Their are very few management books which focus on the art of negotion. I have been reading this book since past week and it made me revisit the book several times.
So, talks aside here is the complete book review along with my notes which provides a complete summary about the book:
Start With No – The Negotiating Tools That The Pros Don’t Want You To Know by Jim Camp
JIM CAMP is the founder of Coach2100 Inc., a coaching clinic for senior business managers and teams. He currently serves as a negotiation coach and runs negotiating clinics and group coaching sessions for more than 150 corporations – including Motorola, Texas Instruments, Merrill Lynch, IBM, and Prudential Insurance. Mr. Camp has experience in negotiation strategies in a wide variety of industries including telecommunications, real estate, investment banking, healthcare, import/export, automotive sales, manufacturing, scientific research, and government administration.
His website for this book: www.startwithno.com
So, Main Idea about this book:
“We’re all professional negotiators. Most of us don’t think of ourselves that way, but we’re all trying to make agreements every day. We’re negotiating. Some of us do so haphazardly, maybe even lackadaisically, while some of us realize that since we’re always negotiating, the more skillfully we do so, the better off we’ll be.”
– Jim Camp
For many years now, “win-win” has been held up as the ideal to aim for in any negotiation. Why? Probably because win-win has always been considered to be the fairest way to do business. But what happens if the other party in a negotiation are simply using our desire to think win-win to get us to agree to unnecessary compromises? In those circumstances, the negotiation often ends up as win-lose, with us on the wrong side of the ledger.
With that in mind, the way to become better at negotiating is to distinguish between what you can control and what you can’t. Win-win is an outcome, and the outcome is beyond your direct control for a host of various reasons. In any negotiation, the only thing you can control is the means by which the outcome is decided. So focus on your behavior and actions, and let the end result take care of itself instead of endlessly obsessing over win-win scenarios.
Good negotiators also do something that appears counterintuitive at first glance. They begin with “no”. In other words, they start out by giving the other person an opportunity to say no right at the outset. Doing that relieves the pressure and allows the other person to think more rationally which, in turn, increases the chances something worthwhile will result from the negotiation. And professional negotiators constantly remind the other party they have the absolute right to veto the deal at any point. By consciously and deliberately allowing the other party to feel more in control, the chances of a favorable outcome increase.
Always keep in mind negotiations are complicated simply because humans are involved. Every negotiation will be different. The path to becoming a better negotiator is rarely straight and will often require many detours and most certainly loads of discipline on your part. Fortunately, however, the rewards which come with being a more competent negotiator are well worth the effort. As long as you keep working at it, eventually you’ll reach a stage where negotiation becomes easy to do. And at that point, you can start approaching your true potential in business.
1. Why “Win-Win” is the Wrong Approach in Negotiations
The prevailing paradigm in negotiations is to structure “Win-Win” deals. Yet these are only possible when both parties are equal – which is very rare. Instead, experienced negotiators use the context of structuring a win-win deal to get the other party to make more and more concessions. Don’t fall for it. Instead, stay focused on getting the best deal you can, even if it means saying no to lesser deals and offers.
In most real world negotiations, deals that start out as win-win in theory end up becoming win-lose in reality. Why?
Win-win sounds fair, but it can only be achieved if both parties are negotiating in good faith and laying all their cards on the table. If that does not happen, it is almost inevitable one party or the other will skew the deal in their own favor.
Win-win is defeatist right from the outset. It encourages people to make unnecessary compromises in the pursuit of being “nice” to the other side.
Win-win is an emotion based strategy – it plays to the heart on the basis the world will become a “better place” if everyone thinks and acts win-win. Good negotiations, however, are decision based. They evaluate agreements on definitive principles rather than emotions.
Win-win implicitly urges negotiators to get to an agreement as quickly as possible, even if that means giving away more than is needed. From the viewpoint of getting the best possible deal, that’s undesirable.
Professional negotiators use win-win as an implicit invitation to demand the other party makes compromises. They will even suggest collective bargaining. All of this is intended to do just one thing – to signal to the other side that if they want to do the deal, they’d better be willing to give up something. And making that suggestion alone can actually change the balance of power in the negotiations.
In essence, when you think win-win, you set yourself up to make compromises before it is certain they are needed. You enter into a negotiation with a defeatist mind-set which states before this deal can be completed, you’ll have to make numerous concessions. And thus, you’ll most often find what you had hoped will be a win-win agreement ends up becoming win-lose with you on the wrong side of the equation.
Your greatest weakness, when negotiating, is how much you need to do a deal. The more you need to get the deal done, the weaker your negotiating position is. And conversely, the less any specific deal means to you, the better you’ll be positioned to negotiate a deal which is in your favor. Thus, the first rule in becoming a better negotiator is to overcome your neediness.
