negotiation tacticsRecognize the most typical negotiation tactics. Understand methods for managing these negotiation tactics, maintaining your leverage, and keeping the conversation focused on the best outcome for both parties.

Below, you will find blog posts with insights into effective negotiation tactics. And for a much more thorough discussion of negotiation tactics, download our complimentary whitepaper “Negotiation Games: Spotting and Neutralizing Five Tactics that can Damage Deals”.

International Negotiation: More About Preparing to Win

In our previous post on international negotiations, we discussed the critical importance of preparation and gathering facts. You can’t control all the factors, but you can control your knowledge base. The bigger that base is, the higher the chances for success.

As noted before, your charge as an international negotiator is to conduct thorough background work on everything that could impact your potential deal. This includes trying to account for cultural influence on business behaviors, regulations unique to that country, and more. Here we will suggest information sources that will widen your knowledge base and make you a more credible negotiator. In some cases, access to these sources may be limited due to considerations of distance or protocol. Read more

Negotiation Examples: The Value of Persistence

negotiation motivation

I often ask people, “Who are the best negotiators in the world?” The most common answer is, “Children.” Yet, children have never been trained in negotiations (certainly not by us). What makes them such naturally effective negotiators?

There are a number of answers to that question. For example, children use tactics of emotional blackmail (screaming in a public place) or they will “negotiate” with principled concessions (“I will eat the peas if you let me stay up until 10.”). The answer we hear most often is that children are naturally persistent – they just don’t take “no” for an answer. Their wants are simple (“I want a cookie.”), yet they have the willingness to repeat the request as often as needed to get their desired outcome. Any parent can tell you about a repetitive argument they’ve had with their child – the child, being persistent and having absolutely no sense of time pressure, simply repeats the same argument over and over again until the parent loses patience and gives in. Read more

Negotiation Examples: Diffusing Intimidating Tactics


Negotiation Tactics Versus Gamesmanship


Negotiation tactics are techniques or actions intended to influence a negotiation. However negotiation gamesmanship consists of techniques or actions, unrelated to the merits of the transaction, used to gain an advantage in a negotiation. Thus, gamesmanship is a subset of tactics. For example, yelling, screaming, intimidation or walking out are types of gamesmanship tactics.

Why Understand Negotiation Games?

Gamesmanship is not for everyone, but all negotiators should recognize and understand these tactics. Gamesmanship as a tactic is used to cause confusion, intimidate, accelerate or improved leverage or momentum. Thus it’s a key skill to recognize gamesmanship tactics when they occur so that the skilled negotiator can deal with them. Read more

Define Value, Win Credibility and Respect at the Negotiation Table

Define Value, Win Credibility and Respect at the Negotiation Table with a Few Simple Questions

Have you ever heard this from a customer during a discussion? “We’d like an additional 10% discount. If you give this discount to me, we can close the deal.” Sellers hear this all the time. More often than not, sellers concede immediately in the interest of getting the fast close. But is this the correct response? Let’s consider the advantages. As a seller, if the deal really closes after you give the quick discount, you can count the revenue and move on to the next deal. And maybe the client likes you for that moment. Read more

Negotiation Tactics: Discovering the Hidden Value in Client Requests

While at the negotiating table, sometimes the rush to provide a client with whatever he or she has requested without discussing the value of the request is a study in blown opportunities. This is illustrated by a recent discussion we had with a client regarding the case scenario below.

Our client was in negotiations with a customer about adding some content to an existing contract. The sales team wanted to close it by end of May. The customer’s procurement organization was involved. In the first week of May, the procurement director stated: "We might be interested in closing before the end of the month." The sales person responded: "That sounds good. What will it take to get that done?"

Read more

M.O.R.E. – Negotiations and the Australian & International Pilots Association

An August article in Aviation Online Magazine caught our eye with this headline – “Qantas Airline Pilots Negotiate Job Security Not Pay Increase”.  It concerns bargaining between the Australian and International Pilots Association (AIPA) and Australia’s largest airline.  Included in the article is a quote from the AIPA negotiations spokesperson that states that the pilots’ leading issues are “job protection, career progression, and off-shoring of jobs”.  Not money.

First, it is an interesting matter that the AIPA negotiator took these issues public.  That can work for them or against them.  On one hand, the list makes clear what the AIPA wants, which is a plus.  On the other hand, this list implicitly makes some concessions.  Read more

Time Stamps in Negotiations

Negotiation and the News is brought to you this week from Cape Town South Africa, where rail travel has ceased. Google (or Bing) “South Africa Rail Strike”, and check out the news. In general two groups of rail employees have struck. First those transporting goods, followed by those transporting passengers. The normal management / union disagreements apply – a mismatch in positions and demands for wages and benefits. Your Negotiation and the News correspondent, being in Cape Town ready to travel (by rail) to Johannesburg, reported live on May 15th. The strike is a classic example of negotiation “time stamps” in action. Read more

Where are we meeting?

