Mastering the Art of Negotiation
iStock
Amateurs in the business world get a lot of advice when it comes to negotiation: Go for the throat, close the deal as quickly as you can, get the biggest commission possible. So, it’s not surprising that rookie entrepreneurs tend to start negotiating extremely aggressively. They want to go home feeling good about themselves, like they earned a victory — but in truth, something else is taking place.
You see, when one person “wins” in a negotiation involving two people, the other person loses. And let’s face it; this isn’t the right way to go about negotiating because of its negative impact on business. Chances are the person who “loses” isn’t going to want to do business again with the person who “wins.”
[More from Manilla.com: The Art of Negotiation: Child's Play]
So what is a truly successful negotiation? Ideally, all parties involved come out saying they’ve gotten a good deal. Everyone is happy, which will most likely lead to repeat business. Conversely, if nobody really feels like they won, that’s OK, too. It means nobody feels like they got the short end of the stick. Compromising may mean you didn’t “go for the throat,” but it also means nobody feels taken advantage of. The best deal possible might not be exactly the deal you wanted — but if all involved parties leave with a similar level of acceptance, then you can consider your negotiations a success.
You can learn a lot about mastering the art of negotiation from the world of sports. Just look at the story of the Miami Heat. Master negotiator and Heat coach Pat Riley talked Dwayne Wade into taking less money to play for the Heat, despite the fact Wade had already earned a championship ring with the team. So why would he let Riley talk him into a lesser contract?
In short, it was because Riley showed Wade a win-win scenario. After Riley brought Lebron James and Chris Bosh on to the Heat, the team went on to win back-to-back NBA championships. Because of this exposure, Dwayne is one of the most well-known and popular players in the league and is high demand for endorsements and TV spots. He might have lost money initially, but in the end Wade has richly profited. Sure, he could have refused to play for less money and as a result, gone to another team; but by compromising and being a team player, Dwayne continued to be part of a championship franchise.
[More from Manilla.com: 5 Sites to Help You Find a Mentor]
You may not be a head coach in the NBA like Pat Riley or a championship basketball player like Dwayne Wade, but negotiating is part of business and it’s part of life. There are several strategies that will bring you closer to this win-win scenario in your own negotiations:
Sure, you know what’s important to YOU, but try to put yourself in the other person’s shoes and understand what’s important to THEM. And if you don’t know, then ask a lot of questions to get a better understanding of what really matters most to them.
Think about things that might be important gains for the other person that aren’t huge sacrifices for you. For example, car dealerships will throw in a free oil change for someone buying a car. The oil change itself doesn’t cost the dealership a lot, but it has value for the car buyer.
Understand the value of “give and take.” In other words, it’s important to prioritize a list of “must-haves,” along with items you are willing to back off on. True negotiation is all about compromise.
Place value in the relationship first and foremost. When both parties walk away feeling like it was a fair deal, there’s an opportunity for that relationship to grow and future transactions to take place. Always stick to the issue at hand, and never make it personal. Calling someone “cheap” or “stubborn” isn’t going to help your cause.
As an entrepreneur, you must learn how to communicate and how to sell — but not necessarily in a way that makes you always win. Successful negotiation means finding a way that makes everyone win. That is the secret to making people want to come back and do business with you.
Patrick Bet-David is a successful entrepreneur, author and thought crusader committed to helping people get more out of life. His intriguing perspective on opportunity is colored from his experience as a young immigrant escaping war-torn Iran in the late ‘80s. He embodies a true rags-to-riches story that saw him first serving in the U.S. military before breaking into the financial services industry. His latest venture is a successful web-based broadcast called “Valuetainment Weekly” which takes complex ideas and current events and converts them into simple life lessons.
More from Manilla.com:
