Women in Negotiation

“Ty Gitou?”

A young woman stood in the doorway of Tyler’s office. Tyler came out from behind his desk to greet her.

“Yes, hello. I am Tyler Gitou. How can I help you?”

“My name is Janice Lumere. My friend Kevin Delclinchy is in sales with the company. He said you were the Deal Whisperer and you might be able to give me some advice on how to become a better negotiator.”

“I’d be delighted to speak with you,” Tyler said. “Please sit down. What are the issues you are dealing with?”

Janice sat in one of two chairs in front of Tyler’s desk. Tyler sat in the one next to her.

“Well, nothing just yet. I just got a job in the sales group and wondered if you had any advice on how to talk with potential clients. Most of the people I am working with are older and usually they are…”

“Male.” Tyler said. He smiled. “Let me compliment you on two points. First, your ability to recognize the fact that there is a difference between men and women in how they sell and negotiate. As much as we try to convince ourselves that we are all equal, women truly do have more hurdles to overcome when negotiating with men and other women. Second, your desire to address and overcome the problem. For someone so early in her career you are showing great maturity in taking action to resolve issues that might limit your success. Many young professionals believe that when they ask for help it is a sign of weakness. In fact, it is a sign of strength when you leverage others’ skills and knowledge to make an organization more successful.”

“Thank you,” Janice said. “Kevin spoke highly of you and I can already see why. So what are the differences and what can I do to address them?”

“There are many and we can’t cover them all in one conversation. But let me give you a start. First, when I say the word ‘negotiation’ what adjectives pop into your head?”

Janice thought a moment. “Difficult; confrontational; demanding…”

“And why do you have that perception when you think about negotiation?”

“Because I need to win and the other side wants to win and I have to overcome some overly aggressive male in order to succeed.”

“And what if you can’t overcome this challenging man?”

“I guess I have to hold my ground as long as I can and then in the end give in for the relationship.”

Tyler laughed. “That’s perfect. You have articulated a universal perception many young women and men have about negotiation. The difference is in what women and men typically view as the ideal outcome of that ‘competition’. The studies I have read on this topic say that women are challenged by a cultural barrier that causes them to believe that negotiation is confrontational. Because women generally focus more on relationship they often won’t counter an offer or ask for more because it might create a negative perception of them as ‘difficult” or ‘pushy’ thereby hurting the relationship. Their negotiation style then often runs from ‘compete’ to ‘accommodate’. Make a demand to get some movement but stop and concede before it might hurt the relationship.”

“That all resonates with me. I feel like I have been through that scenario. So what do I do about it?”

“Come see me next week and we will discuss two elements a Deal Whisperer uses to build a collaborative sales and negotiation environment: legitimacy and perceptions. If we focus on those two first, you will soon find yourself a more confident salesperson and negotiator.”

(See "Women in Negotiation Part 2.")
 http://dealwhisperers.blogspot.com/2011/11/women-in-negotiation-part-2.html

Waiting for "No"

“We had our meeting with the client,” Verdi said to Tyler Gitou. “As you suggested, I provided him the two options.”

“Let me make sure I understand the situation,” said Tyler. “You offered to deliver the equipment for $1 million with a certain level of quality. The client then asked for a $100,000 reduction in price or else he would go to your competitor.”

Verdi nodded. “That’s right. We spoke and you suggested I offer him two options: either paying $1 million for the equipment with the higher quality components, or paying $900,000 for lower quality components.”

“Good,” said Tyler. “Now let’s think about how he might respond.”

“He will either accept one of the two options,” said Verdi, “or he may come back and say he wants both higher quality components and a lower price. If that happens, what do I do? We can’t provide the better quality for the lower price. It’s a bad deal for us. I can’t agree to it.”

"What will he do if you can’t reach agreement?” Tyler asked. “What’s his BATNA?”

“His what?”

“His best alternative to a negotiated agreement, or BATNA. What will he do if he can’t reach a deal with you and he walks away? Will he do a deal with someone else? Not do a deal at all? We need to think of all of his potential alternatives and decide which alternative is best for him. That’s his BATNA.”

“He could delay doing a deal,” Verdi said. “Or he could go to my competitor for the lesser price.”

“Is he likely to do either of those things?” Tyler asked. “Is your competitor’s offering as good as yours? Or will his old equipment provide the quality he needs?”

