Why does hearing the word “negotiation” make our pulse quicken? If you close your eyes and picture a negotiation, what do you see? Many people envision a conference room with people in business attire sitting across the table from one another. More than likely, nobody is smiling, there is tension in the air, and the mood feels adversarial. What if I told you that negotiations don’t have to be that way?
There was a time when battlefield tactics (“I win/you lose”) were the typical negotiating approach. Thankfully, times have changed. We are now encouraged by leaders in the field, like Margaret Neale, at Stanford University and William Ury at Harvard University, to be more collaborative and better listeners. When we seek a win-win outcome, there is an increased likelihood that both parties will end up better off. Rather than splitting a pie, we are expanding the size of the pie. What has changed? Negotiations are now conducted with a longer-term view and include critical elements of emotional intelligence.
Peter Salovey and John Mayer initially defined emotional intelligence (EI) as a set of skills hypothesized to contribute to the accurate appraisal and expression of emotion in oneself and others, the effective regulation of emotion in self and others, and the use of feelings to motivate, plan, and achieve in one’s life. Daniel Goleman later popularized the concept in his book Emotional Intelligence: Why it can matter more than IQ. The four critical pieces to emotional intelligence are (1) an awareness of your own emotions, (2) an awareness of the emotions of others, (3) the ability to regulate your emotions, and (4) leveraging emotions for better outcomes.
Daniel Shapiro and Roger Fisher, both of Harvard’s Program on Negotiation, created a construct of five core concerns that help you better understand your counterpart’s motivations and needs. A detailed explanation can be found in their book, Beyond Reason: Using emotions as you negotiate. This construct offers a unique way to leverage the power of emotions in negotiations.
Shapiro and Fisher propose that our emotions stem from these five areas:
- Appreciation – feeling understood, valued, and heard.
- Autonomy – freedom to make decisions without imposition from others.
- Affiliation – the emotional connection between you and another. A feeling of belonging.
- Status – your standing in relation to another.
- Role – we play pre-established roles. How can you shape their role and yours to be more fulfilling?
Using these core concerns can serve as a lens through which it becomes easier to understand your emotions and those of your counterpart. They can also be used to provide insight and to uncover possible resolutions to challenging situations.
For example, imagine you have offered to prepare a budget for your family. You have taken the time to research each line item from your average weekly food bill to utilities, clothes, and the mortgage. If one of your core concerns is appreciation, you may feel irritated if your partner doesn’t acknowledge your efforts.
Conversely, if your partner sits you down and questions your work, line item by line item, you may feel your autonomy, status, and/or role is being threatened. It’s important to remember that negotiations happen everywhere, not just at work. Negotiation skills can be applied to a wide range of personal and professional situations.
Understanding the core concerns of your counterpart enables you to act in such a way that you give them what they need while still protecting your interests.
One of the essential strategies in entering into a successful negotiation is to be prepared. Being prepared is a process that includes the following steps:
A. From your perspective
• What is your minimum acceptable deal (often referred to as your Reserve)?
• What is your ideal outcome?
• What is your Best Alternative to a Negotiated Agreement (your BATNA)?
B. From your counterpart’s perspective
• What is their Reserve?
• What is their ideal outcome?
• What is their BATNA?
To answer from your counterpart’s perspective, you need to spend time getting to know and understand the other party. What are their needs, motivations, and interests? This information can best be accessed through active listening. Before the actual formal negotiation, it is helpful to have a pre-meeting to discuss interests. By separating it from the negotiations, it becomes less threatening and more congenial. This is an opportunity to build a strong foundation for an ongoing relationship.
In the heat of the moment, it is tempting to accept a deal for the sake of reaching a quick conclusion. When you are clear about your Reserve (the minimum at which a deal is worth making) and your BATNA (what your options are if you don’t come to an agreement), it is easier to walk away from making a bad deal. Those who enter into a negotiation with a better BATNA will have more leverage in crafting a good deal.
In the pre-meeting described above, it is critical to practice active listening. This can be one of the most challenging skills to master. To be effective, you need to listen to your counterpart without interrupting and with no judgment. By mirroring back to them what they have said, you can confirm that you understand their perspective. This is not an indication that you agree with them, only that you hear and understand their point of view. This will provide critical insights into their needs and motivations.
Through active listening and emotional intelligence, you can approach a negotiation through a lens of collaboration. Rather than looking to split the pie, explore ways to make the pie larger.
Most importantly, through active listening and emotional intelligence, we build relationships that enable us to continue to do business with our counterparts in the future.
Sometimes, you can give them what they want at no additional cost to you. For example, when a new employee negotiates their package, it is not only the salary that will contribute to their quality of life. Vacation, a flexible work schedule, and parental leave also have tremendous value. Look beyond the obvious. Be creative.
If, after a negotiation, either party feels that they have been wronged or taken advantage of, the likelihood of repeat business becomes very small. Businesses are built on relationships where there are trust and respect. When we enter into a negotiation, we want to build bridges, not burn them.
An Example for Consultants
If you are working as a consultant, using emotional intelligence in negotiations can be very successful, particularly during challenging times like the current pandemic. People are losing their jobs, businesses are closing, and company budgets for outside vendors are understandably tight.
You may be in a position where you have valuable resources that can significantly impact and help people who are struggling. In times like this, it helps foster relationships when you seek ways to be of service to others. What are your client’s motivations, needs, and interests (the person hiring you and/or the people at the receiving end of your services)?
As consultants, you have a business to run, and it is also essential to take a long-term view. When negotiating work, price is only one consideration. Other approaches that may work in efforts to increase the pie include:
- a longer program for the price of a shorter one
- offering an add-on service for free for which you would otherwise charge
- increasing the number of attendees beyond what your pricing usually includes
- providing better pricing for multiple sessions
- offering customization at no additional cost
Focus on how you can add value in a way that supports your client (especially through these challenging times). When your colleagues and clients look back on life during the pandemic, what would you like them to remember about you?