Never Split the Difference

About

Life is negotiation. Negotiation is the key to collaborattion. The first step to achieving a mastery of daily negotiation is to get over your aversion to negotiating. You don’t need to like it; you just need to understand that’s how the world works.

Key Concept

Negotiation is about creating all-in win-win situations, not compromises. This requires integrity, effort, and is so hard that it is impossible - but the only other alternative is WATNA

Background Reading

Perhaps the most relevant is Never Split the Difference.

Concepts

Tactical empathy - repeating without judgment to gain trust.

Empathy - understanding counterpart, without necessarily agreeing. Harvard and FBI agree on this definition.

Decisions are made emotionally. Emotions are always involved.

You want repeat customers. A win-lose situation is not a repeat customer.

Tactics

• I’m sorry, Robert, how do I know he’s even alive? - apology and first name to seed warmth and prevent bulldozing.
• Employs FBI’s most potent negotiating tools: the open-ended question.
• we call this tactic calibrated questions: queries that the otherside can respond to but that have no fixed answers. It buys you time. It gives your counterpart the illusion of control—they are the one with the answers and power after all—and it does all that without giving them any idea of how constrained they are by it.
• It turned out that our approach to negotiation held the keys to unlock profitable human interactions in every domain and every interaction and every relationship in life.
• “I’m just asking questions,” I said. “It’s a passive-aggressive approach. I just ask the same three or four open-ended questions over and over and over and over. They get worn out answering and give me everything I want.”
• but no matter how we dress up ournegotiations in mathematical theories, we are always ananimal, always acting and reacting first and foremost from our deeply held but mostly invisible and inchoate fears, needs, perceptions, and desires.
• but instead focus on their interests (why they’re asking for it) so that you can find what they really want...At the time, we were deep into Getting to Yes. And as a negotiator, consultant, and teacher with decades ofexperience, I still agree with many of the powerful bargaining strategies in the book.
• Through decades of research with Tversky, Kahneman proved that humans all suffer from Cognitive Bias, that is, unconscious—and irrational—brain processes that literally distort the way we see the world. Kahneman and Tversky discovered more than 150 of them.
• Now think about that: under this model, if you know how to affect your counterpart’s System 1 thinking, his inarticulate feelings, by how you frame and deliver your questions and statements, then you can guide his System 2 rationality and therefore modify his responses.
• From that moment onward, our emphasis would have to

be not on training in quid pro quo bargaining and problem solving, but on education in the psychological skills needed in crisis intervention situations. Emotions and emotional intelligence would have to be central to effective negotiation, not things to be overcome.

• What were needed were simple psychological tactics and

strategies that worked in the field to calm people down, establish rapport, gain trust, elicit the verbalization of needs, and persuade the other guy of our empathy. We needed something easy to teach, easy to learn, and easy to execute.

• The whole concept, which you’ll learn as the centerpiece

of this book, is called Tactical Empathy. This is listening as a martial art, balancing the subtle behaviors of emotional intelligence and the assertive skills of influence, to gain access to the mind of another person. Contrary to popular opinion, listening is not a passive activity. It is the most active thing you can do.

• The majority of the interactions we have at work and at

home are negotiations that boil down to the expression of a simple, animalistic urge: I want.

• The first step to achieving a mastery of daily negotiation is to get over your aversion to negotiating. You don’t need to like it; you just need to understand that’s how the world works.
• Tools: 1 Active listening to Black Swan; 2 Active listening to Late Night FM DJ Voice; 3 tactical empathy through labeling 4. Getting to That's right. 5 Getting to No 6 Bending Reality: timeless, fairness, loss. 8 Calibrated questions - How or What? How is a way to gently say No. 9 Effective offer/counteroffer 10

Black Swan - 3-5 pieces of info that change everything.

• Negotiation is the heart of collaboration.

1

• Your goal at the outset is to extract and

observe as much information as possible. Which, by the way, is one of the reasons that really smart people often have trouble being negotiators—they’re so smart they think they don’t have anything to discover.

• “Seriously,

do you really need a whole team to . . . hear someone out?” The fact that the FBI has come to that conclusion, I tell them, should be a wake-up call. It’s really not that easy tolisten well. We are easily distracted. We engage in selective listening, hearing only what we want to hear, our minds acting on a cognitive bias for consistency rather than truth. And that’s just the start.

• There’s one powerful way to quiet the voice in your

head and the voice in their head at the same time: treat two schizophrenics with just one pill. Instead of prioritizing your argument—in fact, instead of doing any thinking at all in the early goings about what you’re going to say—make yoursole and all-encompassing focus the other person and what they have to say.

• The goal is to identify what your counterparts actually

need (monetarily, emotionally, or otherwise) and get them feeling safe enough to talk and talk and talk some more about what they want. The latter will help you discover the former.

• It’s a phenomenon (and now technique) that follows a

very basic but profound biological principle: We fear what’s different and are drawn to what’s similar. As the saying goes, birds of a feather flock together. Mirroring, then, when practiced consciously, is the art of insinuating similarity. “Trust me,” a mirror signals to another’s unconscious, “You and I—we’re alike.”

