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Delay Tactics: When to Stall and How to Recognize When Someone Is Giving You the Run-Around

September 29, 2011

“Stalling,” simply enough, refers to delaying certain decisions and other details within the realm of negotiation. Typically, a negotiator will employ this tactic in order to inspire uneasiness and doubt in an opponent. However, stalling can also be used more ethically in order to buy time for additional research or internal discussion. It is also a great option if you are worried about your emotions bleeding into your work and you simply need time to cool off.

Of course, like any business maneuver, delay tactics are not without risk.  It is necessary to consider that your competitor might read a sudden absence of communication or change of plans as being combative. This is especially harmful if the negotiation has already proven to be choppy . Indeed, the effects may turn out to be the opposite of what you’ve intended. Instead of buying yourself more time, you may end up under even more pressure. Worse, the other party, feeling neglected, may simply decide to withdraw his offer.

But remember, even if you decide to avoid stalling as a tactic, it doesn’t mean your opponent won’t, so it is important to be able to recognize it when  it’s happening to you. For example, if the other asks you to look at further documentation when all of the necessary information to begin negotiation is already present, there’s a good chance he’s up to something.

Similarly, if the person you’re dealing with suddenly decides that he’s not qualified to negotiate, and that his boss is out of town for the week, you’ve probably got a “staller” on your hands. Also, always be on the lookout for the same questions or ideas being recycled over and over again.

The best way to deal with this is to give the other guy a taste of his own medicine—don’t be the first to give in. Take the little vacation your fellow negotiator gave you and use it to your advantage. Do some extra-credit work to be sure you’re doubly-prepared when he finally decides he’s ready to talk.

Of course, the ideal option would be to circumvent the situation all together by setting  timetables and deadlines at the outset of the negotiation. Make sure the other party understands right off the bat what is expected of him as far as scheduling is concerned.

 You should also be aware that some people stall not as a ploy, but as a defense mechanism. If a negotiator doesn’t seem to want to make up his mind, or uses overly-formal language, or brings up obscure procedural issues , it’s best not to waste your energy on trying to psyche him out. Scale things back, take it slow. Gently remind him of your terms and other matters you’ve discussed. Take time out to start things over, checking with the other party every step of the way.

 This post is excerpted from Keld Jensen’s upcoming book Power Bargaining: Adding Value to Commercial Negotiations to be published early 2012.


By the Book: The Value of Negotiating with a Code of Conduct

June 21, 2011

Negotiations can be stressful, and they are often laced with unexpected challenges and frustrations. A good negotiator weathers the demands of the process while staying true to his ethics, and maintaining a positive, open dialogue with the person across the table. Morals and ethics in business are not subject to change just because a deal is challenging or the other party is disagreeable. But, when a situation gets tough – or you’re just feeling the pressure – it can be easy to lose sight of all the things you said you would or wouldn’t do.

It always helps to write down what you’re thinking, and this case is no different: if you and your colleagues conceptualize and write your own code of behavior, it will be easier to stand by your word and see any negotiation, no matter how challenging, through to a productive – and honest – end.

At the MarketWatch Center for Negotiation Conduct, we have developed a Negotiation Code of Conduct that can help you and your business partners establish rules of behavior to guide you through even the most challenging situations. This code includes statements of what we will and will not do, under all circumstances, in order to preserve the honesty and integrity of the negotiation. Use our list as a basis for your own Code of Conduct, share it with your business partners, and reflect back on it when the stress levels rise:

We will not:

•           We will not lie / bluff

•           We will not intentionally put any pressure on counterparty,

             including time pressure

•           We will not make inflated offers

•           We will not  practice emotional manipulation

•           We will not employ aggressive and hostile negotiation strategies and tactics

•           We will not be holding back information

 We will:

•           We will put our best efforts to keep the trust level in negotiation as high as possible

•           We will restrain from spying, bribing and infiltration attempts

•           We will walk as we talk and will fully observe our agreement, if concluded

•           We will be open about variables and values and share the information

            on an equal level

•           We will try to observe fairness and even sharing of gain added value

We believe:

•           We believe that working together outperforms winning at the expense of the counterpart

•           We do believe in power of ethics and morality in negotiation

 At the end of the day, openly adhering to a common set of moral and ethical guidelines buoys company morale while assuring your business partners that you’re a fair-dealer. Encourage those both inside and outside your company to enforce your own Code of Conduct, and emphasize its importance during even the toughest of deals.

