Negotiation Blog

Should you present your negotiation offer differently to a man than to a woman?

By Marianne Eby

Taking gender into consideration as one factor that may affect a person’s receptiveness to an offer is helpful, as long as you remember that broad categories don’t always work and many other factors affect a negotiator’s style besides gender. But yes, it may help to present your offer differently to a man than to a woman.

This question came up at one of our negotiation workshops recently, during a discussion about how different communication styles affect negotiations. A participant brought up a rule of thumb she’d read about gender considerations when asking for something:

If you’re asking something from a woman, start with small talk or a narrative that prepares her for your request. But if you’re asking a man, do the opposite – open with your request, and elaborate with context and detail afterwards.

Was this a good rule of thumb, and if so would it be useful in negotiation?

Let’s consider this rule in a simple negotiation. If you want to ask your neighbor to remove a tree that leans into your yard, and your neighbor is a woman, you would begin by talking about her garden, your garden, and what is thriving in your yards, before asking about the tree. If your neighbor is a man, on the other hand, such a rule of thumb suggests you start right off with the “ask” about the tree, and fill in the details next.

The participant was spot on. In fact, the last few years of research on the differences between male and female brains can help us. In the 2008 book Leadership and the Sexes: Using Gender to Create Success in Business, Barbara Annis and Michael Gurian describe the differences in male and female brains (there are over 100, and how understanding them can make or break effective communication in corporate culture).

The research tells us that as it turns out, many clichés about gender -- i.e., women are more emotional, men are less talkative -- are proven by PET and SPECT scans of our brains! Images of brain activity show that:

  • In men, language tends to occur mostly in the left brain (the logical, linear-reasoning side), whereas in women, language occurs in both the left and right brain (the perceptive, intuitive, “artistic” side).
  • In women’s brains, there are more active sensorial and emotional centers, and they too have stronger links to language. Men don’t process as much emotion, and they don’t tend to link feelings and senses to words as much.
  • Men’s brains enter a rest state, or “zone out,” several times a day, and particularly when overwhelmed by words. Women’s brains usually do not shut off in this way except during sleep.
  • Men’s brains circulate more testosterone, the competition/aggression chemical, whereas women’s circulate oxytocin – the bonding chemical.

These differences have contributed to the different expectations women and men bring to communication, and to the clichés or cultural norms that have developed.

It’s easy to dismiss the chit-chat part of the approach to a woman as a waste of time. But it’s actually quite efficient, because women tend to get lots of clues during the chit chat. It’s not that the chit chat itself is so stimulating to them; what is stimulating is the wealth of information they gather from the chit chat about trust, comfort/discomfort, readiness to close, ect.

Men, on the other hand, tend to get fewer or no clues during such chit chat, so it makes sense that men find it stressful or wasteful: they find themselves processing what seems to be otherwise useless information.

Let’s say we approach Bob and say: "Hi Bob, how’s it going? I’ve got a question about this tree of yours that is causing me some concern.” For Bob, it is important to have a kind of frame or subject heading for the conversation before he can engage productively. Without that, the extra effort to establish “relational harmony” may be more verbiage and more detail than he wants to absorb at that moment. The chit chat would be inefficient and ineffective.

Let’s say we approach Sally and say: "Hi Sally, how’s it going? You really did get a nice deep blue in that hydrangea. How did you do it?....Your tulips were magnificent this year as well. Any tips for me?.....Now tell me about this tree….” For Sally, the entry dialogue is important: it establishes that they are friendly neighbors, with an interest in a win-win solution, which is her “frame” for a problem-solving negotiation about the tree.

Do these findings about the male and female brains change the way we negotiate in business? No and Yes.

No -- Establishing rapport and trust are critical parts of any negotiation, whether your counterpart is the same gender or not. And that rapport typically depends on a conversation which helps uncover shared interests.

And Yes – Style matters, and a master negotiator adopts strategies that will be most effective with the style of his/her counterpart. Establishing rapport is critical, but it doesn’t have to be the opener.

The real value of our workshop participant’s rule of thumb is that it gives us one simple tip to take with us on the road: plan your approach; sequence and timing matter.

Negotiating Tip

It’s easy to lose your cool when negotiating. Taking three deep breaths will quickly calm you down. Now you can think clearly again.


