Negotiation Space

Salary negotiations are one type of negotiation most working people will enter several times in their lives. At some point, you will want to negotiate a raise or a starting salary or even a multi-year contract.

Salary negotiations are a fine example of the importance of power in a negotiation. When you are asking for a raise, the power may rest with your boss instead of you. How can you help distribute the power more equally?

In an article on the Harvard Business Review blogs, “Negotiate Where You Want to Get What you Want”, Markus Baer and Graham Brown argue that location is a very important factor in salary negotiations. One place where you will be at a disadvantage is in your boss’ office. According to their research:

…residents of an office space — even after only 20 minutes of residing in a space — were able to claim as much as 160% more value in a distributive (”You win, I lose”) negotiation than the visiting party. And it is not only that residents do better when negotiating on their turf. Our study also revealed that entering someone else’s office space causes us to do worse.

Clearly, to do better in salary negotiation you have to take the discussion out from the office to a more neutral spot—perhaps the conference room or a coffee shop. If this is impossible, then you will have to work on increasing your power and confidence. To do that, research as much as you can about salaries in your field, and be prepared to back up your claims.

What do you suggest to people negotiating for a higher salary?

Negotiation is very much in the headlines these days as we watch President Obama and the Congress negotiate regarding the debt ceiling. We see terms thrown around like “calling a bluff,” “raising the stakes,” and “deadlock.” You can appreciate why negotiation knowledge is crucial, not only in business, but in politics and life in general.

This blog (Negotiation Space) is dedicated to giving you useful information, tips and techniques about negotiation. However, you may want to delve deeper. You can take a seminar or buy one of Dr. Chester L. Karrass’s excellent books on negotiation.

Karrass presents public and in-house negotiation seminars including:

• Effective Negotiating- The most widely attended negotiating seminar in the world.
• Effective Negotiating 2—Offered to those who have already attended Effective Negotiating.
• Effective Sales Negotiating-Designed to train sales people on how to make better, longer-lasting sales agreements that work.

More information on these is available on the Karrass website or by calling 323-866-3800.

If you prefer self-learning, we suggest purchasing any or all of Dr. Chester L. Karrass’ books:

• In Business As In Life—You Don’t Get What You Deserve, You Get What You Negotiate

• The Negotiating Game

• Give and Take

Dr. Chester L.Karrass created the Effective Negotiating seminars in 1968,  based on decades of research and experience. Dr. Karrass had been a negotiator for the Hughes organization, a position he obtained after earning an engineering degree from the University of Colorado and an MBA from Columbia University. He received the first Howard Hughes Doctoral Fellowship Award and was able to spend three years conduct research in negotiation techniques before earning a PhD from the University of Southern California. He then returned to Hughes as a negotiation consultant.

Timidity can be a hindrance when negotiating. Obviously, the more timid you are, the less likely you are to be able to stand up for your position, or negotiate with power.

To find out your timidity quotient, you can take the following quiz, adapted from Dr. Chester L. Karrass in his book “In Business As In Life, You Don’t Get What You Deserve—You Get What You Negotiate.”

1. How uncomfortable do you feel when facing direct conflict?

a. very uncomfortable (-10)

b. quite uncomfortable (-5)

c. don’t like it but can deal (0)

d. enjoy it somewhat (+5)

e. welcome the opportunity (+10)

2. How do you feel about situations with many pros and cons?

a. very uncomfortable. I like clarity (-10)

b. quite uncomfortable (-5)

c. don’t like it but can deal (0)

d. Undisturbed (+5)

e. I like it…nothing is every black or white (+10)

3. How confident are you in your business judgment?

a. Experience shows it’s very good (+10)

b. Good (+5)

c. As good as most other business people (0)

d. Not too good (-5)

e. I don’t have good business judgment (-10)

4. How do you usually give in?

a. Very slowly if at all (+10)

b. Moderately (+5)

c. About the same pace as the other party (0)

d. I try to move it along by giving up more (-5)

e. I give in quickly to get it over with (-10)

5. Would you walk back into a store after you tried to reach a deal with the merchant but could not?

a. No way (-10)

b. Rarely (-5)

c. Maybe, but not always. (0)

d. Probably. (+5)

e. Absolutely (+10)

Add up your score. If you are in positive territory, you are not hindered by timidity too often or at all. If your score is negative, you may be a bit too timid. If your score is -50 you may be too timid to negotiate.

