Art of Negotiation
Chapter 13. Clearly define your position and the opponent
Always remember that the most important thing is whether
you are determined to succeed or not. – Abraham Lincoln
Let’s start with where you are? – where do you start?
where you are now?
and to what extent you would agree.
They are the criteria,
the “limiting conditions”
as discussed in the Harvard Negotiation Project chapter.
They are barriers,
factors that you must confront
and deal with in the negotiation.
Your position includes the best and worst outcomes,
plus the maximum or minimum price range
and conditions you can accept
when a deal is reached.
Clarity comes first
What are your prerequisites for a successful negotiation?
What do you have to gain from this process
that is worth the effort and time you put in?
What is the most important thing
that you must not give up no matter what happens?
And what are you willing to give up
to get the results you want?
What kind of serial concessions can you demand or offer?
it is never allowed to make concessions
without asking the other side to reciprocate the same.
If you give up on anything in a negotiation
without asking for something in return,
they will take this as a sign of your weakness
and force you to make further concessions.
Know what I’m negotiating?
What does the other side want to gain from this negotiation?
do your best while considering the opponent’s minimum
and maximum limits.
Not long ago,
I had an office lease negotiation.
When doing pre-negotiation analysis after researching,
I discovered that the owner can only lease the office space
with certain terms and conditions.
He must reach a certain amount in the lease,
or else the mortgage bank will not approve the lease.
With this information,
I know what is needed most
with this owner within a specific range.
An owner can negotiate many elements of a lease.
But the basic rent is controlled
by the mortgage holder.
I can discuss the deductible amount,
parking space, etc.
with the owner,
but the rent must be a minimum.
Otherwise, the contract will not be approved.
I also know that the owner of the building
is facing certain financial difficulties
and in order to keep the building,
he is forced to lease more
than 80% of the building in a short time.
Understanding the owner’s pressing requirements helps me negotiate better leases,
with favorable terms of ownership,
costs for common areas and employee parking.
“If you just communicate, you can get by.
But if you communicate skillfully,
you can work miracles.” – Jim Rohn
Put yourself in the other person’s situation
One of the best ways to improve the outcome of any negotiation is
to argue against the other side’s position
before starting to formulate your own.
In law school,
students are often instructed to take the opponent’s position
and make a complete argument based on it
as if they were supporting the opponent.
They only prepare their own arguments
after anticipating the other’s direction.
The same technique can also give you a clearer picture
of what you’ll be discussing
with your counterpart at the negotiating table,
as well as allowing you to anticipate what they’ll expect
and be persuasive in the process by their opinion.
Know how to reverse the situation before you begin.
Put you in the opponent’s shoes.
Imagine you are the other party
and you want to get the best deal possible out of this negotiation.
If you were the opposite,
what would you ask for?
What are the strengths and weaknesses of your position?
What’s important, what’s not?
Lessons from real estate lease negotiations
Once, when negotiating a new office lease,
I encountered a difficult and demanding owner.
My weakness is wanting to have the convenience
of continuing to lease my current office,
but I don’t want to be tied down to a 5 year contract.
I have the flexibility to switch to a larger
or smaller space at any time.
I wrote down everything that
I thought the owner of the building would require.
My list consists of about 20 items.
Then I drafted the negotiation requirements on another piece of paper.
To this day, when I think back,
I can’t help but be amazed at the great deal
I was able to negotiate
by thinking very carefully about the position
of the building owner.
Instead of spending hours discussing,
in just 30 minutes,
we were able to solve all the problems.
Think carefully in advance
In every negotiation using this technique,
I always get the same result.
I always get a good deal for myself
and create a win-win situation.
Remember, in a negotiation,
each side has important issues that need top priority
and others of medium or low importance.
The reason a negotiation is successful is
that both sides are able to achieve their most important goals
while making concessions on the less important ones.
By writing out all your big and small goals
before you start negotiating,
you’ll have a clearer view,
negotiate more effectively,
and get a better deal.
Ideal results for all
A few years ago,
I flew to New York to negotiate a contract
that would bring in hundreds of thousands of dollars in sales.
I have also outlined exactly what the ideal solution would be for me.
My partner and I spent a
whole day negotiating the terms of the contract.
Instead of starting right away with the contract,
I asked my partner:
“If this discussion is successful,
what would be your ideal outcome?”
They were a bit surprised by this question
but still answered very honestly.
If this negotiation goes well,
it will be done at this price and these terms,
which they didn’t originally plan to say.
They thought the outcome would be ideal for both sides.
On the contrary,
I tell them ideal outcomes for me,
which are not much different
from their goals in the negotiation.
We quickly agree on the small details
and then close the big ones.
Instead of taking 8 hours,
the whole discussion lasted less than 2 hours
and both sides were free to leave.
Don’t go to work to work, go to work to prosper. — Grant Cardone