• The way thelate-night FM DJ voice works is that, when you inflect your

voice in a downward way, you put it out there that you’ve got it covered. Talking slowly and clearly you convey one idea: I’m in control. When you inflect in an upward way, you invite a response. Why? Because you’ve brought in a measure of uncertainty. You’ve made a statement sound like a question. You’ve left the door open for the other guy to take the lead, so I was careful here to be quiet, self-assured.

• Most of the time, you should be using the

positive/playful voice. It’s the voice of an easygoing, good- natured person. Your attitude is light and encouraging. The key here is to relax and smile while you’re talking. A smile, even while talking on the phone, has an impact tonally that the other person will pick up on.

• When people are in a positive frame of mind, they think

more quickly, and are more likely to collaborate and problem-solve (instead of fight and resist).

• When deliberating on a negotiating strategy or approach,

people tend to focus all their energies on what to say or do, but it’s how we are (our general demeanor and delivery) that is both the easiest thing to enact and the most immediately effective mode of influence. Our brains don’t just process and understand the actions and words of others but their feelings and intentions too, the social meaning of their behavior and their emotions. On a mostly unconsciouslevel, we can understand the minds of others not through any kind of thinking but through quite literally grasping what the other is feeling.

• Smile at someone on the street, and as a reflex they’ll smile back.
• Mirroring, also called isopraxism, is essentially imitation.

It’s another neurobehavior humans (and other animals) display in which we copy each other to comfort each other. It can be done with speech patterns, body language, vocabulary, tempo, and tone of voice. It’s generally an unconscious behavior—we are rarely aware of it when it’s happening—but it’s a sign that people are bonding, in sync, and establishing the kind of rapport that leads to trust.

• While mirroring is most often associated with forms of

nonverbal communication, especially body language, as negotiators a “mirror” focuses on the words and nothing else. Not the body language. Not the accent. Not the tone or delivery. Just the words. It’s almost laughably simple: for the FBI, a “mirror” is when you repeat the last three words (or the critical one to three words) of what someone has just said. Of the entirety of the FBI’s hostage negotiation skill set, mirroring is the closest one gets to a Jedi mind trick. Simple, and yet uncannily effective.

• The results were stunning: the average tip of the waiters who

mirrored was 70 percent more than of those who used positive reinforcement.

• I only half-jokingly refer to mirroring as magic or a Jedi

mind trick because it gives you the ability to disagree without being disagreeable.

• “I’m sorry, two copies?” she mirrored in response,

remembering not only the DJ voice, but to deliver the mirror in an inquisitive tone. The intention behind most mirrors should be “Please, help me understand.” Every time you mirror someone, they will reword what they’ve said. They will never say it exactly the same way they said it the first time. Ask someone, “What do you mean by that?” and you’re likely to incite irritation or defensiveness. A mirror, however, will get you the clarity you want while signaling

• Mirroring will make you feel awkward as heck when

you first try it. That’s the only hard part about it; the technique takes a little practice. Once you get the hang of it, though, it’ll become a conversational Swiss Army knife valuable in just about every professional and social setting. Here are some of the key lessons from this chapter to remember: ■ A good negotiator prepares, going in, to be ready for possible surprises; a great negotiator aims to use her skills to reveal the surprises she is certain to find. ■ Don’t commit to assumptions; instead, view them as hypotheses and use the negotiation to test them rigorously. ■ People who view negotiation as a battle of arguments become overwhelmed by the voices in their head. Negotiation is not an act of battle; it’s a process of discovery. The goal is to uncover as much information as possible. ■ To quiet the voices in your head, make your sole and all-encompassing focus the other person and what they have to say. ■ Slow. It. Down. Going too fast is one of the mistakes all negotiators are prone to making. If we’re too much in a hurry, people can feel as if they’re not being heard. You risk undermining the rapport and trust you’ve built. ■ Put a smile on your face. When people are in apositive frame of mind, they think more quickly, and are more likely to collaborate and problem- solve (instead of fight and resist). Positivity creates mental agility in both you and your counterpart. There are three voice tones available to negotiators: 1. The late-night FM DJ voice: Use selectively to make a point. Inflect your voice downward, keeping it calm and slow. When done properly, you create an aura of authority and trustworthiness without triggering defensiveness. 2. The positive/playful voice: Should be your default voice. It’s the voice of an easygoing, good-natured person. Your attitude is light and encouraging. The key here is to relax and smile while you’re talking. 3. The direct or assertive voice: Used rarely. Will cause problems and create pushback. ■ Mirrors work magic. Repeat the last three words (or the critical one to three words) of what someone has just said. We fear what’s different and are drawn to what’s similar. Mirroring is the art of insinuating similarity, which facilitates bonding. Use mirrors to encourage the other sideto empathize and bond with you, keep people talking, buy your side time to regroup, and encourage your counterparts to reveal their strategy.

2

• That’s why, instead of denying or ignoring emotions,

good negotiators identify and influence them.

• Emotions aren’t the obstacles, they are the means.

The relationship between an emotionally intelligent negotiator and their counterpart is essentially therapeutic.

• In my negotiating course, I tell my students that empathy

is “the ability to recognize the perspective of a counterpart, and the vocalization of that recognition.” That’s an academic way of saying that empathy is paying attention to another human being, asking what they are feeling, and making a commitment to understanding their world. Notice I didn’t say anything about agreeing with the other person’s values and beliefs or giving out hugs. That’s sympathy. What I’m talking about is trying to understand a situation from another person’s perspective. One step beyond that is tactical empathy. Tactical empathy is understanding the feelings and mindset of another in the moment and also hearing what is behind those feelings so you increase your influence in allthe moments that follow. It’s bringing our attention to both the emotional obstacles and the potential pathways to getting an agreement done.

