Author Archives: Alan Schoonmaker

About Alan Schoonmaker

Dr. Schoonmaker’s six previous poker books sold over 100,000 copies in English and have been translated into French, German, Italian, Portuguese, and Russian

WHEN SHOULDN’T YOU USE TRUMP’S NEGOTIATING STRATEGY

When SHOULDN’T You Use Trump’s Negotiating Strategy?

An earlier blog answered the opposite question: “When should you use Trump’s negotiating strategy?”

It began, “Some people would answer, “Always! He’s gotten some great deals.”

Other people would insist, “Never! He’s made so many enemies that he should be impeached!”

Both answers are based on emotions, and anyone who says them is ignoring facts that conflict with their emotional reactions.

He has unquestionably:

  • Gotten many great deals
  • Created many enemies

I recently published an online course at Udemy titled: “Is Trump’s Negotiating Strategy Right For YOU?”

It provides the only rational answer to that question: You should use Trump’s strategy ONLY in certain situations.

If you always use his strategy, you will:

  • Create lots of enemies
  • Miss many good deals.

If you never use his strategy, you will:

  • Leave lots of money on the table
  • Get some terrible deals, especially when you negotiate with someone like Trump.

In other words, you should adjust your strategy to fit the situation. This blog will tell you when you shouldn’t use his strategy.

DON’T USE TRUMP’S STRATEGY WHEN

Trump makes a common mistake: He does what makes him comfortable, even when it’s exactly the wrong strategy. Don’t make his mistake. Carefully analyze the situation before you choose your strategy. Don’t bargain hard when …

You Have Important Common Interests.

The more important your common interests are, the more you should cooperate. Countless deals have been lost because one or both parties were so intent on winning that they ignored the fact that their common interests were much more important than their conflicts.

You Want a Harmonious Relationship.

The more important the relationship is, and the more you want to preserve it, the more cooperative you should be.

Trump is an excellent example. His extreme aggression has ruined important relationships with Congress and many foreign leaders. Under our system of government, the president and the congress can’t do their jobs without cooperating. He makes some people so irrationally angry that they ignore the consequences and just fight him.

You Are Weaker Or Power Is Approximately Equal

 

The weaker you are, the more you should cooperate. Since you don’t have the power, don’t play a power-based game.

Why?

Because you will lose.

Bargaining hard from a weak position would be similar to small kid’s challenging the schoolyard bully. He’ll get his ass kicked.

You Trust Them

The more you trust people, the more trustworthy you should be. Trust is extremely fragile. If you copy Trump and lie, bluff, change positions, and use other power-oriented tactics, you will often destroy that trust. Once trust is lost, it’s difficult or impossible to get it back.

It’s Hard To Evaluate Implementation.

The harder it is to know how well it’s been implemented, the more cooperative you should be. For example, if you bargain aggressively and an auto mechanic agrees to fix your car for a very low price, he may install used parts or just do inferior work. Your car may run well at first, but quickly break down.

They Are Cooperating

If they are cooperating, it usually pays to do the same. You’ll probably reach a deal that satisfies both parties and builds your relationship.

You may be tempted to bargain hard to exploit their openness and cooperation. If you bargain hard, you’ll probably get a very good deal, but you may damage or completely destroy the relationship. Many people – especially competitive ones – can’t resist the opportunity to exploit anyone who is too open and cooperative. They often regret it. They win the battle, but lose the war.

So what should you do?

CONSIDER ALL THESE ISSUES

Oversimplification is an extremely common mistake. Hardly anyone wants to analyze all these issues. They’d rather just, “go with their gut.” They may claim that they trust their gut, but they are really just doing what makes them comfortable, not what the situation demands.

It’s not easy to consider all of them, but the more issues you consider, and the more thoroughly you analyze them, the better decisions you will make.

Sometimes, you should ignore relationship issues and bargain hard to get the best deal. Sometimes, you shouldn’t care about this deal and do whatever will improve or preserve your relationship. Generally, you should BALANCE your desires for a good deal and a good relationship.

SUMMARY

Don’t trust your gut.

Ignore your own comfort.

Thoroughly analyze all the issues.

Select a strategy that correctly balances competition and cooperation.

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When Negotiating, NO DEAL IS BETTER THAN A BAD DEAL

Do you believe your bosses want you to make every possible deal?

I certainly hope not. Your bosses really want you to make profitable deals. They want you to walk away from bad deals. 