In business, neediness comes in many different varieties:
- In Western cultures, most people think of themselves as buyers. Therefore, when they need to act as sellers, they feel like the dependent party. And to overcome that poor self-image, they are prepared to give things away or compromise.
- Small businesses always tend to feel like they are more needy than large corporations who can pull off large mega-deals. Negotiators use this perceived imbalance to extract more and more concessions from the small business, more than they need to give.
- People who like to talk a lot need to feel important and to show that they know it all. A good negotiator will feed that need for recognition while structuring a deal which extracts as many compromises as possible.
- Those with a fear of rejection need to be liked. They try and deal with logical issues at an emotional level instead of maintaining a balanced perspective.
A good negotiator understands the other party cannot reject them personally. The worst they can do is to say no to the proposed deal. Therefore, they don’t worry about being liked, thought of as smart or important. Instead, a good negotiator spends energy on the task at hand – putting together the best business deal possible. And if any particular deal doesn’t come together, a good negotiator doesn’t lose sleep over it. He or she knows there will be many more opportunities to put deals together with others in the future.
The key point is that when you try too hard or too quickly to close any specific deal, you show your hand. You show that you need to do this deal, for one reason or another. And that need, in turn, signals to the other party they should look closely for more concessions to extract from you. Therefore, to become a better negotiator, avoid showing your need to do a deal. Keep reminding yourself of the difference between needs and wants.
Also, constantly remind yourself that if any one deal does not come together as planned, there’s always tomorrow and more deals to do with other people. Never show that you need a deal, only that you want to put something good together.
“What is the poison that resides at the heart of the big lie that is win-win? It’s called compromise. Many negotiators play the win-win game with an implicit invitation to debilitating early compromise on the part of their unwary adversaries, who are, in turn, almost programmed into this fatal mistake by the mantra of win-win. Those smooth talking negotiators don’t compromise, but they demand you do.(In the case of corporate purchasing departments, I guess their compromise is that they’re buying from you instead of from someone else). And all the while, they put the happy face on their negotiations. Negotiating under the banner of win-win, you’ll have no way of knowing if you’ve made good and necessary decisions leading up to the compromise.” – Jim Camp
“Whether we like it or not, it really is a jungle out there in the world of business, and it’s crawling with predators. To dance well – to negotiate well – we must hear the music, we must feel the music, we must be tuned into our adversary at all times, we must follow carefully established steps with discipline.” – Jim Camp
“As a negotiator aspiring to excellence, you must, at all costs, avoid showing need. In order to avoid showing need, you must never feel it. You do not need this deal. But what happens if we simply substitute the word and the emotion ‘want’ for ‘need’? The dynamics change. What picture comes to mind when you read the words ‘I want’? I see a bright red Porsche convertible, with a black top and interior. What is your picture? As good negotiators, the word ‘want’ means something we work for, strive for, plan for, but is never confused with ‘need’. Sure I want this global alliance with Humongous Inc. but I don’t need it. I want the car, but I don’t need it. ‘Need’ is death, ‘want’ is life. Believe me, this different attitude will be instantly perceived by the folks on the other side of the table. Confidence and trust go up across the board. Control and discipline go up for you.” – Jim Camp
2. Why Good Negotiations Always Start With “No”
To become a better negotiator, establish right at the outset you’re prepared to accept a “no” answer to everything you propose. Not only will this clear the air but it will also let everyone else relax and look at things more realistically. It will also signal to a shrewd adversary that you aren’t prepared to give away the entire farm in pursuit of the mythical win-win deal. Saying no right at the outset lays the foundation for a good negotiation.
The worst possible outcome for any negotiation is to end up with “maybe”. When you say maybe, neither party knows where things stand. It muddies the water on where you should go from here, and is the kiss of death for successful negotiations. In fact, if you cannot progress them past the maybe stage, you should cut your losses early and move on to the next negotiation because this one is going nowhere.
Good negotiators don’t fear the word “no”. Just the opposite, in fact. Effective negotiators invite their prospects to say no many times, predominantly because they understand every no is reversible. Therefore, they don’t take no personally.
Specifically, the best negotiators:
- Make it as clear as possible to the other party that saying no is perfectly acceptable at any time.
- Expect people to say no at first – and therefore the sooner the other party says no, the better.
- Invite the prospect to say no frequently right from the very start of the negotiation.
- Understand that until the other party says no, they will feel loads of emotional pressure. As soon as they give a negative response, that pressure is lifted – allowing the real negotiation to move forward much faster.
