Negotiation touches every part of our lives. Relationships in business and in our personal lives are negotiated. And the skills to do it effectively can often mean the difference between getting what you want or losing out. You don’t get what you deserve, you get what you negotiate!
In the first section of the book, How to be a Great Negotiator, written by property economist, investor and developer Neville Berkowitz, the characteristic traits of a great negotiator are explored in short, bite-sized nuggets of advice.
Over the next few months, we will bring you the traits needed to succeed at the art of negotiating.
(Courtesy of PersonalEmpowerment.co)
Power is energy or force, latent or applied, that can move, influence, impact, create, and effect change in the real world. Wielding power requires awareness, intention, and skill. If these falter, the balance of power may shift. One who is present enough to gauge the ebb and flow of power in a negotiation can, with artful timing and minimal effort, seize the momentum and turn the tide.
Genuine power unifies, directs, and inspires cooperation and creativity in others. Mere force, incorrectly perceived as power, disturbs, irritates, and inhibits cooperation and creativity in others. Those who use force and threats to coerce and control may have a system of punishments and rewards behind them to enforce their authority, but theirs is the lowest, most primitive form of power. To the degree that you use force in a negotiation you diminish the relationship with the other party and the potential outcome.
And yet, paradoxically, to wield power effectively, every powerful person relies to some degree on other people recognising and acknowledging his or her power. Power in human affairs is also a matter of image and perception. This is why many people in positions of authority all over the world wear uniforms, guns, badges, stars, crowns, and other insignia, or enact rituals and ceremonies that represent and convey their power to those around them. Such trappings, insignia, and rituals instil in others the perception of one’s power, and the conviction that the power is real, backed up by higher authority, and capable of being implemented to its full force and effect. A great negotiator cultivates authentic personal power and also learns to create the perception of power.
On rare occasions the appearance and the potential threat of power may be necessary or justified in a negotiation. These are mostly confined to legal or judicial mediations and negotiations, where threats of lawsuits, fines, or incarceration are used to coerce cooperation from uncooperative parties or confessions from presumably guilty people. But a threat of ending a negotiation and “taking my business elsewhere” is a common and often effective power play. Ideally, the mere reminder and perception of your power, or its latent yet palpable presence, is better than the forceful use of power and often sufficient to sway a negotiation in your favour.
At its best, power is influence and authority, guided by a clear vision, grounded in ethical practices and principles. It is developed and earned through prolonged, diligent practice and effort under the testing conditions of life. Power earned in this way is far more valuable than any power bestowed with a title or promotion. And it is important to know the difference.
This is real power
When you have real power, you are more willing to be generous and adaptable, to help the other party obtain their objectives (while you obtain yours) so that they feel that they’ve won. You are able to win and succeed without demoralising the other party. You develop positive, cooperative relationships that work in your favour in the short- and long-term. People are more likely to refer you to their friends, colleagues, and associates, and to become repeat clients or customers. This kind of power makes you a great negotiator and a natural leader.
When a party is aggressively using their power against you, they’re giving their best shot and revealing their cards. Instead of fighting fire with fire, try to remain calm as they reveal themselves and their intentions through their attitude and behaviour. Let their storm blow itself out with no effect on you. Let your power and presence manifest quietly and steadily through non-resistance and non-engagement. This will baffle and defeat bluster and aggression every time.
While you calmly observe and refuse to engage, the other party’s failed attempt to win by direct assault ends in their loss of face, confidence, and energy. When this happens, you can step in to assert the influence of your moral authority. Your ability to remain steady and calm in the face of persons “full of sound and fury” trying to overpower you demonstrates your superior power.
But, if the persons wield their power fairly and effectively, with no abuse, misuse or ineptness, full cooperation is your best strategy. If the negotiation is moving toward a positive or win/win outcome, it doesn’t matter who is in the power position; there is no need to challenge authority or try to seize power any more than you would try to wrest the wheel of a ship from a captain who is steering you safely to port. When dealing with someone who has the power and authority to grant or refuse your request, to give or withhold assistance or information, or to make things easier or harder for you, you are in the “inferior” position. In such cases, the best strategy is to be a calm, clear, friendly, and respectful presence. Do not challenge that person’s authority, do not be weak or appeasing, nor subversive or uncooperative. Be centered in your own clarity and power.
In most negotiations the other party, even when you are in the “inferior” position, also needs or desires something from you as well. You can use this subtly to your advantage. Try to think and act in terms of partnership. Be helpful, friendly, or cooperative and act in good faith while looking to see and feel if they are trustworthy and competent in their position of authority. If they are, cooperate with them fully and graciously. If they aren’t, and the negotiation is heading toward an unsatisfying or unacceptable conclusion, you may want to cut your losses and end the negotiation on your terms. The simple refusal to acknowledge and accept untrustworthy authority is an act of power, and walking away can sometimes shift the balance of power. But, if this isn’t possible or doesn’t seem appropriate, you may simply need to remain and try to get the best outcome under the circumstances.