• In an fMRI brain-scan experiment,1 researchers at

Princeton University found that neural resonance disappears when people communicate poorly. The researchers could predict how well people were communicating by observing how much their brains were aligned. And they discovered that people who paid the most attention—good listeners— could actually anticipate what the speaker was about to say before he said it.

• Now, pay close attention to exactly what we said: “It

looks like you don’t want to come out. It seems like you worry that if you open the door, we’ll come in with guns blazing. It looks like you don’t want to go back to jail.” We employed our tactical empathy by recognizing and then verbalizing the predictable emotions of the situation. We didn’t just put ourselves in the fugitives’ shoes. We spotted their feelings, turned them into words, and then very calmly and respectfully repeated their emotions back to them. In a negotiation, that’s called labeling.

• For most people, it’s one of the most awkward

negotiating tools to use. Before they try it the first time, my students almost always tell me they expect their counterpart to jump up and shout, “Don’t you dare tell me how I feel!” Let me let you in on a secret: people never even notice.

• Picking up on these tiny pieces of information is how

psychics work. They size up their client’s body language and ask him a few innocent questions. When they “tell” his future a few minutes later, they’re really just saying what he wants to hear based on small details they’ve spotted. More than a few psychics would make good negotiators for that very reason.

• It seems like . . .

It sounds like . . . It looks like . . . Notice we said “It sounds like . . .” and not “I’m hearing that . . .” That’s because the word “I” gets people’s guard up.

• What good negotiators do when labeling is address those

underlying emotions. Labeling negatives diffuses them (or defuses them, in extreme cases); labeling positives reinforces them.

• Labeling is a helpful tactic in de-escalating

angry confrontations, because it makes the person acknowledge their feelings rather than continuing to act out.

• Early on in my hostage negotiation career, I learned how

important it was to go directly at negative dynamics in a fearless but deferential manner. I’ve found the phrase “Look, I’m an asshole” to be an amazingly effective way to makeproblems go away. That approach has never failed me.

• “It seems that

you are really passionate about this gift and want to find the right project reflecting the opportunities and life-changing experiences the Girl Scouts gave you.” And with that, this “difficult” woman signed a check without even picking a specific project. “You understand me,” she said as she got up to leave. “I trust you’ll find the right project.” Fear of her money being misappropriated was the presenting dynamic that the first label uncovered. But the second label uncovered the underlying dynamic—her very presence in the office was driven by very specific memories of being a little Girl Scout and how it changed her life. The real obstacle was that this woman needed to feel that she was understood, that the person handling her money knew why she was in that office and understood the memories that were driving her actions.

• Do an accusation audit - So I don’t ask. Instead, I say, “In case you’re worried

about volunteering to role-play with me in front of the class, I want to tell you in advance . . . it’s going to be horrible.” After the laughter dies down, I then say, “And those of you who do volunteer will probably get more out of this than anyone else.” I always end up with more volunteers than I need.

• The first step of doing so is listing every terrible thing

your counterpart could say about you, in what I call an accusation audit.

lessons from the chapter you’ve just read: ■ Imagine yourself in your counterpart’s situation. The beauty of empathy is that it doesn’t demand that you agree with the other person’s ideas (you may well find them crazy). But by acknowledging the other person’s situation, you immediately convey that you are listening. And once they know that you are listening, they may tell you something that you can use. ■ The reasons why a counterpart will not make an agreement with you are often more powerful than why they will make a deal, so focus first on clearing the barriers to agreement. Denying barriers or negative influences gives them credence; get them into the open.■ Pause. After you label a barrier or mirror a statement, let it sink in. Don’t worry, the other party will fill the silence. ■ Label your counterpart’s fears to diffuse their power. We all want to talk about the happy stuff, but remember, the faster you interrupt action in your counterpart’s amygdala, the part of the brain that generates fear, the faster you can generate feelings of safety, well-being, and trust. ■ List the worst things that the other party could say about you and say them before the other person can. Performing an accusation audit in advance prepares you to head off negative dynamics before they take root. And because these accusations often sound exaggerated when said aloud, speaking them will encourage the other person to claim that quite the opposite is true. ■ Remember you’re dealing with a person who wants to be appreciated and understood. So use labels to reinforce and encourage positive perceptions and dynamics.

3

• “No” is the start of the negotiation, not the end of it.

We’ve been conditioned to fear the word “No.” But it is a statement of perception far more often than of fact. It seldom means, “I have considered all the facts and made a rational choice.” Instead, “No” is often a decision, frequently temporary, to maintain the status quo. Change is scary, and “No” provides a little protection from that scariness.

• It comes down to the deep and universal human need for

autonomy. People need to feel in control. When you preserve a person’s autonomy by clearly giving them permission to say “No” to your ideas, the emotions calm,

• When someone tells you “No,” you need to rethink the

word in one of its alternative—and much more real— meanings: ■ I am not yet ready to agree;■ You are making me feel uncomfortable; ■ I do not understand; ■ I don’t think I can afford it; ■ I want something else; ■ I need more information; or ■ I want to talk it over with someone else.

