Why Successful Negotiations Hinge on Relationship Building with Dr. Daniel Shapiro, Ep #200
Release Date: 06/30/2020
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Relationship building is an important aspect of the negotiation process, according to Dr. Daniel Shapiro. Whether you’re negotiating with a prospective customer, negotiating with a spouse, or negotiating with another country—it all hinges on the ability to build a relationship. In this episode of Sales Reinvented, we talk about building relationships, attributes of a great negotiator, top 3 negotiation dos and don’ts, and much more. Don’t miss this one!
Dr. Daniel Shapiro is a world-renowned expert on negotiation and middle-east politics. He was the US ambassador to Israel from 2011–2017. He also founded and currently directs the Harvard International Negotiation Program. Dan consults regularly for government leaders and Fortune 500 companies and has advised everyone from hostage negotiators to families in crisis, disputing CEOs to clashing heads of state. He is also the author of two best-selling books, Negotiating the Nonnegotiable and Building Agreement: Using Emotions as You Negotiate.
Outline of This Episode
- [1:06] Humans are constantly negotiating
- [2:05] Changing the negative perception of negotiation
- [3:49] Dan describes the pillars of his negotiation process
- [7:37] The attributes of a great negotiator
- [8:44] Allow your customer autonomy
- [11:44] Top 3 negotiation dos and don’ts
- [17:05] Dan’s favorite negotiation story
The entire sales process consists of negotiation
The common misconception of negotiation is that it’s just one part of the sales process in which costs are debated. The reality is that the entire sales process is a negotiation. Anytime you interact with someone else with a purpose in mind you are negotiating. Most salespeople love their jobs and it’s simply one part of the process that brings them more stress. How do we change that?
Dan states that you must change how you view the negotiation process. Firstly, you must focus on building a relationship with the customer. Many salespeople naturally excel in relationship building. Secondly, you must listen with intent: Figure out what your counterpart actually wants and where their interests lie.
The process doesn’t have to encapsulate an “us against them” mentality. You should present options for mutual gains and invent new ideas with the customer. Be innovative with your approach so they don’t move on to the next salesperson.
The pillars of Dan’s negotiation process
Dr. Dan emphasizes throughout the episode that relationship building skills are key. The first pillar that he sets forth is all about building the relationship. Building a relationship is your greatest source of influence now AND into the future. The more you can build a good trusting relationship with some sense of connection the more effective you will be in the negotiation process.
Per Dan, “The most effective negotiations by and large—in the business realm and the international realm—are side by side. They are cooperative.”
Conversely, no salesperson is in it just for the relationship. They are also motivated to make a good sale. Aside from building a relationship with the prospect, you need to be keenly aware of their interests. What’s motivating their behavior other than getting a good deal? Are they hoping for a promotion? Is their budget quite low? Dan acknowledges there could be 1,000 different reasons—but it’s your job to find out what those reasons are.
With the foundation of a relationship and the knowledge of what motivates them, you can work to craft a potential agreement that meets their interests—and yours.
The importance of autonomy
A great negotiator is an avid listener. They learn what their counterpart cares about, what they want out of the relationship, what they’re fearful of, and what they’re dreams and aspirations are. They don’t listen to exploit, but they listen to craft an agreement that works for everyone. You must remember that your counterpart wants the freedom to make decisions without it being imposed on them. They want autonomy.
Dan first became aware of this concept when he was a teenager shopping for jeans at Gap. The slightly older teenager assisting him was showering him with compliments and telling him how great he looked in the jeans. Dan realized he couldn’t decipher if the compliments were real—or just being used to make a sale and therefore a commission for the pushy teenager.
Instead of pushing someone into a sale, allow them the autonomy to make their own decision. Share the attributes of the product, why it meets their interests, and why your pricing is fair while allowing them the freedom to walk away. If they can find a better deal with someone else, then let them know that you won’t stand in their way. Doing this builds trust in your customer relationship. Having their best interest in mind speaks volumes.
The power of appreciation in relationship building
Dan believes that the power of appreciation is the single most important thing to apply to a negotiation. He emphasizes that in ANY human interaction we want to feel heard, understood, and valued—appreciated on a deep level. Yes, you want to come to a deal, but deals don’t happen on an emotional level if the other side doesn’t feel appreciated and respected. It’s more than a thank you. It’s listening to try and find value from their perspective. To find merit in what they’re feeling, thinking, communicating, and understanding.
It isn’t an adversarial or antagonistic approach, but one bent on understanding their perspective and shifting into their seat on a psychological level. If you can truly understand their perspective and appreciate where they’re coming from, it can change the course of the negotiation. Dan shares a powerful negotiation story about how cooperation and understanding in a negotiation lead to more effective outcomes. Listen to the whole episode for more of his negotiation expertise.
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