- Use phrases like: “You know, I’m not sure that what I have to offer will fit your circumstances, so if this doesn’t make good sense to you, just let me know and I’ll leave you alone. Is that okay with you?”
- Don’t worry about trying to save a relationship with the other party. Instead, good negotiators provide the other party numerous opportunities to say no at any point during the negotiation – and then let the other person be responsible for the consequences.
- Aren’t interested in friendship, only in respect – for the value they can deliver with the products and services on offer.
- Help others overcome their natural fear of being wrong by allowing them to change their mind and do an about-face at any point rather than persevere with a bad decision.
The ideal paradigm for this principle comes not from the world of business but from an old TV series Columbo. In this show, Columbo was a disheveled homicide detective who constantly forgot to ask the key question in an interview. Then he would have to ring the doorbell again, apologize and ask one final question which got to the heart of the investigation. The criminals always felt superior to him, dropped their guards and said more than they should allowing Columbo to piece everything together time and again.
The point is good negotiators, like Columbo, consistently make the other party feel like they are in control of the negotiation. The most direct way to achieve this is to create opportunities for the other person to say no. The fact these opportunities are available allows the other party to relax more and think rationally rather than emotionally. That relaxation effect then has flow-on benefits that the other person in the negotiation will then be more likely to move forward because it will be on terms and conditions they dictate rather than vice-versa.
This Columbo-inspired approach can even work when a business needs to renegotiate a bad deal. You can call the other party and say something like: “Your team has done such a great job negotiating this contract that we are now in a very poor financial position. Clearly, you guys are very good negotiators and we are not. We apologize for that, and for putting you in a terrible position. We’re very sorry, but we will be unable to stay in business if this contract remains in place. We take full responsibility for our ineptness in this area.” With that, you’ll lay the groundwork for a serious renegotiation of the existing contractual arrangements.
In summary, when negotiating, it’s good to be a little less okay than your adversary. Put them in the position of power. Give them every opportunity to say no. Display a little ineptness. You’ll be amazed at how much better the negotiation will flow when the other party feels superior to you.
“In a negotiation, decisions are 100-percent emotional. Yes, 100-percent. Research psychologists have proved this beyond any doubt. Our so-called rational minds kick in only after we’ve made the decision, in order to justify it after the fact. Your job as a negotiator is to see emotions clearly and overcome them with precise decision making. Your job is even to use emotions to your advantage with precise decision making.” – Jim Camp
“I like to provoke new clients and folks in seminars and workshops by stating the best ‘yes’ in a negotiation is by way of ‘no’. The negotiation really does start with ‘no’ – not with ‘maybe’, definitely not with ‘yes’, but with a firm, clear ‘no’. In any negotiation, this is the key word I want to hear. Everything that precedes it is mere window dressing. How can this be? Because ‘no’ is a real decision that induces the party across the table into actually thinking about why they’ve just said ‘no’. The responsibility of making a clear decision helps the adversary focus on the real issues of the negotiation.” – Jim Camp
“I cannot emphasize this point too strongly: ‘Maybe’ is the kiss of death for a successful negotiation. If you can’t quickly get past ‘maybe’ – and it comes in infinite varieties, of course – start walking, because you’re wasting your time (especially when dealing with the Japanese, who will drive the untrained negotiator crazy with ‘maybe’).” – Jim Camp
“The trained negotiator is more than happy to let the adversary show off in almost any way he wants to, because the adversary’s greatest strength will eventually become his greatest weakness.” – Jim Camp
“The study and practice of negotiation is extraordinarily complicated. Every negotiation is different, and every human being is a handful, so to speak. How long before you feel a lot more comfortable about negotiating that you feel right now? It could be six months, it could be longer. It depends on your native talent and how hard you work. All I know is this: Every day, you’ll become a better negotiator than you were yesterday and one day you’ll start to achieve at a level approaching your potential.” – Jim Camp
3. The Camp Negotiating Tactics for Getting to “Yes”
The Camp Negotiating Tactics #1
Know your mission & purpose
To negotiate effectively, you have to be able to make good decisions yourself. The only way to do that – especially in protracted negotiations – is to specify your mission and purpose. Quite simply, a good negotiation will serve your mission and purpose whereas a bad negotiation will not. Understanding your mission and purpose is the very essence of success in negotiations.
A valid mission and purpose:
- Will be expressed from the perspective of the most important constituents – for example, from the customer’s perspective for a business or from the perspective of the team sitting across the table for a negotiator.
- Will avoid false assumptions – which can creep in and color every negotiation.
- Expresses what you want to accomplish and how you want to achieve that.
