I mastered the art of negotiating after years of working in legal compliance for several top law firms in New York City. Everyday, we were faced with the challenge of structuring settlements with insurance companies, who wanted to avoid the expensive process of going to trial and settle with complainants without further press attention.
Negotiation is a necessity for every business owner, who has the desire to grow their company. Learning how to converse with other parties and find a common ground is more of an art than a science. Do not think of negotiating with the theatrics of angry people sitting across the table from one another arguing. Building up a clear strategy to communicate your value to the other decision maker(s) is the base to win influence at the table.
One day, you may want to sell your company, sell equity shares to raise capital, or seek investors, and you need to know how to pitch your value. Here are three strategies that will help you win at the negotiating table.
Know your value .
It may sound over-used and a bit cliche, but it is a fact. I refer to this as the "evidentiary" stage of the negotiation process. Take a moment to document your cost-benefit analysis.
- What makes you valuable?
- What is the benefit worth to the other party?
- What do believe it is worth?
In addition, take the time to engage in conversations with other colleagues and professionals in your industry. I have found that Linkedin is the best place to locate professionals in similar industries and ask to connect to facilitate brief conversations, so you can gain a clear perspective on calculating what your value is worth based on your expertise.
Create a measurable scale of your high, mid, and low numbers as a gauge for the conversation based on your findings and bring it with you to the negotiation meeting. Don't ever let the other party know your lowest number.
Remain open minded to every alternative .
One year, I approached a company to partner with them on gender inclusion support, with a very specific number in mind. I had all of the evidence and prepared for a multi-day conversation ahead. However, during our meeting, I was offered advisory shares instead of full compensation for a period of five years. It worked out better than I could have imagined. Hence, you must keep an open mind for the future potential.
Every negotiation meeting is unique. I always advise anyone seeking advice or a "template" to guide them that there is no "one speech fits all" in the negotiating process. You will encounter different personalities, and people with different objectives. Keep an open mind. There is a possibility that you may not get the number you want, but receive all of the "perks" that have future potential.
Never generalize .
Avoid general statements which imply an unsubstantiated and unproven opinion. For example:
- "Other people have said ..."
- "But Robert received two times as much with the same experience ..."
- "Everyone says that I can ..."
Nothing says you are not prepared to advocate for yourself or the value of your company like generalizations. They are hypothetical and should never be used when negotiating money or career advancement(s).
Prepare yourself with all of the facts before using scenarios.
- "12 of the member of your accounting department have said ..."
- "I am aware Robert received a 17 percent increase after the training he attended in December..."
- "All of the members in my department have signed a petition indicating ..."
It is extremely difficult to "low-ball" someone who presents facts and data. Generalizations are considered as an emotional tactic that is based on personal experiences, which may be germane to you, but not factual. Memorize your facts and present your evidence with confidence.