Transcript

Nolan Martin : Welcome to another episode of The NegotiateX Podcast. I am your co-host and co-founder Nolan Martin with me today is my good friend, Aram Donigian. Aram, how are you doing today?

Aram Donigian : I'm great, Nolan, thanks. How are you doing?

NM : I'm hanging in there. So I've got three foster puppies right now. They're just kicking my butt. I mean, we typically will try and foster a few dogs every now and then, that are, you know, at a kill shelter and are not getting adopted out. So every now and then we'll, we'll try and pick some up, this time, we have puppies, and we typically deal with older dogs and they are running circles around me and my wife. I know that's only just a small fraction of probably what you deal with your six kids, so I will stop complaining and I will definitely shut up.

AD : Well, first of all, I think that's a wonderful thing to do. I think animal shelters and taking animals in is so important. And second, at least, at least I can attempt to negotiate with or reason with my children, I'm not always successful, it's a lot harder when you're doing that with an animal.

NM : Yeah, they definitely don't listen unless I have food, then they're pretty good at listening. So I'm excited for today's episode, because, you know, we're going to answer the first question that we got on NegotiateX. So again, if you have a question like this, or you want us to answer something like this on the podcast, shoot us an email at team@negotiatex.com and we'll be glad to take a look in trying to answer it in future episodes. So they asked to remain anonymous and they also asked to kind of generally speak around the business issues, so not in this specific business area that they are facing. But generally the issue is -- how do you collaborate with an impossible person? They write –“Today, I was negotiating for a discount with the key supplier. In summary, the supplier said my best offer is a 5% discount, which is more than we do for any customer, even the government. Furthermore, I'm doing this as a favor because I like working with you. And remember, my boss is an old friend of your boss.” How would you deal with that Aram?

AD : Well, that's a tough situation and realistic. I'm laughing because I love how the other person's the impossible one; we are never the impossible ones, when we're in a difficult situation like that.

NM : Absolutely. It's always the other person. So what do you do though, when someone's using dirty tricks, or these difficult tactics, if they have, you know, more seniority, they have more power or leverage than you do.

AD : A lot of buzzwords in that in that statement. I don't know, Nolan, I guess you just give up.

NM : Yeah, I guess you're right. All right. That's it for today's podcast. No, I’m kidding. But seriously, like, you know, surely this comes up frequently. I would assume that people try and take advantage of situation, I assume that they try and take advantage of the person they're negotiating with and I feel like this has happened with me, that whenever you go into negotiation, I'm sure that this comes up frequently, so how do we handle this? How do you tell your clients to deal with this situation?

AD : Yeah, I like to ask clients tell me some of the difficult things that your toughest counterpart says or does at the negotiation table, I keep track of these things, I think some of these will, will sound familiar,will resonate with our audience, they'll say that, you know, their toughest counterparts will lie or strategically mislead. I love that reframing of lying, they will manipulate the process, they'll simply not respond, they'll ignore what they've heard, they may bring up past relationship issues between the parties, either good or bad, sometimes they leverage the fact they've been together for a long time, like in this case, sometimes they make extreme demands that they just can't justify, they use one sided standards that are really good for them and their case, they tend to become threatening with their BATNA, their Best Alternative To ANegotiated Agreement, they'll conceal information, so they're negotiating in bad faith, they can get really loud and aggressive, generally rude, talking down, being demeaning, they can refuse to listen, they can become really stubborn, you know, be unwilling to discuss any options, sometimes they break their commitments, they don't do what they say they will do, sometimes they tell you to just take it or leave it and that's just a small sampling the list I could keep going on.

NM : I'm not sure if you knew this dirty secret of mine and I'm a little embarrassed to share it, but I am a die-hard fan of The Office. I don't know if you are a big fan of the office, the TV show, are you?

AD : I am, yeah, actually I liked the show, too.

NM : All right, good. So I mean, it's like disgusting, like it could be on in the other room and if I hear the words, like I can see exactly what's happening, and I can't even see the TV. Anyways, when Michael is negotiating, or Darryl is trying to negotiate a salary increase, because he has increased responsibility from his warehouse manager duties, Michael is, I believe, is Wikipedia. But he is basically trying to figure out all the dirty tactics he could use to kind of throw Darryl off his game, so that he didn't have to really face negotiating the actual salary increase for Darryl, so these kind of things that are coming up reminds me of that situation. I'm sure when we actually talk about how to negotiate your salary in the future. Maybe we could pull up that clip, and actually play it for then. Okay. All right. Sorry, a little off. out there.