International Relations: How to Successfully Negotiate with Other Cultures

March 21, 2011

In a typical negotiation, a certain degree of stress is unavoidable. Negotiations are often fast-paced, demanding, challenging, and mentally exhausting. Imagine if, on top of these incredibly stressful conditions, you also had to worry about how to properly and adequately negotiate with delegates from a culture different from your own. In international negotiations you will be confronted with a foreign language, environment, and culture. The other party has different frames of reference, experience, values, and signals than those that you are accustomed to.

 The process that governs the negotiation between two people from different cultures is not terribly different from the process that governs negotiations internally in the United States. Within the given negotiation room and the common framework, you must find a satisfactory solution that meets both your material and psychological needs. In order to successfully negotiate with delegates from other cultures, you must stay focused on the task at hand and:

 ●      Be aware that you are the foreigner.

●      Be wary of generalization.

●      Be mindful of your attire.

●      Be aware of the cultural relationship between men and women.

●      Increase your understanding of foreign cultures.

While the first step may seem terribly obvious, sometimes even the most skillful negotiators overlook it. Keep in mind that when you are negotiating in another country, the delegates from the foreign country are not foreign at all—you are. Thus, it is essential to abandon any preconceived notions and to be open to the culture’s customs, however unfamiliar they may be.

 The skillful foreign negotiator never makes generalizations. What is true for one segment of a foreign population may not necessarily be true for all of the population.  Be open and curious vis-à-vis alien cultures and never make do with simply learning a few facts and applying them to an entire population. Ask around among your business contacts, hotel staff, and other foreign visitors if you need clarification about a particular foreign tradition or custom.

 As any successful negotiator is aware, your attire sends a message to your colleagues. As a result, it is of the utmost importance to be aware of the message your clothes are sending, and to choose them accordingly. However, when you are negotiating in a foreign country, sometimes the same standards of dress do not apply. If you want the other party to listen to you and try to understand your message, you must behave in a manner that inspires confidence. If you depart from the acceptable dress code, you run the risk of having the other party misunderstand your message. Be sure to investigate a country’s business dress code before your arrival, and pack accordingly. One of the most foolish ways to threaten the success of a negotiation is to dress improperly or in a way that may insult the other party.

 A key component of any negotiation is the successful interaction between the two parties. Personal chemistry and good conversation are two tools that are instrumental in governing successful deals. Despite this, it is essential to keep in mind that not all cultures operate under the same social norms. Interactions between males and females in the United States are radically different from those in other countries. In some cultures, it is considered an infringement of social etiquette to shake a woman’s hand, appoint her the head of your negotiation delegation, or invite her (without her husband) to a restaurant to discuss business. It is essential to familiarize yourself with such customs before beginning the negotiation, so as to avoid offending the other party and jeopardizing the deal.

 Finally, in order to be a truly successful foreign negotiator, you must increase your understanding of foreign cultures. In order to better understand a foreign culture and to become aware of your own prejudices, you should read everything you come across that pertains to the foreign country you’re about to visit. Books are an extremely useful resource—read everything from slender pamphlets to extensive tomes. You can also read fiction describing foreign cultures. Peruse some newspapers and weeklies, or read their trade journals. Familiarizing yourself with the country’s customs before you depart allows you to focus all of your time and attention on the negotiation when you arrive.

 Ultimately, it is inevitable that you will run into minor difficulties while negotiating abroad—after all, conflict is part of the negotiation process. However, if you familiarize yourself with the aforementioned steps and make an honest attempt to learn about the other culture, you will be able to eliminate time wasted acclimating yourself with the country’s customs, and instead be able to let your negotiation skills shine.

 This post is excerpted from Keld Jensen’s upcoming book Power Bargaining: Adding Value to Commercial Negotiations to be published mid 2011.

