Tag archives: Negotiation

Getting the most out of your training provider

Here’s a few tips on how to get the most out of your training provider.

1. Determine your objectives from a company point of view. What does the company hope to acheive with the training? This will help you plan out the training for the year. Eg. If you are looking at a turnaround plan for your team you would probably need 9 days of focused training and not a one day program. List down 3 key objectives of the training.

2. Look at your training providers list of clients. Call up their references. Are the clients from a single group or are they from a diverse group of companies? If the client base cuts across industries and size of companies, this means that the training provider is able to tailor their material according to it’s clients.

3. Look at the trainer. Do they have real life working experience relevant to the training? E.g has the negotiations trainer conducted high level negotiations between companies? Has he/she achieved positive results?

4. Look at the training methodology used. The lecture style is very tired and will induce sleepiness! How much of the training is focused on interactivity and implementation of the theory vs just the theory. For example our negotiation courses are 20 percent theory and 80 percent activity/role-play and de-brief.

By using these methods you will be able to work more effectively and efficiently with your training provider.

Simplified Negotiation Grid – A tool to use empathy in negotiation

 empathy, noun

the ability to understand and share the feelings of another.

This article will look at empathy and its application in negotiation. We will examine the basic selfish human nature that affects negotiation and how to deal with this to achieve a win-win solution.

 

We often only focus on what we want in life. We fail to take into account the other side and their point of view. In fact, Malhotra and Bazerman in their book Negotiation Genius have taken this concept further. They talk of overreaching optimism – viewing oneself through rose tinted spectacles. In a survey of husbands and wives they found that inevitably when they asked each party separately of their own contribution to the relationship, the sum was always more than 100%. This shows that we often overestimate ourselves and underestimate the other side. Empathy is one way we can overcome this.

 

Good negotiators think about the other side. The best negotiators eat, sleep and drink as well as walk in the shoes of the other side. As a lawyer, I was trained to prepare the other side’s arguments. Based on this I would prepare a rebuttal. By putting myself in the other person’s shoes, I was able to prepare a well-argued case that resulted in a settlement.

 

We will examine a few scenarios of how companies or individuals could look at “the other side” to increase value in negotiations.

 

Table 1. Simplified Negotiation Grid

 

  You Counterpart Common/shared
Positions     

 

     
Interests     

(in order of priority)

 

     
Possible outcomes     

 

     

 

Using the simplified negotiation grid, we are able to work out what the various parties’ positions and interests are. We can therefore focus on the key drivers for both parties. Skilled negotiators will also be able to revisit the common/shared interest to result in a win-win negotiation.

 

One of my favourite examples is the movie ticket role-play that we use in the juarezlowe negotiation class.

 

Example 1. Movie ticket role play summary

Ali

Ali has 2 tickets for the Gold Class Cinema show at 730pm costing RM60/each (USD18/each) for his date. Ali is 23 and has just started work earning RM2000/month (USD606). His date has just called him to say that she can’t make it. His boss has just called him to ask him to come back to the office. As the tickets are quite expensive, he doesn’t want to waste them. The time is now 715 pm and the line has around 30 people in it. He decides to sell them to someone at the back of the ticket queue.

 

Chong

Chong has his first anniversary celebration with his wife tonight. Chong works as a manager at a multi national company earning RM9,000/month (USD2,727). He has been really busy at work and forgotten to book the tickets that he promised to at the Gold Class Cinema. He manages to get out of the office and arranges to meet his wife at the cinema. She is not very happy as she expected to be picked up. Instead she took a taxi to meet him. During their brief conversation, she asked him “Did you remember to get the tickets dear?” to which he replied “Of course”. He arrives at the cinema at 710pm. To his horror, there is a long queue of 30 people. 5 minutes later Ali approaches him to sell 2 tickets. He looks up and the display above tells him that the seats for the Gold Class movie are “selling fast”.

 

Participants are given 3-5 minutes to conduct this role-play.

 

We find that price variance between participants can range from RM30/ticket (USD9) to RM120/ticket (USD36). Why is there such a huge variance?

 

Table 2. Application of Simplified Negotiation Grid to Movie Ticket Role-Play

 

  Ali Chong Common/shared
Positions Full price for tickets. Buy tickets at discount.     

 

Tickets for sale and purchase
Interests (in order of priority) 1. Avoid losing money.     

 

2. Find a buyer fast.

 

1. Avoid getting in trouble with wife.     

 

2. Buy the tickets at all costs.

 
Possible outcomes if no agreement is reached Lose large portion of salary and be late for boss.     

Find alternative buyer in ticket queue.

Get into major trouble with wife.     

 

Buy roses and gifts to make it up to wife.

 

 

 

Key pitfalls in Movie ticket role-play

1. Most participants take a narrow one-sided approach and start talking first and don’t listen.

2. They don’t take time to talk to the other side to discover the other side’s interest. 

3. They fail to consider what will happen should neither party be able to reach agreement.

 

Key lessons from the Movie Ticket Role-Play

1. Take a deep breath and listen.

2. Focus on the other side by asking questions. What are the things that you are looking for in a product/service?

3. Consider both your possible outcome as well as your counterpart’s possible outcome. 

 

Application of empathy to real life situations

1. Focus on what the other party really wants. Ask key questions to find it out. A lot of the time the other party may want something that costs less to us than he/she values it at.

Example 2. Hotel Negotiation

When negotiating with a hotel, one of the things that they can give is a buffet coupon that doesn’t cost them anything (the buffet costs are fixed). This is a cost to the other party.

 

2. Take the time to develop a connection with the negotiating party. Ice-break and spend a short amount of time on “the courting period”. 