AD : That's okay. It's a fun. It's a fun clip. I actually use that in class sometimes. Because Michael Scott, in so many ways, often gives us the wrong thing to do.

NM : He's so good. All right. All right. So I know we have experienced things like that before and can assume our listeners have too, it's tough not to react when people really try and take advantage of the situation.

AD : Yeah, it certainly is and that's really, why our first piece of advice is to not react, which can be really, really difficult, when in those situations, because we are frustrated, or potentially, you know, emotionally triggered and so our very first natural inclination is to react.

NM : Yeah, absolutely. So how do we not?

AD : Well, one step, one step. There’s a number of things we could talk about dealing with emotional triggers, but one step in not reacting, is simply recognizing your desire to react, right? That’s okay. I'm okay with the fact that that's, that's what my natural response kind of feels like it should be and I want to respond in kind, I want to behave as badly as I'm perceiving that they're behaving, right, and I want to, I want to respond like that and so just recognizing that desire can be really helpful and acknowledging that and just being okay with it and then what I would add is step to the balcony, which is a piece of advice that we get from Will Ury in Getting Past No, but that idea of stepping to the balcony can be real powerful.

NM : All right, you're gonna have to elaborate on that one, what is “step to the balcony”?

AD : Well, it's just an image for taking a step back, or taking a step, kind of out of the actual dynamics and the negotiation occurring, like stepping to the balcony, if you're at a theater or something. So you're, you're somewhat removed, and you're better able to observe what is going on, your counterparts’ words and actions and your own words and actions. And then you're able to better formulate choices for acting intentionally, and moving that negotiation toward your desired end state.

NM : Speaking from firsthand that can be really difficult. I can see how you can get sucked in and so focused on something that you're not able to see the bigger picture.

AD : Yeah, it really requires discipline. And if you think about it, just for a moment, you know, it's a far superior strategy, taking that step back and thinking, you know, what do I need to do intentionally, then just reacting, because if you just react, you're potentially playing into their game, or you're going to cause the negotiation to spiral out of control.

NM : Okay, so, once you've stepped to the balcony, you're seeing the bigger picture. What's next?

AD : Well, the next thing is you want to identify the elements of negotiation the other person is using and how; and in previous podcasts, we've talked about these seven elements of negotiation that again originated from Getting To Yes, and then developed further through Vantage Partners, but the idea of interests, options, legitimacy, alternatives, commitment, communication, relationship, and being able to just identify what elements your counterpart is using and how they're using them and what makes this step really easy is that there, there's only the seven elements to kind of spot, right, there's only seven things and most negotiators tend to only use two or three elements and they tend to use the same two or three and so if you're negotiating with the same person, oftentimes you start to kind of spot the elements they use. I like to ask folks, if they can juggle two or three balls just for this identification that we tend to use just two or three elements, and everybody will raise their hand -- yeah, sure I can. I can juggle two balls, you know, something, the most sophisticated person can juggle three. And then if I asked if you can juggle six or seven, what would that make you? You got to answer that Nolan?

NM : Either Cirque du Soleil star professional juggler, one of the two.

AD : Yeah, I would probably go with professional juggler, although, sometimes people respond with clown and I just find that a really funny response. Anyways, you know, if you take that same concept, move it over to negotiation, if you're able to utilize all seven elements of negotiation, and pull as you need to the different levers of power in negotiation, these seven things that really makes you a very effective professional negotiator and most people just are not at that level.

NM : Okay, so if we kind of take it back to the original question, so let's, let's go back to that, let's see, it was, okay, so his supplier, it said: my best offer is a 5% discount, which is more than we do for any customer, even the government. Furthermore, I'm only doing this as a favor because I like working with you and remember, my boss is an old friend of your boss. So what elements is that supplier using and how?

AD : Yeah, we're going to break this down kind of by statement, it's one of the reasons that I, I do like email negotiations, because it's easy to do this. But if you're, if you're a good negotiator, you're going to be really good listener and so you're going to be able to pull apart the statements. And the statement they start with is, well: my best offer is 5%, that's clearly a commitment, they're trying to lock into a single position and everything they do from here on out is going to be trying to support that, when they tell our listener that no customer, even the government gets more than that. Well, that's the element of legitimacy. Although it's somewhat a fuzzy, one sided standard -- that they're really just using to defend their 5% position. The statement: I'm only doing this is a favor to you, because I like you -- is a clear manipulation of the relationship -- it's to gain a concession from our listener. And then finally, when the other party reminds our listener of the relationship between the two bosses, kind of hinting that if this thing needs to escalate, because you won't agree with me, that sounds like a subtle use of alternatives, and the counterpart is, you know, subtly educating our listener on why agreement is a good idea.

