Notes (and quotes) on being good at negotiating - Never Split The difference
We’re constantly negotiating whether we want to or not. From mundane things like agreeing what to have for dinner, to important decisions like your salary, being good at negotiating is super important, and I honestly suck at it most of the time.
I read “Never Split the Difference” by Christopher Voss to try learning how to be better at it. These are my short notes. They boil down 300 pages into what I think it’s most important.
After my notes you will find all the highlights I took from the book.
People have a lot of reasons for doing or saying what they do. Sometimes it’s obvious, and sometimes it isn’t. Sometimes they’re aware of it, and sometimes not. Labeling allows us to bring those reasons to the forefront and either acknowledge them so we can move on, or use them as part of the negotiation.
Labeling is the same as pointing things out in a non-direct way, its more like an opinion or observation than an accusation: “It looks like you’re looking for a good price”, “It seems you’re aware of how tough the competition is”. “It looks like you want a fair deal”.
By labeling reasons or issues, you open up the conversation.
A good negotiation can’t start or continue when there’s bad faith. If there’s something we did wrong, we should acknowledge it and admit our faults. We can do that even when it isn’t strictly our fault. People love to be told they’re right, and to listen to an apology.
“I didn’t respect your time by coming in late, I’m so sorry”. “I should’ve sent that email earlier, I know how busy you are”. It’s all about Empathy.
In How to win friends and influence people, there’s a great example of this: if the police stops you, or someone tells you off for doing something “wrong”, the best approach is to do this. This disarms people and diffuses any anger.
Repeat the most important thing the speaker said, or the last 2 or 3 words. This is akin to asking “What do you mean?” or “can you elaborate?” while showing that you’re listening. Its also less confrontational than “I don’t understand”.
Mirroring helps to make the other person talk, and the more they talk, the more information you will have.
Mirroring combined with open ended questions can help you direct the conversation in the direction you want.
By having a deadline, both parties of the negotiation are forced to make concessions to get a deal. Even though deadlines are usually flexible, we threat them as iron clad.
Use deadlines to your advantage. For example by telling a company that you’ll consider job offers until X date. That may increase their offer to prevent you for going to someone else.
when negotiators tell their counterparts about their deadline, they get better deals. It’s true. First, by revealing your cutoff you reduce the risk of impasse. And second, when an opponent knows your deadline, he’ll get to the real deal- and concession-making more quickly.
We’re extremely sensitive to things we perceive to be unfair, to the point where we are willing to lose something to prove a point.
A good way to use this to our advantage when negotiating is to say “we just want what’s fair”. It points out that you’re not greedy, you’re just looking to get what you deserve. It’s extremely hard to argue against that, because if that’d make you unfair.
This is my favorite technique in all of the book is this one.
Ask open-ended questions that will make the other side think about how to solve the problem you want them to solve.
Don’t ask a yes/no question, because there’s no problem to solve there. Ask a “how” question that gets them thinking. “how do I know you won’t drop the offer? ” or, “what’s are we in such a hurry?“.
The other person will have to think of a good answer, and try to solve your problem for you by coming up with alternatives. This must work even better in situations of good faith vs confrontational negotiations
Start questions with “how” and “what”. How can I pay so much? How can I focus fully on the position if I’m not compensated accordingly? What caused us to get to this point?
- “Your offer is very generous, I’m sorry, that just doesn’t work for me” is an elegant second way to say “No.”
“[I]t is self-evident that people are neither fully rational nor completely selfish, and that their tastes are anything but stable.”
the Framing Effect, which demonstrates that people respond differently to the same choice depending on how it is framed (people place greater value on moving from 90 percent to 100 percent—high probability to certainty—than from 45 percent to 55 percent,
Prospect Theory explains why we take unwarranted risks in the face of uncertain losses.
Loss Aversion, which shows how people are statistically more likely to act to avert a loss than to achieve an equal gain.
It all starts with the universally applicable premise that people want to be understood and accepted. Listening is the cheapest, yet most effective concession we can make to get there.
Psychotherapy research shows that when individuals feel listened to, they tend to listen to themselves more carefully and to openly evaluate and clarify their own thoughts and feelings. In addition, they tend to become less defensive and oppositional and more willing to listen to other points of view,
In this world, you get what you ask for; you just have to ask correctly.
Going too fast is one of the mistakes all negotiators are prone to making. If we’re too much in a hurry,
Our brains don’t just process and understand the actions and words of others but their feelings and intentions too, the social meaning of their behavior and their emotions.
a “mirror” is when you repeat the last three words (or the critical one to three words) of what someone has just said.