That’s one of the principles of my new online course at Udemy.com: Is Trump’s Negotiating Strategy Right For YOU? It’s based on the live courses I’ve taught to the world’s largest multinationals in twenty countries. I’ve interviewed senior executives in many of those companies, and virtually all of them want their subordinates to be tougher, to negotiate deals that increase the bottom line.

They would agree with this blog’s title: “No deal is better than a bad deal.” Here’s just one example.

Top management of a major publishing house hired me to teach negotiating skills to their acquiring editors, the people who negotiate contracts with authors. This publisher had been purchased by a huge conglomerate that was extremely dissatisfied with its poor profits. The executive who hired me insisted that their editors had to become much tougher because the firm was writing off over $100 million in unearned author advances.

When I told the class that this was our objective, one editor angrily objected, “Those bean counters at X (the conglomerate) don’t understand that publishing is different from most industries. If I don’t overpay for a big book, I won’t get a chance to bid on future big books. I have to prove to the agents that I’m a player.”

I replied, “You mean if you don’t lose money on this book, you won’t get a chance to lose money on the next one.”

She was furious. She didn’t say another word, sat in class fuming until we broke for coffee, left, and never came back. Within a few months she left the firm. I don’t know whether she quit or was fired, but do know that her negotiating objective was extraordinarily stupid. She neglected her firm’s bottom line and top management’s priority because she wanted to be “a player.” If you value your career, don’t make her mistake.

You may think, “That’s an interesting story, but it’s just one anecdote. I’d like more solid evidence.” That’s a reasonable position, so here are some spectacularly bad deals:

  1. In 2004-2007 bankers and millions of their customers wished that mortgage loans for over a trillion dollars had never been made. The bankers took huge losses on the loans, and the customers bought houses they couldn’t afford and frequently lost through foreclosure.
  2. Several American cities cannot provide essential services because so much of their budgets is spent for employees’ pensions. The cities’ negotiators gave in again and again to excessive demands.
  3. World War II could have been prevented if Chamberlain, the British Prime Minister, had refused at Munich to yield to Hitler’s outrageous demands.

The lesson couldn’t be clearer: No deal is UNQUESTIONABLY better than a bad deal.

Walking away rather settling for an unsatisfactory deal may make you very uncomfortable, but you’ll just have to accept that short-term discomfort and become tougher.

Tough negotiating won’t just help your career. It will also put money – perhaps lots of money – into your pocket. You can’t negotiate good deals unless you’re willing to walk away from bad ones.

To subscribe to my blogs and newsletters, click HERE.

WHAT’S YOUR NEGOTIATING STYLE? Take the Quiz to Find The Answer

Personal styles greatly affect negotiations.

  1. Donald Trump and people like him get some great deals, but lose deals and create enemies.
  2. Friendly people make many deals and have good relationships, but get exploited.
  3. Analytic people thoroughly study the issues, but they ignore personalities and essential

That is, every style has strengths and weaknesses.

Let’s look at your style. A brief quiz will identify your natural style. Then we’ll discuss your strengths and weakness.

DIRECTIONS

For each question divide ten points among the three styles:

  1. Aggressive
  2. Friendly
  3. Analytic

You can give all ten points to one or two styles or divide them among all three.

Some questions ask what you do and why you do it. Others ask only what you do.

Don’t try to give the “right” answers because there aren’t any. Say what you really think, feel, and do.

  1. When negotiating, I emphasize:

___ A. Power

___ B. Friendly relationships

___ C. Facts & logic

  1. When I’m buying, my first offer is:

___ A. Much less than I’ll pay because I want to get the lowest price

___ B. Close to what I’ll pay because I don’t want to insult the seller

___ C. Very close to what I’ll pay because it’s the most reasonable offer

  1. When shaking hands, especially with strangers:

___ A. I move close, shake briefly and forcefully, squeeze their hand, and

look intently into their eyes. My body language says, “I’m stronger,

smarter, and tougher than you are.”

___ B. I move close, shake gently, hold their hand for long time, and smile

warmly. My body language says, “Let’s be friends.”

___ C. I stay far away, shake briefly, and have little eye contact. My body

language says, “I don’t want a personal relationship.”