NM : Okay, so I think I counted four different things there. So is that what you got?

AD : Yeah.

NM : Now, is that out of sophistication? Was he trying to -- was that a very sophisticated response. Doesn't really sound like it necessarily was.

AD : I mean, it isn't, it isn't. I mean, I think all four elements are there. And I would say it isn't because again, as I said, the beginning, the focus is really on, what can I do to defend that position of 5% and so that's where they're really fixated and they're just using some other elements to support that.

NM : So why would the supplier kind of take, why would he kind of be negotiating that way?

AD : Yeah, that's a great question. I often like to consider why the other party is using the elements in the way that they’re using them and I try to come up with some guesses and if I've worked with this person before, it's a little easier, but I can brainstorm and I can say, well, maybe it's the only thing they know, right? Maybe it's just how they think the game is supposed to be played, right? Maybe this is what they think how you're supposed to do procurement. Maybe it's what's worked for them in the past. Or maybe they think this is a way to appear very friendly, while not having to compromise on anything. I also like to encourage and I would encourage our listeners to think for a moment. Is it possible that I've contributed to this behavior in the past, rewarded in the past? And, you know, maybe I have some responsibility too, I think it's really important to ask the why question that you're asking Nolan.

NM : Yeah. So you've looked at what elements the other person is using, how they're using them, and why they may be negotiating that way. Then what? How does this translate into some sort of action?

AD : Yeah, so now we're going to go back to those seven elements again; those seven levers of negotiation. And with our measure of success, our goal clearly in mind, we're going to have some choices about what to do next. So the first possibility is to use the elements that they're using, and just use them in a more constructive way, and this often works, because it's meeting our counterpart, where they are so to speak.

NM : Could you give us some examples from the listener scenario?

AD : Sure. So our listeners’ suppliers clearly hung up on commitment, right? So I might start by testing their authority to go beyond 5%. I might also suggest, what would it look like to trade an immediate agreement to buy, which is making the commitment, which seems to be what they want, for an immediate 10% discount, okay, which would be another commitment. They're also sharing a one sided standard of legitimacy, so I might ask the question, so tell me what other customers get 5%? Has there ever been an example or an exception where someone has gotten more than 5%? You know, is this a hard and fast rule? And I might share anything I know about times, places, other examples where greater discounts have been authorized. And then around the alternatives piece, I think I would, I would probably minimize the alternatives by you know, one, reality testing -- what it looks like if we have to escalate; and then two -- just sharing that, you know, I've talked to my boss, and we're in agreement on this, and I'm actually, this is an important metric for us; so, I mean, if you need to go that path, but you know, know that I've already talked to my boss. So those would be some ways to meet them where they are using the same elements.

NM : No, I love it, keep going, what additional moves you got.

AD : So the next thing would be to consider reframing the conversation to elements that aren't currently in play elements that they're not using. So I might ask a question about, you know, how does the discount impact the supplier in their company? Is it tied to a performance metric for the supplier? How does it impact their margin and so on, these are really, you know, this is kind of reframing it to the element of interests I might get, try getting creative, and brainstorming some other deal structures, bring some other ideas to the table, ask them to criticize to add, not make a commitment, but just tell me what would be wrong with any of these and invite them to bring some different ideas to the table as well. There might be some volume trade-offs, there may be some issues around speed, flexibility, quality, control, warranties, and so on, we can discuss, and then, you know, I might try to understand their supply chain issues and see if there's a place where I can assist with that as well. So this is a lot, a lot of ideas around bringing options to the table.

NM : So it sounds like those first two moves are kind of meeting them where they are. And the other one is kind of moving to a different element. Do you find those to be powerful?

AD : I do. Yeah, I do. And I spend a lot of time when I work with clients and students kind of focused on those pieces. And obviously, I just shared a couple examples of how we could reframe to other elements; we certainly could reframe to process pieces around communication, asking different questions; there's other things we do. The key is to be patient and persistent as you attempt to try this and not expect that you're going to change them immediately. So again, effort, persistence is really key. There are a few other things you can do, if you're not finding success with those first two moves, you can always name their game and you can call out the limitations of negotiating this way to both of us, there's often costs or maybe a better way to negotiate, maybe we should consider negotiating how we're going to negotiate. You can choose to play their game -- some people just want to play a game just for the fun of playing it; but you're if you're going to do that, you're going to have to negotiate their game better, so it's a little higher risk. They're choosing to play this game, because they feel pretty comfortable with it. You can always change the player, she can say, hey, there are people we should bring in -- should we escalate, right? Maybe there's too many players? Should we reduce the number of people at the table? And then you can always consider you're going to your BATNA, right you always have your BATNA, whether that is a micro BATNA, walking away today, planning to come back at another time, or it's a macro BATNA, which is actually going to another supplier, handling it internally or so on.