• Then, after pausing, ask solution-based questions or

simply label their effect: “What about this doesn’t work for you?” “What would you need to make it work?” “It seems like there’s something here that bothers you.” People have a need to say, “No.” So don’t just hope to hear it at some point; get them to say it early.

• Positive request - what would make this offer an absolute blowout yes for you?
• I’ll let you in on a secret. There are actually three kinds

of “Yes”: Counterfeit, Confirmation, and Commitment. The commitment “yes” is what you want, but thethree types sound almost the same so you have to learn how to recognize which one is being used.

• good negotiators know that their job isn’t to

put on a great performance but to gently guide their counterpart to discover their goal as his own.

• ultimately that

connection is useless unless the other person feels that they are equally as responsible, if not solely responsible, for creating the connection and the new ideas they have.

• Instead of getting inside with logic or feigned smiles,

then, we get there by asking for “No.” It’s the word that gives the speaker feelings of safety and control. “No” starts conversations and creates safe havens to get to the final “Yes” of commitment. An early “Yes” is often just a cheap, counterfeit dodge.

• Good negotiators welcome—

even invite—a solid “No” to start, as a sign that the other party is engaged and thinking.

• “Do you have a few minutes to talk?” Instead ask,

“Is now a bad time to talk?” Either you get “Yes, it is a bad time” followed by a good time or a request to go away, or you get “No, it’s not” and total focus.

• Today, I coach my students to learn to see “No” for whatit is. Rather than harming them or those they negotiate with,

“No” protects and benefits all parties in an exchange. “No” creates safety, security, and the feeling of control. It’s a requirement to implementable success. It’s a pause, a nudge, and a chance for the speaker to articulate what they do want.

• Mark

Cuban, the billionaire owner of the Dallas Mavericks. I always quote to my students one of his best lines on negotiation: “Every ‘No’ gets me closer to a ‘Yes.’” But then I remind them that extracting those “No’s” on the road to “Yes” isn’t always easy. “No”—or the lack thereof—also serves as a warning, the canary in the coal mine. If despite all your efforts, the otherparty won’t say “No,” you’re dealing with people who are indecisive or confused or who have a hidden agenda. In cases like that you have to end the negotiation and walk away. Think of it like this: No “No” means no go.

• You provoke a “No” with this one-sentence email.

Have you given up on this project? The point is that this one-sentence email encapsulates the best of “No”-oriented questions and plays on your counterpart’s natural human aversion to loss. The “No” answer the email demands offers the other party the feeling of safety and the illusion of control while encouraging them to define their position and explain it to you.

• Negotiate in their world. Persuasion is not about

how bright or smooth or forceful you are. It’s about the other party convincing themselves that the solution you want is their own idea. So don’t beat them with logic or brute force. Ask them questions that open paths to your goals. It’s not about you.

4

• That's Right.
• Behavioral Change

Stairway Model (BCSM). The model proposes five stages— active listening, empathy, rapport, influence, and behavioral change—that take any negotiator from listening to influencing behavior.The origins of the model can be traced back to the great American psychologist Carl Rogers, who proposed that real change can only come when a therapist accepts the client as he or she is—an approach known as unconditional positive regard.

• You're right vs that's right.
• “Sleeping in the same bed and dreaming different dreams”

is an old Chinese expression that describes the intimacy of partnership (whether in marriage or in business) without the communication necessary to sustain it. Such is the recipe for bad marriages and bad negotiations.

• Creating unconditional positive regard gets to 'that's right.'

5

• Compromise is often a “bad deal” and a key theme we’ll hit

in this chapter is that “no deal is better than a bad deal.” Even in a kidnapping? Yes. A bad deal in a kidnapping is where someone pays and no one comes out.

• So don’t settle and—here’s a simple rule—never split the

difference. Creative solutions are almost always preceded by some degree of risk, annoyance, confusion, and conflict. Accommodation and compromise produce none of that. You’ve got to embrace the hard stuff. That’s where the great deals are. And that’s what great negotiators do.

• When you allow the variable of time to trigger such

thinking, you have taken yourself hostage, creating an environment of reactive behaviors and poor choices, where your counterpart can now kick back and let an imaginary deadline, and your reaction to it, do all the work for him.

• Deadlines are the bogeymen of negotiation, almost

exclusively self-inflicted figments of our imagination, unnecessarily unsettling us for no good reason. The mantra we coach our clients on is, “No deal is better than a bad deal.”

• When he arrived, his counterparts asked him how long

he was staying, and Cohen said a week. For the next seven days, his hosts proceeded to entertain him with parties, tours, and outings—everything but negotiation. In fact, Cohen’s counterparts didn’t start serious talks until he was about to leave, and the two sides hammered out the deal’s final details in the car to the airport.

• I n Descartes’ Error: Emotion, Reason, and the Human

Brain,2 neuroscientist Antonio Damasio explained a groundbreaking discovery he made. Studying people who had damage in the part of the brain where emotions are generated, he found that they all had something peculiar in common: They couldn’t make decisions. They could describe what they should do in logical terms, but they found it impossible to make even the simplest choice. In other words, while we may use logic to reason ourselves toward a decision, the actual decision making is governed by emotion.

