Everything is open for negotiation—even prices, schedules, and product offerings that seem carved in stone. This is part one of two of 13 techniques that are taught at the Wharton School of Business.
Editor’s Note: Yesterday, we explored Steven Blum’s first seven of 13 tips to negotiate anything. Read the first part here. These are his last tips on how you can negotiate pay, benefits, prices in stores, and anything else you can think of.
8. Don’t trust imprudently.
The mere fact that you have insisted on forthrightness and unwaveringly offered it does not mean you should entirely trust the other parties. The best advice is to always act in a trustworthy manner but do not assume that others will do the same. Be extremely cautious about placing too much trust in others. It is better to allow your confidence to build slowly as it is earned. And never trust anyone whose incentives and interests suggest strong motivation for them to defect.
9. Be mindful of each “little agreement” step.
The negotiation process is made up of a series of little agreements. Pay attention to them not only as they affect you, but also with an eye toward their impact on your negotiating partners. The idea is to use small commitments to pave the way for the other party to easily agree to the next step. Before you know it, you will find yourselves marching confidently, arm in arm, toward agreements that ensure good outcomes for everyone.
10. Ask lots of questions.
An important study found that skilled negotiators spend almost 40 percent of their time acquiring information (asking questions) and clarifying information (restating and reframing what they’ve heard to verify that they’ve understood correctly). Average negotiators spend about 18 percent of their time on the same behaviors. In other words, average negotiators ask half as many questions as skilled negotiators.
The key is to ask previously prepared questions and, just as important, listen well enough to pose precise follow-up questions. Probing and clarifying the other party’s position requires that you listen carefully and formulate good questions on the spot. Strong listening skills, along with good preparation habits and the ability to express thoughts clearly, are among the top traits of the most effective negotiators.
11. Create scarcity.
Negotiators respond to what is referred to as a closing window of opportunity, i.e., making an offer that is good for only a limited amount of time. When a proposal or offer is structured to end at a certain time, the scarcity effect adds pressure.
Another factor that causes scarcity is competition. When everyone else wants something, there is a tendency for us to want it more, too. Making it clear that everyone desires the item for sale can make even those with little use for it determined to buy it. Nobody wants to be left out.
People seem to be hardwired to greatly fear loss, and that’s why creating scarcity can be an effective negotiating technique. A take-it-or-leave-it tactic or an ultimatum in a negotiation can raise the scarcity effect to sky-high levels.
12. Prepare and practice.
If I could offer only one suggestion to improve your negotiating, it would be this: if you prepare fully for each negotiation, you will do better. It is that simple. As a general rule, the more prepared you are, the better your outcomes will be.
Practice makes perfect. Use every opportunity to test out your skills and think through situations as if they were important negotiations. As you practice, you’ll become a more agile negotiator, able to work around tough situations and create much better outcomes for yourself.
13. Be patient.
One of the best things you can do in the closing and commitment stage of a negotiation is to be patient. The negotiator who is not rushed has a favorable position and is free to work for the best possible deal. Some methods to help make this attitude possible include starting early, not procrastinating, and avoiding negotiating when you are in a needy state of mind.
Negotiation isn’t just about getting a better price for a product or service. It’s about dramatically improving the quality of your life, creating better outcomes for everyone, and even building more harmonious relationships. Improving your negotiating skills is an effort worth making.
Steven G. Blum has been teaching in the Department of Legal Studies and Business Ethics at the Wharton School of Business of the University of Pennsylvania since 1994 and was a visiting professor at the ALBA Graduate Business School in Athens, Greece, for more than a decade.
He is author of Negotiating Your Investments: Use Proven Negotiation Methods to Enrich Your Financial Life, holds two law degrees, and has been guiding clients through all aspects of their financial lives for more than 30 years. In addition to maintaining a law practice, he is a principal at Steven G. Blum and Associates, LLC, which places a special emphasis on the ethics of the professional-client relationship. The firm is based near Philadelphia.
In addition to teaching semester-long courses for undergraduate and MBA students, Blum has taught in Wharton Executive Education programs, lectured and consulted widely, and frequently leads seminars and educational forums. He has led training sessions for a number of Fortune 100 companies as well as organizations of lawyers, physicians, accountants, and other professionals.
Of all the different aspects of his career, Blum takes tremendous pride in his role as teacher. He believes it is the highest calling in society. He has six times won the William G. Whitney Award for outstanding teaching at Wharton.
Blum holds a bachelor’s degree from Wesleyan University, a law degree from Northeastern University School of Law, a master’s degree in education from Harvard University, a certificate of specialization in negotiation and dispute resolution from Harvard University’s Program on Negotiation, and a master’s degree in the law of taxation from the New York University School of Law.
To read more of Blum’s writings or to get further information, visit www.negotiatingtruth.com.
About the Book:
Negotiating Your Investments: Use Proven Negotiation Methods to Enrich Your Financial Life (Wiley, 2014, ISBN: 978-1-118-58307-4, $40.00, www.negotiatingtruth.com) is available at bookstores nationwide, from major online booksellers, and direct from the publisher by calling 800-225-5945. In Canada, call 800-567-4797. For more information, please visit the book’s page on www.wiley.com.