Negotiation is not rocket science. Indeed, only rocket science is rocket science.
Yet, put an untrained person into a negotiation situation (think of buying a car, not hostage), and their blood pressure goes through the roof.
Newbie negotiators can make some pretty damaging mistakes. Unfortunately, that means they lose money, cause deadlocks, and ruin relationships.
Here are the top three mistakes I’ve seen:
Mistake 1: Forgetting The Real Problem
The best outcome of a negotiation — and the problem you’re trying to solve — is where the situation improves for everyone.
Your first task is to be clear about what YOU need and how to meet YOUR interests.
However, your second and possibly more important task is understanding the OTHER side’s interests. And no, this isn’t just about chanting the cheesy ‘win-win’ mantra. It’s about spending time before negotiating and thinking through the best to the worst scenarios. Ask yourself, ‘What does my negotiation partner likely want or need? How can I help them achieve their goals?’
It would be best if you also considered what could be your partner’s ‘red lines’. For example, where could they dig their heels in and refuse to budge?
You can confirm or deny all of your questions in the negotiation itself. But avoid falling into the most common negotiation trap by refusing to let the other person win.
Mistake 2: Focusing Too Much On Price
Prices are important, but they’re not everything.
Academic research suggests that negotiators who drive too hard a bargain lose out. For example, researchers gave participants real money — for instance, £100 — to share. Then, they allocated one person to do the split. If they both agree to the division, they both get the cash. If they disagree, then neither gets anything.
Pure logic would suggest proposing something like “£99 for me, £1 for you”. Or even, “£80 for me and £20 for you…” and so on. Whatever I give you, you’re better off than before.
However, in several research studies, these extreme offers are often rejected. When an offer feels unequal, people leave it. Even if, rationally speaking, they are still ‘winning’, they become offended by the process. Once insulted, they will either back out or try to “punish” the other person.
Remember, people care more about than just money. They care about being treated with respect.
Mistake 3: Not Building Relationships
Less experienced negotiators think more about the negotiation than the big picture. As a result, they keep their eyes too much on their prize.
More experienced negotiators think longer term and on a broader scale. Naturally, they also want to achieve their goals. But they are unwilling to do so if success comes at the cost of damaging relationships.
Newbie negotiators want to win at all costs. But making others feel like they lost a game means they won’t want to play with you again.
Making the other side look like suckers damages your reputation as honest and fair. And once you lose your reputation, it’s hard to win it back. Worse still, future negotiators will be much less prepared to roll over from your bullying tactics.
Developing bad negotiation habits is easy, but pausing for thought helps you improve.
Negotiators, whether fresh-faced or wrinkled, all make mistakes. I’ve made plenty. Yet, if you think carefully, negotiation is easier than it looks…
- Know and be able to explain your interests.
- Try to understand and help solve your counterpart’s problems.
- Treat others as they wish to be treated and build long-term, mutually beneficial relationships.
They may still say ‘non-Merci’ in the negotiation. But at least you’ll both feel good about it.