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:
- 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.
- 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.
- 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.