In times of crisis, it’s all too easy to develop tunnel vision in a negotiation and lose sight of other objectives that are just as important as the one you’re fixated on. Negotiators under stress are particularly susceptible to this. The most common point of focus is to achieve an advantageous financial position. However, even in times of stress, there’s more to negotiate than just price or money.
Negotiation is a trading activity, whether what’s being traded are circumstances, advantages, objects, or money and products. In a negotiation, you’re looking to trade items of lesser value to you for things that you value more. Skilled negotiators also find the most agreeable terms for that exchange, so that all parties can gain value in the process and would be willing to implement the negotiated deal.
It’s Not Always About the Money
We’ve always negotiated. We started our negotiation career as kids. In fact, the way kids negotiate with one another — and the way we, as parents, negotiate with our kids — can serve as a set of valuable reminders for any would-be negotiation ace. Before we knew the value of money, we negotiated for toys, candies, and other material things. But we also negotiated for more TV time or play time, and we even tried to negotiate our way out of doing our chores or eating our vegetables. Kids are not inherently better at negotiating than adults — but it’s interesting to think back to moments of our early conflict and consider how wants and needs can be fulfilled when the exchange of money isn’t the sole focus.
Instead, as kids we exchanged anything of value that we had. In the same way, as adults, we need to recognize when we’re in a position to negotiate for something of value that isn’t necessarily just more money — like longer commitments, more favorable out-clauses, better payment terms, preferred partner status, faster delivery times, or other valuable issues when money is simply non-negotiable or not even part of the conversation.
Value Is in the Eye of the Beholder
Since negotiation is about exchanging things of value for other things of value — specifically, things that you value less for things that you value more — then it’s important to understand how to value those items. Just because you don’t see value in something doesn’t mean that it’s not valuable to the other side. The opposite is true too: Just because you see value in something doesn’t mean the other side does too.
Don’t assume that the qualities you see in something match the qualities the other person sees. One of the most common commercial trades involves exchanging more volume for better pricing. That’s a great trade, unless volume is not the driver of price.
I used to build field marketing teams composed of hundreds, if not thousands, of people. These teams would go into the marketplace to evangelize my client’s products. I was always dumbfounded when a client would ask for a discount as we added more people to the program. In order for me to reduce my price, I would either have to reduce the salaries of the hundreds of people I’d already hired, or begin hiring people at such a reduced rate that it would jeopardize the quality of the program. Volume was not a driver of price. Therefore, we had to find other items to negotiate.
Even in times of stress, skilled negotiators take the time to find out what’s important to the other side. They test assumptions, use hypotheticals to explore boundaries, and ask questions about what the other side finds valuable. In the end, if they don’t know how the other side perceives value, they’ll never be able to trade for value.
In times of crisis, we develop tunnel vision because we’re fixated on our most important value driver or top objective. However, if you tap into your inner child — the one who had to negotiate with limited resources — you’ll find more things of value with which you can negotiate. Then it’s time to get curious about what the other side values. From there, your blinders will become less opaque and your field of vision will expand, revealing many more possibilities at the negotiating table.
Let Us Be Your Value Guide
Since we approach a deal with fresh eyes and no baggage, we can help you to expand your field of vision and find value drivers quickly. We’ll assist you with getting better deals, saving time, creating value for all involved — not to mention preserving and even strengthening relationships. Let us partner you with one of our advisers, ensuring that you’ve got the broadest view of your deal.