In Business Negotiations, Exert Influence through Control, Not Force

Absent a dominant bargaining position, and an opposing party whose long-term relationship matters little, there is virtually no opportunity to persuade others through sheer force. In your typical commercial negotiation, your opportunity and job is to influence the other party through persuasion. While you might not be able to bulldoze with power, you can and should look to influence the other side by assuming control over the negotiation. How exactly do you do that? My answer lies within the answer to one of the most frequently asked questions on negotiations:

Are you better off making the first move, or waiting and countering a first offer from the other side?

My take: Make the first move. In almost all cases, I find it advantageous to move first and seek to take control of the discussion from the very beginning. One of the best ways of influencing others is to lead them through your vision and framework for the deal, from the outset, and to return them to that vision and framework throughout the negotiation. In this context, your framework will consist of the key objectives and components of the deal, as well as a proposed process and schedule for the negotiation, and your agreement template.

By making the first move, I am speaking less about the tactics of who puts the first dollar value on the table, although even then I generally prefer to be the one doing so to “anchor” the discussion on my number, assuming I have sufficient information on which to act (if I don’t, I ask questions and learn more to validate my offer). Much research has been published validating the benefits of taking the lead in communicating the first monetary offer in a negotiation, as it creates an “anchoring” effect by focusing the discussion, and subsequent counters, around that number, as stated in We Have a Deal, Natalie Reynolds (2016) at page 62. I am referring more to taking accountability for guiding the other side through your conception for the deal and a proposed structure for discussing and ultimately aligning on terms.

Why? Consider the many ways in which your approach will decide success or failure in a negotiation: you must come prepared, know the other side’s motivations, know their weaknesses, paint a picture of success for them, among others. You simply can’t afford to delegate these accountabilities to the other side. It may set in motion a bumpy negotiation that proves difficult, if not impossible, to course-correct as a pride-in-authorship dynamic sets in with the opposing party.

What if they take control and insist on moving first? This may well happen at the outset and certainly will occur at some point in the negotiation. Don’t panic. Remain composed and return them to your vision and structure for the deal. They may, for example, move first in quickly setting their monetary offer on the table, placing a wildly high number out there. While being sure to acknowledge their initiative in moving things forward, calmly set it aside. Just like you want the benefits of anchoring the economic discussion around your number, you need to prevent them from doing the same. It doesn’t have to be contentious and should not be dismissive; something along the lines of the following may suffice to reframe the conversation around your vision for the deal:

Thanks for sharing your perspective on the economics for a deal. I know you’ve put some thought into this. What I’d suggest though is we set that number aside for the time being. Candidly, it represents a very different viewpoint on value than what we have for this deal. Rather than focus on a number, I’d propose that we explore the various standards and methodologies that might be appropriate in setting a range of valuations that we both can get behind.

Does that sound reasonable?

From there, you should resume your leadership role in exploring objective standards for valuing economic trade-offs and benefits. The pre-work you’ve done will pay dividends in demonstrating your readiness to lead. Leadership is not automatic. It is earned. And I have found, when you prove your worthiness to lead, others will follow.

Great athletes often talk about the hunger they have to be the one to “take the last shot” to win a game. The work you do in advance of a negotiation should give you the confidence to “take the first shot” on the path to successfully landing your deal.

In your next negotiation, start your preparation by first tackling the (Pre) Work Sheet questions below.

Negotiation (Pre) Work Sheet

Questions Answers
1a. What are your goals/priorities?

1b. What are their goals/priorities?

2a. What value/benefit do you have to offer?

2b. What value/benefit do they have to offer?

3a. What are your dependencies/weaknesses?

3b. What are their dependencies/weaknesses?

4a. Who are your primary and extended stakeholders?

4b. Who are their primary and extended stakeholders?

5a. Who is your decision-maker?

5b. Who is their decision-maker?

6a. What broader interests/aspirations does your company have in relation to theirs?

6b. What broader interests/aspirations does their company have in relation to ours?

7a. What are your non-negotiables (and walk-away line)?

7b. What are their non-negotiables?

8a. What are your best alternatives to a deal?

8b. What are their best alternatives to a deal?

 

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