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Clinching the perfect deal

Anjali Prayag

Two sisters were fighting over an orange. Both adamantly wanted the orange. When a parent separated the two and asked each why she wanted the fruit, one said she wanted to make juice and the other wanted to use the rind for cooking.

Here the interests of both the parties had nothing in common. Each could get exactly what she wanted without the other having to sacrifice her interests. At a negotiating table, one needs to distinguish between interests and positions, which man y people fail to do.

Successful negotiators find that they are more effective if they focus on understanding their interests before they enter discussions. A tried and tested strategy is not to have a `perfect package' before the start of negotiations beca use very often one may find that the ideas of others may actually improve our final result, assert professional mediators.

So, what role does negotiating play in the management function of an organisation? And how well equipped are our executives to negotiate smart?

Says Sudha Raju, Vice-President, NIIT Ltd., ``At the negotiating table, I would like to see what are the value propositions for me, rather than the price.'' She says sometimes the products may look expensive, but she will opt for the deal if she fee ls she is not being cheated by the vendor.

On the other hand, when she is selling, she says, customers are willing to take the price as long as she promises to `deliver value'.

So, is there an art or a science behind negotiating? And can it be learnt? Says Steven P. Cohen, a professional negotiator and a teacher of negotiation skills at various universities across the globe, ``Negotiating is an art practised by virtually everyone, but as a Craft, practised by few.'' He swears by the eight pillars of negotiational wisdom: Be Conscious of the differences; be creative; be fair; be prepared to commit; be an active listener; be conscious of the relationship wit h the other party; be aware of BATNAs (best alternative to a negotiated agreement) -- which means if you do not reach an agreement with the party, does that really make things worse for you?

Another successful strategy is that a good negotiator always ends up in a win-win situation. According to Sudha, it's important not to make the other party feel cheated. ``Sometimes when you give in, it's for a long-term relationship.'' she asserts. `` And many times people mistake assertiveness for aggression.'' So, the traditional practice of winner-take-all is slowly losing its sheen.

Says Soumitro Ghosh, General Manager, Worldwide Marketing, Wipro Technologies, on the aggression vs. acquiescence debate, ``Aggression is important but it has to be balanced with other skills too like addressing all the needs of the cl ient and communicating your value proposition clearly.''

Successful negotiators advise that rather than attack from the word `go,' it's better to put ourselves into the shoes of the other person and look behind requests. That way we may be able to not only give the other party better deals, but also ge t better deals for ourselves. In other words, it will result in a win-win situation.

Prof. Edward Bergman of the Wharton School of Business, a practitioner of negotiation and mediation who was in India recently, states, ``In the past it was complimentary to say that a negotiator `eats people for breakfast''. But the deman ds of the new millennium will place far more emphasis on the negotiator's ability to co-operate and collaborate as a prerequisite for success. After all, he says, it is foolhardy `to eat someone for breakfast' whose assistance you may require by lunchtime.

The Wharton professor says the new millennium will see an expanded use of mediation. ``It will be a shift back to the more comfortable times, when people, acting individually or as a community, assumed greater responsibility for their problems before turning to the courts.''

Different styles

Though economic barriers are falling, centuries-old cultural barriers are still very strong and continue to influence the corporate community. According to Wayne Berry, who runs the `Master Negotiator' programme all over the world, in the eastern countries such as Japan, China, Taiwan, Korea and India, respect for status is important. ``It's a hierarchical society and there is a very orderly relationship between bosses and subordinates.''

He says the Japanese tend to negotiate in teams and they value collective bargaining. ``When we negotiate with them, we often need to explain things to these teams over and over.''

Sudha talks from experience, ``The Japanese watch you straightfaced. They show no emotions at all as you are making a presentation. At the end you do not know if you have succeeded in impressing them or not. On the other hand, the Americans are more vocal and responsive. You know where you stand even as you are making the presentation.'' Sudha says sometimes in the middle of a presentation, Americans have interrupted to tell her either they were satisfied or they were not. ``Wherea s the Japanese will not reveal their decision till the end.''

But, says Sudha, the Japanese look for long-term relationships, not the one or two-year deals that the Europeans or the Americans look for. Agrees Berry, ``When the Americans talk about having a long-term company plan, we talk in terms of a one-year or two-year contract, at the most a 10-year contract. The Japanese, on the other hand, have a minimum 10-year or even a 20-year contract.''

Within the same culture we see different styles of negotiating. For instance, in India, generally ``the North Indian is more vocal about his achievements than the South Indian,'' says Sudha. When the South Indian is given an offer, no mat ter how attractive, he will accept it only after considerable thought. ``On the other hand, the North Indian is willing to experiment with his skills,'' says Sudha. And Ghosh adds, ``Managers from the North and West are more professional and aggressive.''

The next hot question doing the rounds is, are women better negotiators than men? Agrees Sudha emphatically, ``Being a woman has its advantages. Sometimes it's far easier to get to meet people, women tend to build relationships more effecti vely and evince trust from the other party more easily.''

But, she clarifies, ``Most of my colleagues know I mean business and am as much of a professional as the men. But I also have the liberty to show my emotions more freely.''

Ghosh says, ``In the global context, business is gender-neutral especially in the US. I find both men and women equally competent.''

In the general context, Sudha says there are three kinds of people: the seeing type, the hearing type and the feeling type. ``You have to address each type differently,'' she recommends. She says when she is going in for a deal, she categor ises the other party and packages her presentation accordingly. ``For the seeing type, just giving a product profile is enough, for the second type you need to explain the product features and for the third type, a demo is a must.'' These are basi c lessons which any successful sales person needs to know, she asserts.

Nowadays, a very effective method used in negotiating is the `neuro linguistic programming' (NLP) where you seek to experience the other person's world from his or her perspective, rather than your own.

The Indian negotiator

According to Prof. Bergman, who has conducted negotiation workshops for Indians in the corporate sector, ``Indians are better negotiators because of their socio-economic background.'' He says a childhood spent in joint families have made t hem more adjusting, accommodating and they are willing to listen. ``This does not mean that they are willing to lose out on their interests. It only makes them better negotiators.''

Agrees Sudha, ``We tend to give more importance to seniority. If there's an elderly person at the discussion table, we tend not to disrespect him or her.'' This, she cautions should not lean toward submissiveness. ``One should have the maturity t o handle such a situation.''

According to Ghosh, ``Compared to our Western counterparts, we have room for improvement.'' He recommends that we have to

* Remove mindsets. For example, we can demand more pricing for our quality work in the software services area. Our first battle is within ourselves, which we have to win.

* We have to look for the bigger picture and the clients' overall business needs.

* We have to be more aggressive and persuasive.

* We have to be more positive and learn to talk on the same plane as the Big Five.

What about the Indian mindset of `accepting any deal?' ``We can become good negotiators with more global exposure and training. We have the base ability as Indian customers are very demanding.''

The general feeling is that Indians are simple people and less vocal which may make them look `acquiescent'. ``It's time to change that, considering that you are making such an impact on the global economic scenario,'' advises Prof. Bergman.

As Raju says, ``We're hesitant to talk of our achievements and embarrassed to say what good we have done.''

In the negotiating exercise, probably this should be one of the first lessons Indians need to learn.