Are You Negotiating From a Position of Weakness or From a Position of Power?
No matter where I go to teach negotiation strategies and tactics, people tell me they feel as if they're bargaining from a position of weakness. You'd think the lawyers at Intel, Qwest Communications, Warner Brothers and Sony Pictures Entertainment or the engineers and managers at Kraft Foods, all of whose people I've trained, would drape themselves in the power of their corporate brand.
Not so. More than 80% raise their hands when I ask them whether they're negotiating from a position of weakness.
That, I suppose, is because I haven't trained those companies' CEO's, GCs or Boards of Directors. But even then I'll bet I could flip a coin on their answer to the question. The Boards of Directors, after all, have to answer to shareholders and federal governmental agencies. CEOs must answer to their Boards and GCs to the CEO. Sometimes all of them feel intimidated by the lady in HR because Human Resources is the hot nuclear core of conflict in the organization.
What, then, can we do to increase others' perceptions that we have power, a perception that is more than half of our bargaining strength.
How to Have a Power Mindset
First, the importance of a power mind-set in any negotiation (which includes fee setting and product pricing).
Ready? Here it is.
The person with the greatest bargaining power is the person perceived to be most able to walk away from any deal.
When recently asked by a new client how one appears to have bargaining power, I answered with a story.
I once mediated a medical malpractice case that didn't settle. The physician, who was in his fifties, looked as if he'd had the weight of the world on his shoulders. His face was lined, his countenance dour. He was angrier than any defendant I'd ever met and that's saying something after a 25-year litigation and trial practice. I was concerned about his fate, as I am about all my mediation clients. On his way out the door I said, "you know, when you're angry, you look pretty scary and I'd be worried about how the jury will respond to you."
"How," he asked, "can I look less angry?"
"Only by being less angry," I responded kindly. "The jury is the intestinal track of the justice system. They make decisions with their collective gut and if they don't like you, you're likely to suffer at their hands no matter how great your case is."
That advice - to be the person you want to convey to others- was based on hard-earned experience on the ground. Galinksy and friends have now confirmed that experience in their research.
Their first recommendation for job hunters who want to appear powerful is to "think powerful."
Job candidates are rarely in a position of power as interviewers decide the fate of their future career prospects. Yet, the winning strategy in these situations is thinking that one has power, in spite of the situation. As a candidate, how can you engineer a powerful mindset? Well, a simple trick is to remind yourself about a time you had power over a situation right before an interview, and invoke the precise feelings associated with that memory – feelings of confidence and competence, as well as decisiveness during decision making.
The supporting research divided business school applicants participating in a mock job interview into three groups - the first told to write an essay about a time they felt powerful, a second about a time they lacked power and the third to write nothing at all.
The interviewers, who didn't know about the writing assignments, were asked to rate the candidates as likely or unlikely admittees to a business school program. Here are the results:
When candidates went straight to the interview, interviewers accepted 47.1 percent of the candidates. However, the admission rate went up to 68 percent for those people in the group who wrote an essay about a time they had power, and fell to a low 26 percent for those who wrote an essay about a time they lacked power.
Thus, merely recalling an experience of high power increased candidates’ likelihood to be admitted by 81 percent.
The trick? Recall a position in which you've been powerful in any situation immediately before you negotiate a deal, bargain for a pair of sunglasses on the Venice boardwalk or interview for a job.
Tomorrow, we'll talk about the second and third means to increase your power and improve your chances to close any deal you want to.