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Negotiation Blog

The Birth of Win-Win Negotiations

By Thomas Wood

My colleague blogged about Guanxi last month, the age-old concept that we teach in our Best Negotiating Practices workshops. Her post on Guanxi (Get in Touch with Your Guanxi) reminds me of the man who turned Guanxi into a mathematical formula. 

            

In the 1950s, John Nash took the idea of Guanxi -- that caring about the relationship is as important as the outcome -- and applied it mathematically. Years later Nash won a Nobel Prize for his work. Nash suffered from acute chronic schizophrenia most of his career, and as a young prodigy was obsessed with coming up with an original idea. But did he?

Up until this point, most negotiations in the West were focused on the deal – the outcome – the conditions. What did John Nash introduce as an “original” idea? Relationships matter.

Are relationships new to win-win? No! Ancient cultures have valued relationships for thousands of years. John Nash borrowed the concept of Guanxi to support his theory. What is new is that John Nash and his colleagues proved that a win-win result is predictable and repeatable.

John Nash demonstrated that the then predominant theory of economics – Adam Smith’s premise that individual ambition serves the common good and that the best result comes from everyone doing what’s best for himself – was not complete. Nash showed that the best result comes from everyone in the group doing what is best for himself AND the group. You have to factor in all the relationships and connections – you and your stakeholders, they and their stakeholders. You also have to understand what people need with regard to both ego and outcome. You can get the full effect of Nash's theory from the acclaimed 2001 movie A Beautiful Mind.

When you take these factors into account, you reach a result that benefits all – that’s win-win. And how do you get there? With collaborative interest based negotiation strategies, starting with a healthy dose of Guanxi. Some in the West call this the birth of win-win, because it set us on a new course of negotiation mastery and success, as well as paved the way for successful negotiations with cultures more astute at negotiating.

Negotiating Tip

Most people underutilize the caucus. What’s your hurry? Summarize, take a break, and make sure your counter offer is on the mark.


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Negotiation Blog

Negotiators, Get in touch with your Guanxi

By Marianne Eby

Our clients do extensive business in China, where negotiations tend to be a long involved process. What you thought would be a simple business negotiation often turns into multi-day affairs with many delicious meals, multiple toasts, and tours around the factory. While it takes time, this focus on Guanxi, which roughly translates to “relationships and connections,” is viewed as both effective and efficient in China. Good negotiators everywhere would do well to take a lesson and get in touch with their Guanxi.

The Chinese view their business relationships as cooperation amongst various parties that support each other towards mutual gain, where “business favors” or concessions are readily and voluntarily given, knowing that business partners would also be ready to give. Guanxi is a complex concept that involves respect, reciprocity, and a certain deference to the person with more authority, all in an effort to achieve a mutually beneficial relationship.

One famous story of Chinese relationship building is the story of Microsoft’s growth in China. Urban legend had it that on his first trip to China in the mid 1990s, Bill Gates insulted the Chinese President Jiang Zemin by wearing jeans and only leaving time for a brief visit. The legend had China’s President stating that Mr. Gates would be wise to learn more about Chinese culture, essentially saying that understanding China’s customs would pave the way for better working relationships in the country. This legend of course turned out to be pure myth and was later debunked in the 2006 book, Guanxi (The Art of Relationships): Microsoft, China, and Bill Gates’ Plan to Win the Road Ahead by Robert Buderi and Gregory T. Huang, which explored the success of Microsoft’s software laboratory in Beijing, China. The real story is that Gates and one of his key visionaries, Nathan Myhrvold, executed a strategy that set the company and the country on a long term course to build a mutually beneficial relationship by harnessing the talent from within China and learning the cultural knowledge necessary to be successful.

According to Buderi and Huang in Guanxi and the Art of Business, “So far, the company has invested well over $100 million and hired more than 400 of China’s best and brightest to turn the outpost into an important window on the future of computing and a training ground to uplift the state of Chinese computer science – creating dramatic payoffs for both Microsoft and its host country….” China is reaping the benefit of an elite corps of computer scientists, while Microsoft’s barriers to entry were eased.

The legend, the truth, and also the ultimate success of Microsoft in China demonstrate an important lesson: doing business requires understanding the culture of your counterparts and making an effort to build relationships in the ways that are important to them.

