“Prof Freeman, What can I do if the other negotiator is very powerful and I’m very weak? My best alternative to a negotiated agreement (BATNA) is weak at best. Must I just submit to his demands? Steve*” Dear Steve, You’ve asked one of the questions I get most often. Sometimes there IS little you can do. Before you give up, though, here are five suggestions.^^ Moves Away From the Table- One group of ways to get stronger is to do things before you negotiate that can increase your power.
1. Find Allies- Allies can help you offer a better set of options (“work with me and my allies and I can offer you X, Y, and Z”). They can also make disagreement more costly to the other negotiator. ( “my allies won’t be able work with you if you and I don’t agree.”) A mall developer, for example, might feel powerless in negotiations with his prospective anchor tenant ValueMart, an enormous retailer. But alliances with the city, attractive satellite stores, and the bank might let the developer offer a much more attractive proposal to ValueMart that it won’t get anywhere else.
2. Develop Your Best Alternative to a Negotiated Agreement-Use research and creativity to give you a stronger BATNA. For example, the mall developer might begin talks with BargainCo, a rival of ValueMart’s.
3. Learn About The Other Side’s Worst Alternatives– You may be able to diplomatically show him that “NO” will hurt him a lot. “Look,” the developer might say, “I know you don’t want to be near BargainCo’s other stores, and if we don’t agree, you may have to settle for a very unattractive location in the area.” Prepare- Another way is to prepare much more fully.
4. Develop Your I FORESAW IT Plan**-– The weaker your BATNA seems to be, the more you need to develop every other aspect of your preparation. For example, if the mall developer thinks further about the interests here, he may discover that some of ValueMart’s demands don’t hurt his key interests very much and that there are some ways that ValueMart can cheaply help satisfy other interests he hadn’t previously thought of.
5. Make a Fairly Generous but Creative Package Offer-Use your preparation to make necessary concessions, but include terms that give you more value too and make it clear you will walk if necessary. For example, the mall developer might say, “we’re willing to come down to a pretty low rent and let you sublet as you asked, and we’ll add some improvements from the city, provided you agree to a longer term and give us the right to disclose your commitment to prospective tenants immediately. That way we can accelerate development and you can move in faster. But we won’t make unilateral concessions and we will have to walk if you insist on them.” For more information- check out Michael Watkin’s excellent book, Breakthrough Business Negotiation. If you are buying a house- special rules apply! Stay tuned for future articles about that. Listen to My Readers’ Suggestions. I invite my readers to send me their suggestions. I’m at email@example.com. I’ll share a sampling in a future issue. Let me know how it goes for you, Steve. Cordially, Prof. Seth Freeman
*I’ve changed his name to protect his privacy. **I FORESAW IT is a mnemonic that lists ten questions a negotiator should ask and answer before a negotiation. For details, go to the Home page, move the mouse to the heading “Articles” and you will see a subheading for “I FORESAW IT” where you can read how it works. You can also find a copy of a handy I FORESAW IT template by clicking on the I FORESAW IT tab on the left side of the Home page.