Chapter 1: What common mistakes do people make in negotiations?
Kia ora, I'm Nadine Higgins and welcome to The Prosperity Project. How many times have you underquoted, undersold yourself, overpaid or overdelivered because you simply don't want to have an uncomfortable conversation? How many times have you said, it's fine, when it is not fine, you just don't want to seem difficult or, heaven forbid, greedy? But that avoidance has a high price.
So today we're focusing on negotiating and what learning to ask for what you want can achieve not only financially, but personally and professionally. Noah Shear is a negotiation expert, an author and a lecturer. And today she's our guest on The Prosperity Project. Hi, Noah. Welcome to The Prosperity Project. Hi. Why do you think, well, I'm going to speak for myself here.
I don't think I'm very good at negotiating. Would that be common that most of us are a little bit reluctant to rock the boat and ask for what we want? We're a bit backwards about coming forwards?
Yeah, I can tell you right now you're good at negotiating.
Chapter 2: How can understanding psychology improve negotiation outcomes?
Really? I know because I've spoken to you and I know because of the evidence, the role that you're in, the things that you've achieved in life. I think a lot of people don't realize that they are good negotiators because we don't have the frameworks, the structure or any terminology to decipher or to measure good negotiation outcomes.
Okay, so I guess the reason I concluded that I'm not a good negotiator is that I don't like conflict. And I'm a bit of a people pleaser. And I assume those two things combined mean I couldn't be a good negotiator. Am I wrong?
Yeah. No, I'm not saying yes. I'm saying I don't think that the two align. So we could break it down. You could be a person who is... puts a lot of emphasis on relationships and who understands the social cost of jeopardizing a relationship, coming in and demanding whatever it is that you want. Slamming my fist down on the table and saying, I will not accept anything else. That's right.
Chapter 3: What strategies can help avoid underselling yourself?
So if you understand the risk of that, and that is the context in which you are negotiating, it might be a very smart move to avoid conflict. So your style or your strategic choices are separate from your negotiation outcomes. You You could have any style and have fabulous negotiation outcomes.
You just have to ensure that you're using the right strategy to work around your style, your context, even your weaknesses so that you're getting the outcome that you want. For example... You can adopt an interest-based negotiation approach, which is not the type where you come in and demand things.
You don't come in with evidence for why you are so deserving and you don't come in with any sort of threats. You come in and explain why it's in everybody's best interest that you get what you want. I think what does set apart good negotiators from bad negotiators is can you identify what it is that you truly want? And do you initiate the conversations? to promote those things.
Okay. So I guess I think of a good negotiator as maybe someone who is able to strong arm the other person or convince them that something that's good for me is good for you as well. So are you kind of a sales person?
Chapter 4: Why is 'winning' not always about money in negotiations?
Are you selling an idea as a negotiator?
Well, let's use a framework to get some structure around this conversation, because what you're asking me is how do I apply power or am I powerful in the negotiation? I can't strong arm someone, therefore I'm not powerful in the negotiation. So let's just define what power means for each of three approaches. So there are three approaches to persuasion.
One is the power approach, where we get someone to comply with us by coercing them into it. So that's the strong-arming. The Donald Trump approach? The Donald Trump approach, exactly.
The art of the deal.
That's right. But you say that, but it actually, in some contexts, it is the right approach to choose because... In some contexts, that's the game that is expected and that's the game that will get results. So you either come in with a very strong claim about the costs of not doing a deal today. So notice that unions do this, right?
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Chapter 5: What are the three approaches to negotiation power?
So there will be consequences we will strike if we don't get what we want. Let's start there. Or there is a lawsuit on the table. Let's start there now. Let's try and make a deal. So you might threaten or you might show that the other person really doesn't have a choice in the matter. I have the authority to force you to do whatever it is that I want you to do.