- Creates in the other party to the negotiation a vision that will move them to take action.
- Needs to be committed to writing – in order to make it stronger, avoid ambiguities and reinforce commitment.
- Must be adaptable – and able to be changed as circumstances dictate or demand.
- Will help you understand what it is you really do.
For example, consider a company which has entered into a unsatisfactory supply contract which requires them to deliver products priced at below-cost levels. Their mission and purpose in renegotiating that contract will not be: “To return to profitability”. Instead, their mission and purpose will be: “To help our customer’s management see us as a new and revitalized organization which is a strategic asset to them”.
“You must continually analyze and ask yourself: What is my business? What is my mission? What is my purpose? As you set a valid mission and purpose in place, you will discover that the picture of what you are trying to accomplish becomes crystal clear and you eliminate all confusion. As a negotiator, once you have a mission and purpose you can control your emotions, you can make effective decisions. If every decision you make – even one that doesn’t turn out well – is in the service of a sound mission and purpose, you cannot go wrong, not in the long run.” – Jim Camp
“Winning isn’t everything, but the will to prepare to win is everything.” – Vince Lombardi
“Your adversary in any negotiation must have vision before they will ever take action. I’ve said it before, I’ll say it again: no vision, no action. No vision, no decision. No vision, no deal that sticks. This is Human Nature 101.” – Jim Camp
“Sure, win-win sounds good. That’s exactly why it’s so dangerous and why you have to be so careful.” – Jim Camp
The Camp Negotiating Tactics # 2
Focus on your behavior, not the outcome
Too many aspiring negotiators make the mistake of focusing on what they cannot control – the outcome of the negotiation – rather than what they can control – their own behavior and actions. Never fall into that trap. Set goals only in the one area you can have any lasting influence – how you as a negotiator act.
The wisdom of setting goals to control what you can control and forgetting everything else may seem obvious but very few people do this in practice. If you try and set goals in areas over which you have little or no control, all you end up doing is adding to your personal frustration levels.
In other words, think behavior and forget results. Or to use a golfing analogy, concentrate on putting a good swing on the ball each shot you take rather than breaking par for the hole. In genuine negotiations, the other party always has the right to say “no” irrespective of whether you agree with their reasons for doing so or not.
Successful negotiators work hard to increase the amount of time spent on activities that relate directly to the negotiation at hand rather than administrative tasks that support those negotiations. They try and act as far as possible in a disciplined, systematic way rather than chasing vague dreams of huge deals. One effective way to become better at this is to keep a written daily record which identifies their strengths and highlights their weaknesses. This regular self-examination and assessment allows them to monitor their behavior and emotions, and to track their impact on the results they achieve. Weaknesses are pinpointed, strengths are identified for further work in the future and self-esteem grows as a rigorous daily record is kept. The discipline of doing this also encourages the person to think about how their time is used.
“Say you’re a salesperson and you’ve ‘got your number’ for the week, and it’s only Wednesday. You might be tempted to think, ‘Man, I’m great. I can kick back and relax now for the rest of the week’. See the problem? Worse, what if you don’t have your number toward the end of the week? You tend to work harder, not smarter, all in the service of what’s not valid anyway. You end up working on the wrong problem or with the wrong activities and habits and dig a deeper hole. And if you’re into the win-win thing, you very likely end up making a classic win-win mistake: the unnecessary compromise in the course of chasing an invalid goal. That’s a killer.” – Jim Camp
“If I were a beginner in the study of decision-based negotiation (as opposed to emotion- and compromise-based negotiation), my initial goals would be to focus at all times on my mission and purpose, to control my neediness and never demonstrate neediness, to always allow my adversary to be okay, to have no fear of saying or hearing ‘no’. Right there you have four very straightforward, obtainable, valid goals that, if carefully followed, would make you an excellent negotiator relative to the field. But the real point I want to get across here is the distinction between a goal and a result (or an objective as it is commonly labeled). Goals you can control, objectives you cannot. By following your behavioral goals, you get to your objectives.” – Jim Camp
“Think behavior, forget results.” – Jim Camp
The Camp Negotiating Tactics #3
Ask good questions
Good questions are the single most important fuel of the Camp negotiating system. To become a better negotiator, you must increase your ability to ask good questions.
Most people like to appear smart, and the best way to look smart is to answer the questions other people ask. Good negotiators, by contrast, ask good questions so as to learn about the world where the other person lives.
- Serve as a catalyst – encouraging the other person to think about their own vision and to make a decision.
- Are short – no more than nine or ten words.
- Come one at a time – so each point discussed can be absorbed and considered.
