Bite-Size 2018-06-10T02:53:58+00:00

Bite-Size

Looking to keep your finger on the pulse, but short on time?

Enjoy our collection of bite-size thoughts and ideas on negotiation! From commentary on breaking academic research, to watercooler analysis of recent global politics, we keep you informed and your mind sharp… so you can be at your best when you need to negotiate for yourself or your organisation.

Want to see a subject covered here? Contact us using the form at the bottom of the page, and we’ll add it to our blog schedule!

1506, 2019

Read Between the Lines

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Negotiated agreements are often categorised, neatly numbered, and suggest completeness. Behind this picture of order lies another story: what did the parties exclude and why?

The written terms of an agreement imply finality. Most agreements stack pages upon pages of clauses that address a broad array of topics. The sheer multitude of factors to consider can make interpreting real motives very difficult.

Let’s consider a simplified hypothetical where Holly proposes draft terms for the sharing of a car.

In these terms Holly includes:

“1. The car shall reside at Holly’s house in the mornings, and at Joe’s house in the afternoons. Each party must return after their period of use.

2. The car shall be cleaned once a day.

3. No food shall be consumed in the car.”

Have a think about what Holly might be trying to accomplish with each of these terms?

When Holly shares a simple first draft it presents two advantages. First, they define the benchmark for the following negotiation. Second, they paint an ordered picture of what you think they want. Confined and prioritised.

The savvy negotiator may of course question the hidden priorities of the other party, but even that questioning will be directed by the information first presented to you.

A few possible omissions Holly may have made purposefully are as follows:

1. Leaving out specific times of morning and afternoon could work to Holly’s advantage. This may be considered as 12:00am – 11.59am, 6am-11.30am, or any other arbitrary limit that suits her. If the technical limit of 12:00am is upheld, Joe would need to drop the car back by 11.59pm, a more inconvenient time than 11.59am.

2. As Holly is the first user of the car each day, washing at the end of the day seems more logical after everyone has used it. Holly could then escape cleaning duties.

3. Holly does not particularly care whether food is eaten in the car, but knows that Joe loves eating take-out on the road. Conceding on this point could be used as a trade-off for an inclusion of a favourable clause later by Holly.

Practical eccentricities of the hypothetical aside, it demonstrates that what is left off the paper is important. The hidden text allows for flexible interpretation of terms, and could be used in the late-stages of negotiation more effectively than at the beginning.

As a receiver of draft terms for any agreement, be sure to read between the lines!

806, 2019

Thank you!

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In the world of concessions and compromise, you may not achieve all that you want in a negotiation. Or, if you do, it may come at the expense of your counterpart. To keep a healthy business relationship, how can we maximise parties’ post-negotiation impressions of each other? 

Negotiators come to the table with goals. There are stakes involved, and possible promotions or demotions on the line. As much as we seek to remain as objective as possible, our humanness inevitably becomes tied up in the outcomes we seek.

As such, our stumbles tend feel more injurious and our wins more glorious in these environments. This emotive reaction to score-keeping does not sweep by in its pain or pleasure: it will set the tone of future interactions you have with those same people.

As important as a first impression, which anchors our attitude towards a new acquaintance, is the last impression. It is within parting moments that you can significantly shape another’s memory of the interaction.

Let’s say that you are meeting a prospective client for the first time, and hope to maintain long term business with their company. You have the upper hand and negotiate firmly. You achieve almost all of your goals, while your counterpart has compromised heavily. They are noticeably dissatisfied with the result, though they accept it out of necessity.

What is a valuable way of ending that negotiation?

One tool is the use of counterfactual framing.

Neal Roese, a social psychologist who has specialised in hindsight bias and counterfactual thinking, has outlined the consequences of this tool. In essence, our judgement may be shaped when juxtaposed to an anchor.

For instance, a coffee may be hotter after eating ice cream. Likewise, we may believe more strongly that the coffee is hotter because the ice cream is colder if it is emphasised (however irrationally).

To use counterfactual framing in the above hypothetical, what focus areas may be useful in influencing our counterparts lasting impression of us?

Pause to think.

One option is to highlight the less advantageous outcomes that were also possible. Creating the impression that the actual result was far better than other realistic paths, where more losses occurred or no deal was reached at all, can makes both parties more grateful for what was achieved.

Another option is to emphasise your sentiments of gratitude. According to social psychologist Adam Grant, using the simple words ‘thank you’ after someone has helped you can significantly increase the likelihood of them helping you again. Expressing your gratitude for your counterparts efforts can encourage them to judge you as a personally decent individual they would like to do business with again.

As well as the professional benefits you’ll receive from using this tool, it is a fantastic practice for anyone to use in their daily lives. Thinking on how you are grateful today can lift your mind from daily worries. Sharing that with others can make their day.

Counter factual framing is a road to gratitude, so try it out in your next negotiation!