Don’t abuse your power
When you are in the “superior” position, having power and authority over another, try to conduct yourself with the objectivity, fairness, and integrity of a judge. Having authority in a negotiation means you have the power to either grant or refuse an offer or request as it is presented; or to grant one with conditions attached; or to make a decision or judgment; or to delay making one in order to take time to consider it. Whatever the circumstance, remember that the mature and “righteous” use of authority is always in your best interest, because character and ethics are the very foundation of real power.
Power is also a matter of context and location, or what is called a power base. For example, a president of a corporation walking down the street has no power there, but a policeman walking down the same street does. But when the president enters a specific building, he becomes a man with immense power, with the livelihoods of tens, hundreds, or even thousands of people in his hands. What changed when he went from powerless pedestrian to company president? His power base changed.
All power has limits and restrictions of some kind or other, and power in one area doesn’t automatically translate into other areas. A company executive cannot order a policeman to do his bidding. The president of the United States cannot order his wife around as he can his personal staff. A military general cannot order civilians in the street to obey him or her as he or she can with subordinates. A mutual consensus between parties that power is legitimate is usually required for power to be effectively exercised. Non-acceptance of power reduces or negates its potency.
The power of 6
Now let’s take a look at six major types of power that can and ought to be cultivated and practiced by aspiring great negotiators.
#1 Sanctioned Power – Sanctioned power is conventional worldly power. It generally comes from positional ranking or formal access to greater authority that is the ultimate source of such power. Sanctioned power gives one the ability to assist or make something happen that the other person needs. Or it allows you to make decisions that affect outcomes, to say “yes” or “no,” after which the power is spent and gone. And the one who wields sanctioned power or authority is subordinate to the source of that power or authority. For example, the president of the United States has sanctioned power granted by the US Constitution to which he is subject and which he is bound to uphold. Hence, the saying that no one is above the law includes, at least in theory, the president.
The official position, rank, or title of a person in any hierarchical structure or organisation defines his or her sanctioned power and authority within that structure. People with sanctioned power in such a hierarchy can assign, instruct, or order others below them, and must obey or comply with those above them. They can also, within assigned limits, take decisive actions and make final decisions regarding matters of policy, production, negotiation etc. Sanctioned power is also earned when a person or company establishes a proven reputation for quality, excellence, integrity etc. Such legitimacy at its best includes name recognition – think Rolls Royce, Apple, Steve Jobs, Oprah, and any other name or brand synonymous with the highest quality or integrity.
#2 Reward Power – Reward power is the carrot in the carrot versus stick metaphor. Incentivised people usually perform better than non-incentivised people. Having a personal stake in the outcome motivates people to try harder and persist longer. Incentives can be tangible or intangible. In a structured environment, tangible incentives may include receiving a bonus, commission, salary increase, award, special perk, promotion, stocks in the company, equity in a business, a seat on the Board of Directors etc. Intangible incentives may include public praise; an elevation in perceived stature and importance; the appreciation, admiration, and respect of one’s peers or important personages; greater influence in one’s field etc. Reward power, besides stimulating initiative, also fosters better working relationships and loyalty between the one who offers the rewards and the one who earns them.
#3 Coercive Power – Coercive power is the stick in the carrot versus stick metaphor. It is derived by pressuring, threatening, or instilling fear in another party in order to make them comply, obey, or perform better. Coercive power is perhaps the least effective and least desirable in general business negotiations. The idea that fear of unpleasant consequences will cause others to work harder or be more cooperative is true to a limited extent. But its many negative and unintended side effects include resentment, stress, and loss of loyalty on the part of the person being coerced. And it typically produces a psychologically unhealthy and less productive work environment for all concerned. Coercive power is a default strategy best applied only when other, more benign, approaches have failed.
#4 Expert Power – Expert power is comprehensive, detailed, and authoritative knowledge in a particular field that gives you power in that arena. Imagine a bomb disposal expert locked in a room full of billionaires and heads of state with a ticking time bomb. Whose expertise has the greatest value and power while the bomb is ticking? The bomb disposal expert, of course! Imagine a plane filled with Nobel Prize winning scientists. Whose expertise has the greatest value while the plane is in the air? If you guessed the pilot, you guessed right. Expertise grants elite power but only in a limited arena. It’s important to develop expertise in your arena, so that, when the time for negotiating comes, you will be the most powerful person in the room.