Asking good questions is actually part science and part art form. The science comes in how the questions are framed. The art is found in how you actually ask the question: your tone of voice, your choice of words, your behavior when you hear their response and so on.
From a negotiation perspective, probably the most useful questions are led by an interrogative (who, what, when, where, why, how, which):
“What is the biggest issue we face?”
“How can I tighten up the terms of this proposal for you?”
“When should we bring your subordinates into the loop?”
“How important are the delivery dates we have discussed?”
“What are your thoughts?”
“What price would represent better value in your mind?”
“How would this technology help you stay competitive in your line of business?”
Note interrogative questions are designed to provide you with some useful information. They cannot be answered with a simple “Yes”, “No” or “Maybe”. They also are framed as an attempt to understand what the other person is thinking rather than an attempt to trick them. And most of all, interrogative questions get the other party talking. That gives you an opportunity to pick up some insight that may help.
“My clients really do live and die – mostly live, mostly thrive – by asking interrogative-led questions. One client was recently brought into a negotiation with a large multinational to be the competitive vendor for a primary vendor. We understood this was to be the dynamic and accepted it, and we also knew that the primary vendor would have a powerful constituency within the multinational’s own middle management, because some such liaison is almost a given. We therefore framed the following question to the CEO: ‘How do we keep our efforts from being sabotaged by someone within your company who’s responsible for the competitor’s success?’ In this instance, the answer was the CEO’s instruction to the in-house spear-carrier for the primary vendor to be certain that my client’s efforts came to fruition. The man’s annual bonus now depended on it. ” – Jim Camp
“No vision, no decision? Of course. And now I add, no interrogative-led questions, no vision, no decision.” – Jim Camp
The Camp Negotiating Tactics # 4
Have no preconceptions
Two things that can stop negotiations dead in their tracks are expectations and assumptions. Successful negotiators avoid both – by creating a mental “blank state”. Doing this consistently enables the negotiator to learn what’s really going on in this negotiation – what’s holding things up.
What’s the problem with expectations and assumptions?
- If a negotiator has positive expectations an agreement is imminent, they can get suckered into offering an outlandish discount just to help the deal move forwards. Then, when the promised volume gets watered down, the customer will still expect that unreasonably low price to be available.
- Similarly, if a negotiator has negative expectations (a string of negotiations which led nowhere perhaps), the natural tendency is to try and buy their way out of a slump and create some forward momentum by coming down in price further than they should.
- In a similar vein, assumptions are dangerous. They cause people to move in the wrong direction all the time, and expend effort in areas that are unrelated to the business at hand.
In-depth research of the facts can overcome the inherent problems with expectations and assumptions but most people aren’t in the habit of doing much basic research. With that in mind, a more accessible tool is to take great notes about what the other person says. This is very simple. As they say something, write it down in your notes. That alone will enhance your focus on what is being discussed. In any negotiation, the most successful negotiators block out their own thoughts and concentrate on what the other person has to say. Taking notes helps you do that. It also helps you make the distinction between what’s being said and what they mean.
By taking notes:
- You end up doing less talking – which is good.
- You are forced to listen to what the other person has to say – which is what you want.
- You relax a little more – which helps you make less emotional and more rational decisions.
- You have a permanent record of the key points agreed to.
- There is less chance you’ll blurt out something useless – like a price concession.
- You will have less opportunity to spill the beans – about your internal cost structure.
- You become less likely to fall for traps – like promises of future global alliances or huge pending purchases.
Not only are the best negotiators good note takers, they also have a blank mental state. In other words, they consciously play a mind game to rid themselves of expectations, needs, fears and assumptions. They do this by visualizing a scene from nature that is inspiring – like a sunrise – or by reliving a pleasant experience from their past – like a sporting success while growing up. Revisiting those scenes mentally before a negotiation clears their minds, allowing them to treat the facts as they are presented rather than the way they hope to find them. Creating a blank mental state is a tremendous advantage for professional negotiators and it is something aspiring negotiators can work on.
The Camp Negotiating Tactics # 5
Identify the key pain point
As a negotiator, you need to have a clear vision of what the other parties real problem is, where they feel pain. Until you find that hot button, you’re just stabbing in the dark. Once you know where their pain point is, you then have precisely what you need to move forward – a way to structure your product or service as a way to alleviate their current or future pain.
Most people in a negotiation won’t tell you right away what’s causing them pain. Instead, you’ll have to do a little digging, a little detective work. Your objective here is to uncover their pain and then paint it as clearly as possible for them so they become motivated to action.
It’s only natural that most people will be reluctant to discuss what causes them pain. So how do you do that?