With thanks to: Neal Roese and Kai EpstudeAdam Grant, and Sam Harris.

2405, 2019

The Aussie Negotiator

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So you’ve got some upcoming deals down under? This is your guide to the best negotiated outcomes with Australians. 

From politics to footy to the boardroom, Australians tend to value certain characteristics and negotiating styles. Every individual is different, and you should certainly always be on the lookout for the vast numbers of people who don’t conform to their cultural stereotype, but that doesn’t erase the fact that cultural norms do exist… meaning you can use those traits to your advantage. Here are our top five Aussie values, and how to play to them in your negotiation:

  1. Larrikin-ness: Australians use humour to lighten formal settings, to establish rapport with acquaintances and friends, and as a general conversational style. We are often skeptical of all-business types, and will typically be less generous in information sharing accordingly. Try not to jump into serious business talk too soon in your meeting, and keep your conversational style respectful but casual.
  2. ‘Struth-ness’: Australians will shoot straight from the hip with business proposals. We respect a no frills, clear-cut communication style. Try to be clear about your intentions, and support them with strong data over strong emotion.
  3. ‘Under-Dog-ness’: Bragging about status and title is a no go for Aussies. We will rarely be intimidated by statements alluding to rank, and are generally distrustful of authority. Likewise, it is common for all members of our negotiation team, regardless of rank, to speak up in business settings about our ideas. While personal achievements may be respected, try to avoid falling back on your title and focus more on the value of your proposal.
  4. ‘Beers-All-Round-ness’: Aussies love a fair go for all (just ask any politician!). We are a typically cooperative people who are open to compromise if it is seen as helpful for all to move forward in a negotiation. Our preference is for a win-win outcome. Try to demonstrate an appreciation of this value with reciprocated acts of trust. This will also assist in maintaining long-term business relationships.
  5. ‘Mateship’: This is one of the most identifiable Aussie characteristics. Often associated with the diggers in WWI, the word evokes the idea of an authentic friend, men and women alike.  To be called a mate is a term of endearment, and should be taken as a positive sign if you are called one. Try to avoid using it in any forced or unnatural manner.

Follow that advice and you’ll be stoked with your negotiation outcome with any Aussie!

With thanks to: Business Insider, Cultural Atlas

1805, 2019

What Trump means for the female negotiator

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Donald Trump has made it no secret that his approach to any negotiation is to win at all costs. Aggressive positioning and zero-sum strategy are central to this. But has his style really made it harder for negotiating women? 

Short answer: yes.

There are two major ways this manifests.

First, in specific policy changes. Under Trump, equal pay regulations have been scrapped, funding for birth control has been cut, and only male chief executives have been appointed by Trump to the Women in the Workplace panel.

The seemingly most powerful leader in the democratic world has promoted a consistent position against women’s issues. On these topics specifically, American women now have to push harder than before when negotiating their pay, the rights of their bodies, and fair treatment in their places of work.

Second, in general influence effects. Men in positions of power have two prominent narratives weighing on their decision making. Either, women are as inferior in the workplace as the President makes them out to be, so why listen to their perspectives as seriously as their male counterparts? Or, women are in a superior position of power given reactive women’s rights groups, so why work with women when they may accuse you of inappropriate behaviour?

Trump’s discourse has reduced the narrative of women’s roles in any negotiation setting (at home, in society, or in the workplace) to extreme ends of the power spectrum: too weak or too powerful.

An understanding of feminism as nothing more than equality between human beings, where policy over gender matters more in a negotiation, is a perspective sadly drowned out in the misogynistic vitriol of the firgurehead of the ‘free world’.

A leadership change won’t fix it all, but it seems it will certainly be a move in the right direction for supporting women at the negotiation table!

2502, 2019

Broach Diplomacy

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Broaches may be a bit too 90’s for your choice of apparel, but when flaunted on the lapel of negotiation power woman Madeline Albright, they packed some serious semiotic power.

As U.S. Ambassador to the UN, Albright was faced with a rather undiplomatic comment: former Iraqi dictator Saddam Hussein referred to her as a serpent. Instead of reacting the provocation with a jab of equal pettiness, Albright took the opportunity to make statement. She retrieved an old pin from her collection and wore it at every future negotiation with Iraq: a snake pin.

Two decades on, in a purportedly more progressive and respectful world, such slings and slurs are not an uncommon experience for professional woman. Whether they be a manifestation of prejudices that take more than a generation to phase out, or a reaction to the tumultuous and confronting political climate of 2019, snarky verbiage is a reality woman continue to face.

Rather than delving deeper into the point of how unfortunate it is that educated professionals still cannot behave with more decorum, let me take this opportunity to reflect on the lesson that Albright’s broaches can teach us.

