This negotiation guide isn’t just for people in business or sales. Whether you realize it or not, you can apply basic rules of negotiation and negotiation tips to help you and others successfully pass through what could otherwise be challenging but critical conversations regarding home life, career, personal relationships, and more. This guide is a blend of concepts and action items from Ignite Your Potential and also gleaned from Chris Croft (Senior Lecturer at Bournemouth University Business School), Chris Voss (former top FBI hostage negotiator, the CEO of The Black Swan Group Ltd, and co-author of the book Never Split the Difference), and Harvard Law School’s Program on Negotiation.
Great negotiation is about great collaboration. It’s about several people faced with different aspects of the same problem. The adversary is not the person sitting across from you at the table. The adversary is the situation. The person sitting on the other side of the table is a counterpart who is struggling with some aspect of the same situation you are. When you work with them and solve the problem together, you’re both better off. With effective negotiation, you can achieve your goals through collaboration and the use of tactical empathy that creates trust-based influence.
Before we get started, note that this is a solid primer for negotiation. This negotiation guide reviews some of the most important aspects of negotiation. That said, I want to acknowledge that negotiation is something you can take a series of college courses on and even work for years to become an expert. So, if you have an important negotiation coming up with high stakes, use this as a negotiation guide, but we also advise that you study the subject in-depth, do the necessary research, and make sure to practice. Let’s get started.
Why Do People Avoid Negotiation?
There are a number of reasons why people avoid negotiating and even steer clear of learning about negotiation. Here are four:
1.) Biases About Negotiation
Some people fear that it’s rude to negotiate. This might be true in some cultures, outside of specific business practices, this is generally true in the US and UK.
There are stereotypes about negotiation and often they fall into this idea that it’s somehow off-putting to negotiate. That one person will win and the other will lose. That the loudest, more aggressive person will win by taking the most, at the other person’s expense. That one person beats another. None of these ideas are true. When you consider how stereotypes form…. they begin as misunderstandings. They begin when one person who offers judgments doesn’t actually understand the other person or thing in any depth.
If you feel or believe these things but you’re open to thinking of negotiation differently then consider the idea that people who don’t understand negotiation, could be “speaking a different language” than people who do know how to negotiate. Think of negotiation as a dance. Do you want to be in a situation where this dance is happening, but you don’t know how to recognize what is happening or how to participate? Or you don’t know the dance moves? Or you insist on not doing the dance because you buy into the stereotype? But the great thing is, it’s so easy and so valuable that it’s worth overcoming this resistance to learning and seeing this practice for what it is. Negotiation is a communication tool that’s been used and honed for thousands of years.
2.) It Appears to Have No Structure
Another reason people will avoid negotiation is that they don’t know what the other person will do. There doesn’t seem to be any rules. What if it all goes horribly wrong? What if you do not get the thing you were wanting? Or you don’t get the deal that you wanted to make? But I am going to show you throughout this negotiation guide that there IS a process you can follow and that the process will ensure that you can’t fail to get some aspect of the deal.
People will also fear negotiation because they are concerned by the idea that they could look cheap or greedy. Especially if in the end we have to cave in and say, “All right then. I will pay the full price after all.” What if they laugh at us? What if they think we’re a bad person after we’re finished? I think wanting to be liked is one of the biggest barriers to negotiation.
Or a similar reason one might fear negotiation, and maybe even more important to some people, is a fear of hurting the relationship. Yet I know it is possible to negotiate and still be liked. And it’s worth saying that especially in our more important relationships, in our personal lives and our professional lives…if you can’t have critical conversations with people that are important to you…you may be damaging the relationship already through avoidance. If you aren’t getting your needs met in that relationship, because you don’t know how to communicate your needs effectively, that is a problem that will eventually come to a head and backfire later. In other words, you need to bring attention to that issue immediately.
4.) A General Blindspot
In this case, one may just not have encountered any lessons on negotiation. Maybe you don’t have a shared language or understanding of what negotiation really is. No fear…. that is why we created this negotiation guide!
All of these feelings and concerns can be resolved. In fact, every reason for not negotiating is really presenting us with an opportunity to learn. So, what do you think is the biggest barrier for you when it comes to negotiation? And how will you overcome it?
One trick is to think of this as a game or a dance. Remember that humans have been doing this for thousands of years. It’s a type of conversation. In the worst-case scenario, in the event that you negotiate and the other person, says no or will not participate, the most regretful fate is that you are back where you were before you began to negotiate. You aren’t going to lose the deal or the offer if you follow some basic guidelines.
What Happens When We Avoid Negotiation?
We lose money. We leave money on the table. Research has shown that women (and men as well) who do not negotiate are leaving 1 to 1.5 million dollars on the table through the course of their lifetime of careers!
