Win With Win/Win
Last month, my wife, Brigid, and I drove from Portland, Maine to Boulder, Colorado. It’s a long journey (2000+ miles!), so we tried to plan some fun stopping points along the way.
One of these, near Cedar Rapids, Iowa, is Edith Lucille’s Bait Shop and Wing Depot (motto: “Eat at Edith Lucille’s — and get worms!”). After reading about it online, we knew we had to stop.
It wasn’t much to look at from the outside (see photo), but what it lacked in curb appeal it made up for many times over in friendliness. We stepped inside and immediately received a big hello: “Welcome to Lucille’s — sit wherever you want!” Two minutes later, our waitress, Crystal, came over and introduced herself.
She told us about the daily special (a heart-stopping prime rib sandwich with three types of cheese, grilled peppers, and onions), made some recommendations (“Try the Iowa eggrolls, they are f@cking awesome!”), and asked where we were from and where we were headed. Forty-five minutes later, we walked out the door with full stomachs, an armload of Edith Lucille-branded paraphernalia, and a promise to Crystal that we would stop in on our way back East.
Win/Win Goes a Long Way
You don’t need to be in the restaurant business to appreciate the value of Crystal’s friendly approach. We spent more money than we initially intended and had a blast along the way. The same concept applies at the negotiation table — your tone and manner can make a significant difference in the outcome for both parties.
Most people take one of two approaches in a negotiation:
- Win/Lose, in which one side gets everything (or nearly everything) it wants and the other side doesn’t (i.e., it loses); or
- Win/Win, in which each side wins on its critical issues.
In my experience, the second approach is nearly always better for everyone involved. It builds trust, leads to a better understanding of each party’s needs, and results in a mutually beneficial, long-term relationship.
With that in mind, here are four suggestions for getting to win/win…
1. Prepare, Prepare, Prepare
Before commencing the negotiation, complete as much research as possible about the other party. What are its likely needs? What market forces impact its success? What are the backgrounds of the individuals with whom you’ll be negotiating and what is the makeup of the leadership team?
The more you know about the other side and its representatives going in, and the more you can speak to that in your discussions, the more quickly and easily you will earn their trust and respect.
2. Listen Actively and Dig Deep
Do your best to listen carefully, so you can understand what the other party truly needs, whether it’s big picture or related to specific issues. This means speaking less and asking lots of questions to uncover the other party’s true motivation. Some examples:
- As members of the procurement team, are you under significant pressure to cut costs?
- What is driving your need to meet a certain deadline or delivery date?
- Why can’t you commit to subscribing for longer than one year?
During a recent negotiation, the other party revealed that it was changing vendors because of its existing provider’s poor security controls, as evidenced by a recent data breach. Knowing that, we did as much as possible to demonstrate my client’s different (i.e., better) perspective regarding security. We included the Chief Privacy Officer on calls, provided references to existing customers with similar concerns, and responded promptly and thoroughly to the customer’s security questionnaires.
Because we understood what was driving this customer to look elsewhere, we were able to tailor our approach to address their concerns.
3. Brainstorm Ways to Improve Outcomes for Both Parties
A win/lose approach assumes that the pie is fixed in size and that the only way for me to get more is for you to get less. Win/win seeks to increasethe size of the pie by creating additional value for all concerned. An effective means of uncovering this extra value is to brainstorm different approaches without reacting positively or negatively.
For example, one party may be happy to trade off a longer-term commitment in exchange for lower pricing. On the legal side, one party may be willing to trade specific data security obligations for an increased limit of liability for data breaches.
The point is, you don’t really know what matters most to the other side — nor do they know what matters most to you — until you have an open discussion to learn more about each other’s needs and uncover these types of opportunities.
4. Present Multiple Packages
In an earlier newsletter, I wrote about the advantage of offering a package solution that satisfies each party’s competing needs. In addition, consider offering multiple packages that address the various needs of each party differently. Then discuss each package with the prospect.
For example, you may offer one package that includes tiered pricing (i.e., larger discounts in exchange for a longer commitment) in addition to other items of value, such as enhanced support, reduced fees for additional users, more favorable renewal pricing, etc.
By listening carefully to the prospect’s reaction to the various elements in each package, you’ll be able to tease out their true needs and objectives. Even if they don’t accept one of the packages as is, you can use the additional feedback to offer a final package that includes their favored elements.
Ultimately, whether or not the prospect accepts this last package, the prospect will know that you’re working to address its needs and concerns.
Whether operating a quirky restaurant or negotiating a high-stakes transaction, there’s tremendous value in working to establish a win/win scenario for all involved.
Not only does it usually lead to better outcomes for all parties, but it’s also a much more pleasant and satisfying way to do business.