  1. Which word best describes you?

___ A. Aggressive

___ B. Friendly

___ C. Analytic

  1. When preparing to negotiate, I emphasize learning:

___ A. People’s strengths and weaknesses

___ B. People’s personalities

___ C. Objective facts such as the market and production costs

  1. When negotiating, I communicate:

___ A. Deceptively to increase my power and hide my weaknesses

___ B. Openly to create a trusting relationship

___ C. Openly so everybody has enough information to solve the

problem

  1. My primary negotiating objective is to:

___ A. Win

___ B. Have a good relationship

___ C. Reach a rational deal

  1. My feelings about hard bargaining are:

___ A. Positive, I love competition

___ B. Negative, I detest competition

___ C. Negative, hard bargaining doesn’t produce rational deals

  1. I’d define a “good negotiation” as one that:

___ A. I win

___ B. Improves our relationship

___ C. Produces a rational deal

  1. I prefer to negotiate with:

___ A. Successful people. I don’t waste time with lightweights.

___ B. Nice people. I want friendly relationships.

___ C. Logical people. I want to focus on the facts in a logical way.

CALCULATING YOUR SCORE

Add up the points for A, B, and C and insert the total in the proper space. Make sure the three scores total 100.

  1. Aggressive        ___
  2. Friendly ___
  3. Analytic ___

INTERPETING YOUR SCORE

If a score was 55 or higher, it’s your natural style. The higher your score, the more extreme your style is. For example, Trump would get close to 100% aggressive.

If none of your scores is 55 or higher, but two scores total 80 or more, you’re that combination of styles.

If none of your scores was 55 or higher, and no two scores totaled 80, your style is balanced.

WHAT ARE YOUR NEGOTIATING STRENGTHS AND WEAKNESSES?

EVERY style has strengths and weaknesses.

EVERY style will succeed in some situations and fail in others.

Here’s a summary of the three basic styles’ strengths and weaknesses.

AGGRESSIVE

Negotiating Strengths: Their greatest strength is their love for bargaining. Discomfort makes many people avoid or rush through negotiations, but they enjoy playing the game.

They excel in adversarial negotiations, such as about prices.

They enjoy making extreme demands, stonewalling, bluffing, expressing anger, and even lying. These tactics often succeed because most people can’t or won’t act that way.

They will push right to the limit, getting virtually every penny on the table.

Negotiating Weaknesses: They are ter­rible at satisfying other people’s needs, working together to solve common problems, and building trusting relationships.

They compete even when they should cooperate. They have to win, even if a victory costs them more than it’s worth. They often try to push past people’s limit, losing both the deal and the relationship.

They won’t create the trust, cooperation, and open communication needed to solve common problems.

They see compromises, not as a means to reach mutually satisfying deals or build good will, but as signs of weakness. They often won’t make essential  compromises.

They create enemies. Other people may refuse to make concessions they had intended or walk away from an acceptable deal. “I’d rather lose money than let that SOB run over me.”

They won’t change a bad strategy. Changing feels like admitting their original strategy was a mistake, and they won’t admit mistakes. Trump once said, “My style of deal making is quite simple and straightforward.  I just keep pushing and pushing and pushing to get what I’m after.”[1]

They often can’t fit together a mutually satisfactory deal because they are too insensitive to understand and respond to other people’s signals.

Their impatience and poor attention to details can make them rush into an agreement without fully understanding its implications. Serious implementation problems often occur.

They push too far. Either the negotiations break down, or the others ache for revenge, don’t implement the agreement well, or decide not to do any future business. They win the battle, but lose the war.

FRIENDLY

Negotiating Strengths: Their strengths and weaknesses are the opposite of aggressives’. One is strong where the other is weak.

Aggressives win some negotiations, but miss many deals. Friendlies make deals that aggressives couldn’t make, turn around bad relationships, and establish a foundation for future cooperation. They reach win-win deals because:

  • They want everyone to feel good about the deal and the way it was reached.
  • They reduce tensions, bring together people who don’t want to cooperate, and break deadlocks. Nearly every family and organization needs people like that.
  • Because they communicate openly and honestly, they encourage others to do the same. Both sides can build on a foundation of trust and good information.
  • Since they want to understand people and listen well, they learn others’ situations and motives.
  • Instead of considering only one or two possible deals, they may experiment and produce a creative, superior solution.
  • They build solid, trusting relationships. People like to work with them and may even accept an inferior deal because they know that they can be trusted.

These strengths make them valuable members of most families and organizations, especially intensely competitive ones.

