Six Principles Every International Negotiator Must Know: A Divided Team is a Costly Team
This is the sixth post in a series entitled: The Principles of International Negotiation: Finding Universal Value in a Complex World
As many have learned, cracking the united front of a negotiation team can yield prized concessions. As with a teenager who knows how to play one parent against another to get permissions and privileges, the party across the negotiation table will pick your team apart if given a chance. Even if it’s an opportunity they don’t take, disunity can severely damage your credibility, and prolong or sometimes cripple negotiations. In an international environment, where team members can often be in different time zones, keeping a unified voice is a particular challenge.
A Negotiation Example
In a key negotiation meeting with a Japanese buyer, our team firmly held that the product we were selling had to be clearly differentiated by the Japanese before it was resold. Product improvements, service differences, solution packaging – any of these would have been acceptable to us. In a consensus culture such as Japan, decisions often take time. After days of inconclusive negotiations, our team’s manager said, “Well, if this is a real problem, perhaps you could phase in the differences over time.”
This was a terrible error. If we had continued on this path, we would have had no key differentiators and ended up in a price war with our own client. Moreover, none of us had agreed to this “phase-in” idea internally. Our manager had just lost patience. We were a team divided. We managed to recover from the error, but it added weeks to the negotiation cycle and our differentiation was weakened. Everyone lost a little bit in the end.
The Value of a United Team
A united front at the negotiating table is important. It is particularly true when someone on your team commits a blunder. When negotiating with somebody from a different culture, in addition to the mechanics of the deal, there is the opportunity to stumble on language and culture differences. If you’re negotiating abroad, the stress of travel and jet lag can take a toll, as well. When a mistake happens, your team’s response to the mistake is critical. Mistakes can scramble decision-making and jeopardize your united front.
First, there is a high probability that the other team will try to exploit those mistakes. You can further weaken your position by letting the event throw your team into chaos and blame assignment. The key is to correct the error as soon as possible. A shorter time from error to correction simplifies the fix. Then continue by showing loyalty to your team and improving your teamwork. These actions will minimize the damage of the error. Internally, it will keep your credibility within the team and retain their support. If teammates allow their team to be divided just because one team member makes a mistake, how will you maintain your position when the other side presents genuine challenges?
A few years ago we were working with a US company that was discussing a purchase of assets and subsequent closure of a facility in France. One of the seller’s two largest shareholders was against the facility closure, and kept raising the issue of French labor laws that would make the deal uneconomical. The other large shareholder favored the sale, and stated to the buyer that he was willing to underwrite the transfer of employees to another party. This immediately aligned the US company with the second shareholder. It also enabled the buyer to lower the purchase price while removing the first shareholder’s only argument against the sale. By not having a united front, the shareholders eroded their position.
Teams can and should encourage internal debate, but a unified position must always be presented to the other party. “Stand by your team” is advice that will serve you well in most negotiation scenarios. This does not mean that you should support your team members if you have lost trust in their ability to support a negotiation. If necessary, removing a team member should be done in a way that is not seen by the other side to be punitive or damaging to credibility. As much as possible, the various rationales for an internal split should not be made apparent to the other side. Debate internally, unify externally – and do your research about the culture of the people with whom you’re negotiating!