So is that about you need leverage? You need ā you have to be willing to walk away or to cause ā
uh disruption like the strike perfect and if you don't have that then maybe that's not the right strategy exactly exactly so the power in that approach comes from being able to either enforce the the threat that you're talking about um for example if i say to my child you know if you don't eat your greens there's no tv but then i give in and give them tv then there's no more
I have no more leverage in future negotiations, right? If a union says we will strike and then management comes back with, oh, you don't have your constituency behind you, then it's never going to work. If you have an alternative, what we call a BATNA, that is an acronym, a terrible acronym, best alternative to the negotiated agreement. So basically just a plan B.
So like if you were going for a job, it would be, oh, well, if you don't give me what I want in this role, I've got company, be over the road, I'm going to go over there.
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Chapter 6: How can you prepare effectively for a negotiation?
I don't need you. And that's fine. You have no power over me. So the power approach is basically about the balance of power, how much leverage I have to get what I want from you. The second approach is the rights-based approach, where you get someone to comply with you by showing them that you are in the right and they are in the wrong, or you are deserving.
And you might appeal to something that is completely neutral, that we both accept. For example, here are the KPIs, or here are the standards, the criteria, according to that. I've met all of them, tick, tick, tick. Here's the evidence. You know, I've done this, I've done this with And people do this, especially in New Zealand and in Australia.
It feels like the default way of negotiating because fairness is so central to our values. And we want to remove ourselves. It feels non-confrontational because it's not about me or you.
It feels less personal as well.
Chapter 7: What mistakes should women avoid in salary negotiations?
So if you say no, it doesn't hurt my feelings so much.
That's right. Well, this is not about me or you. This is about justice. Yeah. We just want what's fair. You know, this is the F-bomb that people drop in negotiations. What's fair? We just want fairness.
Different kind of F-bomb. That's right.
That's right. So in that approach, it would really serve you to, well, the way that you empower yourself is by benchmarking, doing all of your research and finding out all the information that to have those all the bits of evidence. I've done this, I've done this, I've done this.
Chapter 8: How can you create value in a negotiation beyond price?
Still, we have this weird fantasy that we will go, look, Nadine, look, all the evidence, look, it's about fairness. And then you will go, oh, you know what? I'm so sorry. You are right. I'm clearly wrong. And that somehow never happens because we get ourselves into a contest. It's not a contest of power, but it's a contest of who's got the better evidence, right? So now you'll come back with
oh, but what about this? Or that evidence that you gave me is not relevant. Like if I say to my son, eat your broccoli because I slaved all day in the kitchen to make this. I deserve, right? He would say, who asked you to do that? Or if I say, eat your broccoli because you haven't had greens for a week. He would definitely come back with, knowing my son, he would come back with,
No, that's not true. You didn't see, but yesterday I ate a piece of lettuce when you weren't looking. So we always come back. I mean, that's a silly example, but even in serious negotiations, people have counter examples and we end up clashing.
Yeah. It also makes me think, and I don't know if you consider this negotiating, but, you know, at the family barbecue and Uncle Trevor's gone down a conspiracy theorist rabbit hole and you can give him all of the evidence and Yeah. Well, people, so this is the psychology behind it.
People don't enjoy being proven wrong. And they don't want to show inconsistencies and they want to double down. Plus, because of this underlying dynamic of reciprocity, if I approach you with a certain approach, you know, power or rights, the one that I'm describing now, you will respond in kind. So you'll come back to me with the same approach.
So now we are in this contest of who is more deserving. right? The third approach is the one that carries the least risk and the one that maybe you're talking about in terms of your own personal style. That is the interest-based approach to negotiation. And lots of books cover this, but I don't think they do it well because there's never a step-by-step process.
It really is a two-step process if we think about it. We must identify the interests of the other party, the real drivers and motivations. And And then we have to tie our request or our suggestion to that interest. So you have a problem or there is a concern or there is something that's driving you. What I'm suggesting is a solution to that.
What happens though when your interests are kind of diametrically opposite? You know, like I'm trying to buy a house. I want to buy it for the lowest price. They're trying to sell a house. They want to sell it for the highest price. How can I solve my problem and their problem at the same time?
Yeah, it's funny you should mention that because I've been working with real estate agents a lot in the recent past and still. And my cousin actually reached out the other day to say, we've got an offer on our house. How do we approach this? Because we want a larger offer. They've just given us the bare minimum.
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