NEGOTIATING WEAKNESSES: Their cooperative strengths can be much smaller than their bargaining weaknesses. Many negotiations don’t contain significant cooperative opportunities, but there is always conflict

Many friendlies deny reality about conflict. They essentially pretend it doesn’t exist. Without conflict there’s no need to negotiate.

Getting to Yes dishonestly became a best seller by pandering to the naïve belief that conflict doesn’t exist. It claimed its win-win approach is an “all-purpose strategy” that works in every situation, even with hijackers. A later edition repeated that lie after hijackers killed over 3,000 people by flying airplanes into the World Trade Center.

They openly share information and expect others to do the same. But many people withhold information, bluff, and lie while negotiating. The information friendlies give away is often used against them.

They make too many concessions. Even in obviously competitive situations such as price negotiations, they concede too much rather than fight for their fair share.

ANALYTIC

Negotiating Strengths: Their impersonality helps them to remain cool and analytic, even when others become emotional or irrational.

They prepare very thoroughly. They may carefully study the market, compare several products, and learn various vendors’ prices, reputation, and after sales service. This thoroughness builds their power:

  • They have important facts right at their fingertips.
  • They learn about other alternatives.
  • They can walk away from this deal and make a different one.

While negotiating, they analyze issues thoroughly and don’t act impetuously. They understand the implications of any position before acting.

Because they don’t talk carelessly, they often get much more information than they give. Some people to talk too much, even about sensitive subjects, trying to force some reaction from them.

They are willing to walk away rather than accept a bad deal or respond to an unrealistic position.

Their thoroughness reduces implementation problems. Everyone knows what to do.

Negotiating Weaknesses: Their greatest weakness is their dislike for negotiations, especially its “irrational” elements. They often respond to their discomfort, not to the negotiating process’ demands.

Although they prepare thoroughly about the issues, they often ignore “irrational” subjects such as the other people’s personalities and probable reactions.

They can be so uncomfortable that they try to convert bargaining sessions into analytic, problem-solving meetings.

They ignore essential rituals, especially the mutual concession ritual. (I give a little; you give a little; and we reach a deal that makes both of us feel we gained by negotiating). Many people regard that ritual as the essence of negotiations.

Instead of building “fat” into their proposal, then trading it away, analytics start near or even at their bottom line. Others resent their refusal to “bargain in good faith.” Rather than “lose” by making all the concessions, they just walk away, even if the analytic’s offer is within their range.

They are insensitive to other peoples’ motives and concerns. They miss signals, including quite obvious ones, because they don’t care what others want, think, or feel. They care only about objective facts and figures.

They may prepare so thoroughly that they won’t consider alternatives that haven’t been thoroughly researched. They may miss opportunities for more creative and mutually-beneficial deals.

They may also be too rigid because they believe that what is right or most cost-effective can’t be compromised. They may place so much emphasis upon certain facts, principles, or procedures that they can’t make compromises, especially tactical ones.

Too much time can be spent clarifying issues, including unimportant ones. There may not be  not enough time to make trades, explore creative alternatives, etc.

Predictability is their final weakness. Others can often accurately determine and exploit their limits, priorities, power, and strategy. Then they will use that knowledge against the analytics.

WHAT’S NEXT

I hope you’re learned some valuable lessons from this quiz and discussion. But there’s lots more to learn. My book and online course will teach you how to:

  1. Build on your strengths and reduce your weaknesses
  2. Select the right strategy for various situations
  3. Adjust your style when negotiating with various types of people

For more information about my online course, click HERE.

For more information about my book, click HERE.

To subscribe to my blogs and newsletters, click HERE.

[1] “Flashy symbol of an acquisitive age: Donald Trump,” TIME, January 16, 1989.

WHEN SHOULD YOU USE TRUMP’S NEGOTIATING STRATEGY?

Some people would answer, “Always! He’s gotten some great deals.”

Other people would insist, “Never! He’s made so many enemies that he should be impeached!”

Both answers are emotional, and anyone who says them is ignoring facts that conflict with their emotional reactions.

He has unquestionably:
• Gotten many great deals
• Created many enemies

I recently published an online course at Udemy.com titled: “Is Trump’s Negotiating Strategy Right For YOU?”

It provides the only rational answer to that question: You should use Trump’s strategy ONLY in certain situations.

If you always use his strategy, you will:

  • Create lots of enemies
  • Miss many good deals.

If you never use his strategy, you will:

  • Leave lots of money on the table
  • Get some terrible deals, especially when you negotiate with someone like Trump.

