Negotiating as if your business depended on it

16.10.2022

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Kirjoittanut: Ariel Cohen - tiimistä SYNTRE.

Esseen tyyppi: Akateeminen essee / 3 esseepistettä.

KIRJALÄHTEET

KIRJA	KIRJAILIJA
	Chris Voss

Esseen arvioitu lukuaika on 12 minuuttia.

Negotiating as if your business depended on it

Ariel & Samu

Introduction

A few months ago, something unfortunate happened with a sale of our company asset. At first, everything went perfectly, and in a way that you would expect: we had negotiations about a price with a seller, they agreed on buying the asset, we came to a settlement with the price and payment date, and we signed the contract. However, when the actual due date for the payment came, issues surfaced. No money was transferred into our bank account. We weren’t paid.

Later, after numerous phone calls and back-and-forth arguments, things got sorted out. The whole phenomenon still raised many questions. How can two parties seem to be so in tune with each other, but still manage to not follow through on a deal? To gain a little insight into the topic of negotiations and deal-closing, we read the book “Never split the difference. Negotiating as if your life depended on it” by Chris Voss, a former international kidnapping negotiator in the Federal Bureau of Investigation. Through this book I came to realize that negotiation is a learnable skill, that can be generalized to multiple aspects in life; business, personal life, or, in Voss’s case, something extreme like hostage situations. The principles – which we are going in-depth into this essay – work the same in every situation.

Calibration

Chriss Voss is a big voucher for the FBI’s most potent negotiating tool: Open-ended questions. Calibrated questions that the other side can respond to. They buy you time and give your counterpart an illusion of control. They help you gain information. In negotiating you want to get every piece of information that you can get and make psychological insights about the counterpart. When you enter a negotiating situation, you should take this mindset of discovery. You want to discover as much as possible so you can use the things for your benefit when the negotiation goes further. Often smart people are too arrogant for negotiating since they think that they do not have anything to discover anymore. It is easier and usual for people to stick with what they believe and ignore their counterpart’s opinions. Great negotiators remain more emotionally open to all possibilities and are more intellectually agile in fluid situations. (Voss 2016

Dialogue and negotiation have a lot of similarities. In both, you need to be a good listener, show empathy for your counterpart, and use non-verbal communication such as eye contact, facial expressions, gestures, postures, and body orientation. Instead of prioritizing your argument, put all your focus on the other person and what they have to say. In that mode of true active listening, you make the counterparts feel safe. Making arguments and starting to debate about things will not help you with getting to an ending where both parties are happy. Not in dialogue or negotiating. (Cherry 2022)

In negotiating, your goal is to identify what your counterpart actually needs, be it monetarily, emotionally or otherwise. Make them feel safe enough to open up and talk more about what it is that they want. Listening and making it about the other person, validating their emotions, and creating enough trust and safety for a real conversation to begin. When your counterpart is having a feeling of trust and overall think that you are a good guy, it is easier for him to meet you halfway, or even further.

When thinking about negotiating strategy, people usually tend to focus on what they say or do. That’s just how we are. It is the easiest thing to enact and the most effective model of immediate influence. Our brains don’t only understand the verbal communication or actions of others, but their feelings and intentions, too. We can understand the minds of others by grasping what the other is feeling. When we give out signals of warmth and acceptance, conversations just seem to flow. When we enter a classroom, workplace, meeting, or bar with a certain level of comfort and enthusiasm, we tend to attract people toward us. When we smile at someone on the street, they smile back. It is a natural reflex (in Finland this might not work, though). Understanding that reflex and putting it into practice is critical to the success of just about every negotiating skill there is to learn. (Voss 2016)