• If you find yourself in this situation, the best reaction is

to simply mirror the “F” that has just been lobbed at you. “Fair?” you’d respond, pausing to let the word’s power do to them as it was intended to do to you. Follow that with a label: “It seems like you’re ready to provide the evidence that supports that,”

• The last use of the F-word is my favorite because it’s

positive and constructive. It sets the stage for honest and empathetic negotiation. Here’s how I use it: Early on in a negotiation, I say, “I want you to feel like you are being treated fairly at all times. So please stop me at any time if you feel I’m being unfair, and we’ll address it.”

• If you can get the other party to reveal their problems,

pain, and unmet objectives—if you can get at what people are really buying—then you can sell them a vision of their problem that leaves your proposal as the perfect solution.

• By far the best theory for describing the principles of our

irrational decisions is something called Prospect Theory. Created in 1979 by the psychologists Daniel Kahneman andAmos Tversky, prospect theory describes how people choose between options that involve risk, like in a negotiation. The theory argues that people are drawn to sure things over probabilities, even when the probability is a better choice. That’s called the Certainty Effect. And people will take greater risks to avoid losses than to achieve gains. That’s called Loss Aversion.

• Ask: “What does it take to be successful here?” - SPARK THEIR INTEREST IN YOUR SUCCESS AND

GAIN AN UNOFFICIAL MENTOR

• As you work these tools into your daily life, remember

the following powerful lessons: ■ All negotiations are defined by a network of subterranean desires and needs. Don’t let yourself be fooled by the surface. Once youknow that the Haitian kidnappers just want party money, you will be miles better prepared. ■ Splitting the difference is wearing one black and one brown shoe, so don’t compromise. Meeting halfway often leads to bad deals for both sides. ■ Approaching deadlines entice people to rush the negotiating process and do impulsive things that are against their best interests. ■ The F-word—“Fair”—is an emotional term people usually exploit to put the other side on the defensive and gain concessions. When your counterpart drops the F-bomb, don’t get suckered into a concession. Instead, ask them to explain how you’re mistreating them. ■ You can bend your counterpart’s reality by anchoring his starting point. Before you make an offer, emotionally anchor them by saying how bad it will be. When you get to numbers, set an extreme anchor to make your “real” offer seem reasonable, or use a range to seem less aggressive. The real value of anything depends on what vantage point you’re looking at it from. ■ People will take more risks to avoid a loss than to realize a gain. Make sure your counterpartsees that there is something to lose by inaction.

6

• We learned that negotiation was coaxing, not

overcoming; co-opting, not defeating. Most important, we learned that successful negotiation involved getting your counterpart to do the work for you and suggest your solution himself. It involved giving him the illusion of control while you, in fact, were the one defining theconversation. The tool we developed is something I call the calibrated, or open-ended, question.

• But all the support in the world won’t work if your

counterpart’s team is dysfunctional. If your negotiation efforts don’t reach past your counterpart and into the team behind him, then you’ve got a “hope”-based deal—and hope is not a strategy.

• Worst of all, the bad guys know that they have just given

you something—a proof of life—which triggers this whole human reciprocity gene. Whether we like to recognize it or not, a universal rule of human nature, across all cultures, is that when somebody gives you something, they expect something in return. And they won’t give anything else until you pay them back.

• That’s why we failed, while numbskulls like this crooked

Philippine politician just stumbled in and got what we so desperately needed. That is, communication without reciprocity.

• The genius of this technique is really well explained by

something that the psychologist Kevin Dutton says in his b o o k Split-Second Persuasion.1 He talks about what he calls “unbelief,” which is active resistance to what the other side is saying, complete rejection. That’s where the two parties in a negotiation usually start.

• “He who has learned to disagree without being disagreeable has discovered the most valuable secret of negotiation.”
• Here are some other great standbys that I use in almost

every negotiation, depending on the situation: ■ What about this is important to you? ■ How can I help to make this better for us?■ How would you like me to proceed? ■ What is it that brought us into this situation? ■ How can we solve this problem? ■ What’s the objective? / What are we trying to accomplish here? ■ How am I supposed to do that?

• The implication of any well-designed calibrated question

is that you want what the other guy wants but you need his intelligence to overcome the problem. This really appeals to very aggressive or egotistical counterparts. You’ve not only implicitly asked for help—triggering goodwill and less defensiveness—but you’ve engineered a situation in which your formerly recalcitrant counterpart is now using his mental and emotional resources to overcome your challenges. It is the first step in your counterpart internalizing your way—and the obstacles in it—as his own. And that guides the other party toward designing a solution. Your solution.

• Who has control in a conversation, the guy listening or the

guy talking? The listener, of course.

• Ask calibrated questions that start with the words

“How” or “What.” By implicitly asking the other party for help, these questions will give your counterpart an illusion of control and will inspire them to speak at length, revealing important information.

• Don’t ask questions that start with “Why” unless

you want your counterpart to defend a goal thatserves you. “Why” is always an accusation, in any language. ■ Calibrate your questions to point your counterpart toward solving your problem. This will encourage them to expend their energy on devising a solution. ■ Bite your tongue. When you’re attacked in a negotiation, pause and avoid angry emotional reactions. Instead, ask your counterpart a calibrated question. ■ There is always a team on the other side. If you are not influencing those behind the table, you are vulnerable.