Ask someone, “What do you mean by that?” and you’re likely to incite irritation or defensiveness. A mirror, however, will get you the clarity you want while signaling respect and concern for what the other person is saying.
How can you separate people from the problem when their emotions are the problem?
Emotions are one of the main things that derail communication. Once people get upset at one another, rational thinking goes out the window.
Tactical empathy is understanding the feelings and mindset of another in the moment and also hearing what is behind those feelings so you increase your influence in all the moments that follow. It’s bringing our attention to both the emotional obstacles and the potential pathways to getting an agreement done.
when people are shown photos of faces expressing strong emotion, the brain shows greater activity in the amygdala, the part that generates fear. But when they are asked to label the emotion, the activity moves to the areas that govern rational thinking. In other words, labeling an emotion—applying rational words to a fear—disrupts its raw intensity.
the word “I” gets people’s guard up. When you say “I,” it says you’re more interested in yourself than the other person, and it makes you take personal responsibility for the words that follow—and the offense they might cause.
In any interaction, it pleases us to feel that the other side is listening and acknowledging our situation. Whether you are negotiating a business deal or simply chatting to the person at the supermarket butcher counter, creating an empathetic relationship and encouraging your counterpart to expand on their situation is the basis of healthy human interaction. These tools, then, are nothing less than emotional best practices that help you cure the pervasive ineptitude that marks our most critical conversations in life.
The reasons why a counterpart will not make an agreement with you are often more powerful than why they will make a deal, so focus first on clearing the barriers to agreement. Denying barriers or negative influences gives them credence; get them into the open.
Pause. After you label a barrier or mirror a statement, let it sink in. Don’t worry, the other party will fill the silence.
Remember you’re dealing with a person who wants to be appreciated and understood. So use labels to reinforce and encourage positive perceptions and dynamics.
“Yes” is often a meaningless answer that hides deeper objections (and “Maybe” is even worse). Pushing hard for “Yes” doesn’t get a negotiator any closer to a win; it just angers the other side.
“No” is the start of the negotiation, not the end of it. We’ve been conditioned to fear the word “No.” But it is a statement of perception far more often than of fact. It seldom means, “I have considered all the facts and made a rational choice.” Instead, “No” is often a decision, frequently temporary, to maintain the status quo. Change is scary, and “No” provides a little protection from that scariness.
People need to feel in control. When you preserve a person’s autonomy by clearly giving them permission to say “No” to your ideas, the emotions calm, the effectiveness of the decisions go up, and the other party can really look at your proposal.
In every negotiation, in every agreement, the result comes from someone else’s decision. And sadly, if we believe that we can control or manage others’ decisions with compromise and logic, we’re leaving millions on the table.
everyone you meet is driven by two primal urges: the need to feel safe and secure, and the need to feel in control. If you satisfy those drives, you’re in the door.
Saying “No” gives the speaker the feeling of safety, security, and control. You use a question that prompts a “No” answer, and your counterpart feels that by turning you down he has proved that he’s in the driver’s seat.
We’ve instrumentalized niceness as a way of greasing the social wheels, yet it’s often a ruse. We’re polite and we don’t disagree to get through daily existence with the least degree of friction. But by turning niceness into a lubricant, we’ve leeched it of meaning.
“Yes” is the final goal of a negotiation, but don’t aim for it at the start. Asking someone for “Yes” too quickly in a conversation—“Do you like to drink water, Mr. Smith?”—gets his guard up and paints you as an untrustworthy salesman.
Summarize: A good summary is the combination of rearticulating the meaning of what is said plus the acknowledgment of the emotions underlying that meaning (paraphrasing + labeling = summary).
We don’t compromise because it’s right; we compromise because it is easy and because it saves face.
Deadlines are the bogeymen of negotiation, almost exclusively self-inflicted figments of our imagination, unnecessarily unsettling us for no good reason.
Increasing specificity on threats in any type of negotiations indicates getting closer to real consequences at a real specified time. To gauge the level of a particular threat, we’d pay attention to how many of the four questions—What? Who? When? And how?—were addressed.
Car dealers are prone to give you the best price near the end of the month, when their transactions are assessed. And corporate salespeople work on a quarterly basis and are most vulnerable as the quarter comes to a close.
when negotiators tell their counterparts about their deadline, they get better deals. It’s true. First, by revealing your cutoff you reduce the risk of impasse. And second, when an opponent knows your deadline, he’ll get to the real deal-and concession-making more quickly.