We lose opportunities because we don’t know how these conversations work.
We don’t get what we ultimately want. This is both short-term but also the achievement of our big-picture goals and dreams.
And we don’t get what we deserve.
Negotiation Guide: Tips for Negotiating
Instead of Yes or No, Negotiate
There are times when you may not realize that negotiation is an option. This negotiation guide will point out the fact that it’s a great option. But nonetheless, you may find yourself in situations where you think your only option is to say “Yes” or “No.” But these are not your only options, instead of yes or no there is a third option: to negotiate. For example, what if someone asks you to work on a project that you have concerns about. Maybe you’re concerned it involves more travel than you want to do. Or it doesn’t involve solving your favorite problems. Or it’s not as optical as you like. (Meaning, it isn’t a visible project. It won’t bring you acknowledgment from the rest of the organization.)
Instead of a reluctant “Yes, alright, I’ll do it.” Or “No, I’m not doing it.” Consider that there’s a price that will make it worth doing it. Even if it’s a very high price. You can determine what that price is and then offer, “I will do it for this price.” Then they can decide if they will say yes or no to your offer or they may decide to negotiate. This price might be financial, it might be getting on a desired project, it might involve being moved to a different team. Part of negotiating is identifying what will work for you.
It’s the same with time rather than money or projects. Let’s say that my sister asked me to go away with her to her in-law’s house for the weekend. Let’s say, purely hypothetically, that I didn’t really want to go. I could reluctantly say yes. Or I could say no, but that might not be supportive of my loved one.
But I could also negotiate.
What if I suggested going in the afternoon rather than the morning? And saying I’d like to do a little bit of shopping while I’m there. Or that I will come if it’s okay for me to bring my laptop and if it would be okay if I slipped away to get some work done for a bit of time. This is a compromise. A give and take. It allows me to get some things done and have some breaks from the in-laws but it’s also supportive to my sister.
So if you find yourself about to say no or not wanting to say yes, switch your negotiating light on. Begin to consider what circumstances would make this work for you. Can you think of a situation, either at work or at home, either about money or time, where you tend to reluctantly say yes or tend to just say no, where you might be able to try negotiating instead?
Tactical Empathy and Emotional Intelligence
Empathy is about becoming completely aware of the other side’s perspective, point of view, and take on things. How they see it and what they feel. It’s not an agreement in any way, it’s not compassion and it’s not sympathy. Let’s tactically take what we know to be the case and apply it in our interactions. There are rules of human nature that apply to all humans. It doesn’t matter if you’re a terrorist or a businessperson. And if you can really get at what’s driving someone, then you can change their outlook and their decision-making.
You must understand what their rules are, and you have to respect those rules. You don’t necessarily have to adopt those rules or even agree with them…. but you must understand what they are and respect them. This is time to use emotional intelligence. The beginning of a negotiation conversation is about building rapport and gaining trust.
Be curious about what the other person wants and why.
A common misconception about negotiation is that you must make your case. You must come prepared with the reasons why the other side should make the deal and go along with what you want. You must make your argument. Your value proposition, if you will, and you must lay all that out. This negotiation guide will show you, that is not the case. Instead, you need to find out what’s possible and you need to engage the other side on what their thoughts are so they feel involved in a process and consequently, they want the deal to happen.
This technique of mirroring is a way to get the other side engaged, to get them to feel like they’re involved, and also to tease out the information you might not have had otherwise. To gain pieces of information that could make all the difference in the world. So mirroring is a way to let the other person know that you feel empathy for them and understand. It also gets them talking and the information they share essentially presents to you how the deal can work while having them feel more bought in because it came from their ideas. So mirroring is critical in information gathering and having the other side feel bought in.
Mirroring is a form of reflective listening. It’s the simple repetition of one to three words, typically the last one to three words of what someone said. But when you get good at mirroring, it can be a few words from anywhere from what they just said. The other person feels listened to, it tends to connect their thoughts in their head.
Part of the message it sends to the other person is:
‘I heard every word you said word for word but it’s not enough, I still don’t get it.’ And then as the person goes on with a further explanation, they’re going to add more information. It will cause people to go on, elaborate, and use different words giving you more information. It’s a simple technique, so simple that it may not seem possible that it will work. But it does work. The other person loves to know you’re paying attention.
For example, let’s say you are purchasing a used car from someone. You ask them why they are getting rid of it. They say, “I’ve had it a long time, it’s time to let it go.” You mirror by saying: “It’s time to let it go?” And pause to let them tell you more.
Mirroring is also a rapport-building, relationship-building skill. People love to be mirrored; they love the encouragement to go on. There’s an old saying: Interesting people are interested. If you mirror you will be interesting to others because you’re interested in them.