This site will tell you when you should use his strategy.

My next post will tell you when you shouldn’t use it.

Your Interests Clearly Conflict.

Price negotiations are the most obvious example. If you’re buying, you want the lowest price. If you’re selling, you want the highest one. Since every dollar you get costs the other party one dollar, you have what game theorists call a zero-sum game.

Those games have often been compared to cutting up the pie. The more you get, the less they get. You should obviously try to get as much as possible for yourself.

You Don’t Care About the Relationship.

The less you care about the relationship, the harder you should push for the best deal. If they don’t like it, so what? For example, when you’re buying a car from a stranger, you shouldn’t care whether he likes you.

You Are More Powerful.

Since you have the power, use it to get the best deal possible. On this point I must praise President Trump. Many previous presidents made terrible deals because they wouldn’t use America’s extraordinary power. Trump knows he is the most powerful man in the world, the leader of the largest economy and the strongest military. He loves renegotiating those deals, and he has often, but not always, done it exceptionally well.

Many people intensely dislike the way he uses his power, and they constantly criticize him, but he doesn’t care. He just wants to win. And although I detest him as a person, I want him to win.

You Don’t Trust Them.

If you don’t trust someone, you must bargain hard. Some people are much too trusting, and others – especially ones like Trump – take advantage of their gullibility. If you’re too trusting, you’ll make too many concessions. If you openly share information, it will probably be used against you.

It’s Easy to Evaluate Implementation.

 

If the deal is easy to implement and evaluate, bargain hard. For example, if you’re buying a child’s chair, all you have to do is give them the money and take it home. So try to get the lowest possible price.

They Are Bargaining Hard.

If they are aggressive and you’re passive, you will almost always lose

American diplomats have often made that mistake. For example, after World War II we were extraordinarily powerful, and the Russians were desperately weak. Millions of Russians had died, and their economy was devastated.

The Americans called Molotov, the Russians’ chief negotiator, “Old Stone Ass.” He just sat there refusing to budge, while the Americans made one concession after another, hoping he would “be reasonable.”

Of course, since he was winning, he had no desire to “be reasonable.” We essentially rewarded his stonewalling by giving away Eastern Europe and making many other extremely costly concessions. You can read all about this idiocy in my book, Negotiate to Win: Gaining The Psychological Edge, 2nd Edition.

SUMMARY

Good negotiators adjust their strategy to fit the situation. Fools always negotiate the same way. You should use Trump’s strategy only when you have all these conditions.

  1. Your interests clearly conflict.
  2. You don’t care about the relationship.
  3. You are more powerful.
  4. You don’t trust them.
  5. It’s easy to evaluate implementation.
  6. They are bargaining hard.

My next post will describe the conditions that shout, “Don’t use his strategy!”

No Deal Is Better Than A Bad Deal

Do you believe your bosses want you to make every possible deal?

I certainly hope not. Your bosses really want you to make profitable deals. They want you to walk away from bad deals.

That’s one of the principles of my new online course at Udemy.com: Is Trump’s Negotiating Strategy Right For You? It’s based on the live courses I’ve taught to the world’s largest multinational in twenty countries. I’ve interviewed senior executives in many of those companies, and virtually all of them want their subordinates to be tougher, to negotiate deals that increase the bottom line.

They would agree with this blog’s title: “No deal is better than a bad deal.” Here’s just one example.

Top management of a major publishing house hired me to teach negotiating skills to their acquiring editors, the people who negotiate contracts with authors. This publisher had been purchased by a huge conglomerate that was extremely dissatisfied with its poor profits. The executive who hired me insisted that their editors had to become much tougher because the firm was writing off over $100 million in unearned author advances.

When I told the class that this was our objective, one editor angrily objected, “Those bean counters at X (the conglomerate) don’t understand that publishing is different from most industries. If I don’t overpay for a big book, I won’t get a chance to bid on future big books. I have to prove to the agents that I’m a player.”

I replied, “You mean if you don’t lose money on this book, you won’t get a chance to lose money on the next one.”

She was furious. She didn’t say another word, sat in class fuming until we broke for coffee, left, and never came back. Within a few months she left the firm. I don’t know whether she quit or was fired, but do know that her negotiating objective was extraordinarily stupid. She neglected her firm’s bottom line and top management’s priority because she wanted to be “a player.”

If you value your career, don’t make her mistake.