Verdi thought for a moment. “No and no,” he said. “The competitor’s product is not even close to ours in terms of quality and reliability. And he has to do a deal to upgrade the equipment because he has regulatory compliance issues to address.”

“What I am hearing, then, is that your client really has no alternative which will better meet his interests than your product, and that the deal you have put on the table is your best and final offer. Is that correct?”

Verdi nodded. “That’s sounds right,” Verdi said. “So what do I say if he requests the same quality at the lower price?”

“Verdi, the answer is right there in front of you!” Tyler laughed. “You’re just afraid to say it.”

Verdi swallowed hard. “I say, ‘no’.”

“Exactly,” Tyler said. “You have to say ‘no’ because you just told me you won’t say ‘yes’! But you’re afraid to say ‘no’ because you perceive that is the end of the deal. It’s not. A Deal Whisperer knows that ‘no’ is often the beginning of the deal. What you don’t see is that your client is waiting for you to say ‘no’. Like any good negotiator, he is going to keep asking you for changes until you say ‘no’. Why shouldn’t he keep asking as long as there is a chance you might say ‘yes’?”

“You’re right, of course. I was afraid of what he would do if I said ‘no’. Analyzing his BATNA with you makes me less concerned. But how do I actually say ‘no’?”

Tyler smiled. “Explain the situation. This is your best deal. You can reduce the price if you reduce the quality, otherwise your hands are tied. Let him know this is it. You don’t have to say ‘no’ so much as you need to let him know these are the final options.”

Verdi stood up. “OK, I’ll give him a call. Let’s hope the next time we meet it’s to say the deal is done!”

“I’m confident it will be,” Tyler said.

Admit It, You're Wrong!

Nobody likes being wrong. In fact, some people have so much trouble admitting they are wrong that they will perform acrobatic feats of rationalization to avoid accepting blame. Think for a moment about arguments you have had with your significant other. How often do the excuses start with, “Well, if you hadn’t…” and continue with a tenuous chain of cause and effect that ends with “…so it’s not my fault!”

Disciplined negotiators not only admit when they are wrong, they use mistakes as opportunities to build trust. Because people rarely admit their errors, when we deal with people who do, it is refreshing and puts them in a different light than run of the mill “blame dodgers.” Over a period of time, having a reputation for admitting mistakes can pay dividends when a problem arises that really isn’t your fault. The other party has every reason to believe you because you’ve shown your practice is to admit when it is your fault. They trust you.

A greater challenge is what to do when the other party refuses to admit that they have made a mistake. Trying to resolve a dispute, for example, becomes difficult if the other side won't acknowledge their contributions to the problem. (In one memorable exchange, Party A admitted they had made mistakes, but said it was still Party B’s fault because Party B failed to stop Party A from making mistakes!)

The reason why people don’t admit mistakes is very simple: they fear the consequences of being held accountable. Like a teenager claiming the dent in the car was “not my fault,” they don’t want to get “in trouble”. Those consequences might be institutional (they expose their business to liability) or personal (they or their colleagues will hurt their careers or reputations). In some cases, the fear may be purely egotistical: some people like to believe they are always right.

If you can eliminate their fear of the consequences you will start to change the other party’s behavior. Two ways of eliminating the fear are:

· Build affiliation by acknowledging your own mistakes or by sharing examples where other business partners made mistakes and how things worked out. Create an environment where everyone appreciates the issues are complex, fast-moving and mistakes will be made. Just don’t make the same mistakes twice! “Hey, we’re trying to launch a whole new business process here under tight timelines. We’re all doing our best but we know something will get messed up. The key is to learn from it, fix it, and move on.”

· When discussing what went wrong, also discuss the outcomes. If the other party can see over the horizon, they may be more willing to concede what happened. Demonstrate your intent is to help remedy the problem and to make them as successful as you in achieving the goal. “We know you are short of material for now. I can get some from another supplier and keep working on the product until you can get the rest of what we need from your factory. The cost for the delay will be minimal. What else can we do to help you?”

These same methods apply even to teenagers! Before asking “what happened”, let them know the consequences. Tell them the truth will produce one outcome, and not telling the truth produces a harsher outcome. Model the behavior you seek and slowly you will see change.