- Create a nurturing climate – where the pain will be discussed empathetically in an attempt to develop a solution rather than off-handedly and casually, or even worse, where the other party will try to take advantage of them because of that pain. For example, you might say: “OK folks, now I ask you to be a little patient with me here. Maybe I misunderstand the situation, and everything I say may be wide of the mark, but with your permission, I’d like to tell you what I see here. Maybe by working together, we can come up with something that makes sense.”
- Give the client permission to say “No” – and let them correct your analysis of where their pain point is.
- Show genuine empathy – by putting yourself in their position.
- Remember you’re trying to uncover the pain that already exists, not create more pain for the other party.
- Keep reminding yourself you’re really not trying to tell the other party anything – rather you’re trying to see things from the same perspective they already use to identify their needs.
Bottom line, helping the other party in a negotiation paint their pain is an art the skilled negotiator develops. Good negotiators don’t try and save or browbeat their adversaries. Nor do they try and overpower them intellectually. In fact, if they are excessively positive or too negative, it can be detrimental to the negotiation process. What’s needed most is a simple painting of the pain the other party currently experiences. Uncover those genuine pain points and the negotiation will move forward quickly.
“Your greatest strength is your greatest weakness.” – Emerson
“The clearer your adversary’s vision of his pain, the easier the decision-making process.” – Jim Camp
“The vision has to be clear, but so does the solution you offer. You must not frighten or anger the adversary, you can’t appear to be lauding it over your adversary, you must nurture at all times. Painting the pain is one of the real arts of negotiation. You must wield the brush with the touch of an Old Master.” – Jim Camp
“Pain is whatever the negotiator sees as the current or future problem. People make decisions in order to alleviate and take away this current or future problem – the pain. Put in these terms, what else would any negotiation concern?” – Jim Camp
The Camp Negotiating Tactics # 6
Build Your Budget
The “budget” in any negotiation is more than just money. The real budget has three components: time-and-energy, money and emotional investment. And not all of these factors are of equal importance – if time has a value of x, then energy will be calculated as 2x, money as 3x and emotion as 4x.Your job as a negotiator is to be certain you know both your own real budget and that of the other party.
Budget is the way you keep track of the real price of any negotiation, which goes way beyond just dollars and cents. The basic principle, naturally, is to keep your own budget as low as possible and the other party’s budget as high as feasible.
A real budget has three components:
1. Time-and-energy budget
Everyone has the same number of hours in the day. The challenge in business is to use those hours as productively as possible, and ideally more productively than competitors. In any negotiation, the value of the other person’s time and energy must be taken into account. Many negotiators try and get the other party to invest so much time in the process they feel pressured to come up with something that justifies their investment. Be aware, however, that is a two-way street. Great negotiators are careful about maximizing the value of their time just as deliberately. Building the other party’s time-and-energy budget is a way skilled negotiators get them to focus their attention. Time can intensify pain quite vividly, and the thought of wasting energy can be a powerful motivator to act. Good negotiators build the time-and-energy budgets of the other party constantly.
2. Money budget
Money is relative. The same given sum will mean different things to different people. Successful negotiators understand the other party’s frame of reference and then try everything available to drive up their money budget during a negotiation. That encourages the other party to make a compromise to get the deal done before it gets more expensive. Professional negotiators assess their own and the other party’s money budgets at regular intervals.
3. Emotions budget
Emotions have the highest value of all in any negotiation. When emotional pain is involved, the value of the negotiation increases by many multiples. For most people, any decisions about money are highly emotions driven. Quite simply, it comes down to the “thrill of victory” vs. the “pain of defeat”. Good negotiators find ways to build their adversary’s emotional budget during a negotiation. Similarly, the other party will do the same – with threats, promises, outlandish requests, arbitrary deadlines, exclamations the deal is dead in the water and so forth. Whoever manages to keep their emotional budget in control is positioned to extract a better deal from the other party in the negotiation.
“Know your budget. Control your budget. Know their budget. Build their budget. These rules apply for time-and-energy, for money, for emotions. When you master them, you really can’t fail. You must not expect to manage the actual wins and losses, because you can’t do this. You can only manage the means to the end: stay within your system, manage your activity, manage your behavior. This is all the armor you need.” – Jim Camp
The Camp Negotiating Tactics # 7
Negotiate with the real decision makers
It’s critically important that you know who’s actually calling the shots and making a decision for the other party in any negotiation. Why? Mainly because until you know who the key decision makers are, it will be impossible for you to paint the pain effectively.
If you don’t get to know your opponent’s decision-making process right at the outset, you hand them a golden opportunity to drive up your time-and-energy, money and emotion budgets.