Voice tones in negotiations

According to Voss, there are three essential voice tones available for negotiating situations: deep and relaxing like that of a late-night radio presenter, a positive and playful voice, and a direct or assertive voice. The latter one can easily be overwhelming, though, if it’s signaled in a too dominant, aggressive way. According to Trudi Griffin, a licensed professional counselor in Wisconsin specializing in addictions and mental health, assertiveness is a way of standing up for your own thoughts and needs. And arrogance is an aggressive, overbearing way of thinking and behaving that violates others’ rights and demeans others in order to build up one person. Most of the time you should use a positive/playful voice. It is the voice that gives others the feeling that you are an easy-going and good-natured person whose attitude is light and encouraging. The key is to be relaxed and smile a lot. Even smiling while talking on a phone has an impact on your voice tone. When people are in a positive frame of mind, they tend to not overthink, are most likely to collaborate, and solve the common issue instead of fighting and resisting. Late-night FM DJ voice, on the other hand, will give your counterpart the feeling that you got it covered. Lower your voice, and talk slowly and clearly. You can be very direct with it, just remember to create safety with a tone of voice that says I’m okay, you’re okay, let’s figure things out together. You create an aura of authority and trustworthiness without making the counterpart feel the need to defend himself.

Mirroring

Mirroring (a.k.a. isopaxism) is mostly imitation of other people. It is a neurobehavioral act, where we copy others to comfort each other. Mirroring can be done with body language, vocabulary tempo, tone of voice, or speech patterns. It follows a very basic but profound biological principle: We fear what is different and bond with things that are similar. It is mainly subconscious. When employed consciously, however, it plays a huge role in getting to know others and establishing a level of comfort. It is a sign that people are bonding, in sync, and establishing the kind of atmosphere that leads to trust. (Voss 2016)

It explains why couples are walking in sync or how friends tend to cross their feet almost simultaneously. How you subconsciously scratch your nose after the person you talk to does it. The Federal Bureau of Investigation have used this to its advantage in a very simple way. They just repeat the last three words of what someone said. By repeating back what people say to them, they trigger this mirroring effect, and their counterparts will most likely elaborate on what was just said and sustain the process of connecting. (Voss 2016)

Mirroring is also playing a role in manipulation and narcissistic behavior. The difference is that people are taking it to extremes and only trying to win you over by reflecting on things you want to hear. Meeting people with this kind of behavioral attribute can be risky – they have a tendency to mold you in a way that benefits them. It can be concluded that slight narcissism seems to work well in negotiating situations. (Voss 2016)

Tactical empathy

As mentioned earlier, empathy is playing a major role in negotiating situations. There are three main categories of empathy: Affective empathy, the act of understanding another person’s emotions and responding to them appropriately, Somatic empathy; where you respond with a physical reaction, i.e. feeling symptoms of embarrassment after seeing someone get embarrassed, and Cognitive empathy; the ability to understand other person’s mental state and what they may be thinking. (Cherry 2022)

What Voss is teaching to his students is something called “tactical empathy” which is similar to cognitive empathy. What perhaps differs the most, is that in tactical empathy you also want to know what is behind those feelings, so you can increase your influence in all the moments that follow. It helps in understanding other’s emotional obstacles and the potential pathways in order to get an agreement between both parties. Voss refers to it as “emotional intelligence on steroids”. When we closely observe other people’s faces, gestures, and tone of voice and think that we are in that person’s shoes, our brain starts this process called neural resonance, and it helps us to understand better what they think or feel. In neural resonance theory, the brain learns how to consciously attend, learn, and recognize a changing world. (Grossberg 2012)

How to use tactical empathy?

Demonstrate that you are negotiating in good faith
Be genuinely interested in what drives the other side
Don’t suppress emotions
Work to deactivate negative feelings.
Aim to magnify positive emotions.
Look for tells (Try to see if the other person is telling the truth or not)

(Masterclass 2021)

Labeling

Labeling is a way of validating someone’s emotion by acknowledging it. In labeling, you give someone’s emotion a name and you show you identify with how that person is feeling. Think of labeling as a shortcut to intimacy, “a time-saving emotional hack”.

Labeling is a way of highlighting other people’s emotions and exposing negative thoughts to daylight. Labels usually begin roughly with the same words:

It seems like…

It sounds like…

It looks like…

Pay attention to how the phrases start, if you start a conversation with “I”, it might get people’s guard up. When you say “l” at the start, it feels like you are more interested in yourself than your counterpart. Usually, people tend to answer longer than just “yes” or “no” when you label their emotions. People tend to start to speak about their emotions and issues. For example, you see someone looking sad and you ask them, how are you doing? They most likely answer shortly, when you could ask, it seems like you have a rough day, how are you doing? (Voss 2016). Lastly, give room for silence. Once you labeled the issue, just be quiet and listen. Label’s power is that it invites the other person to tell you more and reveal himself. Give your counterpart time to answer. Let the label do its work.