7

• “YES” IS NOTHING WITHOUT “HOW”
• That’s why negotiation is often called

“the art of letting someone else have your way.”

• “You’re right,” it’s often a good indicator

they are not vested in what is being discussed. And when you push for implementation and they say, “I’ll try,” you should get a sinking feeling in your stomach. Because this really means, “I plan to fail.”

• Our negotiating strategy in Ecuador worked not just

because the questions contributed to the environment that let José escape, but because they made sure the kidnappers— our counterparts—were all on the same page.

• When implementation happens by committee, the

support of that committee is key. You always have to identify and unearth their motivations, even if you haven’t yet identified each individual on that committee. That can be easy as asking a few calibrated questions, like “How does this affect the rest of your team?” or “How on board are the people not on this call?” or simply “What do your colleagues see as their main challenges in this area?”

• It turns out that the head of the division that needed the

training killed the deal. Maybe this guy felt threatened,slighted, or otherwise somehow personally injured by the notion that he and his people “needed” any training at all. (A surprisingly high percentage of negotiations hinge on something outside dollars and cents, often having more to do with self-esteem, status, and other nonfinancial needs.) We’ll never know now.

• But learning how to handle aggression and identify

falsehood is just part of a larger issue: that is, learning howto spot and interpret the subtleties of communication—both verbal and nonverbal—that reveal the mental states of your counterparts. Truly effective negotiators are conscious of the verbal, paraverbal (how it’s said), and nonverbal communications that pervade negotiations and group dynamics.

• THE 7-38-55 PERCENT RULE

In two famous studies on what makes us like or dislike somebody,1 UCLA psychology professor Albert Mehrabian created the 7-38-55 rule. That is, only 7 percent of a message is based on the words while 38 percent comes from the tone of voice and 55 percent from the speaker’s body language and face.

• When someone’s tone of voice or body language does

not align with the meaning of the words they say, use labels to discover the source of the incongruence. Here’s an example: You: “So we’re agreed?” Them: “Yes . . .” You: “I heard you say, ‘Yes,’ but it seemed like there was hesitation in your voice.”Them: “Oh, it’s nothing really.” You: “No, this is important, let’s make sure we get this right.” Them: “Thanks, I appreciate it.”

• The Rule of Three is simply getting the other guy to

agree to the same thing three times in the same conversation. It’s tripling the strength of whatever dynamic you’re trying to drill into at the moment. In doing so, it uncovers problems before they happen. It’s really hard torepeatedly lie or fake conviction. When I first learned this skill, my biggest fear was how to avoid sounding like a broken record or coming off as really pushy. The answer, I learned, is to vary your tactics. The first time they agree to something or give you a commitment, that’s No. 1. For No. 2 you might label or summarize what they said so they answer, “That’s right.” And No. 3 could be a calibrated “How” or “What” question about implementation that asks them to explain what will constitute success, something like “What do we do if we get off track?”

• Or the three times might just be the same calibrated

question phrased three different ways, like “What’s the biggest challenge you faced? What are we up against here? What do you see as being the most difficult thing to get around?”

• In a study of the components of lying,2 Harvard

Business School professor Deepak Malhotra and his coauthors found that, on average, liars use more words than truth tellers and use far more third-person pronouns. They start talking about him, her, it, one, they, and their rather than I, in order to put some distance between themselves and the lie. And they discovered that liars tend to speak in more complex sentences in an attempt to win over their suspicious counterparts. It’s what W. C. Fields meant when he talked about baffling someone with bullshit. The researchers dubbed this the Pinocchio Effect because, just like Pinocchio’s nose, the number of words grew along with the lie. People who are lying are, understandably, more worried about being believed, so they work harder—too hard, as it were—at being believable.

• The use of pronouns by a counterpart can also help give

you a feel for their actual importance in the decision and implementation chains on the other side of the table. The more in love they are with “I,” “me,” and “my” the less important they are. Conversely, the harder it is to get a first person pronounout of a negotiator’s mouth, the more important they are.

• People always talk about remembering and using (but not

overusing) your counterpart’s name in a negotiation. And that’s important. The reality though is people are often tired of being hammered with their own name. The slick salesman trying to drive them to “Yes” will hit them with it over and over.

• Just as using Alastair’s name with the kidnapper and

getting him to use it back humanized the hostage and made it less likely he would be harmed, using your own name creates the dynamic of “forced empathy.” It makes the otherside see you as a person.

• Humanize yourself - At the front

counter the young lady asked me if I wanted to join their frequent buyer program. I asked her if I got a discount for joining and she said, “No.” So I decided to try another angle. I said in a friendly manner, “My name is Chris. What’s the Chris discount?”She looked from the register, met my eyes, and gave a little laugh. “I’ll have to ask my manager, Kathy,” she said and turned to the woman who’d been standing next to her. Kathy, who’d heard the whole exchange, said, “The best I can do is ten percent.”

• “Your offer is very generous,I’m sorry, that just doesn’t work for me” is an elegant

second way to say “No.” This well-tested response avoids making a counteroffer, and the use of “generous” nurtures your counterpart to live up to the word. The “I’m sorry” also softens the “No” and builds empathy. (You can ignore the so-called negotiating experts who say apologies are always signs of weakness.)