Your place or mine?  When setting a negotiation meeting do you do it at your location, your “adversary’s” location, or a “neutral corner”?  Not long ago, in the news, we read, “The aircraft maker Airbus [was] among half a dozen companies to sign roughly $30 billion in contracts… with Chinese partners.”  It happened in Beijing.  Well, if you were getting your share of $30 billion, wouldn’t you be willing to travel?  Yes, you would.

Taking a broader view, as professional negotiators we are mostly insensitive to location (ours or theirs), with a few exceptions.  If you’ve done your homework and are well-prepared, there should be no “home field advantage” in terms of your negotiation results.  However, if:

  • the right resource for one side or the other can only be in one place, go there
  • physical issues are likely to raise the odds of negotiation errors (extreme time change, for example), either go early enough to be rested, or make them come to you
  • logistics such as contract drafts are being handled by one side, and time is of the essence to you – go where the logistics will be smoother
  • you have been unable to get the information you need to prepare reasonably – try to have them come to you in case you need “surprise” resource or analysis
  • you know that it is important to the other side, but it isn’t to you – go to them (but consider if they should offer something in return, like $30 billion)
In the end, location shouldn’t matter.  But certain factors – for example: fatigue, delay for logistics, or availability of the right team – will increase your sensitivity to location.  Think about them when you set up your next negotiation. (TD)

Cerebrus Capital Management & United Rentals Inc.

What do you do if you think you agreed to pay too much?  Let’s turn to the financial pages for an example.  But before we begin – we don’t have any inside knowledge about this deal, and we don’t know which side is telling the truth.  It just makes for an enlightening negotiation topic.

In many recent financial articles, it has been reported that Cerebrus Capital Management wants to either renegotiate the terms (including price), or back out of their agreement to buy out United Rentals Inc. (URI).  Cerebrus was willing to pay a $100 million “breakup fee” specified in the agreement.  Good money, but the buyout price was $4 billion.  What happened? 

URI is suing Cerebrus for specific performance on the contract (which essentially means forcing them to do what they contracted to do). In addition, URI alleged that Cerebrus intentionally leaked a letter that said Cerebrus was going to renegotiate, thus causing URI’s stock to drop by more than 30% – which in turn made the old price Cerebrus agreed to a lousy deal.  Two days after that, Cerebrus made a significantly discounted buyout offer, and (reportedly) called it “attractive”.  Ouch.

It is now in the courts.  One thing is predictable.  No matter how it turns out, the future is gloomy. 

(Insert “allegedly” appropriately in the following – basically everywhere.) If Cerebrus leaked, and the buyout price does come down, was this a good tactic?  After all, it’s a $1.2 billion dollar difference.

Our experience shows that buyers and sellers in commercial transactions see these things differently in one key way.  Buyers are more likely to use tactics and get away with it.  Sellers who get caught in an “iffy” tactic are much less likely to get away with it.  Why?  In either case, the side that gets caught in a tactic suffers a tremendous loss of credibility, and of “negotiation capital”.  Negotiation capital can best be described as the other side’s willingness to negotiate with you.  It spends like capital, and comes from an account that can be depleted severely.  Caught in a nasty tactic?  You just emptied your account, and every step in your future negotiations will be harder.   

But why is there a difference between a buyer who gets caught, and a seller who gets caught? Because in the minds of most buyers, there is always another seller.  But in the minds of most sellers, every buyer could be the last one.

We don’t recommend tactics like these – for buyers or sellers.  Your reputation is too hard to get back.  Most of the time, we want a client / supplier for the long term.  Learn to negotiate on the merits of the transaction, and you’ll be more successful. (TD)

BEA and Oracle (Part 2)

Carl C. Icahn goes over the BEA management team’s head. Hard on the heels of BEA’s rejection of Oracle’s $17/share buyout offer, BEA’s largest shareholder Carl C. Icahn has sued BEA to force a shareholders’ meeting to vote on the offer. The negotiations implications are interesting. BEA now has an internal conflict – Icahn arguably has similar (but not exactly aligned) motivations to those of BEA management. At the same time, his threat undercuts the strength of BEA’s position that a price of $21 per share is the right one, and supports Oracle’s position that $17 per share is fair. Interestingly, this would seem to work against Mr. Icahn. If $21 per share were possible, his benefit would be nearly 25% greater. What is BEA to do? Is this pressure (called Negotiations Leverage) real?

Threatening to go “over their head” is a common tactic. In the real world, these kinds of conflicting motivations within a single “team” are common, and have to be managed. If you don’t, it will be expensive to your side – it this case, it could cost up to $6 billion. This is a simple example of the power of negotiations. Ask us how to avoid losing 25% on your next deal.