“If you approach a negotiation thinking that the other guy thinks like you, you’re wrong,” I say. “That’s not empathy; that’s projection.”
As a negotiator, you should strive for a reputation of being fair.
imagine that I offer you $20 to run a three-minute errand and get me a cup of coffee. You’re going to think to yourself that $20 for three minutes is $400 an hour. You’re going to be thrilled. What if then you find out that by getting you to run that errand I made a million dollars. You’d go from being ecstatic for making $400 an hour to being angry because you got ripped off. The value of the $20, just like the value of the coffee mug, didn’t change. But your perspective of it did.
a person who’s told he has a 95 percent chance of receiving $10,000 or a 100 percent chance of getting $9,499 will usually avoid risk and take the 100 percent certain safe choice, while the same person who’s told he has a 95 percent chance of losing $10,000 or a 100 percent chance of losing $9,499 will make the opposite choice, risking the bigger 95 percent option to avoid the loss. The chance for loss incites more risk than the possibility of an equal gain.
The tendency to be anchored by extreme numbers is a psychological quirk known as the “anchor and adjustment” effect. Researchers have discovered that we tend to make adjustments from our first reference points. For example, most people glimpsing 8 × 7 × 6 × 5 × 4 × 3 × 2 × 1 estimate that it yields a higher result than the same string in reverse order. That’s because we focus on the first numbers and extrapolate.
In a recent study,4 Columbia Business School psychologists found that job applicants who named a range received significantly higher overall salaries than those who offered a number, especially if their range was a “bolstering range,” in which the low number in the range was what they actually wanted.
numbers that end in 0 inevitably feel like temporary placeholders, guesstimates that you can easily be negotiated off of. But anything you throw out that sounds less rounded—say, $37,263—feels like a figure that you came to as a result of thoughtful calculation. Such numbers feel serious and permanent to your counterpart, so use them to fortify your offers.
Ask: “What does it take to be successful here?”
On the bottom, he’d added his desired compensation: “$134.5k—$143k.” In that one little move, Angel weaved together a bunch of the lessons from this chapter. The odd numbers gave them the weight of thoughtful calculation. The numbers were high too, which exploited his boss’s natural tendency to go directly to his price limit when faced by an extreme anchor. And they were a range, which made Angel seem less aggressive and the lower end more reasonable in comparison.
The F-word—“Fair”—is an emotional term people usually exploit to put the other side on the defensive and gain concessions. When your counterpart drops the F-bomb, don’t get suckered into a concession. Instead, ask them to explain how you’re mistreating them.
You can bend your counterpart’s reality by anchoring his starting point. Before you make an offer, emotionally anchor them by saying how bad it will be. When you get to numbers, set an extreme anchor to make your “real” offer seem reasonable, or use a range to seem less aggressive. The real value of anything depends on what vantage point you’re looking at it from.
People will take more risks to avoid a loss than to realize a gain. Make sure your counterpart sees that there is something to lose by inaction.
Giving your counterpart the illusion of control by asking calibrated questions—by asking for help—is one of the most powerful tools for suspending unbelief.
“He who has learned to disagree without being disagreeable has discovered the most valuable secret of negotiation.”
you can use “what” and “how” to calibrate nearly any question. “Does this look like something you would like?” can become “How does this look to you?” or “What about this works for you?” You can even ask, “What about this doesn’t work for you?” and you’ll probably trigger quite a bit of useful information from your counterpart.
there are a few that you will find that you will use in the beginning of nearly every negotiation. “What is the biggest challenge you face?”
What about this is important to you? ■ How can I help to make this better for us? ■ How would you like me to proceed? ■ What is it that brought us into this situation? ■ How can we solve this problem? ■ What’s the objective? / What are we trying to accomplish here? ■ How am I supposed to do that?
Calibrated questions make your counterpart feel like they’re in charge, but it’s really you who are framing the conversation.
A “No”-oriented email question to reinitiate contact: “Have you given up on settling this amicably?” 2. A statement that leaves only the answer of “That’s right” to form a dynamic of agreement: “It seems that you feel my bill is not justified.” 3. Calibrated questions about the problem to get him to reveal his thinking: “How does this bill violate our agreement?” 4. More “No”-oriented questions to remove unspoken barriers: “Are you saying I misled you?” “Are you saying I didn’t do as you asked?” “Are you saying I reneged on our agreement?” or “Are you saying I failed you?” 5. Labeling and mirroring the essence of his answers if they are not acceptable so he has to consider them again: “It seems like you feel my work was subpar.” Or “… my work was subpar?” 6. A calibrated question in reply to any offer other than full payment, in order to get him to offer a solution: “How am I supposed to accept that?” 7. If none of this gets an offer of full payment, a label that flatters his sense of control and power: “It seems like you are the type of person who prides himself on the way he does business—rightfully so—and has a knack for not only expanding the pie but making the ship run more efficiently.” 8. A long pause and then one more “No”-oriented question: “Do you want to be known as someone who doesn’t fulfill agreements?”