Negotiations in western cultures proceed at a speedy clip more often than not, but relative to the speed and cultural nuances, there is always a need to invest in the relationship. Building a strong connection up front with your supplier, customer or partners provides an invaluable foundation of trust and connection that supports all future negotiations in the relationship. Get in touch with your Guanxi!

Negotiating Tip

Understand, access and address real interests and concerns – that is focus on WHY they want what they want, NOT on demands or positions. 


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Negotiation Blog

Can you negotiate with someone who doesn’t seem to know how?

By Thomas Wood

What if someone you are dealing with seems unable or unwilling to negotiate? You sense that, for personal or cultural reasons, or because of inexperience, they don’t warm to, or recognize, your attempts to open negotiations. Do you give up?

This was the question that came over our Need Help Now web advice service, in which one of our workshop participants was was dealing with a new buyer at a key customer. Often we see a disinclination to negotiate from very smart technical people, such as scientists, technologists (techies, IT, programmers), and engineers. We also see it in the helping professions (researchers, nurses, doctors, laboratory technologists). It applies equally to someone who has resources you need, or authority to give you something you want (a promotion, a better assignment, an extension on a deadline). Your assessment of the “negotiation environment” tells you that despite your counterpart’s inexperience or unwillingness when it comes to negotiating, a collaborative negotiation would indeed yield a great outcome for both sides.

Let’s start with the absolute DON’Ts:
1. Don’t ask them to ‘negotiate’ with you. Such an approach runs the risk of raising red flags and making them nervous. If they feel intimidated, they will avoid further conversation. If they believe negotiating is akin to arguing or win/lose and they are conflict averse, they will either retreat or take a hardball stance.
2. Don’t make any offers (demands, proposals) until they do.

So what do you do?
When dealing with a novice or non-negotiator, try to transform the interaction into one where the other party feels like they are simply having a conversation. Remember, collaborative negotiation is at its heart a conversation, only with a goal of expanding value.

How to begin?
Model the characteristics of a collaborative negotiator:

  • Build in more time for developing rapport and trust. Find a mutual interest, pay a true compliment, find common ground.
  • Prepare more thoroughly. You may need to do some research to find out what your counterpart’s interests are so that you can ask questions that elicit them – he or she might not know the company's needs yet.
  • Probe with care. As always, ask open-ended questions. Show genuine interest and listen carefully to the answers. Ask follow-up questions that make it clear you were listening. Discover their interests, needs and goals.
  • Talk in term of WE. Focus on creating a cooperative discussion, using the word “we.” (“I think we agree the timetable is important; let’s talk about how we can make that happen.”)
  • Paint a picture of a possible collaboration, proposing options and possibilities without commitment. Say “what would it look like if we….”

The idea is to uncover their interests and fears, to gain their trust, and help them see how you can arrive at a “win-win” solution. If you do that, you may find yourself developing a joint agenda and moving into bargaining without your uneasy counterpart ever realizing they are negotiating.

Negotiating Tip

Does your mood matter? Yes. Those in a good mood capture more value. Get in a good mood before sitting at the negotiating table.


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Negotiation Blog

Unilateral disclosure in negotiations — foolish or enlightened?

By Thomas Wood

When you disclose valuable information to your negotiation counterpart, you want equally valuable information in return. Right? Not always. Sometimes what you seek in return is a new level of trust – that will lead to getting more information and ultimately, trades that create value. Sometimes "one-way" is "two-ways".

Consider these situations:
  • Have you ever begun talking to a negotiation counterpart where sufficient trust hasn’t yet developed?
  • Are you facing negotiations where the trust previously established has been damaged?
  • Are you asking to re-negotiate an agreement as a result of changed market conditions that were not originally anticipated?
In these types of situations, you need to build (or re-build) trust in the relationship. Without the appropriate level of trust, parties are not likely to share their interests, and without discovery of interests, you are left only to argue positions, without much hope of creating value for both parties.
 
One trust-building strategy is to unilaterally disclose confidential or proprietary information that is valuable to your counterpart. (Obviously the disclosure has to be legal, ethical and appropriate to the circumstances.) You are taking a calculated risk that your disclosure will build trust and thereby assure progress in the negotiations.
 
What information should you disclose? The information should be of low risk to you but of significant value to your counterpart. This strategy only works if it is clear to your counterpart that you shared something you didn’t have to, and if the information is something your counterpart values knowing.
 
