Creative approach

May 21, 2018

If you are compromising, then you do not know how to negotiate. Good. Now I have your attention. Is compromise part of negotiation? Yes… but a much smaller part than you might think. The media and other detractors of negotiation would have you believe that if you engage in negotiation, then you may have to give up what you want most in order to reach a deal. Frankly, that is just nonsense and the furthest thing from the truth.

The best negotiators can always fall back on compromise, but that is far from their starting point. Negotiation takes two forms. The first is trying to create a deal with another side. The second is to solve a problem or a conflict. Either way, the most effective negotiators see the issues in front of them from a problem-solving perspective. These negotiators flip a challenge in endless directions until they find the best deal or solution possible.

In order to come up with the best solution possible, effective negotiators always look for opportunities to expand the pie before slicing it. By expanding the pie, I mean they engage in a creative search for value. In any negotiation, there is a maximum value to be had. This is where compromise falls short—solutions that split the difference almost always leave value on the table because compromise short circuits people’s exploration of all the possible options to a solution. The negotiators have hit a snag on a challenging issue and instead of getting creative, they split the difference, take a piece of the pie, and go home. They do this but do not realize that their piece of the pie may very well have been much bigger had they engaged in some creative thinking.

This last point leads to an important insight into effective negotiation—one’s mindset matters… a lot. The old adage goes, “If every problem looks like a nail, use a hammer.” If you enter a negotiation with a win-lose mindset, then that is where you will end up. If you hold out the possibility that both parties can gain, then much of the time that is where you land. Mutual gain is based on getting down to people’s interests—understanding their underlying needs and motivations. Why someone does and wants something is far more important than what they want. When you understand why someone wants or needs something, there are often many avenues to satisfy that need. Let me give you two examples.

The first example occurred a few years ago when I was working with a company that provides research tools to academics working in the sciences. One of the salespeople shared a story with me about a potential customer whom she could not get to buy her products…until she really understood her underlying interest. She tried for months, meeting after meeting with the customer, but [there was] no progress. Then one day, she asked the customer if there was anything she should know that she did not already understand. The customer finally opened up. She had purchased an expensive machine the previous year, promising her boss it would really help their research. It turned out that the machine did not help, or at least they had not been able to figure how to use it to its maximum potential. Upon hearing this, the salesperson explained that if that was the problem, she could help. Some of the tools she had to offer could be used with that machine and could, indeed, help them with many aspects of their research. The customer was thrilled—she could finally get out of her boss’ bad graces and prove her worth. They were able to reach a deal shortly thereafter. This deal got done only because the salesperson finally understood the customer’s underlying interest.

The second relates to a company I worked with that serves as an environmental and water management consultant to large public and private companies around the world. I was working with a project manager who was trying to negotiate with his client—the project manager for a city in the northeast of the United States. The project manager from this company had encountered a problem and suggested a very creative and innovative way to solve the problem, to the client project manager. The client project manager quickly rejected the solution without any real explanation. The project manger was a bit confused and frustrated when we talked. I then asked him, “Did you ask why he did not want to do what you were suggesting?” He sheepishly said, “No”, but then told me he would call him and get back to me. The next day, he called to explain what happened. As he told me, “Eventually the client PM told me what was happening for him. The reason he rejected the idea was because he did not really understand the engineering behind it and he would have had to take the idea back to the city council and make the case as to why this approach made sense. He was very unsure how to do that.” “So, what did you do then?,” I asked. He continued, “Well it turned into a relatively easy fix. Once I knew the problem from his perspective, I offered to go with him to the city council and explain the solution to them and to make him look good in the process. Problem solved.” As one can grasp from this example, getting to the city project manager’s underlying interest enabled him to find a viable solution that worked for all involved.

So, in summary, your key takeaways are:

  • if you are compromising, then you are leaving potential value on the table
  • shift your mindset from win-lose to mutual gain
  • move from positions to interests
  • and get creative, search for value, and view negotiation as a problem-solving endeavor

If you do all of these things, then you will be well on your way to reaching better and more effective deals in whatever your context may be.