You may think, “That’s an interesting story, but it’s just one anecdote. I’d like more evidence.” That’s a reasonable position, so here are some spectacularly bad deals:

  1. of their customers wished that mortgage loans for billions of dollars had never been made. The bankers took huge losses on the loans, and the customers bought houses they couldn’t afford and frequently lost through foreclosure.
  2. Several American cities cannot provide essential services because so much of their budgets is spent for employees’ pensions. The cities’ negotiators gave in again and again to excessive demands.
  3. World War II could have been prevented if Chamberlain, the British Prime Minister, had refused at Munich to yield to Hitler’s outrageous demands.

The lesson couldn’t be clearer: No deal is UNQUESTIONABLY better than a bad deal.

Walking away rather settling for a deal you dislike may make you very uncomfortable, but you’ll just have to accept that short-term discomfort and become tougher.

Tough negotiating won’t just help your career. It will also put money – perhaps lots of money – into your pocket. You can’t negotiate good deals unless you’re willing to walk away from bad ones.

TRUMP-LOVERS & TRUMP-HATERS DENY REALITY

You can’t afford to be so foolish.  Good negotiators are brutally realistic. They accept reality, even when they intensely dislike it.

I recently published an online course at Udemy, “Is Trump’s Negotiating Strategy Right For YOU?

It states that Trump’s negotiating strategy works wonderfully in some situations, but fails abysmally in others. Some Trump-Lovers and Trump-Haters refuse to accept that obvious fact.

What Trump-Lovers Deny

Some Trump-Lovers deny that his extraordinary aggression creates enemies, loses deals, and prevents absolutely critical cooperation. For example:

  • We’ve had the longest government shut down in our entire history.
  • 40% of his staff have left.
  • Some prominent Republicans have attacked him.
  • Many foreign leaders don’t trust him.
  • The Democrats are desperately trying to impeach him

What Trump-Haters Deny

Trump-Haters are equally blind to reality.

A distinguished professor reacted to my course’s title with this extraordinarily silly email: “I’m deeply suspicious of anything that has ‘Trump’ and ‘Strategy’ in the same sentence. He has none. Never has. So it’s simply not possible that it could be ‘right for you.’”

Since Trump made billions and won the American presidency, that statement is a purely emotional denial of reality. If he didn’t have a strategy, he couldn’t have been so successful.

Another friend was equally irrational. I said that Trump had gotten some great deals.

He angrily replied, “Name one!”

It would be a silly response for anyone, but it was especially silly for my friend. He knows that Trump couldn’t have become a multi-billionaire without making great deals, and he also knows that Trump’s books describe manygreat deals. He just can’t accept those facts.

I mentioned only one deal, Mar-A-Lago. My friend knows that Trump bought it for a small fraction of its worth. Did he accept my answer?

Of course not.

He said, “That wasn’t a great deal.”

Saying that buying a property for much less than it’s worth isn’t a great deal because you hate him is like saying, “Ty Cobb wasn’t a great baseball player,” because he was an exceptionally nasty SOB.

Ty Cobb was one of history’s greatest players. His batting average is the highest of all time, and he received 98.2% of the votes for the Hall of Fame.

His record speaks for itself. The same can be said for Trump. Whether you love him or hate him, don’t deny reality: He’s a huge winner.

I must add that I detested Trump long before most people knew his name. I lived near Atlantic City, played poker in his casinos, and learned that he mistreated his employees, bullied local businesses, and even tried to run over a little old lady. She owned a house he wanted to tear down for his parking lot. But I don’t let my dislike for him blind me to the fact that he has negotiated MANY great deals.

To negotiate well, you MUST accept reality, even when you intensely dislike it.

Creating the Right Negotiating Atmosphere Part Two

It’s your first task. If you don’t create the right atmosphere, you may never start moving toward a deal.

Part One included a transcript of the first minute of a session between Jack, a consultant, and George, a long-term client. George is a tough negotiator, but he likes to start with a little warm-up period. Jack annoyed him by immediately asking, “Did you get a chance to read our proposal?”

George frowns slightly, then says, “Yes, it seems to satisfy most of our needs.”

Jack misses the significance of the word “most” and continues, “I’m sure you’ll find that it’s an excellent proposal.”

“Jack, I have a lot of confidence in your firm. You’ve always done good work for us.”

“Thanks, George.”

“But I’m concerned about the training.”

Jack looks a bit surprised. “Oh?”

“You said that one of your people will do it.”