• As you put the following tools to use, remember this

chapter’s most important concept. That is, “Yes” is nothing without “How.” Asking “How,” knowing “How,” and defining “How” are all part of the effective negotiator’s arsenal. He would be unarmed without them. ■ Ask calibrated “How” questions, and ask them again and again. Asking “How” keeps your counterparts engaged but off balance. Answering the questions will give them the illusion of control. It will also lead them to contemplate your problems when making their demands. ■ Use “How” questions to shape the negotiating environment. You do this by using “How can I do that?” as a gentle version of “No.” This will subtly push your counterpart to search for other solutions—your solutions. And very often it will get them to bid against themselves. ■ Don’t just pay attention to the people you’re negotiating with directly; always identify the motivations of the players “behind the table.” You can do so by asking how a deal will affect everybody else and how on board they are. ■ Follow the 7-38-55 Percent Rule by paying close attention to tone of voice and body language.Incongruence between the words and nonverbal signs will show when your counterpart is lying or uncomfortable with a deal. ■ Is the “Yes” real or counterfeit? Test it with the Rule of Three: use calibrated questions, summaries, and labels to get your counterpart to reaffirm their agreement at least three times. It’s really hard to repeatedly lie or fake conviction. ■ A person’s use of pronouns offers deep insights into his or her relative authority. If you’re hearing a lot of “I,” “me,” and “my,” the real power to decide probably lies elsewhere. Picking up a lot of “we,” “they,” and “them,” it’s more likely you’re dealing directly with a savvy decision maker keeping his options open. ■ Use your own name to make yourself a real person to the other side and even get your own personal discount. Humor and humanity are the best ways to break the ice and remove roadblocks.

8

• Now, bargaining is not rocket science, but it’s not simple

intuition or mathematics, either. To bargain well, you need to shed your assumptions about the haggling process and learn to recognize the subtle psychological strategies that play vital roles at the bargaining table.

• found that

people fall into three broad categories. Some people are Accommodators; others—like me—are basically Assertive; and the rest are data-loving Analysts.

• And remember, your personal negotiating style is not a

straitjacket. No one is exclusively one style. Most of us have the capacity to throttle up our nondominant styles should the situation call for it. But there is one basic truth about a successful bargaining style: To be good, you have to learn to be yourself at the bargaining table. To be great you have to add to your strengths, not replace them.

• The greatest obstacle to accurately identifying someone

else’s style is what I call the “I am normal” paradox. That is, our hypothesis that the world should look to others as it looks to us. After all, who wouldn’t make that assumption?

• You have to

identify their type by opening yourself to their difference. Because when it comes to negotiating, the Golden Rule is wrong.

• The Black Swan rule is don’t treat others the way you

want to be treated; treat them the way they need to be treated.

• http://info.blackswanltd.com/3-types
• Negotiation academics like to treat bargaining as a rational

process devoid of emotion. They talk about the ZOPA—or Zone of Possible Agreement—which is where the seller’s and buyer’s zones cross. Say Tony wants to sell his car and won’t take less than $5,000 and Samantha wants to buy but won’t pay more than $6,000. The ZOPA runs from $5,000 to $6,000. Some deals have ZOPAs and some don’t. It’s all very rational. Or so they’d have you think. You need to disabuse yourself of that notion. In a realbargaining session, kick-ass negotiators don’t use ZOPA. Experienced negotiators often lead with a ridiculous offer, an extreme anchor. And if you’re not prepared to handle it, you’ll lose your moorings and immediately go to your maximum.

• As a well-prepared negotiator who seeks information

and gathers it relentlessly, you’re actually going to want the other guy to name a price first, because you want to see his hand. You’re going to welcome the extreme anchor.

• How about - what's your lowball?
• You can also respond to a punch-in-the-face anchor by

simply pivoting to terms. What I mean by this is that when you feel you’re being dragged into a haggle you can detour the conversation to the nonmonetary issues that make any final price work.

• “Let’s put price off to the side for a moment

and talk about what would make this a good deal.” Or you could go at it more obliquely by asking, “What else would you be able to offer to make that a good price for me?”

• Such well-timed offense-taking—known as “strategic

umbrage”—can wake your counterpart to the problem.

• Threats? delivered without anger but with “poise”—that

is, confidence and self-control—are great tools. Saying, “I’m sorry that just doesn’t work for me,” with poise, works.

• When you want to

counteract unproductive statements from your counterpart, you can say, “I feel ___ when you ___ because ___,” and that demands a time-out from the other person.

• The person across the table is never the problem. The

unsolved issue is. So focus on the issue.

• Always be in a position to walk away. No deal is better than a bad deal.
• Ackerman model [The systematized and easy-to-remember process has

only four steps: 1. Set your target price (your goal). 2. Set your first offer at 65 percent of your target price. 3. Calculate three raises of decreasing increments (to 85, 95, and 100 percent). 4. Use lots of empathy and different ways of saying “No” to get the other side to counter before you increase your offer. 5. When calculating the final amount, use precise, nonround numbers like, say, $37,893 rather than $38,000. It gives the number credibility and weight. 6. On your final number, throw in a nonmonetary item (that they probably don’t want) to show you’re at your limit. The genius of this system is that it incorporates the psychological tactics we’ve discussed—reciprocity, extreme anchors, loss aversion, and so on—without you needing tothink about them.

