THOUGHTS ABOUT NEGOTIATION & SETTLEMENT

THOUGHTS ABOUT NEGOTIATION & SETTLEMENT

I have been a fan of Roger Dawson for many years. See:  http://www.rdawson.com I have read most of his books about sales and negotiation. I have attended his lectures. His ideas about communication, persuasion, sales and negotiation make a great deal of sense to me. Dawson was born in England and then became president of one of California’s largest real estate companies. Since 1982 he has been a full-time speaker and writer regarding sales issues. Here is a brief summary of some of his ideas regarding negotiation:

  1. Act dumb, not smart. When you do that it tends to defuse the competitive spirit of negotiation. You also have the advantage of learning more than if you act smarter than the other person.
  2. Always congratulate the other side. When you’re through negotiating always credit the other side with the  winning outcome. You want the other side you feel good about what happened. It avoids after settlement controversy and you are likely to encounter the same person again. You don’t want them in frame of mind where they are looking for a way to pay you back.
  3. Always get the other side to commit first. The reason is that their first offer may be better than you expect. It also gives you information about for you have to tell them anything.
  4. Never say yes to the first offer. For obvious reasons you need to explore the extent to which the other side is willing to go.
  5. Always act shocked at the offer. Good negotiation skills are like playing poker. You do not want to reveal your hand by the way in which react.
  6. Remember the tactic of higher authority. Always have a higher authority in negotiation  that you need to clear with before making a deal. It can be your client, your partner, or someone else, But you need to be able to say that before you can accept an offer you need to clear with someone in a position higher authority in order to be able to have our negotiation. The police have used “good guy – bad guy” tactics in interrogating. It’s a similar psychology where one person is friend and the other is the unreasonable one to ingratiate better attitudes.
  7. Project the reluctant buyer attitude. You will not get the best off when you demonstrate and over eager interest in offers or settlement.
  8. Never offer to split the difference.Splitting the difference doesn’t mean down the middle because you can do that more than once. Encourage the other person split the difference only when it is to your advantage.
  9. Time pressure is important in negotiation. It has been well established that in general 80% of the progress in the negotiation occurs within the last 20% of the time left for negotiation. That’s why you should have inflexible time limitations allowed for negotiation.
  10. Be on guard for nibbling. Nibbling is the tactic of adding terms after the deal has been made. We are most vulnerable when the negotiation appears to be over. We’re feeling good because the pressure and tension of negotiation is over. The defense lawyer waits until that time and says “of course we will want a confidentiality agreement.” That’s nibbling. You think to yourself: “oh no, I don’t want to reopen the negotiation again and risk losing the whole deal we just made.” So, you give in. Big mistake. guard against nibbling.

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