The Traps of the Professional Negotiators

It is neither necessary nor useful to try to “trap” your counterpart into agreeing to a good deal. Listening, understanding, convincing, and thinking up solutions acceptable to both parties are much more desirable objectives. It is therefore not a question of recommending that you use the techniques presented in this chapter. Instead, it is essential that you know how to thwart them.

Undermining

A negotiator may seek to make her counterpart feel inferior, often insidiously or indirectly. For example, the buyer may make the seller wait for an hour, suggesting that he is ultimately of little importance, or the buyer may offer him a chair that is lower than hers or allow the meeting to be interrupted repeatedly by taking a series of phone calls. Such undermining can also be direct, maybe involving insulting statements about the supplier’s company or occupation. This makes the other person uncomfortable: Having been treated like a child, he is less capable of resisting pressures or demands.

What are the possible responses?

• Refuse to be undermined: Leave after waiting for 20 minutes, ask for a different seat, suggest that all phone calls be diverted, and so on.
• Demonstrate your refusal to be undermined: when waiting in reception, keep working on another deal and pretend not to notice your counterpart’s arrival.
• Put the issue on the table, while not offending the other person’s sensibilities: “Some buyers resort to odd practices, such as making visitors sit on a lower chair. I know that you have no need to do that, Mrs. Peake.”

Threats

In negotiations, threats are a weapon of last resort. They may take various forms. At best, you are warned about what is at stake if you do not meet the terms demanded. At worst, you are told nothing: The threat is indirect, taking the form of hearsay, unexplained incidents, and the like, encouraging you to believe that a breakdown in negotiations could have serious consequences.

Under these circumstances, the party doing the threatening is hoping that, under pressure, the other party will give more ground than she had planned. When faced with a threat, you really must avoid giving ground out of fear—and without adopting a defiant attitude toward the other party, even if you do not believe that her threat is credible.

What are the possible responses?

• It is sometimes preferable to pretend not to understand the threat: rephrase things, without paying much attention to your counterpart’s intimidating remarks. Adopting a calm approach focused on seeking precise information and resolving problems may be enough to encourage your counterpart to adopt a more relaxed approach.
• If the threat is confirmed, the best thing is to calmly examine what is at stake: recognize the existence and reality of the risk, citing its potentially damaging effects for both parties, while allowing it to appear that you are prepared to take that risk (without saying so provocatively): “Of course, that would cause problems for me, but ultimately that’s up to you.”
• In all cases you will need to carefully analyze the probability of the threat being put into effect: What would be the consequences for both parties?

Urgency

Your counterpart demands an instant reply: “I’m ready to issue the PO right now”; “I’ve only got one left in stock”; “the committee is meeting tomorrow morning”; “If you want, you can call your senior managers right now”; and so on. This is a trap offering many benefits to the party laying it. The urgency pressures the counterpart as she faces an imminent risk of permanently losing an opportunity if she does not give way. Furthermore, if your counterpart calls her boss, the boss will be unprepared for negotiations: Which arguments should she use (Golden Rule No. 2)? What should she ask in exchange (Golden Rule No. 3)? How can she give concessions gradually (Golden Rule No. 4)? Thus urgency very often leads to the giving of greater concessions than would have been the case if there had been sufficient time for reflection. Therefore it is important that you avoid the classic errors: immediately capitulating under pressure, phoning your line management in front of the other party (unless there is a prior agreement to adopt a particular set of tactics), and so on.

What are the possible responses?

• Take no account of the urgency expressed by your counterpart if you suspect she is bluffing.
• Negotiate firmly over the deadline: Ask for 5 or 8 days to adapt your stance.
• Impose an even shorter deadline to put pressure on the other party (e.g., “I can only keep this offer open until midday tomorrow”).

The Columbo Effect

Your counterpart seems satisfied and is bringing negotiations to a positive conclusion when she suddenly makes an unexpected demand: “Naturally, you’ll need to sign this little amendment to our general terms, but that shouldn’t be a problem for you, should it?”