And just to make things more interesting, the bigger the organization you’re negotiating with, the more complex and confusing their internal decision making process is likely to be. Many times, even they won’t really be clear about who will make the final decision within their own organization. To move things forward, you will need to help them sort that matter out.
So how do you actually do that? There’s usually no simple answer, but a starting point would be to ask some pertinent questions:
- “Of course, I understand you make the decisions. But who else is there you might want to talk with about this offer?”
- “Who else in your organization do we need to get on-board with this before we can move ahead?”
- “Who in your organization would be upset if they were left out of the loop on this decision?”
- “How will a decision be reached on this – and what paperwork needs to be in place first?”
As a rule-of-thumb, there will generally be multiple decision makers. Your job will be to unearth them and negotiate with each and every one of them. You never know who will hold the veto power. In some organizations, even the janitors can nix a proposed deal if it affects their schedule and the work they do, so be inclusive rather than exclusive while considering the decision makers.
Along the way, you’ll come across “blockers” – people in the other organization who specialize in telling you they are the decision makers when in reality they have nothing to do with it.
These may be receptionists or secretaries who won’t give you an appointment with their boss. Or they may be the people who handle the paperwork for the decision makers. Or they may the purchasing department. To deal with blockers:
- Try starting at the top – and approach the CEO. If he has the time to talk with you, the usual blockers will respect that and do likewise.
- Feed the blocker’s ego – by telling him you’re happy to get his okay first before making a presentation to the key decision makers so long as you make that presentation to the key decision makers in person. Then go ahead and make your full presentation. Sell the blocker on the idea first, and enlist the blocker as your ally in figuring out how to sell the real decision makers.
- Coach the blocker – by telling him the points he needs to present to the key decision maker for them to understand the proposal. Offer to wait in the hall or in their office while he or she makes the presentation in case there are questions that arise. This option gives you a chance to build the blocker’s role in the entire process so if the decision works out well, they will be positioned to take all the credit.
The Camp Negotiating Tactics # 8
Stick to your agenda
Every negotiation needs an agenda if it is to stay on track. By crafting and negotiating the agenda, you gain an accurate picture of where you presently stand. By putting the agenda into action, you work to improve your standing over time.
A good negotiation agenda will cover five basic categories:
1. Problems – Anything, real or imaginary, which stands in the way of reaching an agreement right here and now. This covers the entire spectrum from a bad reputation to misunderstandings. Unless you get the problems out in the open, they will fester away in the background and stop the deal from coming together.
2. Our baggage – The assumptions we are making about the other party to the negotiation. These will usually be based on either our experience or the experiences we’ve heard others have had. Again, unless these assumptions are openly placed on the table for discussion, there will be problems in moving forward.
3. Their baggage – The assumptions the other party in the negotiation makes about us. Often, there will be numerous unstated feelings – they may see you as too inexperienced, overconfident, too big or too small. The issue isn’t whether or not their fears are valid. The key here is to get everything out in the open so it can be dealt with.
4. What we want – If a negotiator doesn’t know exactly what they want, then it’s little wonder the other party will be a little fuzzy about where everything is heading as well. The basic principle is if you don’t ask for something, you put yourself at the mercy of the other party who are then free to do whatever they decide. Thus, wants must be explicitly and unambiguously spelled out every step of the way. Be specific. Make your goals clear and concise about how to put together a deal that will stick. Usually wants start out as rather broad in the early stages of a negotiation and keep getting better focused until by the time the agreement is finalized, everyone knows precisely what everyone else is after. At the end of the negotiation, you’ll want (and need) a decision to be reached.
5. What needs to happen next – This specifies what both parties will do to follow-up on the negotiation. If you fail to specify this, your proposal will get lost in the background noise. Carefully negotiate what will happen next and you’ll be protected against the situation where both parties say one thing but mean something entirely different at the end of each stage of the negotiation. Spell out how and when the next chapter will occur.
In good negotiations, there are no hidden agendas. Ideally, every agenda will be the subject of intensive negotiation with more than a little give-and-take. Only an agenda which has been discussed with the other party to the negotiation will produce results. The more effective you become at involving the other party in setting the agenda, the better. People respect competence and professionalism, and this is one way an experienced negotiator shows those traits. There is no need to attempt to blind-side or push the other party to an agreement. Even if you manage to put together an agreement that way, it won’t stick. The only way for a negotiation to move forward is if both parties collaborate in deciding the agenda every single step of the way.
The Camp Negotiating Tactics # 9
Keep it simple
Beware using anything that has the potential to complicate your presentation – like a PowerPoint presentation on your notebook computer. Invariably, even the best planned show-and-tell runs into a few technical glitches and ends up doing more harm than good. There’s something to be said for being quiet at times and letting the other party discover the benefits of what you have to offer for themselves.