Develop Your Message: Increase Communication Efficiency

February 23, 2011

In any negotiation, communication is key. Good communication between parties is an essential component of a successful deal, as it creates a positive negotiation climate and allows for both parties’ messages to be clearly expressed. It is important to keep in mind that efficient communication is characterized by far more than simply having a way with words. Focus on preparing your message to the other party and on learning how to read the other party’s signals to you. You can do some things that will drastically increase your communication efficiency, allowing you to have better and more constructive negotiations:

1. Find the Purpose of the Message

Before you even begin to negotiate, pause and consider the results that you wish to achieve from the negotiation. Do you wish to influence the other party and change his attitudes, assessments, and needs, or do you wish to provide information and background knowledge to keep the other party informed? Do you wish to explain something? Do you want to create awareness of something? Do you want information from the other party? Keep in mind that your primary purpose is to catch the attention of the other party. Finding the purpose of your message before you begin to negotiate will allow you to capture the interest of the other party immediately and help you to avoid rambling.

2. Outline Your Message

Once you have found the purpose of your message, you must next consider how to effectively convey the message. What do you need to say to accomplish your purpose? Set up a number of columns, an agenda, or headings under which you write the information that belongs in different blocks. Sort out the blocks in the appropriate sequence. The sequence will be governed by the strategy or structure you think the negotiation should take. Once you’ve established a sequence, then you may prioritize. Ask yourself what should be first, second, third, and so on. Logical links running through your presentation allow the other party to follow your thoughts.

3. Limit the Flow of Information

Remember to keep your message simple and concise. The other party can only make use of three or four facts at a time. Expressing oneself in simple terms and being brief but still intelligible is difficult for many people. They speak a lot and know a great deal about the subject, but no one understands what they say, because the information is bogged down by too many facts and complex words.

4. What Does the Other Party Want to Hear?

While it is important to focus on getting your message across, do not forget that negotiation is a two-way street. Be customer-oriented in your presentation. The other party is most receptive to new information that is in keeping with his needs and solves his problems. Put yourself in the other party’s place. What questions might he have?

5.  Activate Several Senses

You occupy a greater share of the attention of the audience if you transmit on several channels at the same time. However powerful your speech may be, we can only listen to information for so long before we grow restless or disinterested. We as humans are better at remembering visual impressions. An extensive and complex message will be more easily received if words and images are combined. How often do you make use of images in your negotiations? If there is no blackboard or whiteboard, you can always use paper and pen. Virtually everything can be expressed and summarized in images: columns of figures, pie charts, timetables, graphics, and so on. By appealing to the other party’s sense of sight, you activate information and experiences stored deep in their long-term memory.

6.  Physical or Intellectual Demonstrations

You should also appeal to your opponent’s other senses in your presentation. A product is demonstrated physically by having the other party try it out. But how do you demonstrate an idea? In an intellectual demonstration you describe the principle by means of an example that is as down-to-earth and simple as possible. When people listen to you, they must be able to see the chain of events. When you have presented the proposal and have caused him to understand the principles, you ask questions like: What happens if you switch to…? In doing so, you force people to grasp your proposal and think about it. You get feedback as to whether they have caught the message, and a reaction concerning their assessment of it.

Ultimately, there is no way to accurately predict the outcome of a negotiation before it even begins. However, you can most certainly increase your chances of a favorable outcome by developing your message. By increasing your communication efficiency, you are giving your team an advantage and ensuring that your message will be conveyed in the most concise and accurate manner.

 This post is excerpted from Keld Jensen’s upcoming book Power Bargaining: Adding Value to Commercial Negotiations to be published mid 2011.

How Negotiators Shoot Themselves in the Foot- Part II

February 5, 2011

In the previous post, I identified eight issues that cause negotiators to come away from the table with an outcome that is less than their initial expectation. In this post, we continue this list of reasons why things go wrong:

 9. Working in an unstructured manner without an agenda – This negotiator does not make notes on the flip chart or summaries of what has been agreed upon.  Rather, she leaps back and forth between individual terms and provisions. The negotiation becomes a hodgepodge where no one can see the big picture or look at the consequences of any aspect of the bargain. The opponent becomes unsure of the negotiator’s intentions. To avoid this, the negotiator should prepare an agenda in advance and share it with her counterpart.

 10. Failing to assign roles within your own delegation – This delegation is undisciplined presents an incoherent message due to the absence of a designated leader. They function poorly and reprimand one another in front of the opponent. These delegates will sometimes negotiate within the delegation attempting to take control of decisions where they have some technical knowledge. If roles were assigned to the members a better result could be achieved which advanced the overall interests of the company.