You are helpless. You have just started to relax, thinking it is a done deal, and you do not know how to respond. You are afraid of losing everything at the very last minute. If you still have some room to maneuver in the negotiations, it will be tempting to use it in order to grant the concession demanded.

What are the possible responses?

• Close down the discussions: “Nice try, Mrs. Peake, but you know very well that I’ve quoted you my best offer and you got a great deal.”
• Launch a war of nerves: “I wasn’t aware of that demand. If it really is a priority, then we’ll have to start again from scratch. I’ll have to take my offer and the benefits agreed to off the table.”
• Get something in return. Start by refusing to concede, argue, and then maneuver your counterpart into a position where he offers a further benefit. Then partially grant the concession demanded by the other party and seal the deal.

The “Good Cop, Bad Cop” Routine

Two negotiators combine forces to deal with a seller. The first adopts a very hard-line stance and speaks forcefully. Any negotiation is practically impossible. Then the second negotiator intervenes, trying to “reason” with his partner, and makes the other party an apparently more acceptable proposal. This is yet another trap that is often highly effective: You are distressed by the confrontation with the “bad cop” and tend to place great trust in the “good cop,” viewing his proposal as a lifeline to cling to.

You need to avoid common errors in situations of this type. Do not lose your cool with a “bad cop” when the real negotiation has not even started yet. It is also important to remain on your guard and not be too quick to see the more conciliatory negotiator as an ally.

What are the possible responses?

• If you are also operating with two negotiators, divide the roles between you: One takes on the “bad cop” in a struggle where nothing is really at stake, while the other adopts a more affable stance and prepares to conduct the real negotiations.
• If you are operating on your own, allow the “bad cop” to speak, but do not respond, then negotiate with the “good cop” without taking any account of the “bad cop’s” demands.
• You can also highlight the technique employed in order to defuse it: “That’s strange, it looks like you’re deploying the ‘good cop/bad cop’ routine and you’re doing it very well, but I do think that we should now come together to find a solution acceptable to everyone, so I suggest that we look again at the issue of…”

The “Limited Budget”

Almost regretfully, the buyer claims that he cannot commit more than a given sum to this purchase, although your product or service is indeed worth more. This “limited budget” argument is an extremely cunning one, as it puts the seller in a difficult position: He cannot defend his product, as it has not been criticized, nor can he seek to justify the price, as the buyer is not saying that the price is inappropriate as such. Furthermore, this technique allows negotiations to proceed in a constructive climate, with the seller trying “to help” the customer to buy the product while keeping within his budget.

Lastly, the buyer can obtain useful information from the seller: for example, “If you take it without the aluminum guardrail, we can supply you with the same machine, with a plastic component, for $7,000 less.”

The “limited budget” argument may be genuine or purely tactical. It will be all the more effective if the buyer can use documentary evidence or the testimony of others to bolster his credibility. The seller may even be manipulated in advance: The buyer asks for a quotation “for information only” on a basic model; the seller then makes an approximate commitment-free price quotation; the buyer then comes back asking for a more sophisticated model, with a view to an imminent purchase, saying, “I’m sorry, but I only have a limited budget.”

If you are acting as the seller, you may find an idea for an effective response from among those suggested below.

What are the possible responses?

• Obtain as much information as possible about the buyer’s budgets (i.e., how and when they are decided, etc.) to verify the credibility of the argument.
• Find out who has the power to revise the budget. If necessary, ask to meet that person, with your own line managers, if appropriate.
• Demonstrate that the benefits provided are worth the extra cost.
• Look for a way of splitting the cost: between two financial years (e.g., by offering a part-sale this year, with the balance being paid early next year) or between two different budget headings (e.g., certain machine parts from a linked budget, or you could reduce the price of the machine and increase contractual service charges).
• Stand firm on price, but offer concessions that are less costly to you and that might justify his exceeding his budget.
• Look for potential recompense for a price cut: for example, simplified product specifications, certain services covered directly by the customer, supply of a demonstration model used at trade fairs, an increase in order volumes, a customer commitment to order consumables, payment of a large deposit, changes in the delivery schedule, and so on.