You negotiate virtually every day of your life. In fact, negotiation is so common, you might not even recognize when you’re doing it.
Learning the correct vision, mindset, and tools when negotiating is essential for success. But, it’s equally as important to learn and identify what not to do.
Over the next several blog posts, I will share why negotiations fail and ways you can better prepare for a successful negotiation. You’ll be able to correct the ways you may be currently sabotaging your own negotiations.
One oftentimes surprising reason why negotiations fail is rigidity. Some people come in with a very rigid view of what they want in a negotiation. While it is important to know your bottom line (when you’ll walk away), rigidity often shows up around how things need to look or how things need to be structured, rather than the bottom line. Rigidity can be a real negotiation-killer.
Let’s break rigidity down into 3 areas:
- Preconceived notions
- Pace & timing
- PRECONCEIVED NOTIONS
- I’ve had many clients give specific instructions for how they want a negotiation structured
For example, Miguel, a long-term client, came in once and said, “Corey, I’ve got a buyer for my company. I want to sell it, and I want to do it as a reverse triangular merger.” I said to him, “Okay, no problem if that is the way we end up going, but why do you want to structure it that way?” “My friend did his deal as a reverse triangular merger; it worked out really well, and he saved a bunch of taxes,” Miguel responded.
While the merger worked out well for Miguel’s friend, Miguel’s deal is not necessarily his friend’s deal. Instead of automatically structuring his deal the same way, I suggested we talk about his objectives and where he wanted to be by the end of the deal.
Miguel was great about it, even though he’d come in with this preconceived idea of what he wanted. Not surprisingly, his deal ended up not being structured as a reverse triangular merger, but the deal did achieve Miguel’s objectives.
It’s important to be able to let go of preconceived notions and work with the factors at hand.
Some people aren’t as flexible as Miguel was. Instead, they come in with preconceived notions of how things have to be—whether that’s a specific type of deal structure, the purchase price, or deal terms—and insist on sticking to them.
Coming to the negotiating process from a very rigid place could work against negotiators and create the kind of inflexibility that can kill a good deal.
PACE AND TIMING
Every negotiation, every deal, has its own pace and its own rhythm. Going too slow can cause people to lose interest, come up with objections, or find simpler alternatives. Pushing the pace too fast can indicate desperation or impatience and cause alarm in the other party. Negotiations need to flow in their organic rhythm, which could be very fast, very slow, or somewhere in between, depending on the deal.
Several years ago I had a client, Kim, who was so anxious to get out of a business partnership that she couldn’t sleep at night. It was only after several long sessions with Kim in which I helped her surrender the pace of the negotiation to give the best chance for a positive result, we were able to achieve it for her.
When you’re rigid around pace and timing, you lose creativity. There’s no time for thinking out of the box or innovation. There’s less chance of finding an alternate route when you hit a roadblock. This kind of thinking often comes from a deep-seated fear of losing control. Whether it comes from fear or arrogance or any other driving force, a set timetable is a good way to derail a deal.
Are you rigid in your negotiations? Which do you see most often occur when negotiating, preconceived notions, inflexibility, or a set timetable? How can you work against these roadblocks?
Corey Kupfer is an expert strategist, negotiator and dealmaker. He has more than 35 years of professional deal-making and negotiating experience. Corey is a successful entrepreneur, attorney, consultant, author and professional speaker who is passionate about deal-driven growth. He is also the creator and host of the DealQuest Podcast.
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