Chris Voss, a former FBI hostage negotiator offers a new, field-tested approach to negotiating. The starting postulate of the book is that you have to negotiate every day (with your partner, at a shop, with your boss...) thus it's a key skill to master. As always, I strongly encourage you to read the book. I shared in this post a raw transcript of my notes.
Good negotiation is about understanding your counterpart
- The language of negotiation is the language of emotion. You need to develop a strong emotional intelligence to understand the feelings and the needs of your counterpart.
- Make assumptions prior to the confrontation ("Their priority is X. They're not used to work with a startup and thus they'll be scared.") and test them during the meeting. To build these hypothesises, imagine yourself in the shoes of the other person.
- Negotiate in your counterpart world. Persuasion is not about how bright or smooth or forceful you are. It's about the other party convincing themselves that the solution you want is their own idea. So don't beat them with brute force or logic. Ask them questions that open paths to your goals. It's not about you.
The stance of the negotiator
- Talk very slowly, with a late-night DJ voice. You create an aura of trustworthiness and authority which avoid creating defensiveness.
- Use tactical pauses of at least 4 seconds. It shows strong confidence and make the other uneasy. They will feel the urge to fill the void. They will give you useful information or propose something not well-thought so in your favour.
- Mirror your counterpart. We evolved to like people and things which look familiar (i.e. safe)
→ Take the same stance
→ Use the same words and expressions (e.g. if they have some internal vocabulary or abbreviations)
→ Repeat their last sentence or pieces of their sentences. "So you said that [piece of last sentence] ..."
- Smile. It makes your opponent lower their defences. It also creates more brain flexibility and put your counterpart in "collaboration mode". Confrontation rarely works, always keep in mind that you're trying to solve a problem together. Even if you're not face to face, smile while you're talking. It changes the tone of your voice.
- Use your counterparts' names, holy music to their ears, to show them that you care enough to remember them.
- Give your name when you start a negotiation and regularly refer to it to humanise the case for your counterpart. You're not a random customer, you're Thomas or Marie, people they know might have the same names.
Use tactical empathy
- Actively listen to your counterpart. In any situation, it is pleasing to see that the other side listens and acknowledges the situation. You create a bridge with the other person.
- → Rephrase their points to show that you're truly listening. "So if I understood you well, you mean that..."→ Label their feelings. Fear, anxiety, hope... Putting a label of what they feel will make them feel understood and it builds trust. "It seems like / It sounds like / It looks like [label on their feeling]". Ex : It seems like you're scared you will get a bad deal. I'm sensing that you really like XXX."
- Your goal is to make your counterpart felt listened to and understood. You want to hear the magic words: "That's right".
Beware "Yes", master "No": don't avoid barriers and fears, confront them
- Many negotiation / sales techniques rely on getting the other side to answer yes-yes-yes all the time. If it helps to start a negotiation with something we all agree on, this technique is often obvious to the other part who feels trapped and manipulated.
"Do you enjoy a fresh glass of water? -Yes. Do you like it clean, crisp, with no chemical aftertaste like mother nature made it? -Well yes, but... Then our water filtering machine is for you.."
- There are actually three kinds of 'yes':→ The counterfeit yes, in which your counterpart plans on saying no but actually feels 'yes' is an easier escape route on the short run. He probably feels that it's more comfortable not to confront you now and ghost you later for example.→ The confirmation yes, in which your counterpart just disingenuously wants to keep the conversation going to get more information but there is no promise of action→ The commitment yes which truly leads to action. It's the one you want.
- A 'no' makes your counterpart feel safe and in control, and creates an healthy negotiation space. Autonomy is a core need of human beings.
- Getting a 'no' is actually often the start of the true negotiation, as you can understand what's the blocking point and dive into it.→ I am not ready yet to agree→ I do not understand→ I don't think I can afford it→ I need more information...Then you can start working on it. "What would you need to make it work?"
- The reasons why your counterpart won't make a deal matter more than the reasons why they want to do it. So you need to address these first. Start with asking them the reasons why they wouldn't make a deal."Okay, so today what are the reasons why you wouldn't or couldn't work with us?"
- Use the accusation audit technique. List all the worst things the other side could tell about you and say them before they can. E.g. "Okay we are a small startup, so we are much less equipped regarding security blabla...". As they are often exaggerated the other side will defend the opposite (and thus you). This technique allows to turn down negative dynamics before they even start.
🎬 See Eminem in 8 Miles when he is saying all the bad things about his mom and himself in his final rap. Then his opponent is left with nothing to say and babbles nonsense.
- Use this technique to improve your sales cold emailing performance. Try to provoke a 'no' with a one sentence followup email implying you're ready to walk away. "Have you given up on this opportunity? Should I stop sharing these opportunities with you?". You will get 'no wait' answers like "No our priorities haven't changed but...". It plays on the fear of the other person to miss an opportunity later. They don't want to close the door.
The three golden rules to be a good negotiator
- Prepare, prepare, prepare. When the pressure is on, you don't rise to the occasion. You fall to your highest level of preparation. Get information regarding your counterpart, write down your questions etc.
- No neediness: develop the ready-to-walk mindset. No deal is quite often better than a bad deal. To do that, you should have clear, pre-defined boundaries (I refuse to sell below X thousands $). If you feel you can't say no, you've taken yourself hostage. Your counterpart will feel it and take advantage of it.
- Beware of deadlines (or create artificial ones). Seasoned negotiators use artificial deadlines to get better deals. Time pressure make people accept conditions that are against their best interest. It is a powerful leverage because it appeals to our loss aversion. 99% of the times deadlines are artificial. If your counterpart gives you a deadline, simply ignore it, take the time you need to make an educated decision and negotiate a good deal. Once again, no deal is better than a bad deal.
