Sunday, May 8, 2011

Some Wise Words of Dealmaking

I was recently asked by a client to share my favorite negotiation-related quotes, so here they are plus some thoughts on each.

“The single most powerful tool for winning a negotiation is the ability to walk away from the table without a deal.”
Harvey Mackay, author of the #1 New York Times bestseller Swim with the Sharks without being Eaten Alive

Having a good Plan B in any negotiation is crucial – but what if you don’t have a good one? Develop one. If you’re looking to sell your company and ABC Company has expressed interest, reach out to additional possible buyers. If you’re negotiating with a long-time vendor and he hits you with a big price increase, bid out his work. The better your Plan B - the stronger your leverage.

“The most critical thing in a negotiation is to get inside your opponent’s head and figure out what he really wants.”
Jacob Lew, White House Director of the Office of Management and Budget (OMB) (currently and formerly under President Bill Clinton)

This is easy to say but often extraordinarily difficult to accomplish. Sometimes your counterpart is an open book. But often you must dig deep to uncover your counterpart’s true underlying needs and interests. Focus on this. Ask a lot of questions, especially what I call the magic question in negotiations - why.

“My father said: ‘You must never try to make all the money that's in a deal. Let the other fellow make some money too, because if you have a reputation for always making all the money, you won't have many deals.’ “
J. Paul Getty

Two elements here strike me as critical. One, all worthwhile deals must satisfy all the parties’ interests – financial and otherwise - to get done. You need to make sure the other side does okay for you to get your interests satisfied too.

And two, the long-term view and an appreciation of the value of reputation reflect a very strategic focus. It’s often easy to get caught up in the moment and let your ego push you to get that extra dollar. But taking a step back and focusing on reputation and the long-term will always stand you in good stead.

“Failing to prepare is preparing to fail.”
Legendary UCLA basketball coach John Wooden

“If I had eight hours to chop down a tree, I'd spend six sharpening my axe.”
Abraham Lincoln

I can’t overemphasize the value of taking the time to strategically prepare for a negotiation and not leaving it to your intuition. Too many busy professionals just wing it in significant negotiations. Don’t. And prepare not only on the substance but for the process.

The biggest failure of negotiators is to negotiate instinctively and intuitively. To truly succeed, do your homework so you can negotiate strategically based on the experts’ proven research.

by Marty Latz May 6, 2011



Some Wise Words of Dealmaking

No comments:

Post a Comment

Featured Artists

Archive

Recent Comments

My Blips