 11. Being afraid to bargain– Delegates who are afraid to bargain are seeking to avoid conflict. For this reason, they are afraid to make an offer or counteroffers, and as a result, the negotiation gets stuck. During the bargaining phase of the negotiation, they express contradictory perceptions of what a reasonable offer should look like. The attitude that bargaining is something nasty must be rethought. The session must be organized in such a way that bargaining can begin early in the process.

 12. Failing to formulate a strategy in advance– These negotiations are unstructured and characterized more by verbal combat than creative problem solving. Instead of approaching an agreement methodically, step-by-step, these negotiators improvise. It is not clear to them when it is time to stop arguing and move on to map out possible solutions. They have not considered the advantages and disadvantages of being the first to make an offer and instead wait for the opponent to take the initiative. They are not sure whether they should make one overall offer which covers all parts of the agreement or whether they should take care of the problems one at a time.

 13. Losing track of the math– No one in the delegation has been assigned to keep track of financial implications of the offers and counteroffers. No one is monitoring how the overall budget will be affected when possible solutions are being bantered back and forth.  These negotiators do not know where they stand in relation to their own pain threshold or their negotiation goal. They enter into an agreement without knowing if they have achieved a good result or whether they have landed outside their budget. If someone has been assigned the responsibility of tracking the math as the bargain is being crafted the parties will be able to understand the impact of the bargain instantly.

 14. Making insultingly low offers– Insultingly low offers are the result of poor analysis of what the opponent thinks a reasonable offer should look like or just plain stinginess. Negotiators who make these offers have overestimated their power position. Their strategy is to start out tough and later back down from the unrealistic offer. Most people who have been presented with an insultingly low offer feel offended and break off further negotiations. Others remain at the table with their guard up. This makes the negotiation go off the rails and the added value is never explored.

 15. Not being a good listener– The concept of listening is far more than passively receiving the opponent’s words. Delegates need to realize that often they do not know the answer and that new information may help them uncover the hidden added value in the transaction. These delegates fail to find new openings and new information that will expose the non-visible added value because they refuse to listen. Insecurity causes these negotiators to stubbornly stick to their original plan no matter what happens at the table. They are afraid of listening because it seems too risky.

For many negotiators who fail, it is a question of learning to think differently when they are preparing and analyzing the negotiation. In order to think differently negotiators should:

  • dare to be active during the negotiations
  • use significantly more energy on mapping the negotiation possibilities
  • bargain instead of arguing
  • improve their communicative competence
  • increase your understanding of negotiation by reading books and attending training
  • develop negotiation skills through the experience of real negotiations

 Inevitably, all negotiators stumble upon roadblocks from time to time. However, having the ability to recognize the behaviors that lead to unsuccessful negotiations will help you make better judgment calls.

 This post is excerpted from Keld Jensen’s upcoming book Power Bargaining: Adding Value to Commercial Negotiations to be published mid 2011.

How Negotiators Shoot Themselves in the Foot – Part 1

January 14, 2011

There are a fairly predictable set of behaviors that cause negotiators to fail. I have broken the list into two segments because of its length but, taken together, you will have a solid understanding of the behaviors and perspectives that cause one party to de-rail a commercial negotiation and come away from the table with a poor result.

1. Seeing only half the negotiation – These negotiators see the negotiation only from their perspective: what they will have to give in order to get back what they want. They are preoccupied with protecting their own interests and do not view the negotiation as a SMARTnership™. If they were working in SMARTnership they would approach the project with the purpose of reducing the overall costs and risks and increasing the joint earnings.

 2. Aiming too low – Instead of having an open mind about what the best possible deal may look like, this negotiator’s goal is to keep within budget or to reach an offer which is somewhat better than their second best alternative.

 3. Failing to actively search for the added value – This negotiator is passive and lets the opponent control the negotiation. He rarely has all the necessary information to find out where to create added value. Often he is an inexperienced negotiator who may allow the bargaining to glide into a traditional zero-sum game. He does not know which variables to negotiable. An agreement can only be reached if one of the parties makes concessions.

 4. Having only one strategy: combat – Argument seems to be the only approach this delegation understands. They spend their energy and preparation time formulating good arguments. The more arguments they come up with, the more they believe that they are right. They lack the ability to recognize that they were wrong. Their ego and power positioning take over the dynamic between the parties.