When should you make such a disclosure? The most ideal time is during the Information Exchange stage. You want to learn early on whether your counterpart is negotiating in good faith, or how much work needs to be done to restore trust. Of course, sometimes during the Bargaining stage you realize you have to back up and re-engage in the activities of Information Exchange before proposals that address interests will surface.
 
A very public example comes on this 1 year anniversary of the US disclosure of the size of its nuclear arsenal -- 5,113 weapons, down from its peak at over 31,000 weapons in 1967, a secret long held since the Cold War. Good minds debate the wisdom of this “transparency policy,” but as a negotiation strategy, well, it’s right out of the master negotiator’s playbook.
 
Historically, there is great distrust between those countries with nuclear power and those without it. All nations will be hurt by nuclear war, but those with nuclear power are the main targets. And remember, the US and many other nations are already obligated by treaty to decrease their nuclear arsenals.
 
Let’s check the US strategy for the key markers of a good negotiation strategy:
  • Is trust the goal? The US had a preliminary interest to bring other nations “to the table”, and the risk of that engagement taking years was too great, so trust needed to be repaired/developed quickly.
  • Low risk? The disclosure was low risk because experts had long provided reliable estimates that were very close to accurate. In fact, the experts’ guesses were only off by 18, so revealing the actual number did not put the US at a disadvantage.
  • High value? The value of the information to other nations was great, as it allowed them to justify to their stakeholders that working with the US in global nonproliferation would be met with the transparency they sought.
  • Information Exchange stage? Much preparation had been done, but no new offers were on the table, so Bargaining had not commenced when the US disclosed. The US was in the Information Exchange stage of negotiations, and chose to make the unilateral disclosure at the May 3, 2010 opening of a five-year review of the Nuclear Nonproliferation Treaty. 
The result? Whether such a unilateral disclosure builds trust remains to be seen. The general law of reciprocity would dictate that your counterpart would respond in kind if they too want to build trust in the relationship. If your counterpart does not respond in kind, it’s possible they don’t see any mutual benefit, or have a hidden agenda. This alone is valuable information that indicates you need to be serious about your alternatives. But if they do reciprocate, you have saved months (with nuclear war heads, years) of negotiations and began the open flow of information that can lead to effective bargaining.
 
Going back to our “public event” example, the US ally, UK, followed suit and on May 26, 2010 disclosed that it had a stockpile of 225 warheads. According to Deutsche Welle, the German Foreign Minister acknowledged the power of the US strategy when he said: "It underlines that the US is aware of its responsibility in the disarmament process. From transparency, grows trust - the basic precondition for further disarmament."
 
Can unilateral disclosure backfire? Yes, like all risks, there’s a down side, and an upside. Your counterpart could reveal some valuable information as way to trick you into trusting them. If you suspect such trickery, you are well advised to spend more time in the Information Exchange stage. People who want unjustified rewards are usually not willing to wait for them, hence their motives will become apparent.
 
An example from a Watershed client (names and specifics changed to protect confidences).
 
Our client (let’s call it Acme) had a contract committing it to a $1.5M spend per year and a 3-year contract with a key supplier (let’s call it BT Supplier).  Due to the economic downturn, Acme did not meet its volume commitment in the 2nd and 3rd year of the contract, by 12% and 22% respectively. Acme avoided discussion of the breach, offering only vague promises of a plan to catch up.
 
Acme came to Watershed for help because it wanted to negotiate a new contract with BT Supplier. The problem was that BT Supplier has lost all trust in Acme because Acme did not live up to its commitments and did not handle the situation well.  Acme needed to do something to re-build its credibility and trust. 
 
We worked through several trust-building strategies with Acme, and the company chose a path of unilateral disclosure. Acme decided to invite an engineering team from BT Supplier to a round of R&D meetings. Acme proactively solicited input from the BT Supplier engineers on a series of new products Acme was developing. This would give BT Supplier a significant advantage when it came time to bid the parts for the new products. Most important, however, Acme’s unilateral outreach and sharing of valuable information demonstrated a serious commitment on Acme’s part toward BT Supplier, and was integral to re-building trust between the parties.
 