In this negotiation guide, this technique can seem awkward at first so we suggest you practice this in many conversations. In fact, in the next conversation you have, try mirroring the other person and see how that goes. The more you practice this the more you will see the value of building rapport and trust and getting to understand more about the other person, what’s important to them, and their context.
Setting Your Limit Beforehand
In this negotiation guide, one of the most important aspects of negotiating is to set your limits before the negotiation. This is your walk-away point. This is the most you will pay if you are buying something. This is the least you will accept if you are selling something. If you are considering taking a job offer, it’s the lowest offer you will take for doing this job. The reason this walk-away number is so important is that it’s the root of all your strength. Having a walk-away point gives you something to push back from like your back being against a wall. And if you know you’ll walk away at a certain point, it gives you power, because the only power you have in a negotiation is the power to walk away.
Put another way, if you don’t have the power to walk away, and the other person knows it, you have no power at all. Most people are fine with the idea of setting a limit. What tends to be challenging for people, is then, sticking to it.
There are two ways to look at this: the logical side and the emotional side.
On the logical side, why would you do a job but be paid less than you think you’re worth? On the emotional side, your limit is a promise to yourself.
If you go beyond your limit what you’re saying to yourself is that you don’t mean it. That essentially, you can’t trust your own word to yourself. This is an important thing to consider, and we encourage you to honor your promises to yourself. But it also means that you need to set your limit very carefully. You need to make sure that you will walk away if your limit is not met. The other side of this is when you truly have a limit, the other person can feel it. And having a limit means you are acknowledging to yourself that you aren’t in scarcity, there are other job opportunities.
It’s worth saying however that you never start a negotiation at your limit. More about that next.
You would never want to “wing it” when it comes to negotiation. Important negotiation tip: preparation and practice are key. Before you negotiate, first do a negotiation analysis. This is when you do all your pre-planning, assessing each side’s interests, what your and their walkaway point is, imagining possible agreements, factoring in personality and culture, thinking through moves and possible countermoves, and considering what potential hard questions the other person could pose.
Negotiation guide: basic questions that can form your negotiation analysis:
- What outcomes are you seeking through this negotiation? What outcomes might the other person be seeking? On a basic level, what do you want?
- What are my strengths—values, skills, and assets—in this negotiation?
- What are my weaknesses and vulnerabilities in this negotiation?
- Why is the other party negotiating with me? What do I have that they need?
- What is my Best Alternative To a Negotiated Agreement, or BATNA? What might their BATNA be?
- What is my aspiration point in the negotiation—the ambitious, but not outrageous, goal that I’d like to reach? What might their aspiration point be? This is what you wish would happen.
- What are the other side’s interests? How important might each issue be to them?
- What is my “walk away” point? What do I think theirs might be?
- What’s my relationship history with the other party? How might our past relationship affect current talks?
- Are there cultural differences that we should prepare for?
- Who are my competitors for this deal? How do our relative advantages and disadvantages compare?
- What objective benchmarks, criteria, information, facts, and/or precedents support my preferred position?
- What are the hard questions that the other side could pose to you? (After listing these hard questions, go through and come up with answers.)
Answering these questions will give you a handle on the conversation you’re about to have and help you outline your goals for the negotiation.
We’ve discussed the first thing you need to know: your limit. But you also need to know your opening offer. Of course, in some job situations, they give this opening offer. There are times, when speaking with a recruiter, that they may ask you your range, and there are times when it is appropriate to tell them. One of those times is when you are both trying to determine if the role is even at the appropriate level for you. That said, in many more situations, when you are interviewing and if they were to ask what you are looking to make, I would consider deferring to them and saying, “I would prefer to hear the range that you are paying for this role.”
The opening offer is the first specific statement of what you’re looking for in a negotiation. After you’ve set your goals for the negotiation, you can consider your opening offer. For example, in a job interview, the opening offer is the salary you’re seeking. Don’t look for any hard-and-fast rules or magic formulas. To determine your opening offer, you should draw heavily on the goals and limits you set and the information you’ve gathered while preparing for the negotiation.
Your opening offer should be higher than the goals you’ve set for yourself. But it shouldn’t be so outrageously high as to be off-putting to the other side or make you look foolish or inexperienced.
Keep in mind that we aren’t suggesting you always make the opening offer but rather that you should know what this number is for you.
Here are some important aspects of the opening offer:
Hardly anyone accepts the first offer. So, if you do put a number out there first, make sure there is room for you to be satisfied even if you choose to maneuver lower.
Ideally, your offer should be at or near what you think is the other party’s BATNA (best alternative to a negotiated offer), close to the most that your buyer will pay, or the least your seller will accept.