Dealing with irrational counterparts
It's very common for unseasoned negotiators to assume that their counterpart is crazy because their behaviour seems irrational. 99% of times it's because you're missing something, and your job is to uncover it. Usually, there are three scenarios:
- They suffer an information asymmetry (they are ill informed) and thus cannot make rational decisions.
-> give them complete information from a reliable source (ex: an audit firm, someone they trust or consider neutral)
- They are constrained by something or someone and aren't eager to reveal it (e.g. legal bindings, a superior, promises made to someone etc.). -> find an ally who's an insider to get the information for you and offer a workaround to your counterpart. Or get time around the table with the person.
- They have other interests (personal goals..).
-> try to create a more personal relationship with them to make them open up
When you recognise that your counterpart is not irrational, but simply ill-informed, constrained or obeying interests that you do not yet know, your field of movement greatly expands. And that allows you to negotiate much more effectively.
Overcoming the fear of conflict
- We evolved to dread confrontation and conflict because for thousands of years it meant a risk to be an outcast in the tribe, and die.
- In business or personal relationships, not having your voice heard, going along, will eventually have negative consequences. It will create unfair situations, make you frustrated or bitter. embracing conflict is critical to a successful life.
- Remember, pushing hard for what you believe is not selfish if you are honest, calm, and listening to your counterpart. It's not a strong-arm, not bullying, it's an healthy confrontation to uncover the fairer deal.
- At first, negotiation will often trigger a fight-or-flight answer and get your palms sweaty the first times you do it. But it's only a matter of practice. In your daily life, either at the office or the family table, don't avoid honest, empathetic confrontation. One can only be a great person by both listening and speaking clearly and empathetically.
Should you go first? The anchor effect
- In most situations, don't go first, let the other person give a number. You might be surprised that it's often higher than what you expected. Let them give you some information, it gives you advantage. But beware of the extreme anchor seasoned negotiators will use to bend your reality. Ex: "What's your budget? What are the typical financial terms when you work for a startup?"
- The tendency to be anchored by extreme numbers is a psychological quirk known as the "anchor and adjustment" effect. Researchers have discovered that we tend to make adjustments from our first reference point.
Most people glimpsing at this series of number 8 x 7 x 6 x 5 x 4 x 3 x 2 x 1 estimate that it yields a higher result than the same string in reverse order
- If you have to go first (e.g. a prospect asking your financial terms), don't give a number, give a range and use the technique of the "bolstering range".→ The highest number should be exaggerated, an extreme anchor→ The low number in the range should be your actual target. The extreme anchor makes it sound reasonable.
💸 Columbia business school psychologists found that job applicants who named a range received on average a significantly higher wage than those offering a number, especially those using a "bolstering range".
What type of negotiator are you?
- Your personal negotiation style is formed through childhood, schooling, family, culture... by identifying it you can identify and leverage your negotiation strengths and weaknesses (and those of your counterparts).
- Despite the Hollywood image of the tough, assertive negotiator, there is no style better than another. The three of them work better in certain situations and actually you need components from all of them to be an effective negotiator. 75% of high-performing attorneys have a cooperative style.
- For instance, Analysts are methodical and diligent. They are not in a big rush, they want to minimise mistakes by making a thorough study of each parameter. Analysts are problem solvers, information aggregators, and are hypersensitive to reciprocity.→ Strength: you cannot be bamboozled, you stick to the facts and the data. You are capable of keeping your emotions away to make the best decision.→ Weakness: you might speak in a cold and straightforward manner that can throw off your counterpart without you realising it. Facing them, it's critical to be well-prepared and to support your arguments with data.
- Other types are accommodator, assertive... all the details are in the book if you want to know more.
Additional tip 1 - Don't use round numbers and leverage non-monetary terms
- Round numbers like $35,000 make your counterpart feel like you came out with them randomly. They are temporary and can still be negotiated down.
- But anything you throw out that sounds less rounded -say $37,263- feels like a figure that you came to as a result of rational, thoughtful calculation. Such numbers feel permanent and serious.
- Non-monetary items are powerful because they are uncountable, ruling out any rational calculation. If you offer a provider a Linkedin post to promote their business, it increases the odds of getting your low offer accepted.
Additional tip 2 - Force empathy with calibrated questions
- Using "How" and "What" questions is one of the most powerful tool of the negotiator.→ E.g. "How am I supposed to find that amount of money? We're just a startup."→ "What should I do, I'm just a student?"
- These questions force your counterpart to slip into your shoes and hopefully to bid against themselves by giving you hints.
Conclusion - The Ackerman bargaining framework
This framework is used by the CIA and top hostage negotiators. It's very effective because it musters several tactics: extreme anchoring, reciprocity, non-monetary items, loss aversion etc. The decreased thresholds (halved each time) give your counterpart the feeling that they squeezed you until the last drop, almost to breaking point. From the point of view of the buyer it looks like that:
- Set you target price (your goal)
- Announce your first offer at 65% of your target price
- Calculate three raises of decreasing increments (to 85, 95 and 100%)
- Increase progressively the threshold but not without showing some resistance (say "No, I'm sorry but I cannot accept that") and using forced empathy ("How I am supposed to do that in my situation...".) → you force your counterpart to figure out solutions for you and thus to slip into your shoes.
- When making your final offer, use precise, non-round numbers (e.g. 37,897$) to give credibility and weight to it (it's the result of a very complex, rational calculation). Also, offer a non-monetary item ("We'll write a recommendation for you") to show that you're at your limit.