Example 3. Training negotiation

When chatting with one client, I discovered that one key factor in decision making was whether or not the vendor would organize the training venue. Had I not spent the time to get to know the client, I might not have found this out. 

 

3. Prepare both sides of the simplified negotiation grid before you enter a negotiation to the best of your ability.This allows you to realistically assess the negotiation.

Example 4. Vehicle financing negotiation

When negotiating with some banks for financing for a company I used to work with, I realized that the financial market was increasingly competitive. I therefore commenced negotiations with 2 banks that we had a relationship with and 1 bank that wanted our business. This knowledge enabled me to negotiate a competitive financing package for our commercial vehicles that resulted in meeting our annual profit targets within 5 months.

 

This has been a short article on how to apply empathy in a negotiation setting to avoid a narrow one-sided focus. juarezlowe Sdn Bhd conducts courses on negotiation as well as negotiation consulting. Unlike other consultants, our negotiation fee structure can be partly tied into the amount of savings or extra value of the contract. To find out more, please email negotiation@juarezlowe.com.

Islamic negotiation

A contemporary look at Islamic negotiation and its application in the modern day business world

A Muslim participant asked me “Is there an “Islamic” method of negotiation? I was training an Islamic financial institution at the time. We talk a lot about Islamic Financing, but do we actually negotiate in an Islamic manner. This being the month of Ramadhan, I thought it an appropriate time to post my comments on this topic.

This article will look to answer the following questions:

1)    Is there an “Islamic” method of negotiation – if so what is it?

2)    Is it applicable centuries later, in particular to the business world?

My research has come up with a simple answer – Yes. When we look at the history of Islam, Islamic negotiation has 3 key principles: –

1)    Honesty

2)    Fairness

3)    Respect

These three principles are remarkably similar to modern negotiation theories such asHarvard’s Program On NegotiationFischer’s Getting to Yes and Nierenberg’s Negotiation.

1) Honesty.

“Truth stands out from error…And God heareth and knoweth all things.”

The Holy Quran, Baqara Sura II:256.

Malaysian Malay culture has an adaptation of the “taqiyya” or exceptions to this rule and termed it “Bohong Sunat” (white lies). The exceptions to this rule are in cases of war, to facilitate a reconciliation, and in a husband and wife situation of conflict. We will not discuss this further as it is rare that any of us will be pressed to use these exceptions.

Modern day application

The key takeaway here is to be honest in your negotiations. Honesty puts you on the long road to gaining trust and respect with your counterpart. Lying loses hard earned trust and respect immediately. In my experience as a negotiator, I find that being honest has led to many long-term mutually beneficial relationships. My honesty in justifying the reasons for a price hike with my clients led to immediate approval as well as increased business. I had explained that this price hike was due to external factors and was necessary to maintain our levels of service to the client. In addition, I gave them data on what other firms were charging to prove that our rates were below the market rate.

2) Fairness.

“But if the enemy incline towards peace, do thou incline towards peace, and trust in God: for He is the One that heareth and knoweth.”

The Holy Quran, Anfal, Sura VIII:61

When we look at the Prophet (S.A.W.), we find that he worked towards being extremely fair, especially to his vanquished opponents. It was common during the time of the Prophet, peace be Upon him, that to the victors would go the spoils which included killing the men and raping and pillaging the survivors. The incident with the Quraish, where the Prophet (S.A.W.) told Abi Sufian, “He who shuts his door is safe, he who goes to the home of Abi Sufian is safe.”

Modern day application

We may find ourselves in situations where the balance of power is overwhelmingly in our favour, where we have a proprietary product. The example is of Johnson & Johnson in the stent market, where they had first mover advantage and allegedly “exploited its monopoly”. Johnson & Johnson reportedly did this by gouging their customers and refusing any discounts.

This backfired when a competitor, Guidant emerged and took a 70% market share from Johnson & Johnson. Had Johnson & Johnson taken a fairer (“just”) approach, it is would probably have been more difficult for Guidant to take that 70% market share.

3) Respect

“To every People have We appointed rites and ceremonies which they must follow, let them not then dispute with you on the matter, but do invite (them) to your Lord: for you are assuredly on the Right Way. If they do wrangle with you, say, “God knows best what it is you are doing. God will judge between you on the Day of Judgment concerning the matters in which you differ”

(Al-Hajj 22:67-69)

Islam teaches tolerance and respect of all people regardless of color, race or even religion. During the persecution of the Jews by the Christians, many Jews sought and received refuge in Muslim communities and countries.

“It is a fact of history that when the Jews were being persecuted in Europe during the middle ages they found peace, harmony, and acceptance among the Muslim people of Spain. In fact, this was the era of Jewish history that they themselves refer to as “the golden age.”

Modern day application

Robert Sutton, professor of management science and engineering at Stanford University, wrote a book entitled The No Asshole Rule: Building a Civilized Workplace and Surviving One That Isn’t, New York: Warner Business Books, 2007. His work documents the high cost of not respecting people in organizations. The famous example of Patterson, CEO of Cerner, where he told employees that he expected the car park to be substantially full between 730am to 630 pm and all employee benefits were frozen with immediate effect, led to Cerner’s stock price declining by 22% in 3 days when the email was leaked.

In summary, these principles of Islamic negotiation:-

1)    are relevant and applicable to modern day negotiation in any country

2)    have stood the test of time of over 5 centuries, and

3)    are also applicable to modern day business situations.          

Juarez Salih Lowe is a negotiations trainer, coach and consultant. His team of trainers has trained people from Maybank, TM, Ambank, Petronas, MIDF, YTL, Johnson & Johnson and L’oreal.

For further information about how your organization or team can implement these negotiating principles contact juarezlowe Sdn Bhd at negotiation@juarezlowe.com or 03-22614248