NM : So that really supports what we've said before about maintaining your choices during a negotiation, which we see is essential and being able to elevate your influence through purposeful negotiation. So, Aram -- on the topic of dealing with a difficult counterpart, any additional advice that we didn't cover yet?

AD : Hey, sure, just a few things. First of all, don't get discouraged if it takes some time. Be persistent, remain positive, try some different moves, recognize that you're unlikely to change somebody overnight, especially if this is a way they've been negotiating for some time; number two, get really well prepared Louis Pasteur said “chance favors the prepared mind” -- I love that quote.The better prepared you are, the more readily you'll be able to handle changes but to be flexible, so maybe consider using the prep sheet from negotiatex.com, and see if that helps you when you face unexpected things in the negotiation. And then three, never reward bad behavior, stay focused on what your measure of success is, you might have to adjust how you achieve it, but you shouldn't have to compromise it just because the other party is using some sort of difficult tactic or dirty trick. And to that point, be willing to negotiate explicitly over the, you know, behaviors and process choices that both parties are making.

NM : Yeah, thanks, Aram, I think that this is pretty powerful. And for the audience, you can kind of see the value that Aram's able to provide when you're able to, you know, bring up a specific situation that you face, this kind of goes on to our one on one consulting that we're able to do, so if you're interested in something like this, you can see our services that we offer and negotiate.com and we can get scheduled for one on one consulting. So this is a podcast that is all about taking action. Basically, we're looking to deliver value to your business, organization and life. So with that, Aram, can we share some key takeaways for our listeners?

AD : Yeah, Nolan, let me do something different today, and maybe just share a story by way of wrap up instead, that I think our listeners will find impactful. A number of years ago, when I was teaching at West Point, we launched an annual West Point negotiation conference invited students from different schools to come and participate, to learn more about negotiation and we would bring back a panel of graduate students who had been in the course of the negotiation course, and then gone on deployed into different situations, then able to put the tools in the practice. And during one of those panels, we had a young student, his name was Daniel and Daniel shared the following story, and this is just, I think this is a wonderful story about the discipline it takes to deal with difficult tactics, and this is really the ultimate difficult tactic, which will really, most of the challenges we face fails in comparison to this. So Daniel said he was on a patrol while deployed to go meet with a local village elder and this was a really important meeting that would set the tone for actions they would take in his area of operations, for the remainder of the deployment, different plans were going to be made and timings and so forth. And as he's on his way to that meeting, a call comes across the radio that says that tells Daniel that his best friend has just been killed, a fellow platoon leader has just been killed in an IED accident, or incident. And so Daniel just feels the wave of emotion, he gets a second call that says: we don't know this to be true, but we have reason to believe – the person you're going to meet with, well, not directly involved, may have had knowledge of it, okay? Now he's dealing with even like some, some anger, too. And then he's told he needs to continue to keep on this, this mission. And he will say that in the moment, there was all this desire to kind of react to what was happening. And it was everything he could do to step back, step to the balcony, pause for a moment, and say, I know what our goal is, I know what I need to do, I need to shape this conversation in a constructive way and achieve my aims. And that's what he was able to do. He was able to go in, he was able to problem-solve with his village elder, he was able to get some commitments that they were able to follow through, and he was able to be very successful. So I share that because none of us are probably likely to ever face that exact dynamic. It's pretty powerful. And I think it's an example for the ability, the importance of being disciplined and intentional and purposive, in our negotiations.

NM : Yeah, I think that's a great example. And I also want to thank Daniel for sharing that story. I know it's pretty difficult for him to do that. So with that, my kind of takeaway is for the listeners to help us out, head over to Apple podcasts or wherever you listen to podcast give us a five star rating, and leave us a review. It really helps us out and be able to grow the podcast, we've already been growing and getting this out into the, to the right hands of negotiators that are trying to improve their game. So just do that for us. We'd really appreciate it. So in closing, that's all for us on today's episode. We hope that you enjoyed it. If you have any questions or you want us to cover something like this in a future podcast show, just shoot us an email at team@negotiatex.com, we will try to cover in future episodes. We will see you in the next episode.