“That’s right.”

“We have a well-qualified person who could handle it. Her name is Joan Mclntyre. Here’s her resume.” George hands Jack the resume and sits back, waiting for him to read it

Jack doesn’t even look at it because he’s already dismissed the idea of using Joan. “Well, George, we’ve found that our staff does a much better job than internal people.”

Questions and Textbook Answers

Of course, you may disagree with the textbook answers. Many people do, but make sure you have good reasons for disagreeing.

  1. What should Jack have done after George said, “”It seems to satisfy most of our needs.”

He should have recognized that “most” meant it didn’t satisfy all of George’s needs. It’s subtle, but good negotiators understand subtle signals. The more you understand other people, the better results you’ll get.

You may regard “most” as a positive signal because you want to “think positively.” That’s the wrong way to think while negotiating. Instead, be realistic: Try to learn how other people really think, not how you want or are afraid they think.

Jack should have said something like: “Most? I guess that means it doesn’t satisfy some needs. Which ones wouldn’t be satisfied?”

That question provides two benefits. First, it shows he’s trying to understand George, improving the atmosphere. Second, he would learn some important information.

  1. What should Jack have done after George handed him Joan’s resume?

Whenever somebody gives you something to read, either read it immediately, or ask, “Should I read this now?” Jack rejected and offended George.

Understanding and adjusting to other people are central themes of my videos and eBook: Negotiate to Win: Gaining the Psychological Edge, 2d Edition.

The eBook will be published very soon. FOR A LIMITED TIME, you can get a free copy by clicking HERE .

(I will arrange to send the copy when the book is released.)

You can watch the first video of this series for free by clicking HERE.

 

 

 

Creating the Right Negotiating Atmosphere

It’s your first task. If you don’t create the right atmosphere, you may never start moving toward a deal.

Jack, a consultant, will negotiate with George, a long-term client. George is a tough negotiator. He’s friendly and likes to start with a little warm-up period, but, when it comes to money, he’s really tough. He even brags about how much he saved on his office furniture.

Today’s negotiation concerns a contract for about $150,000. George ordered nearly $2,000,000 worth of computers and related equipment that will be delivered in two months. It can’t be used well without a consultant’s help.
They’ve had several meetings and agreed on most issues. Jack believes that today’s meeting is to settle the price. He submitted a written proposal covering all the issues, including price.

Jack enters George’s office and walks toward him. George smiles, and says, “Thanks for coming. Jack. How are you today?”
“Fine, George. Did you get a chance to read our proposal?”
George frowns slightly, then says, “Yes, it seems to satisfy most of our needs.”

They’ve been together less than one minute, and Jack made a serious mistake.

Questions

  1. What was Jack’s mistake?
  2. How did George indicate that it was a mistake?

Textbook Answers

Of course, you may disagree with these answers. Many other people have done so, but make sure you have good reasons for disagreeing.

1. What mistake did Jack make?
He got down to business much too quickly. He knew George always liked to have a brief warm up period, but he immediately asked, “Did you get a chance to read our proposal?”

2. How did George indicate that Jack had made that mistake?
He frowned slightly. You may think that it’s unrealistic to expect somebody to pick up such a subtle signal, but skilled negotiators constantly look for body language and other signals of people’s feelings. If Jack had recognized that signal, he should have slowed down and made small talk. He needed to create the right atmosphere before discussing his proposal.

Of course, many people detest small talk. With them you should create a different type of atmosphere. The critical task is to understand what other people want and then adjust to them.

Understanding and adjusting to other people are central themes in my videos and book: Negotiate to Win: Gaining the Psychological Edge, 2d Edition.

The eBook will be published very soon. FOR A LIMITED TIME, you can get a free copy by clicking HERE .

(I will arrange to send the copy when the book is released.)

How To Play The Negotiating End Game

The End Game (the last few minutes) is usually the most stressful part of a negotiation. Because most of the “fat” has been cut away, the concessions are often painful, and deadline pressure intensifies the stress. Everybody knows that there is a lot at stake, and you may not have enough time to think carefully or correct your mistakes.   

Because this tension causes many serious mistakes, the critical personal quality during the End Game is good nerves. Without them you can settle too quickly and leave lots of money on the table.

The tension can make you miss clear signals that other side will go further, perhaps much further: They might say something like this, “We think it’s a fair deal for both of us, but, if necessary, we can make adjustments.” Instead of exploiting this obvious opportunity to get a better deal, some people just settle, leaving lots of money on the table: “OK, glad we’re both happy.”