Don’t try to force your opponent to admit that you are right. Aggressive confrontation is the enemy of constructive negotiation. ■ Avoid questions that can be answered with “Yes” or tiny pieces of information. These require little thought and inspire the human need for reciprocity; you will be expected to give something back. ■ Ask calibrated questions that start with the words “How” or “What.” By implicitly asking the other party for help, these questions will give your counterpart an illusion of control and will inspire them to speak at length, revealing important information. ■ Don’t ask questions that start with “Why” unless you want your counterpart to defend a goal that serves you. “Why” is always an accusation, in any language. ■ Calibrate your questions to point your counterpart toward solving your problem. This will encourage them to expend their energy on devising a solution. ■ Bite your tongue. When you’re attacked in a negotiation, pause and avoid angry emotional reactions. Instead, ask your counterpart a calibrated question. ■ There is always a team on the other side. If you are not influencing those behind the table, you are vulnerable.
The trick to “How” questions is that, correctly used, they are gentle and graceful ways to say “No” and guide your counterpart to develop a better solution—your solution. A gentle How/No invites collaboration and leaves your counterpart with a feeling of having been treated with respect.
“No” question you’ll use is some version of “How am I supposed to do that?” (for example, “How can we raise that much?”). Your tone of voice is critical as this phrase can be delivered as either an accusation or a request for assistance. So pay attention to your voice.
The Rule of Three is simply getting the other guy to agree to the same thing three times in the same conversation. It’s tripling the strength of whatever dynamic you’re trying to drill into at the moment. In doing so, it uncovers problems before they happen. It’s really hard to repeatedly lie or fake conviction.
“Your offer is very generous, I’m sorry, that just doesn’t work for me” is an elegant second way to say “No.”
Use your own name to make yourself a real person to the other side and even get your own personal discount. Humor and humanity are the best ways to break the ice and remove roadblocks.
As the Danish folk saying goes, “You bake with the flour you have.” But anyone can learn a few tools.
Once you’re clear on what your bottom line is, you have to be willing to walk away. Never be needy for a deal.
Set your target price (your goal). 2. Set your first offer at 65 percent of your target price. 3. Calculate three raises of decreasing increments (to 85, 95, and 100 percent). 4. Use lots of empathy and different ways of saying “No” to get the other side to counter before you increase your offer. 5. When calculating the final amount, use precise, nonround numbers like, say, $37,893 rather than $38,000. It gives the number credibility and weight. 6. On your final number, throw in a nonmonetary item (that they probably don’t want) to show you’re at your limit.
Prepare, prepare, prepare. When the pressure is on, you don’t rise to the occasion; you fall to your highest level of preparation.
Black Swan theory tells us that things happen that were previously thought to be impossible—or never thought of at all. This is not the same as saying that sometimes things happen against one-in-a-million odds, but rather that things never imagined do come to pass.
it often doesn’t matter what leverage actually exists against you; what really matters is the leverage they think you have on them. That’s why I say there’s always leverage: as an essentially emotional concept, it can be manufactured whether it exists or not.
That’s why experienced negotiators delay making offers—they don’t want to give up leverage.
Normative leverage is using the other party’s norms and standards to advance your position. If you can show inconsistencies between their beliefs and their actions, you have normative leverage. No one likes to look like a hypocrite.
Discovering the Black Swans that give you normative valuation can be as easy as asking what your counterpart believes and listening openly. You want to see what language they speak, and speak it back to them.
the “paradox of power”—namely, the harder we push the more likely we are to be met with resistance.
We’re all hungry for a map to joy, and when someone is courageous enough to draw it for us, we naturally follow.
Black Swans are leverage multipliers. Remember the three types of leverage: positive (the ability to give someone what they want); negative (the ability to hurt someone); and normative (using your counterpart’s norms to bring them around).
Exploit the similarity principle. People are more apt to concede to someone they share a cultural similarity with, so dig for what makes them tick and show that you share common ground.