It’s not news that understanding the other person’s key interests is a crucial skill for your negotiation skills toolbox. I knew that when I went into the contract negotiation in the following story…and I almost blew it anyway. It took a question born out of desperation to teach me that some interests can be elusive, surprising, and even downright unbelievable.
“Agree to 20 percent less and we have a deal,” said the university dean.
I was in her office, sitting across from her at her round conference table. I recall her red pen hovering above the paper, poised to cross out the amount on the proposal I’d put in front of her just a few minutes before.
Inwardly, I cringed. Maybe outwardly too. Four thousand dollars felt like a big chunk of change to cut from that contract. She and I were negotiating my fee for a conflict resolution contract for her division and it was my first big contract since starting out in private practice as a mediator. This was years ago.
“Well, it might be helpful for you to know,” I explained pleasantly, “that I don’t arbitrarily inflate my fee as part of a negotiation game. If my fee is too steep for your budget, then let’s discuss ways to revise the project so it fits your financial parameters.”
There. That should help clear things up.
“No,” she replied. “I don’t want to change the scope of the project. I just want to pay you 20 percent less than you’re proposing.”
Damn. Were we just going to sit there and horse trade to a number? That’s really not how I wanted to work.
The contract was slipping through my fingers
On we went, back and forth, me trying to explain that I don’t inflate fees, her trying to explain that she wasn’t willing to pay my full fee. It was a very polite tug of war.
And the longer it went on, the more clearly I could see my first big contract slipping through my fingers. Inside my head, I started to waffle. Was it really better to walk away from $20,000 on principle than accept $16,000? Could I afford to lose that contract? Could I do all the work outlined for that smaller amount? Was I just being a positional idiot?
I didn’t want to seem desperate, but kept thinking of all that salary I’d walked away from to go into private practice. I would sure like to start filling those coffers again.
The question that unlocked everything
Finally, I did what I should have done at the very beginning: I stopped trying to persuade her and reason with her, and started being curious. Really, it just came from desperation.
“Why 20 percent?” I asked.
“Because that’s the amount my CFO is going to expect I got out of you.”
Wait a minute. What?!?
“You mean you’re trying to satisfy a demand the CFO makes? That the dollar amount per se doesn’t matter?” I was astounded.
“That’s right,” she replied, shrugging. “I’ve got the money already budgeted. But when I send this contract down for his final approval, he’s going to ask if I talked you down.”
In all the guesses inside my head, that answer would never have occurred to me.
And I still didn’t entirely believe her. It seemed too…pat. A way to pass off tough negotiation as being someone else’s game.
So I decided to test it and did some quick math in my head.
“Ok, then, I have an idea.” I reached for the contract and crossed out the $20,000 figure. “I’ll re-do the contract and increase my fee to this amount,” I said, writing $25,000 in place of the old figure.
She smiled. “And when I take 20% off that figure, we’ll have the $20,000.”
“Perfect!” she said. “Send me the revised contract to me and I’ll take it from there.”
Don’t assume key interests will be obvious
You know, when I’ve told this story to my negotiation grad students they’ve never believed me. If I hadn’t lived it I wouldn’t believe it myself.
It was priceless learning to my newly minted mediator self: When negotiations get stuck, stop trying to convince and start trying to understand what you’re missing [click to tweet this].
Uncovering someone’s unstated key interests can unlock contract negotiations — actually, all sorts of negotiations at work and home — in ways you never thought possible.