 5. Focusing on the parts, and failing to see the whole – These negotiators have a poor grasp of the overall costs and the revenue associated with the project. They fail to see the whole deal. The price they have to pay is more important than the overall cost or the overall return. Often they have not analyzed the negotiation variables or discussed possible solutions and how these might affect the result.

 6. Lacking knowledge and perspective, operating from a defensive posture – This problem can best be illustrated by a remark by the famous Swedish skier Ingmar Stenmark: “You can only talk with those who understand”. Many negotiators lack economic, technical, business, and practical knowledge about the things they are bargaining for. They do not think like business people. When someone suggests that a project can be handled differently from their traditional approach, this negotiator sees the comment as an invasion of their territory, a criticism of their work, and a questioning of their experience and competence. To this person, negotiating is about defending against an invading enemy.

 7. Obsessing on the details – For these delegates individual details become far too important. These negotiators get stuck on questions which do not involve important financial issues or big risks. Each member of the delegation wants to express his personal opinion. There is no discipline in the group and the individual members find themselves in verbal combat. The negotiators have not established priorities, therefore all details seem to be of equal importance. Each delegate wants to present her view. Nobody listens. Power positioning takes over.

 8. Failing to acknowledge that your opponent needs to make money – This negotiator has a hard time accepting that the loyal opposition is entitled to make money on the transaction. He believes: If our counterpart makes money on this deal, we have not done our job.  The really smart negotiator demands that his counterpart make a profit on the transaction.

 My next post will continue this list of ways negotiator’s get in the way of their own success. If you have ideas about other ways negotiator’s self-destruct in the bargaining process, please share your views by commenting below.

 This post is excerpted from Keld Jensen’s upcoming book Power Bargaining: Adding Value to Commercial Negotiations to be published  mid 2011.

The Value of a Written Summary

December 22, 2010

When you are negotiating, you and the other party are seeking to reach an agreement. Wishful thinking and assumptions can make you believe that you are in agreement. Sometimes one party will even say: Now we are agreed. A moment later it becomes apparent that you have differing ideas about what the agreement covers and what it is about. This disconnect indicates that the oral summaries made during the process have been misunderstood, or there have been too few of them.

There must be a written summary. It should be drafted and reviewed before the delegates part company at the end of the session. If the parties can agree on the language of the written summary, misunderstandings and future disputes can be avoided. You will be surprised to discover the degree to which the other side has not heard you correctly and how unclearly your alternative solution has been communicated. But if you ask for the written summary you will get an opportunity to correct the misunderstandings so the delegation is contemplating the alternative you actually intend and the terms you have in fact suggested.

It is not as effective for you to write down your understanding of the agreement and send it to the other party a week later. This approach can lead to further disagreement and misunderstandings and the other delegation feeling manipulated or hoodwinked. A written document can be interpreted, or misinterpreted, many different ways.

If possible ask your opponent to write the summary. When you analyze the other party’s summary and scrutinize their choice of language and the attitudes expressed, it will sometimes give you an inkling of whether they will accept the proposed solution.

When this does not work, summarize the message of the other party: what you’re telling me is that you can’t make a decision today. In this way you avoid misunderstandings and force the other party to send clear signals. This also allows the other party an opportunity to explain himself. You can be provoking in your summary in order to test boundaries by summarizing “incorrectly”. You add things, you subtract things, and you modify in such a way that you are testing the waters for the next stage of the negotiation.

It is often effective to forward appropriate documentation to the other delegation prior to the negotiation that will support your arguments and positions. The other party will be more receptive to your message, better prepared, and equipped to ask meaningful questions. You will waste time and lose trust if you take the other party by surprise at the negotiating table. They will not be able to answer your questions. They cannot benefit from the information when it is given to them all at once causing them to feel overwhelmed, insecure, and unable to act.

You should forward additional documentation to your counterpart after the session. Provide a full set of documents, highlighting the most important points in an accompanying letter. Document everything you have agreed to in writing. If disagreement occurs later on, your documentation will become highly valuable.

Always review the negotiation afterwards, interpret your notes, discuss things you’re your colleagues, analyze the result, and establish new objectives. Assess your own performance and that of your colleagues and adjust your strategies and tactics so that you are advancing your objective and moving toward a win-win solution.