Memorial Day is observed on Monday, and most businesses (although not retail since there is a tradition of holiday sales) in the United States are on holiday. Most people will have a long holiday weekend, marking the unofficial start of summer. How does this relate to negotiation?

Chance to rest

Negotiators do best when they are well rested. A long holiday weekend is a good chance to relax and recharge.

Chance to remember

Memorial Day is, after all, a day to remember those who have sacrificed for the country. In towns and cities across the United States memorial commemorations and parades will be held in order to honor the U.S. military. It is a good time to think about goals and priorities, and about what is important.

Chance to plan

Although summer does not start officially until June 21, it is a great time to start planning for summer and for the third and fourth quarters of the year. Perhaps it is a chance to find new inspiration and new goals.  Perhaps it is a chance to start a “swipe file.” Christopher Penn explains on his blog, “Awaken your Superhero,”  how creating a swipe file is a great way to charge up your creativity and inspiration. You collect materials, such as a great negotiation case study, an inspiring quote, a useful website, in a file (which can be electronic) to look back on and get some great ideas.

Karrass wishes our Negotiation Space readers and friends an enjoyable Memorial Day Weekend! We won’t be posting on Monday in honor of the holiday, but we will back next Wednesday.

Is there a relationship between leadership and negotiation? Can you negotiate well if you do not possess leadership skills?

Not every leader will be a great negotiator, nor every negotiator have great leadership skills. Yet, to succeed in business negotiations, you should possess some key leadership traits if you seek to achieve objectives and results. And certainly, to be successfully in charge of a negotiating team, you will need leadership characteristics.

According to the article 5 Key Traits of Great Leaders, on Entrepreneur.com, there are certain features every leader has:

• Vision
• Passion
• Decisiveness
• Team-building
• Character

There are a total of 14 leadership traits according to the U.S. Marine Corps. Bear in mind that every leader does not necessarily possess all 14 traits, and may be stronger in some than others. These traits are:

1. Justice
2. Judgment
3. Dependability
4. Initiative
5. Decisiveness
6. Tact
7. Integrity
8. Enthusiasm
9. Bearing
10. Unselfishness
11. Courage
12. Knowledge
13. Loyalty
14. Endurance

Read the descriptions of each trait here.

In negotiation, many of these leadership traits are helpful and some are necessary. Perhaps the most important are decisiveness, initiative, knowledge, endurance,  and tact. Without those, you would be hard-pressed to reach agreement with the other party.

Which of the leadership traits listed do you think are essential in negotiation?

Women and men may approach conversations, discussions and negotiations differently due to sociological, cultural and even physical differences. Some aspects of the way men and women communicate differently could affect the perception of power during a negotiation.

It is proven that women and men communicate and talk differently. In her 1990 landmark book, “You Just Don’t Understand” sociologist Deborah Tannen explored how communication styles differed between women and men. For instance, women have been socialized to be nice, and not be aggressive. This is often expressed when a woman makes a declaration, but starts the sentence with “I’m sorry, but.” Tannen says women talk to interact and build relationships, while men talk to exchange information.

Some of these gender communication differences make it easier for men to dominate conversations. It is not a leap to see that female communication may also put women in a less powerful position during a business negotiation.

Not only do women and men speak differently, they also have different body language. In the article “10 common body language traps for women in the workplace,” Carol Kinsey Goman explores how women present themselves and how that can affect their interactions with male colleagues.

Among these 10 “body language traps,” female negotiators should be aware of the following, as they could affect the power balance in a negotiation:

• Smiling excessively: makes you look less serious
• Nodding too much: Women nod to indicate encouragement while men nod to indicate agreement
• Having a weak handshake: Weak handshakes indicate passivity, for both genders.
• Tilting your head: Men view head tilting as submissive, whereas women use it to signify interest.
• Waiting to speak: Goman says the following:

In business negotiations, men take control by talking more than women and interrupting more frequently. TIP: One perspective on the value of speaking up comes from former Secretary of State Madeleine Albright, who—when asked what advice she had for up-and-coming professional women—replied, “Learn to interrupt.”

Being aware of these differences in body language and communication styles will help both female and male negotiators during a negotiation.

Have you noticed that you cede ground because of your communication style? If so, how have you counteracted?