To reduce these stresses and their negative effects, perform three kinds of preparation:

  1. Psychological: You need every bit of your mental and physical energy to bepsychologically ready for the stressful Get control of your nerves, and make sure you’re not tired, not even slightly intoxicated, or fuzzy-headed.
  2. Informational: You should have a fairly clear picture of the others’ objectives, power, strategy, and so on. If you don’t have this information,you can’t play the End Game well. You don’t have enough time to get that information; you need it
  3. Positional: You don’thave time to create a good position; you need it when the End Game begins. If you don’t have it already, try to create it as quickly as possible.

What should you do if you’re not well-prepared? Get out of the End Game. Extend the deadline to get time to take whatever steps you needed to prepare for the next End Game.

The others may refuse to extend it and escalate the costs of not meeting it. It takes nerve to stand up to that pressure, but you can’t afford to yield to it. If you enter the End Game unprepared, you’ll probably make costly mistakes. If you’re not ready for the End Game, don’t play it.

Countless people have ignored that simple principle, and they almost always regretted it.

When you’re well-prepared, shift your focus to the End Game’s four primary tasks:

  1. Test Their limits. Learn how far you can push them.
  2. Communicate Finality. Make them believe that you’ve reached your limit; you can’t go further.
  3. Use Deadline Pressure. Make that pressure and tension work for you, not against
  4. Let Them Save Face. Let them feel they have won by your words and body language.

Future blogs will tell you how to take each step.

This blog is based on my newest book, Negotiate to Win: Gaining the Psychological Edge, 2d Edition. For a free Kindle copy of it click HERE.

Should You Negotiate Like Donald Trump?

My previous blog said many people underestimated him. You can read it here. It’s equally foolish to overestimate or carelessly copy him.

I’m not judging – either positively or negatively - his policies. That’s not my job. My only mission is to teach you and others how to negotiate.

WARNING #1: YOU CAN’T EFFECTIVELY USE MUCH OF HIS STRATEGY.

His business success was obvious, and some of his presidential negotiations worked well. However, it’s too soon to tell their long-term effects. His short-term success occurred because:

  • He’s the world’s most powerful person.
  • He’s extraordinarily unpredictable.
  • He created an extremely dominant and aggressive image with successful business deals, a savage election campaign, a best-selling book, and a television show.

You don’t have remotely as strong a position, nor do you have such a scary image, nor can you take all the steps he’s taken.

WARNING #2: HIS STRATEGY WORKS ONLY FOR PURE BARGAINING.

He’s a master bargainer, but a terrible joint problem-solver. Pure Bargaining is a win-lose game based on power. Joint problem-solving is a win-win game based on trust and information sharing. Nearly everything that builds power reduces trust and information-sharing and vice versa.

WARNING #3: HIS STRATEGY PREVENTS DEVELOPING GOOD RELATIONSHIPS.

He beats up people and enjoys doing it. He even tried to trademark, “You’re fired.”

People don’t trust or share information with him because he’s so deceptive, competitive, aggressive, and power-oriented.

WHEN SHOULD YOU NEGOTIATE LIKE TRUMP? 

The only intelligent answer is, “It depends on the situation.”  Don’t decide before answering many questions:

  1. How much do your interests conflict?The more they conflict, the more appropriate bargaining becomes.
  2. How powerful are you? It pays to bargain when you’re strong, to problem-solve when you’re weak.
  3. How important is the long-term relationship?The more important it is, the more you should usually emphasize problem-solving.
  4. How hard will implementing the agreement be? If it will be easy, bargaining generally pays. The harder implementation will be, the more you should try for win-win.
  5. Which approach are they using?If they’re bargaining, and you’re problem-solving, you’ll probably lose, at least in the short term, and you’ll probably resent it. Conversely, if you’re bargaining, and they’re problem-solving, you’ll probably have a short-term victory, but you may damage or destroy the relationship.
  6. Can you CREDIBLY copy his strategy? Don’t try it if you’d be too uncomfortable. You’ll just mess things up.

If you’re thinking of copying him, carefully answer all these questions, and discuss your answers with a good negotiator. Then use only the parts of Trump’s strategy that fit your situation, image, and personality.

This blog is based on my newest book, Negotiate to Win: Gaining the Psychological Edge, 2d Edition. For a free Kindle copy of it click HERE.