Salary Negotiation Specifically
First, let’s acknowledge that negotiation at work, whether it’s when you get an offer and you are negotiating salary or before a review cycle, is not something that begins at that exact moment. It’s something you’ve been working toward throughout the interview or throughout the previous year before having that conversation with your boss about compensation. Rapport and relationships are the foundation of negotiations. By using the techniques we’ve gone over in this handout you can learn a lot about who you’re dealing with, what’s important to them, and possibly even how to influence them. Rather than being self-centered, you want to be and come across as we-centered, team-centered, or company-centered.
So how do you make yourself valuable to an organization? One way is to ask “How” questions. For example, in an interview or even on the job ask your boss a question like: ”How can I be involved in the strategic projects that are critical to the future of the company?” You’ve asked a great “how” question. It’s very deferential, and instantly you transform yourself into someone who wants to guarantee their future. Two things happen. They love that and they want to pay you more because they want to retain you. You’re not just there to get a paycheck and do the minimum and go home. You’re there looking out for the entire team. It’s an incredibly strong message.
It’s worth noting that there are careers where salary negotiation doesn’t happen. In childhood education (elementary school and high school), in law, and firms that hire a large number of college or professional-school graduates into entry-level positions tend to offer standard packages and avoid negotiating with new recruits. Also, there are specific companies who have banned negotiation and in these environments where they are banning negotiation, they will let you know ahead of time this is how they handle it. In most cases, there is always room to negotiate. It’s expected that you will negotiate.
In addition to this negotiation guide, we have another article “When you Should Think Twice About Salary Negotiation” here.
Market Value Salary
Before getting into negotiation around salary make sure you do a market analysis and consider the company itself and what it can sustain. This is a very important aspect of salary negotiation that cannot be left out. The market value salary is the amount of money that an employee should be paid for their position, based on the current market conditions. This number is usually determined by looking at similar positions within the same industry and geographical location.
Confidence, Presence, and Body Language
Suggestions show that body language makes up more than 60% of what we communicate. People offer non-verbal communication through micro-expressions, posture, gestures, physical behaviors, and eye-glazing. When involved in negotiation, we should be aware of the other person’s range of communication including body language. And likewise, we need to be aware of ourselves and how we are coming across. Here are a few negotiation tips:
Show up on time
Be ready with a firm, friendly handshake
Stay aware of your own body language.
Try to make sure that your body language reflects the positive connection and rapport you’re building. Take care not to frown or wrinkle your forehead worryingly and take the opportunity to smile and nod in agreement whenever possible. Keep your chin up, showing positivity, and keep your eyes level. Remember, the other person will be looking to see if your physical gestures mirror your words–keep your body language both open and positive.
A few additional points:
- Keep your arms calm and open.
Don’t cross your arms or legs.
- Keep your hands away from your face.
When negotiating, the general rule of thumb is to keep your hands away from your face. Rubbing one’s face or head generally equates to a symptom of anxiety.
- Maintain a nice verbal pace.
Speak calmly and at a pace that is not fast. Listen closely to the other person. Refer to the mirroring technique we discussed earlier.
- Keep your posture positive and confident.
Shoulders back, chest open.
In her book Presence and in her TED talk (which incidentally is the second most popular TED talk in all of TED talk history), Harvard professor Amy Cuddy discusses how “through accessing our personal power, we can achieve “presence,” the state in which we stop worrying about the impression we’re making on others and instead adjust the impression we have been making on ourselves.” In other words, what we think about ourselves matters and becomes part of our presence. We don’t need to achieve the greatest heights to feel good about ourselves and show strong executive presence, instead, we need to “nudge ourselves, moment by moment, by tweaking our body language, behavior, and mindset in our day-to-day lives.”
Cuddy revealed through scientific research that the way we carry ourselves not only is a part of our communication with the people around us, but it also has a strong effect on our own self-image. Studies show that our body language physically changes the testosterone and cortisol levels in the brain hormones that affect the way that we feel. Cuddy explains that by practicing “power posing” (by standing in a confident posture) we affect our mindset, and this makes us feel more confident. So, this is something that you can do before negotiation or before any important conversation or meeting.
Negotiation is Necessary
There are many situations that require negotiation. In fact, you cannot overstate the importance of negotiation. This negotiation guide covered a number of topics for your consideration. Negotiation holds the key to getting ahead in the workplace, resolving conflicts, and creating value in contracts. We hope that this negotiation guide can help you feel more confident with negotiation but also give you reason and techniques to practice again and again. Also, remember that our award-winning coaches at Ignite offer a 25–30-minute free phone session that can further build on this negotiation guide. Click here to schedule this through our website by clicking any of the coaches’ photos.