Need some last minute gift ideas for the negotiators in your life? Consider what savvy negotiators always need:

• Access to current information
• Ways to display or show information
• Market research
• Improved business and negotiation skills and knowledge

Following are some suggestions:

For those who love gadgets and electronics:

• Wi-Fi enabled Tablet PC or IPad: great way to access and display the latest information on the go.
• E-reader such as the Kindle or the Nook, so you can access the latest business books, magazines and daily newspapers in one place
• Smart phone with business apps (suggestions for business-related IPhone apps)

For those who prefer print:

• Subscription to a business magazine such as Entrepreneur, FastCompany or Inc. or to the Wall Street Journal (print or online)
• Any of Dr. Chester L. Karrass’ books on negotiation
• One of Amazon’s top business books of 2010.

Good for anyone:

• Subscription to business news aggregator such as Hoovers
• Admission to a Karrass Effective Negotiation seminar
• Of course, most negotiators will appreciate a bottle of wine or a box of quality chocolates!

Karrass wishes you and your family Happy Holidays and a Wonderful 2011!

In order to be a better leader, you must also be a good negotiator. We could also argue that good negotiators must have leadership skills. The bottom line is that leadership and negotiation are closely linked.

Being a successful negotiator is a steppingstone to being a great leader. When you succeed in negotiations, you are drawing on many skills and talents. You are knowledgeable about your market and product. You are able to understand other people’s motivations. You plan successful strategies and tactics to attain your goals.

Perhaps one of the most necessary skills for both negotiation and leadership is the ability to be persuasive. If you are able to persuade people to support your viewpoint, you will certainly get ahead in business negotiations and in the executive suite.

According to the article “Negotiation Skills for Leaders,” written for the Washington Post by Joyce E. Russell, several negotiations tactics and strategies are considered essential for those in leadership positions. Some of these are:

• Doing your homework (being prepared)
• Building trust
• Always having a Plan B (alternative scenario for the negotiation)
• Knowing when to talk and when to listen (communication skills)
• Controlling emotions during difficult negotiations
• Having a flexible, friendly personality

How have your negotiation skills impacted your leadership ability? Have you found that you use negotiation strategies to further your career?

Whether we are buying a car, selling furniture, attempting to get a salary raise, or closing a big business deal, we all negotiate to a larger or smaller extent. Most people understand the basics of business negotiations, but some people are negotiation super-stars—whether by instinct or by training, they know what move to make when to succeed in achieving win-win deals.

Great negotiators are persuasive and have a keen understanding of human nature, especially of how power and motivation work. Great negotiators don’t break under the pressure of a tense negotiation. Instead, they keep their calm, and may even have a sense of humor to diffuse the tension.

If you are in a position to hire a negotiating team, you should probably know what traits these great negotiators have in common.

• Self-confidence
• Sound business judgment allowing them to discern what is important and what is not
• Ability to tolerate ambiguity and conflict
• Patience—and the wisdom to know when to wait and when to move
• Integrity
• Open-mindedness
• Ability to read other people and find out if there are hidden issues
• Commitment to planning, strategy and understanding what is being negotiated
• Stable personality that doesn’t need approval or to be liked

How do you rank these traits? Are there other traits you would add?

In the Facebook world, status is what you are doing right now. In negotiations, status is your position or rank in relation to the other party. Many times your job title confers your status: are you the vice president or a director? An account executive or an account manager?

People tend to separate themselves according to status. An entry-level person in the company may shy away from talking to the company’s president because a higher status can be intimidating.

In business negotiations you need to remember that status is not equivalent to power. A vice president may indeed sit across the table from an account manager and have no clear power advantage.

The problem with uneven status is with the feelings that are engendered in the people involved. Because in business hierarchy matters, people with a lower status FEEL uncomfortable with someone of higher status.

Dr. Chester L. Karrass writes about status in his book Give and Take:

“Status differences affect the way people act and make decisions. Status is part of the process that makes the deal and part of the deal itself.”

“My advice to those who face people of higher status is to take them on….The better you prepare, the more knowledgeable you are, the less status matters. Don’t be intimidated. Just work harder.”

Status is real and some people are higher on the feeding chain than others, but that does not mean they have more power in a negotiation. A higher status does not mean the other party will automatically get his or her goals accomplished in a negotiation. Both sides will have to work it out, regardless of who has a better title.

Lao Tzu, the philosopher and founder of Taoism, said about status:

“Pride attaches undue importance to the superiority of one’s status in the eyes of others; And shame is fear of humiliation at one’s inferior status in the estimation of others. When one sets his heart on being highly esteemed, and achieves such rating, then he is automatically involved in fear of losing his status.”

How do you deal with status differences? Are you intimidated when the person across the table has a better title than yours?