Power can be presented with poise. We do not have to shout to be heard or laud over our counterparts to be seen. Nor is the broach the sole totem of female power. A favorite fierce pantsuit, a fun set of personalized pens, a fiery shade of red: whatever reminds you to rise above the vitriol and play the game with strength and sangfroid is worth it.

Though we do not possess the power to change our counterparts’ countenance, we do possess the power to rise above it!

With thanks to: NPR

1402, 2019

The Art of ‘Relationship Diplomacy’: A Valentine’s Day Strategy

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When Empress Wu Zetian sent a pair of pandas to her Japanese counterpart in the 7th century, she sent with them a desired impression of her nation.

A figure of gentleness and strength, the symbol of this gift spoke multitudes. The practice of ‘panda diplomacy’ prospered for centuries, from Empresses to Chairmen. Success stories span globally, with explicit requests arising from U.S. President Nixon to British PM Edward Heath in the 1970s. Clearly, this was a winner of a gift.

And the Valentine’s market has certainly picked up on the theme. For what gift inspires our feelings of warmth, endearment, and delight than a cuddly panda bear (albeit in a rather less alive form)?

In our heart of hearts, is this not a most desirable outcome (especially when certain calendar dates exacerbate expectations)? Though we may throw in the metaphorical hat on any prescription of romantic activity being constrained to a socially approved date, it is an undeniably simple pleasure to perk up a loved one’s day with a fitting token of appreciation. Moreover, this small act of ‘relationship diplomacy’ can lead to lasting benefits in partnerships we wish to maintain.

If you will allow a rather rudimentary, though arguably fitting, comparison of non-romantically inclined international relations (though I am not in a position of authority to rule this aspect out of diplomatic ventures) to relations of a more romantic kind, what can we learn from ‘panda diplomacy’?

I suggest three valuable take-aways for V-day gifts. The gift should:

  1. Be genuinely reflective of a part of ‘you’
  2. Guide your partners attention to your desirable characteristics
  3. Be proportionate to the state of the relationship

A live panda may work for a Chinese diplomat desiring to make a strong impression on a new ally, but may not work for an Australian university student desiring to make a gesture of appreciation to his long-term partner (if only for the logistical nightmare that is keeping a live panda in a small rental).

To maximize the results of a gift, tailor it by the three take-aways (even if that mean’s genuine ‘take-away’ for a nice night in). It need not be material, nor typically ‘cutesy’, if it hits all of these marks.

This should be seen as a lesson in thoughtful consideration of your relationship with your chosen partner, and not a tool whipped out in an emergency! Diplomatic gifts, in the spirit of Cialdini’s Reciprocity, can be crucial to maintaining long-term relationships. They remind our counterpart of their value and uniqueness in our mind. Their value should not be dismissed in the general interests of non-materialism or non-conformity (for they can be as quirky and inexpensive as the circumstance warrants).

Let this Valentine’s be the Launchpad of a consistent pattern of reflective appreciation for your partner. If your outcome is to maximize the long-term experience of your relationship, make ‘relationship diplomacy’ a consistent practice.

Go forth diplomats and find your panda!

With thanks to: The Guardian and Influence At Work

2611, 2018

Utility Curves at a Glance

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Would it mean more to someone to get a payrise from $15,000 a year to $20,000, or from $100,000 a year to $105,000?

You almost certainly preferred the first option above, for a very simple reason: the utlity or value of $5,000 is not constant across every situation, or for every person. Things have different utility based on (for example) how common they are, what they can be used for, and when they are being received.

Different types of utility curves include:

  • Diminishing Returns — Money may mean less and less to you personally, the more you have of it.
  • Accelerating Returns — The more money you have, the more you have spare to invest, allowing you to further increase your wealth faster.
  • Parabolic — Too little free time will burn you out, while too much free time bores you… You may want a happy medium in between.
  • Threshold / Cutoff — if you can’t get at least 30 days off from work to go on your dream mountaineering trip in the Himalayas, you’d rather just work now and do it later. 15 days of vacation time might mean very little too you, if anything.

There are essentially infinitely many types of utility curves (as there are essentially infinitely many types of curve in mathematics!), but let’s not overcomplicate things right now.

What matters is that you keep this concept in mind, and identify when its application is critical to your next negotiation. The “trade-off” rate or conversion between two or more factors at hand is not always constant, and the difference between a “Poor” and “Decent” outcome may be miles more important — or less important! — than the difference between “Decent” and “High”. Make sure these phenomena are factored into your decision making.

2611, 2018

The Hidden Value of Experience

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Experience is often thought of as a “knowledge advantage” that directly helps people make better decisions, but there is also a hidden, more subtle value — it helps us identify better decision-making tools in the first place.

Whether you rely mostly on popular, academic, or institutional knowledge on the art of negotiation (or even the Envoy insight blogs!), you will have likely realised by now that there are far too many different ways to make a decision to possibly use all of them in a single negotiation. It would simply take too much time, and at a certain point that time would be better spent on further human interaction or research rather than refining your decision-making tools even further.

