How to win in the art of negotiation

Speak softly: So ditch the megaphone

10 April 2012

There are markets in people as well as commodities. Last year Myleene Klass was worth a million to Marks & Spencer, now the store has revalued her at £750,000.

She made a savvy calculation that she could not get more from a rival so she took the hit. Highly paid stars and executives are all making the same nervous self-evaluations at the moment.

The price of houses and goods has gone down and so has the price of people. This is not a time to push your luck. You would have to be brave or foolish to ask for a rise, and some people are making a pre-emptive offer of a reduction in salary.

There has been a kind of Nietzsche-style "revaluation of all values", even though a sharp discount on a double bed in Ikea wasn't exactly what the German professor meant.

In this environment, where the value of everything is so uncertain, negotiation is important.

And when it comes to negotiating, power is everything. If you've got money, then, as any traveller in the Middle East will agree, you've got power in the bargaining process.

Tough times sharply delineate power relationships. Everything becomes much clearer. Companies and employers are now in charge, while it was the star individual, or "talent", who was on top before the economic meltdown.

Remember Robbie Williams and his £80 million EMI deal in 2002? The BBC Trust can hardly wait for Jonathan Ross's contract to come up for renegotiation.

The truth is the current climate has made fools of a lot of powerful people. People who thought they were indispensable now seem very ordinary.

"The Talent", who used to live by different rules, are suddenly being downgraded to economy class like everybody else. And, like the rest of the world, they are suddenly content just to be in a job.

The economic climate has returned us to a more basic struggle for survival. Large companies are putting pressure on their smaller suppliers, by delaying payments.

The corporate giants are squeezing the little guy. Forget Jack the Giant Killer. In the real world, it's the giant who's taking strips off Jack.

In the high street, the consumer is still king. The consumer doesn't have to go out to the cinema or go to fancy restaurants.

He or she can just stay at home eating beans on toast, watching TV. It's the fancy restaurants you should feel sorry for. In business, it's the big corporates who have the power. The small businessmen, the people the politicians pretend to support, get crushed.

Harvard Business School prophetically hosted a conference entitled Buddhism and the Art of Negotiation. Bernie Glassman, who lectures on Buddhist studies at Harvard Divinity School, was a star speaker at the conference.

Glassman uses Zen principles in his negotiations. He employs the concept of the "don't know mind". It encompasses a complete "unattachment" to any knowledge or preconceptions.

"I come to a new situation without any preconceived notion of how I am going to take care of it," Bernie says. "I come totally open."

There are probably five useful tips, derived from the various schools of Eastern philosophy:

1. Be flexible in your thinking. Don't have too many preconceptions.

2. Let the other person come up with the first offer; it may surprise you. If it's unreasonable, say so. People may be trying to wrong-foot you.

3. Have plenty of time to make the decision; if you don't have time, pretend you have all the time in the world.

4. Be courteous and speak softly. Theodore Roosevelt's saying, "Speak softly and carry a big stick" applies, even if you don't have a big stick.

5. Try to disguise your reactions. If the offer is beyond your wildest dreams, simply nod gravely. If it's outrageous, express your disapproval in polite, moderate terms.

To this, we should bear in mind the Western idea of the "Golden Rule".

In today's environment, there are bigger power imbalances than ever. Some have lost everything, while others remain solvent and secure.

When it comes to negotiating, in a world in economic turmoil, the person with the gold usually makes the rules.

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