Beware “YES”, master “NO”

Was it in a negotiation situation related to hostages or business, we want to get an answer that pleases us. Most commonly this answer is a “yes”. Voss is challenging this thought with why. Why is it better to actually get a “no” answer before the “yes” answer?

We can take a discussion with a phone salesman as an example of this. As a salesman, you want the customer to answer “yes” to basically every question you ask and often you formulate the questions in a way that a “no” doesn’t really respond to them. Simultaneously though, you want to know what the customer really needs, but when asking these questions, you can’t actually discover anything. You just get a forced “yes”, which makes your counterpart feel uncomfortable and ultimately ruins the sale. Being pushed for “yes” makes people defensive. Answer “no” will start the negotiation.

Why it is important to get the “no” before the “yes”, is because when people say no, there is a reason behind the answer. It is easy then to follow that up with another question and discover more about the customer. Saying “no” makes the speaker feel safe, secure and in control, so you should trigger those feelings. By saying what they don’t want to, your counterpart defines their space and gains the confidence and comfort to listen to you. This aids in the sales process. “Of course, you want to get a “yes” for an answer eventually, but it is important to know when you want to get it.” (Voss 2016)

In addition to yes and no, there are a lot of other crucial words that can guide the conversation in one way or another. You could consider them as triggering words: sayings that make you change your approach to the conversation and affect the behavior of your counterpart. Small differences in how you create the phrase have a massive impact on the outcome, like saying “you’re right” rather than “that’s right”. You see, when pushing for getting the answer “you’re right” there is a chance the counterpart only wants to get rid of you and does not own the conclusion. It is a way for people to get out of the conversation and never change their habits. (Voss 2016).

Creating an illusion of control

Negotiation is not about defeating your counterpart. It is about coaxing your counterpart to do the work for you and suggest the solution, your solution. It happens when you give the counterpart the illusion that he is in control, while in fact, you were the one defining the conversation. As talked about earlier, open-ended questions and calibrated questions work well for this. What it does, is that it removes aggression from conversations by acknowledging the other side openly, without resistance. It lets you introduce ideas and requests without sounding too pushy and forcing. As simple as it is, for example, you can remove hostility from the statement “You can’t leave” and turn it into a question “what do you hope to achieve by going?” (Voss 2016)

“Who has control in a conversation, the guy listening or the guy talking?” – the listener of course. You as a listener want to discover as much as you can, and the speaker is vomiting information. If trained well, even leading the conversation to the listener’s own goals, without the speaker even noticing it. You could think of it as a Brazilian Jiu-Jitsu match between a huge, muscular guy and a skinny, small guy. Most likely the big one will win because of the difference in strength, but what if the small guy knows the right strategies and knows how to use his opponent’s strength for his own benefit? That he knows exactly where he wants the huge guy to position himself for submission. In a matter of fact, in submission wrestling l am often giving my opponent the illusion that he is in control, but in fact, he is in that position only because l allowed it and it was part of my plan to submit him and win.

Quick recap:

Don’t try to force your opponent to admit that you are right. Aggressive confrontation is not the key to winning a negotiation.

Avoid questions that can be answered with only “yes” or small pieces of information, ask calibrated questions that start with the words “how” or “what”.

Asking for help with implicity will give your counterpart an illusion of control and will aspire them to vomit important information for you.

Avoid questions that start with “why”. “Why” is treated as an accusation – in any language.

Use calibrated questions (open-ended questions), to encourage others to expend their energy on delivering a solution.

(Voss 160-161)

Guarantee execution

“Negotiators have to be decision architects: they need to dynamically and adaptively design the verbal and non-verbal elements of the negotiation to gain both consent and execution.”