Luckily, there is a shortcut.

Human intuition and experience can go a long way towards selecting only the most appropriate decision-making tools for the negotiation at hand. This typically works through our mind (consciously or unconsciously) picking out prominent themes and traits of the people, solutions, and priorities we are dealing with, and then selecting the best possible, known decision-making tool to work through those themes.

For instance, in negotiations where some component of the deal (a person, company, industry, etc.) is liable to be highly volatile, an experienced negotiator or industry expert may quickly identify that risk analysis should be part of the conversation. Whether this takes the formal shape of some kind of risk analysis matrix, or the informal structure of a simple sentence (“Jim’s Farm is on some pretty low-lying floodlands and it’s coming up to monsoon season, we’d better get a great price from him to justify potential losses”)… risk will become a relevant factor in the decision-making in ways that, say, utility curves and game theory will not.

Experience doesn’t just help you weigh up relevant information better. It also helps you figure out what relevant information or factors should be fed into that decision-making process in the first place, and determine how you should weigh things up before you actually begin that process.

 

2311, 2018

Don’t Count On Numbers

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Quantifiable factors and solid data are incredibly useful tools for deciding your negotiation priorities and strategies – but they must remain a tool, rather than the master.

Professionals across the world have never had better access to data, or data analysis tools to make use of the information. With almost the entirety of humanity’s knowledge at our fingertips wherever we go, it can be easy to think that the solution to our problems always lies somewhere in the numbers, waiting to be brought out by an expert.

Transforming your priorities into hard numbers (e.g. by rating your priorities from 1-10, then taking a weighted average of the value of each of your available solutions) can be powerful, and good data is worth its weight in gold… but we should remember that solid qualitative input can be just as valuable, and bad data still exists today.

If a friend who has been in the tiling industry for 30 years tells you that Brook’s Tiles are notorious for poor handiwork (and that you probably don’t want them tiling your home, even though they are the cheapest option out!), you might choose to value that opinion over 200 online reviews raving about Brook’s products and rating them 4.5 stars out of 5.

Maybe the friend is just wrong, or biased, of course — but it is also possible that the review link has only been sent to satisfied customers, or that the company has bought fake reviews, or that the data has been manipulated in other ways completely unknown to you. Neither data nor qualitative input are inherently better than the other, and you will always have to make a judgement call as to which is stronger in any particular situation.

Further, don’t let yourself fall into the trap of overvaluing quantifiable factors! You might not have any hard data available to confirm or deny your friend’s hunch that Kim’s Burgers are mildly better than Patty’s Patties, but that doesn’t mean that their price should automatically become the tiebreaker in your decision-making. If food quality is a much more important factor than cost, then at the least you should try to find out more about the quality discrepancy, before you let the numbers or data play into your decision making as a last resort.

1911, 2018

Currency Conversion for Negotiators

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Want a creative way to compare two deals, or get the best of both worlds between them? Try “converting” the currency of success in one issue, into the currency of success for another.

Step out of your shoes for a moment, and into the world of a budding cafe owner, seeking to buy a pre-established business. You’ve frequented Cafe Jupiter for a few years now, and their desserts are out of this world… but they’re selling for a cool $5,000,000 price tag and you’re just not sure they’re worth the money.

Meanwhile, Deli Deluxe is selling down the road for just $1,000,000, but their decor needs heavy refurbishment and you just don’t find yourself losing your mind over their chocolate mousse like you would at Cafe Jupiter. How are you ever going to make this decision?

A possible solution might have already struck your mind — you could potentially snap up Deli Deluxe for the lower price tag, and use the $4,000,000 you saved to refurbish the place and hire better (or additional) chefs to bring the quality of the dessert up to scratch. If you worked the numbers, you might be able to end up with a higher quality establishment than either of the two, for a lower cost than Cafe Jupiter wanted to extort from you.

This kind of thinking can also be applied to non-monetary issues. If you are deciding between two book publishers and trying to find the right fit for your groundbreaking political manifesto, Gary’s Great Reads might only be able to offer you mediocre editing services, but give you more time to complete the book before it has to go to market. On the other hand, Yohan’s Books would provide decent editing for you, but really wants to rush you to complete the book as soon as possible.

A creative solution could be to use some of the time afforded to you by Gary’s Great Reads to either edit the book yourself, or work a side job to afford better editing services elsewhere. This way, you might end up with both more free time than Yohan could offer you, and better editing than Gary could offer you; not quite the best of both worlds, but certainly better than the deals that appeared to be on the table at first sight.

When working a deal with multiple currencies of success, keep an eye out for avenues to convert one into the other. It can’t hurt, and you may very well come out the other side a lot richer.

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