• Top negotiators know, however, that conflict is often the

path to great deals. And the best find ways to actually have fun engaging in it. Conflict brings out truth, creativity, and resolution. So the next time you find yourself face-to-face with a bare-knuckle bargainer, remember the lessons in this chapter. ■ Identify your counterpart’s negotiating style. Once you know whether they are Accommodator, Assertive, or Analyst, you’ll know the correct way to approach them. ■ Prepare, prepare, prepare. When the pressure is on, you don’t rise to the occasion; you fall to your highest level of preparation. So design an ambitious but legitimate goal and then game out the labels, calibrated questions, and responses you’ll use to get there. That way, once you’re at the bargaining table, you won’t have to wing it. ■ Get ready to take a punch. Kick-ass negotiators usually lead with an extreme anchor to knock you off your game. If you’re not ready, you’ll flee to your maximum without a fight. So prepareyour dodging tactics to avoid getting sucked into the compromise trap. ■ Set boundaries, and learn to take a punch or punch back, without anger. The guy across the table is not the problem; the situation is. ■ Prepare an Ackerman plan. Before you head into the weeds of bargaining, you’ll need a plan of extreme anchor, calibrated questions, and well- defined offers. Remember: 65, 85, 95, 100 percent. Decreasing raises and ending on nonround numbers will get your counterpart to believe that he’s squeezing you for all you’re worth when you’re really getting to the number you want.

9

• Find the Black Swan
• That’s why I say that finding and understanding Black

Swans requires a change of mindset. You have to open up your established pathways and embrace more intuitive andnuanced ways of listening.

• Most people expect that Black Swans are highly

proprietary or closely guarded information, when in fact the information may seem completely innocuous. Either side may be completely oblivious to its importance. Your counterpart always has pieces of information whose value they do not understand.

• Map is not the territory - In practice,

where our irrational perceptions are our reality, loss and gain are slippery notions, and it often doesn’t matter what leverage actually exists against you; what really matters is the leverage they think you have on them. That’s why I say there’s always leverage: as an essentially emotional concept, it can be manufactured whether it exists or not.

• To get leverage, you have

to persuade your counterpart that they have something real to lose if the deal falls through.

• 3 types of leverage - At a taxonomic level, there are three kinds: Positive,

Negative, and Normative.

• Positive leverage is quite simply your ability as a negotiator

to provide—or withhold—things that your counterpart wants.

• Negative - threats - don't do it.
• NORMATIVE LEVERAGE

Every person has a set of rules and a moral framework. Normative leverage is using the other party’s norms and standards to advance your position. If you can show inconsistencies between their beliefs and their actions, you have normative leverage. No one likes to look like a hypocrite.

• Using your counterpart’s religion is extremely effective

in large part because it has authority over them. The other guy’s “religion” is what the market, the experts, God, or society—whatever matters to him—has determined to be fair and just. And people defer to that authority

• ■ Review everything you hear. You will not hear

everything the first time, so double-check. Compare notes with your team members. You will often discover new information that will help you advance the negotiation. ■ Use backup listeners whose only job is to listen between the lines. They will hear things you miss.

• Crotch sniffing is good.
• While idiotic reasons worked with something simple like

photocopying, on more complicated issues you can increase your effectiveness by offering reasons that reference your counterpart’s religion. Had that Christian CEO offered me a lowball offer when he agreed to hire my firm, I might have answered, “I’d love to but I too have a duty to be a responsible steward of my resources.”

• IT’S NOT CRAZY, IT’S A CLUE. If crazy - Your job when faced with someonelike this in a negotiation is to discover what they do not

know and supply that information.

• Whatever the specifics of the situation, these people are

not acting irrationally. They are simply complying with needs and desires that you don’t yet understand, what the world looks like to them based on their own set of rules. Your job is to bring these Black Swans to light.

• If this book accomplishes only one thing, I hope it gets

you over that fear of conflict and encourages you to navigate it with empathy. Here are some of the best techniques for flushing out the Black Swans—and exploiting them. Remember, your counterpart might not even know how important the information is, or even that they shouldn’t reveal it. So keep pushing, probing, and gathering information. ■ Let what you know—your known knowns —guide you but not blind you. Every case is new, so remain flexible and adaptable. Remember the Griffin bank crisis: no hostage- taker had killed a hostage on deadline, until he did. ■ Black Swans are leverage multipliers. Remember the three types of leverage: positive (the ability to give someone what they want); negative (the ability to hurt someone); and normative (using your counterpart’s norms to bring them around). ■ Work to understand the other side’s “religion.” Digging into worldviews inherently implies moving beyond the negotiating table and into thelife, emotional and otherwise, of your counterpart. That’s where Black Swans live. ■ Review everything you hear from your counterpart. You will not hear everything the first time, so double-check. Compare notes with team members. Use backup listeners whose job is to listen between the lines. They will hear things you miss. ■ Exploit the similarity principle. People are more apt to concede to someone they share a cultural similarity with, so dig for what makes them tick and show that you share common ground. ■ When someone seems irrational or crazy, they most likely aren’t. Faced with this situation, search for constraints, hidden desires, and bad information. ■ Get face time with your counterpart. Ten minutes of face time often reveals more than days of research. Pay special attention to your counterpart’s verbal and nonverbal communication at unguarded moments—at the beginning and the end of the session or when someone says something out of line.