When negotiating the deal, keep in mind that there might be other people behind the negotiator and their viewpoints might affect the negotiator a lot. Doesn’t matter if it is the CEO or some other person in charge, they probably have someone who is whispering to their ear and giving out advice. You can simply avoid this by asking some calibrated questions to discover more about them. “How does this affect everybody else?” or “How on board is the rest of your team?”. Keep in mind, these questions start with “How” and not “what”. (Voss. 2016)

During your negotiations, you surely will face liars and jerks from time to time, you just have to know how to deal with them. UCLA psychology professor Albert Mehrabian created this 7-38-55 rule, which means that 7 % of the message is based only on the words, 38 % comes from the tone of the voice, and 55 % from the speaker’s body language and face. (Mihail 2020). How do you use this rule? Pay very close attention to tone and body language to make sure they match up with the words. If they don’t align, it is possible that the speaker is lying. If you aren’t convinced, try labeling to discover the source of the incongruence. (Voss 2016). Other common red flags for lying are: being vague; offering few details, repeating questions before answering them, speaking in sentence fragments, failing to provide specific details when a story is challenged, grooming behaviors such as playing with hair or pressing fingers to lips”. (Voss 2016)

You sure know the famous story of Pinocchio, whose nose grew every time he lied. Although it is a story, it is not far-fetched. Most people offer similar signs when they are lying. A study made by Harvard Business School professor Deepak Malthora and his coauthors found that on average, liars used a higher percentage of third-person pronouns, numbers, and profanity than other participants. They also found that liars tend to speak in more complex sentences to win over their counterparts. This effect was named the “Pinocchio effect” (Malthora 2012).

Bargaining is also a form of negotiation where usually you want to get the price as low as possible when your counterpart wants to gain the most profit out of it. Preparation for these kinds of situations is very important. In bargaining, it is good to know your counterpart’s bargaining style. Design your own ambitious – but realistic – goal and then bring up the labels, calibrated questions, and responses. You need to prepare to take a punch and handle it calmly, you don’t want to fall off your game and compromise. (Voss 2016)

Ex-CIA agent Mice Ackerman came up with a new model, that you can use in preparations:

Set your target price (your goal)

Set your first offer at 65 percent of your target price

Calculate three raises of decreasing increments (to 85, 95, and 100 percent)

Use lots of empathy and different ways of saying “no” to get the other side to counter before you increase the offer.

When calculating the final amount, use precise, nonround numbers like, say 37,893, rather than 38 000. It gives the number credibility and weight.

On your final number, throw in a non-monetary item (that they probably don’t want) to show you’re at your limit.

(Voss 2016)

Conclusion

Negotiation is a psychological investigation. You will boost your confidence in these situations by preparing well. Set up a goal and think through the best/worst case scenarios but only write down a specific goal that represents the best case. Summarize the known facts about the subject of negotiation, and what you know already about your counterpart. Use labels and make an accusation audit where is fill-in-blank -labels that can be used in nearly every situation, for example, It seems like _________ is valuable to you. Prepare the calibrated questions beforehand and keep in mind there might be people behind your counterpart whom you need to get on board.

“Without a deep understanding of human psychology, without the acceptance that we are all crazy, irrational, impulsive, emotionally driven animals, all the raw intelligence and mathematical logic in the world is little help in fraught, shifting interplay of two people negotiating”. (Voss 2016)

References

https://www.verywellmind.com/types-of-nonverbal-communication-2795397

(Cherry. K. 2022. Types of nonverbal communication. Read on 6.9.2022)

https://www.verywellmind.com/what-is-empathy-2795562

(Cherry. K. 2022. What is emphaty. Read on 9.9.2022.)

https://www.wikihow.com/Be-Assertive-Without-Being-Arrogant

(Griffin. T. 2022. How to be assertive without being arrogant. Read on 6.9.2022.)

https://pubmed.ncbi.nlm.nih.gov/23149242/

(Grossberg. S. 2012. Adaptive Resonance Theory: how a brain learns to consciously attend, learn, and recognize a changing world. Read on 5.9.2022.)

https://www.masterclass.com/articles/how-to-use-tactical-empathy-to-negotiate

(Masterclass. 2021. How to Use Tactical Emphaty to Negotiate. Read on 5.10.2022)

https://www.hbs.edu/faculty/Pages/item.aspx?num=44221