To be a true professional in any arena requires some expert power. Secretaries, computer programmers, scientists, doctors, and even fast-food workers all need expert power in their fields to do what they do. But the degree of expert power derives from the value placed on the particular expertise in a certain culture. For example, in the West an expert accountant tends to have more “power” than an expert janitor; an expert doctor tends to have more “power” than an expert auto mechanic, and so forth. Expert power is more fluid and independent than other types of power. A person with certain business expertise may hold a key position in an organisation; or work as a hired consultant or freelance operator; or be a trainer, coach, teacher, workshop leader, writer etc.
Developing expert power generally requires diligent study, practical skill, and hands-on experience in the field. But merely being an expert by the above definition doesn’t fully bestow expert power. You must also establish your credentials, either through educational degrees, professional achievements, various kinds of publicity, or by word of mouth. Other people knowing, or at least believing that you are a true expert is an essential part of expert power.
Expert power enables you to educate, impress, reassure, persuade, or convince the other party and move a negotiation toward a successful outcome. Getting the word out and building awareness of your expertise may require advertising, networking, giving talks, speeches, workshops, and seminars; hosting discussion groups; having a website; using social networking media etc. And, of course, you must be able to show up and perform at an expert level and produce corresponding results.
#5 Personal Power – Personal power can be natural to a person – some seem to be born with it and to exercise it naturally and effortlessly. It can also be developed and refined through discipline, dedication, and effort. Personal power usually combines elements of charisma, intelligence, expertise, and people skills. For this reason, it is effective and appealing to others, who often respond positively and intuitively. It may include the power to create, facilitate, and manifest visions, solutions, or outcomes; to manage people or circumstances; and to improve or add value to what you manage or are responsible for. At its most basic, personal power is energy, a force of body, mind, or personality that allows a person to consistently produce results, make things happen, achieve goals, and accomplish things in life. Personal power often grants the ability to inspire and influence others in the direction of your goals. It is the core of resilience and the fire of will that allows a person to “take a licking and keep on ticking,” to come back strong after loss or defeat. Personal power is the engine of a great negotiator.
Authentic personal power is the source of real authority. Personal power has a kind of energetic, moral, or spiritual force that convinces and validates what you say and do. But it isn’t something to wilfully or arbitrarily impose on others. Personal power must be used with discretion and maturity on an as-needed basis from a larger perspective than pure self-interest. Its highest use is not to coerce or control others in order to get your way, but rather to direct, inspire, and educate others so that achievements and goals can be reached that serve the needs of all parties involved.
Personal power is the ideal quality in a great negotiator. This is because the highest use of power as a negotiator is helping others get their needs met while also achieving your own goals. This kind of power inspires the other party’s confidence and trust in you and facilitates a synergistic joining of wills in a cooperative pursuit of mutual goals that produces win/win outcomes. And this is the highest purpose of power and the essence of leadership.
#6 Reverent Power – Reverent power is a product of unique status whose vital element can best be called “spiritual,” even when it appears in people you would call secular. At its highest, reverent power is a personal magnetism, charisma, and authority combined with true human or spiritual maturity consistently embodied in virtuous conduct. Mahatma Gandhi and Rev. Martin Luther King Jr. embodied this kind of reverent power to remarkable degrees.
Yet some reverent power is purely a result of having been promoted to or born into some exalted position, such as the head of a monarchy or a spiritual lineage. For example, some Roman Catholic cardinals who are selected to be popes, some princes who inherit the throne to become kings or princesses who become queens, and some presidents elected to office are thrust suddenly into positions of reverent power they did not have until the “promotion” occurred. Sometimes reverent power is achieved after death.
Well-known examples of reverent power include Pope John Paul, the Dalai Lama, Queen Victoria, Mahatma Gandhi, Rev. Martin Luther King Jr., Nelson Mandela, Oprah Winfrey, Abraham Lincoln, John F. Kennedy, Mother Teresa, and many others. These are examples of the highest form of reverent power. Yet individuals of lesser status can attain reverent power in their sphere of influence. Most of us have known someone in our lives who embodied reverent power – a beloved teacher, parent or grandparent, boss or mentor.
Reverent power is more than mere fame and celebrity. A very small percentage of rock stars, movie stars, politicians, artists, and sport stars achieve reverent power. They do so by embodying an ideal or set of values or virtues greater than mere creativity, talent, or renown. And they are generally driven by a vision much larger than their own personal needs and status or mere material success. Though they incompletely and imperfectly embody these ideals at best, the public’s perception and projection onto them of an idealised character is a significant part of their reverent power. John Lennon is a prime example.
Ordinary individuals may attain reverent power through exemplary living, virtuous conduct, great integrity or compassion, inspired vision or creativity, noble achievements, or heroic acts. Not all great negotiators possess reverent power. But those who do, by that very quality, transcend the function of negotiator.