I know, I know, it is cliché; but yes, I had a lemonade stand when I was little boy. (Well actually, it was a Kool-Aid® stand because I really didn’t care for the taste of lemonade.) I recall spending many a summer weekend manning that stand, and despite my rather tight-fisted supplier (mom and dad), an unimproved infrastructure (two milk crates and a wooden plank), and often times discouragingly small margins, I was able to squeak out enough money over any given Saturday afternoon to buy me a cherry Slurpee® and a pack of Bazooka Joe® bubble gum at the local 7-Eleven.
“25¢ per cup,” I’d advertise, only to have my friend from school and his brother rebut me with a counter-offer of two cups for 25¢. Not realizing that tendency to protect the bottom line had already kicked in, I eagerly acquiesced to their counter, quickly poured two cups of syrupy, lukewarm Kool-Aid®, and sent my friend and his brother on their way with a wave and “see you at school on Monday.” I can remember to this day chuckling to myself as my friend and his brother walked away with two half-filled cups of syrupy, lukewarm Kool-Aid®.
I would like to think that, as a negotiator, I have come a long way since my childhood days of pandering Kool-Aid® on the neighborhood street corner. Since then, I’ve come to believe that the desire to negotiate, if we have it, to some extent seems to be hard wired into us. (My four-year-old reminds me of this every night as I’m trying to get him into bed.) Over the years I’ve been fortunate to have had the opportunity to negotiate hundreds of disputes and business transactions, some much more notable than others. For instance, one of my very first clients as a new lawyer was a very wealthy, elderly man who could not drive his insanely low-riding Dodge Viper down a communal drive because his equally wealthy, equally elderly neighbor constructed make-shift speed bumps out of 5 ft. tall mounds of deformed concrete.
Based on how hard those two fought during settlement negotiations, you would have thought they were negotiating the 1995 Middle East Peace Accord.
More recently, I represented a client who wanted out of a multi-national distributorship agreement that was diminishing day by day in value. (Interestingly enough, this dispute settled much faster than the speed bump dispute!)
Yes, over the years I have had my fair share of interesting, engaging and sometimes downright bizarre negotiations. All along the way, I have learned a few things about what many call the “art of negotiating.” If you set side-by-side all of the books that have ever been written about negotiating, I’m sure that you could fill a good-sized library from top to bottom. From selfmade millionaires to Harvard professors to captains of industry, everyone seems to have something to say about how best to negotiate business and personal affairs.(I guess I am no different!)
Although I have read dozens of these books and have learned a great many insightful things from them, one concept seems to be lacking from them all. That concept is the role, better yet the hindrance the “self” plays in being a proficient, successful negotiator.
The “self” -in my experience, is one of the most fatal characteristics an executive or business owner can have in trying to successfully negotiate. When I say “self,” what I mean to point out is the natural tendency humans have to fall in love with our own ideas and perspectives. When the self gets in the way, that is when a person is unable to step back from his own ideas and ways of thinking, he often finds it difficult to successfully negotiate for the betterment of his company. More often than not, he is interested only in making sure that everyone else knows what he, not necessarily his company, thinks, needs or wants.
Let’s look at a cinematic example of how the self, or ego, can get in the way of successfully negotiating a business deal or dispute. In the legal drama, “A Civil Action,” Jan Schlichtmann (played by John Travolta) is a very successful plaintiff’s tort lawyer in Boston, Massachusetts.
As the film opens, he has agreed to represent dozens of families from a small, upstate town who have, over the years, become mysteriously ill with various forms of cancer and other diseases.
Upon discovering that the owner of the local leather tannery has been dumping the tannery’s toxic bi-products into the watershed, Schlichtmann sues the tannery owner on behalf of the families, many of whom have lost their fathers, mothers and children. Knowing the impact suffering can have on a jury, Schlichtmann begins to see a potentially lucrative case for both the families and his firm. If only he can get the families on the stand in front of a jury; the jury will have no choice but to rule in his clients’ favors.
Prior to trial, the tannery company submits several offers to Schlichtmann, each subsequent one being significantly larger than the one before. But because he believes that his clients’ case is fullproof, he convinces his clients to turn down every offer. Frustrated with Schlichtmann’s hardheadedness, his partner, played by William H. Macy, looks at Schlichtmann in disgust and points out that the only offer Schlichtmann is prepared to accept is the one tannery is not willing to make! At that point in the movie, it becomes clear that Schlichtmann has stopped negotiating with respect to his clients’ goals and values and instead has begun negotiating a mere position. That is what the “self” does. It makes you argue for arguing sake, with no real objective or purpose in mind.
As many of us can attest, arguing a position is one of the most surefire ways to submarine what could otherwise be a successful negotiation. In Schlichtmann’s case, his failure to acknowledge that fact forced his clients’ case to trial, where due to some very good, very unanticipated lawyering by the tannery’s lawyer (played by Robert Duvall), Schlichtmann’s clients never made it to the stand. With the crash of the judge’s gavel, Schlichtmann’s clients’ very large, multi-million dollar award went down the drain, along with Schlichtmann’s legal career.
As any good lawyer will tell you, Schlichtmann’s goal, his value, should have been to achieve the best result he could for his clients. As his lawsuit unfolded, that “best result” was arguably his and his clients for the taking on several different occasions. But because he could not see beyond himself, because he could not get past his own position, he had predisposed himself to rejecting every offer the tannery owner was willing to make.
What is worse, he convinced his clients that his way of thinking was right, and as a result he recovered far less for his clients at trial than he could have recovered had he accepted any one of the tannery owner’s offers. Not a good result.
When you negotiate, do you focus on maintaining or advancing a position, or do you focus on maintaining or advancing a value that is important to your business? While Roger Fisher and William L. Ury encourage the “value perspective” in their book “Getting to Yes,” I would add that, in order to have that perspective, you must be able to take yourself out of the equation to a degree greater than you might otherwise think. That is not to say that you cannot be assertive or aggressive in your negotiations, and it certainly does not mean that you cannot bring your own unique style to the negotiating table; but it does mean that you must put the interests of your organization, in front of you as you sit at that table.
Many people continue to negotiate thinking that they are good negotiators. While you may feel like a savvy, hard-nosed barter jockey, at the end of the day you have to ask yourself, “do my owners and employees look to me to satisfy an ego or do they look to me to advance the company’s values and achieve its goals?” I think we would all answer that question the same way, or at least we should.