a confrontation —

even with their wife and kids — and that's the worst possible way.

"Just because you're smart, it doesn't mean you can negotiate. It is a separate skill that can be learnt. And it is not a stressful contest, as people of the win-win or leverage school make it out to be," says Diamond, who has authored a book called Getting More: How To Negotiate to Achieve Your Goals in the Real World on the subject. For starters, good negotiators find out everything they possibly can about the people they are negotiating with- what makes them tick, what they value, how they perceive the issues at hand.

Money is usually a proxy for other, deeper needs and negotiations become easier once these needs are out in the open."People fight over money because they don't know enough about each other," says Diamond. “Most people won't easily tell you their needs, but you have to persist in asking. You need to do research on every aspect of the individual. How long does it take for him to commute to work? How close is he to retirement? In the end, you need to see the pictures in their heads. It's more important in persuading them than anything you say or propose, including facts or expertise."

It sometimes turns out that what the other person values highly would cost you very little to provide. Diamond, who is president of Global Strategy Group, a firm that advises companies and governments on negotiation strategy, gives a recent example of a deal between Google and a contractor for a fiber-optic installation in Southern US. Google's negotiator asked the contractor, 'What can Google do for you?' and he said that if he received a letter of reference from Google, he could grow his business on the basis of it and in turn, reduce the price. Google readily agreed and the contractor ultimately charged it $6,000 for a job that normally would have cost $6 million — a 99.9% discount.

In the absence of specific information, people often go by stereotypes, taking guesses about what those on the other side of the table want. Diamond, who has done a fair amount of research on the subject of identity, says these biases can hurt negotiations:"Assuming things about the other person because he or she is American, Islamic, an attorney, a women or the employee of a certain company is too imprecise. Our research found most successful women don't get their identities from being woman - they get it from many other things. You should focus on each individual and how they view things at the moment of the negotiation,"he says.

Though people may feel more comfortable negotiating with those from a similar background, there is actually more to be gained if there is diversity at the negotiating table."Differences are the source of profitability,"says Diamond. “Work groups in which people disagree produce three times as many marketable ideas than consensus groups. Homogeneity is less profitable."

Still, when diversity at the negotiating table is high and people make insufficient efforts to understand each other, there is a danger of things becoming confrontational. Despite everything, threats and coercion remains common tools in negotiations, leading to conflict and communication breakdowns. When threatened, people become angry, irrational and indifferent to self-harm."The focus changes from the solution to the threat itself. People lose sight of the goals and just want to retaliate. It becomes extremely personal,"says Diamond.

Another destructive strategy often used by negotiators is to walk away from the table, which is probably the worst kind of threat — whether it's an M&A deal or a peace negotiation."It's a stupid tactic, though they seem to like it in the movies,"says Diamond. "Walking away sends a signal that you don't care enough to even talk to the other party. The alternatives are usually war, litigation or no deal." The more important the negotiation is, the more emotional people tend to be. In such situations, the logic of facts and figures counts for very little.

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