The first rule in negotiations is: Shut. Up.
That was the opening line at my first official negotiation training many years ago. I signed up for a two day seminar with the Karrass Negotiation Seminar. (SIDE NOTE: If you can afford the time and cost, I highly recommend this negotiation seminar for everyone!) I was a young traveling salesperson and I wanted to learn how to make better deals, get more money, and out-negotiate my clients. Before I attended this seminar, I pictured great negotiators sitting across a large mahogany conference table from each other, yelling out different counter-offers. Eventually, the loudest and most stubborn negotiator would win in my misguided vision.
But, I was wrong. Great negotiators are not angry, yelling, stubborn figures. They don't talk. They listen. In other words, they shut up. There are two important components to shutting up: (1) not talking and (2) listening.
Not Talking
According to a study out of the University of Groningen in the Netherlands, it only takes four seconds of silence for a person to feel awkward. The study links these emotions and the need to “fill the silence” with feelings of social belonging. If the conversation is flowing, we feel like we are being accepted.
Therefore, silence can be an extremely effective tool in negotiations. Knowing that other people will want to speak after only four seconds of your silence, means you won't have to wait long for them to give concessions.
As a typical talkative extrovert, I didn't totally believe this notion. So, I decided to test it out. After I returned home on the first day of negotiation training, I decided to hire a man to build a fence in my backyard. I did my research and chose one particular contractor. I called him up and the conversation went as follows:
Me: Hello. I need to build a concrete block wall in my backyard. It will need to be 6 feet tall and 20 feet long.
Contractor: OK. We average about $8 per square foot and $34 an hour for labor. We have done hundreds of walls, so I can confidently tell you that it will cost approximately $2,500.
Me: Hmmmm…(silence)
Contractor: If that's outside your budget, we can try to cut costs.
Me: (silence)
Contractor: Actually, we have a new client special right now and we can knock 20% off the price immediately.
I couldn’t believe it, but I had successfully negotiated a 20% discount without saying a word! I took advantage of the contractor’s emotional desire to fill my silence. He misunderstood it as a rejection of his price and his business. His emotions got the best of him, and it cost him 20%.
“When you talk, you are only repeating what you already know. But if you listen, you may learn something new.” - Dalai Lama
Listening
Everyone has heard the old adage that God gave you one mouth and two ears, so you can do twice as much listening as you talk. However, in a world consumed by content, listening has been undermined. The good news is that a well prepared negotiator can use the world’s love of talking to his/her advantage.
We've already established that people like to talk, especially when faced with silence. So, the negotiator’s job becomes not only one that includes creating silence, but also leveraging that silence by listening to the other person. However, listening is not a passive endeavor; it must be active.
According to an article out of Harvard Law School, “active listening is a dynamic process that can be broken down into three different behaviors: paraphrasing, inquiry, and acknowledgment.” Paraphrasing involves repeating what the other party said in order to clarify your understanding of their position. Be sure to use your own words and not just repeat what they said verbatim. The inquiry should then be used to vet out any of the other party’s objections and understand why they object and how you can address them. Finally, acknowledge the other party’s feelings. As much as we like to deny that emotions exist in business and negotiations, they actually play a huge part in our success and/or failure. It is not weak to show empathy and understanding for the other party’s perspective; it creates feelings of camaraderie and cooperation. By engaging these three techniques, you will be able to obtain a complete picture of what the other party wants and doesn’t want.
DON’T FORGET TO TAKE NOTES!
Many people are surprised by the importance of silence in effective negotiations. Unfortunately, the media has distorted the role of the negotiator into one that serves his/her own ego and works only to “defeat” the other party through yelling and threats. However, in business that will never work. Business relationships do not exist for only one transaction and beating up the other side until they hate you will not create long-term lucrative relationships. Silence and listening help to facilitate a positive and cooperative win-win outcome. And remember, if all else fails, shut up.
Happy negotiating!
Megan Porth is the owner and managing attorney at Your Contract Shop. Megan was born and raised around entrepreneurs and business people. From a very young age, she was attending networking events, strategic planning meetings, and marketing seminars. Her passion for helping businesses grow inspired her to go to law school, where she graduated with honors. She currently owns her own business consulting firm in addition to being a practicing business law attorney.
Megan Porth is only licensed in Arizona. Any other work done through Your Contract Shop outside of Arizona will be done only with attorneys who are licensed or authorized to practice in that state.
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