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 / Winter 2006 / Issue 45(originally published by Booz & Company)


Best Business Books: Negotiation

BUYER: “I want a 10% price rollback. Now.”
SELLER: “I hear what you are saying…but what are we really talking about? Is this a recognition thing for you? An empowerment thing? Do you feel my company has not treated you with enough respect in the past? Let’s be honest with each other.”
BUYER: “Thanks, pal, but if I’d wanted psychotherapy, I woulda’ called a shrink. I’m here to talk pricing. And I’m in a hurry. What’s it going to be?”

Mr. Thomas’s book is thus primarily about tactics in the core “science” process of negotiation: getting the other side to make concessions in a zero-sum game. He is somewhat skeptical about the “creative” side: It is important, he admits, but the returns should not be exaggerated. While Professor Shell’s book suffers from excessive complexity — it is chock-full of frameworks and structures, with four steps, four types of negotiation, five styles, six foundations, and no single organizing principle — Mr. Thomas’s book is refreshingly straightforward. He offers seven critical rules, four important but obvious rules, 10 “nice to do” rules, and a bit about ethics and special situations. To its credit, the book always explains the logic of its advice. It is not especially original, but it is punchy, no-nonsense, and humane.

Although Mr. Thomas has a more competitive style than Professor Shell, he places just as much emphasis on the importance on relationships and is actually tougher on ethics, stating categorically that negotiators should never lie. As for wisdom, he admonishes the reader not to “hose” the other side — not to use every bit of leverage and every tactic in the book to get the best possible deal. Given widely prevalent norms of fair play, such “win-lose” deals really pay off only when there will be no subsequent relationship. Instead, the Thomas-guided negotiator seeks a win-win deal, meaning that both parties feel they have achieved their objectives even if they have not maximized their gain.

Ironically, this discussion of purpose is the one place where the hard-edged and ruthless Mr. Thomas turns out to be a bit too benevolent. Major retail chains, for example, bargain very hard with their suppliers — Wal-Mart under Sam Walton was known as “the rudest account in America.” This did not stop the vendors from supplying the company, and it did not stop Wal-Mart from becoming the biggest retailer in the world. Of course you have to keep the other side alive if you want to work with them again — but only just long enough to fulfill your objectives.

In reality, as I have found in my 20-year career as a professional negotiator, it is more useful to stay focused on balancing short- and long-term outcomes. Optimizing the latter may require modification to the negotiating strategy. This does not necessarily mean being soft — indeed, one of the classic justifications for adopting a tough negotiating stance is the need to manage future expectations. A vivid example is negotiations with terrorists, which might involve short-term concessions, but only if they are not seen as leading to long-term loss of control over the situation. A more everyday case is traditional employment negotiations, in which an unequal power relationship established at the outset may prove very useful later to the party that starts with the upper hand — this is usually, although not always, the employer. This may not sound very nice, but it is reality. The fact is that there are many negotiated injustices in the world, and good (efficient) negotiation is not always good (moral) negotiation.

One of Mr. Thomas’s important but obvious rules is “keep the climate positive,” and much of Roger Fisher and Daniel Shapiro’s Beyond Reason: Using Emotions as You Negotiate focuses precisely on how to do this. The authors make plain that negotiation is not just a matter of logic, but of emotion, too. The book is a sequel to Getting to Yes, but it also represents a significant change in Professor Fisher’s thinking. For most of his career, he has been on record as saying that the single critical factor in the ability of a negotiator is clear thinking and logical capability. Personally, I have long disagreed with this; when analytically trained people overlook the emotional resonance of their negotiations, they can damage their own and everybody else’s interests. But his coauthor, Dan Shapiro, is a trained clinical psychiatrist. If he could persuade Roger Fisher of the value of emotion in getting to “yes” (and apparently it took a number of years), then he should be persuasive enough for anyone!

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