INC.: OK, let's say it's time to start the negotiation. Prac-tically speaking, how do you create this atmosphere from the start? You walk into the room . . .
WOOLF: . . . and I let you know what my attitude is. I'm forthright and positive. I tell you I want to make a deal. I tell you I'm not here to outwit you.
INC.: You tell me?
WOOLF: Right. Straight out. I really am an average guy and I want you to know it. I also ask if you have any particular problems or anything that I should know about that would help me as we talk. Maybe I can work within your needs, maybe I know something that could help you. I try to make it a partnership. You and I have a problem, and we're trying to solve it so you're happy and I'm happy. A successful negotiation isn't one where I get everything and you get nothing.
INC.: No? By some standards, that's perfect success.
WOOLF: I don't think so. I haven't done a single contract that I couldn't have gotten more money on. I always leave money on the table.
INC.: Forgive us, but people will read that and think you're nuts. Let's assume you can sell a computer system for $220,000. You're saying you'll take $200,000 for it? Why not pick up the extra 10%?
WOOLF: Because it's possible to push the price so far, create such antagonism, that the extra 10% isn't really worth it. If someone feels you held them up, they're going to take it out on your business or -- if it's an employee -- on you. In my case, they'll take it out on my client, make him miserable, trade him. Obviously, a negotiation isn't about only money.
You have to give the other people a profit margin and let them live. You want them to thrive and grow. It's only practical: if they go out of business, it doesn't help you any. As they grow, maybe you'll participate in the growth. The idea is to be a deal maker, which means sometimes you'll have to compromise on your demands.
Just never compromise on your principles. You've got to develop a reputation for being smart and honest -- so people know you won't renegotiate, you won't play tricks. You can't play tricks, because you'll probably be going back to these people again -- or to someone they know. Your good reputation is incredibly important.
INC.: You're talking about a negotiation in which there is an ongoing relationship. What about a deal in which you're buying a house, or you're selling your company for cash and moving to Bimini, and you'll never see the other person again?
WOOLF: Look, if someone wants to be a bastard, fine, be my guest, but most people don't. When you buy a car, aren't you just trying to get a fair deal? Or are you trying to prevent the guy from making any profit on the transaction? Would you try to do that? Most people wouldn't.
INC.: No. But if I'm negotiating, I don't think it's my job to figure out what's fair for the other guy. Doesn't it make sense to depend on him to protect his interests? And when it comes to leaving money on the table, doesn't it make sense to push for a stiffer deal if it's a onetime relationship?
WOOLF: Well, yes, if it really is a onetime deal then I wouldn't leave as much, but I still wouldn't try for the last dollar. And you're wrong not to judge what's fair from the other side's point of view. If you don't have a pretty good idea before you start talking, then you haven't done your research. You haven't prepared.
In addition to writing my own goals and scenarios before every negotiation I do, I also prepare what I think my counterpart wants. I write down his goals, making believe I'm him. What would I want? What would I give up? I try to figure out what's really important to him.
INC.: What exactly do you do before you sit down to talk?
WOOLF: I try to find out everything I can about the person I'm negotiating with, about what's going on in the marketplace, and with my own client -- or, if I'm a CEO, about my company and its needs.
INC.: How?
WOOLF: There's no formula. Just ask questions. Talk to people who know the person, are around him, deal with him. That includes his secretary and the person he sends to get you at the airport. I want to know everything about who I'm negotiating with. What kind of person is he? What is his reputation? Is he a good negotiator? Is he fair? Does he try to intimidate you? Does he know what he's talking about? Does he have authorization, or will he have to go to someone else to get the deal approved?
INC.: So if I'm considering a deal with a new parts supplier, say, I get a list and call his customers. I call the people who sell him his materials. I call people in his town -- banks, newspapers, local government officials who might have contact with him. If I'm real serious, I might call civic and social organizations I've discovered he belongs to. . . .
WOOLF: Absolutely. Information is power. And I start the attitude process early, too. If I know someone who's close to the person I'll be negotiating with, often I'll have that person call ahead and say, "Hey, Bob's not a bad guy, believe me, he's going to live up to his contracts." I might call ahead myself just to lay that foundation.
INC.: And after you've got the story on the guy?
WOOLF: Then I question myself. I ask whether I'm the right person to do the negotiation. Is my own ego going to get in the way? Is there something about me or the circumstances that will jeopardize the negotiations?
INC.: Has the answer ever been yes?
WOOLF: Oh, yeah. Lots of times I know I'm not the right person. For instance, right now I'm trying to help a friend. He's been a sports announcer on television for 27 years, and he asked me to do his contract. He's making just $66,000, but out of friendship I'm trying to do it. The fellow on the other side, however, is antagonistic and offering a $3,000 raise. His posture has nothing to do with my "client." The fellow's just thrilled that I'm calling him, and he's gonna show me. He's gonna beat Bob Woolf. In this case, I'm not the right person to do the negotiation.
