With his wild roller coaster of a career, entrepreneur, hedge fund manager, and blogger James Altucher has seen a lot of negotiations. More than 100, by his count. That's given him lots of opportunities to screw them up and learn from his mistakes, as well as plenty of chances to see great negotiators at work.
On Medium recently, Altucher shared what he's taken away from all that experience; his post "The Ten Worst Things You Can Do in a Negotiation" is peppered with interesting anecdotes and counterintuitive negotiation wisdom. If you're about to try to hammer out an important deal, it's well worth a read in full. To give you a flavor of what you'll find, these are some of the innocent-seeming moves that Altucher warns against.
1. Don't get enough sleep
You might be too stressed the night before a big negotiation to sleep, or you may feel that the best use of your time isn't resting but preparing for the tough discussions to come. Either way, you need to rethink your up-all-night approach, according to Altucher. Not getting enough sleep in the runup to a negotiation is a sure-fire way to torpedo your chances of success.
"Carl Icahn, one of the best investors in the world, uses this technique. He schedules his negotiations for the early evening," Altucher writes. "Throughout the day, our willpower slowly leaks away until we sleep again. That's why we watch TV and eat donuts at night rather than when we first wake up. So Carl Icahn will sleep until 4 p.m. and then go to the negotiation at 6 p.m. On the other side of the table are exhausted lawyers who have been working all day. Bam! Who do you think will win that negotiation?"
2. Come with a small list of terms
Coming to the negotiation with just a few points to discuss might seem like a smart way to keep things simple and focus on what's truly important, but it's actually a recipe for negotiation disaster, Altucher feels.
"Let's say you are selling a company. One side is usually focused on the final price. That side will henceforth be called 'the loser,'" he writes. "Make your list bigger: what are the terms of the noncompete, what is the length of the earn-out, what are the salaries of the new top executives, what are the perks, what are the options packages." Why? "The side with the bigger list can give up the nickels for the dimes to the loser."
3. Say no
Wait, don't you need to take a tough line and stand your ground when negotiating? Not really, says Altucher, or at least not overtly. If you're flat out saying no to the other party, you're unlikely to prevail, he feels. Instead, great negotiators "bury a no inside a yes," keeping things friendly while simultaneously standing their ground.
"There's a well-known improv technique of 'Yes, and ...' In improv, the first performer creates the premise," he explains. "The second performer can't change it or reject it, he can only build on it. In a negotiation, if someone says, 'Well, you're only worth $1 because you have X,' you can say, 'Yes, and we also have Y, so let's take that into consideration.' Suddenly, your value is higher because you didn't start a fight. You agreed and added."