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How to Negotiate in our New Normal

Three Strategies for Creating Shared Value.

Recently I have had a few conversations with clients about taking on some new work.  When it came to the part where I needed to provide a proposal with my fees, I felt a familiar discomfort.  It was that nagging voice of uncertainty that says, what if my rates are too high? What if they can’t afford it right now? What if, what if….  I was tempted to adjust my fees lower in light of our current economic climate.  But I didn’t. 

When I teach my negotiations course or coach my clients, I tell them that the first number they put out is incredibly important.  It acts an anchor for the entire discussion.  The way we first present ourselves to clients (or to anyone really) matters because our brains are biased.  Our brains focus on the first piece of information we receive when making a decision.  So if you go out there and lower your ask, your client will now associate your services or product with that lower price and it will reduce that person’s perception of what your services are worth.

The other thing that I emphasize with my clients is that asking isn’t selfish.  We reduce our asks because we don’t want to appear to be self-serving, but when you say it out loud it seems pretty silly.  How dare you ask to get paid what your services are worth? How dare you as a business try to make money?  How dare you as a woman ask for what you need?  Unfortunately many of us have been trained that it’s wrong to ask.  It is much easier for everyone else when we stay small and don’t use our voice, but we will never get what we don’t ask for.  As Beyoncé says: “Power is not given to you, you have to take it.” 

So here is the reminder that I needed and you may need as well:  Yes, you should still be asking for what you need and what you are worth.  Does that mean that you are going to get everything you ask for? No. That’s not how negotiation or relationships work. Asking is a critical step, but it’s just the beginning.  You have to go into the discussion with the knowledge that the person you are negotiating with has needs too.  Success in negotiations means drawing on your creativity to find ways to generate more value for everyone involved.  Ultimately negotiations, when done properly, will help you forge stronger relationships and partnerships.  The world doesn’t need more win-lose propositions right now, it needs win-win.  Here are three strategies for helping you create more value for yourself and for others:

1.       Create multiple options.  Let’s continue with the example above and pretend that I am presenting a proposal to a client.  I provide them with two options that vary the scope and the price.  For example, Option A is priced at $10,000 but only delivers Phase 1 of the work.  Option B is $20,000 and delivers Phase 1 & 2.  I have made appropriate trade-offs in the two options by reducing the amount of work to be delivered with the reduced price scope and vice versa with the higher scope.  The point is to create options that are of equal value to you.  As a reminder, what you value can go far beyond price or money.  Whatever it is, get creative and find multiple options that work for you and then present these to the person you are negotiating with.  The benefit of presenting multiple options is that you appear flexible and you can actually get more information from the other person in how they respond.  If they prefer one option over another, you have the opportunity to ask questions and get more information around how you can create something that could work for both of you.

2.       Use the Power of Reciprocity.  Sometimes you hit a stand-still.  Neither person can seem to come up with a solution that will work.  In these moments it can be difficult to see how you can move forward towards an agreement.  If you feel that you have reached an impasse – take a break.  Nothing good will come from pushing forward in that moment.  When you schedule a regroup ask each person to write down two lists before you meet again.  The first list is – what are you willing to do?  The second list is – what would you ask the other to consider? By having each person think through how they could balance their needs with the other person’s needs it begins to activate more empathy and acts as a reminder that we are interdependent. During the regroup have each person share their lists and identify where there are cross-matches.  Finding even small areas of agreement can begin to build momentum and help move the discussion forward.  If there are absolutely no areas of agreement – that’s powerful information too. Its better to understand that early so that you can move on to developing other options.

3.       Focus on the Future. When creating alternatives we often let our current limitations dictate the possibilities.  If we want to find new ways to generate value, we have to go beyond the short term and focus on where we want to be in the long term. Ask the person you are negotiating with where they want to be 5 or even 10 years from now.  Then dig into what would need to change between now and then to make that happen.  This discussion can help shift thinking from what can’t be done, to what has to be done to create the future you both envision. 

Negotiation is a powerful and misunderstood tool.  It’s the art of building mutually beneficial relationships.  Sure, relationships can be transactional or power dynamics can be asymmetric and used to take advantage of people, but that’s not a recipe for building lasting relationships.  If we want to create value long term, we have to find ways to create shared value. This process will rely on each of us to draw on our creativity, our empathy, and our vision for a better future.  It is undeniably hard work, but it starts with a simple question, an ask.  So keep asking friends.  Get curious.  There is opportunity and possibility out there, but we have to go in search of it.

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