“The greatest presentation you will ever give is the one your adversary never sees.” – Jim Camp
In other words, nobody likes walking into a shop and having a salesperson immediately attach themselves like a leech. Most people like to be left to look around for themselves, unless they already have a good idea exactly what they want. Similarly, if you’ve implanted the vision in the other party, painted their pain effectively and made a winning presentation, the best thing you can then do is to be quiet and let them think. Anything else you try and add will have the net effect of detracting from rather than enhancing their ability to decide.
Always remember negotiations take place in the other party’s world, not yours. If you’ve failed to paint the pain vividly enough, even a brilliant presentation won’t save you now. In fact, a formal presentation will simply make you look bad because it will come across like you’re pressing them to decide. All the high-tech glitz in the world won’t save the negotiation if you’ve failed to address all the necessary steps along the way before reaching this point.
So what should be on your agenda as the next step once you’ve reached this stage? It’s usually pretty clear-cut. You want them to say yes or no:
If they say no, you can then thank them for their time and let them know maybe there will be an opportunity do something in the future. By avoiding the temptation to burn bridges behind you, you avoid showing any neediness to do the deal.
If they say yes, you can move on to the next item on your agenda, asking them for referrals for more business. One way to do this is to give them a chance to say no, even at that stage, if the deal isn’t exactly what they want. If they still proceed with signing the agreement, your job is to make sure they stay happy and meet their obligations. You then move on to serving their associates and acquaintances.
“Think about this from your own experience. When someone presents to you, your instinct is to hunt for objections, quibbles and mistakes, and you always find them. The classic presentation serves only to create objections, so you end up answering questions rather than asking them. If you have worked effectively to paint the pain, a presentation is simply a waste of time and energy. Furthermore, a presentation shows neediness, doesn’t it? Can’t it often seem to the adversary to be a rush to close? Or you want to present because this negotiation is going nowhere, and the presentation is your last hope. Think honestly about your own experience and I’ll bet you agree that otherwise effective negotiations have survived formal presentations, but they have never needed them.” – Jim Camp
The Camp Negotiating Tactics # 10
Don’t think “pay-back”, think “pay-forward”
To succeed long-term as a negotiator, you need to have high self-esteem. There is always a direct link between your self-image and how you perform. And the best way to generate and sustain high levels of self-esteem is to regularly pay-forward to others. Consistently search out opportunities to do good things for other people and not only will you be a better negotiator but a better human being as well.
Professional negotiators consistently face overwhelming odds. To endure, they need to have high internal reserves of self-esteem or, in other words, a high self-image. Without that, they simply won’t have the emotional strength to make all the tough decisions. And the best way to build those internal reserves is to think “pay-forward” rather than “pay-back”.
What does it mean to pay-forward? This simply involves doing good things for others without any likelihood of them being able to reciprocate. It means contributing to society. It means doing what you can to make the world a better place. A good negotiator will foster the habit of paying forward at every opportunity. Not only is this the right thing to do, it will also make them a better negotiator, because they will feel better about themselves.
Don’t think you have to wait until you’re ultra-successful before you can start paying forward. Anyone can start paying forward at any time, irrespective of their age or material circumstances. Simply put, to become a better person and thus a better negotiator, start doing things for people without any thought of what you’ll receive in return.
“Achievement requires self-esteem, and to build self-esteem you only need to start paying forward, to pay forward more effectively, at every opportunity, with your family and friends, in the workplace, in your community, in your house of worship, everywhere. And then you should pay forward some more. It is the most dramatic way to see yourself as a good person, a successful person, a contributor to society. It is the most dramatic way to be this individual.” – Jim Camp
“So how, exactly, should you go about settling in with the Camp system? First, I recommend you try out the most straightforward, discrete principles and rules of the system. Every day, jot down as many of these rules as you feel comfortable handling, review them in the morning, then try them out during the day, here and there. Find a risk-free situation and use them. The following day or the following week, jot down a different set of rules, and the following week, yet another set. Mix them up, because they all work together. At this test-drive stage, you’re not trying to put these activities in a broad context. All you’re trying to do is convince yourself they work. How long do you devote to this stage? I have no idea. However long it takes. You move then from the test drive to the shakedown cruise, if I can mix the metaphor. You’re ready to implement the system in one specific negotiation. Choose a pretty straightforward one at first. Slowly you’ll acquire a sense of how the pieces all come together. Every day you become more adept with the system, you’ll become a better negotiator than you were yesterday.” – Jim Camp