Trust Building Strategies are legion. Trust, of course, is fundamental to the success of collaborative negotiations. There are, however, many ways to build trust with your negotiating counterpart. Unilateral disclosure of valuable information is only one such strategy, but it can be a powerful ally in certain situations.
 
Foolish or enlightened? You decide.

Negotiating Tip

Ask "why" to understand interests. Ask your counterpart’s advice on how to achieve shared goals. Be sincerely curious.


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8 Tips for Successful Email Negotiation

By Thomas Wood

Email may well now be the dominant form of business communication, and increasingly unavoidable in negotiations. It has its advantages -- it saves money and time, allows you to ask questions that might be more difficult in person, and sometimes reduces stress because of the time allowed for contemplation and reaction. So why do half of email negotiations end in impasse?

Negotiating by email has pitfalls too many negotiators ignore. Research shows that negotiators experience less satisfaction with the process, less rapport, and less future trust in their partners. Why?

  • There is a greater tendency to lie, exaggerate, bluff, or intimidate with email.
  • Negotiators don't feel the pressure of "live performance," and thus often prepare less.
  • Because it is more difficult to build rapport and trust, there is often less focus on interests and more on positions and demands.
  • Communication challenges arise easily, including rudeness, ambiguous messages, misinterpretations, and ill-conceived reactions.
  • It is easier to say "no" and brainstorming is not possible, thus cramping creativity and the likelihood of value creation.

Because of these downsides, email negotiations can inhibit the trust and mutual understanding that builds and sustains rapport, so conflicts or misunderstandings can easily degenerate or worsen. Here are 8 tips for maximizing the value of email and minimizing the risk:

  1. Meet first. The first meeting is critical to establishing rapport. It gives everyone the chance to observe expressions and gestures, gauge likeability, style, and personality. Web-conferencing can work, but meet face-to-face if possible, especially for complex agreements.
  2. Continue to build rapport. Over the course of emailing, express emotions as you would in person, especially positive ones (e.g., excitement, confidence, hopefulness. Even a simple opening greeting and sign-off, as we naturally do in face-to-face meetings, can go a long way in maintaining essential rapport. Make “small talk” or “small text” as you naturally do in face-to-face conversations, before you get into the meat of your message. “Hope all is well.” “Were you hit by that tropical storm last week?” “Did your daughter’s team win their game?”
  3. Have a well-established goal. Think of negotiating as communicating with a goal in mind. Beware of stream of consciousness negotiation on key deal points. Share your expectations, and when you think things have gone awry. Always know the minimum and maximum parameters that make agreement worthwhile for your side, and return to those before responding to offers via email.
  4. Brainstorm offline. Email does not usually spark or encourage creativity like the back and forth of live conversation. When a solution is not apparent, schedule a phone call or in-person meeting to get the ideas moving.
  5. Stamp out conflict. If an email comes off as rigid, or rude, it may be unintentional. Don't respond immediately and don't respond in kind. Take a short break, then contact your counterpart by phone, or email a simple statement of concern or desire to clarify. If there is a problem, pick up the phone or schedule a face-to-face meeting as soon as possible. Conflict with emotional intensity is rarely solved over email.
  6. Ask more questions, not less. There is a tendency to limit questions over email because it appears tedious. Don't fall into this trap. To avoid lengthy and exhausting lists, start with broad questions, intersperse phone conversations to discuss the answers, and use shorter emails to group follow-up questions by topic.
  7. Keep the climate positive. Maintain a friendly tone in emails -- use emoticons, yes frown (but don't over use), if it feels friendly. Interpret email messages with caution and sensitivity, and leave room for personality, style, and cultural differences. Make sure to clarify any ambiguities right away, and use generally accepted best practices in email etiquette.
  8. Sprinkle in the personal touch. Share or ask something personal to connect with the other side -- even if it's only about the weather or a local team. Or look for other areas of common interest (try checking Linked In) and asking open-ended questions. Once you've found out their interests, send them URL's or articles that they might find interesting. Avoid religion or politics, though!

Business professionals continue to use email to further the negotiating and decision-making process, despite its drawbacks, so there's no avoiding it. Just use it carefully! And smile as you type.smiley

Visit Watershed's Negotiator's Learning Center to read more on Negotiating Over Email.

Negotiating Tip

A weak partner is a dangerous partner. At minimum, find ways for all parties at the negotiating table to save face. 


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