INSIGHTS ON NEGOTIATION WITH ROGER DAWSON
By CINDY YAP
The art of negotiation is an important element in our day-to-day lives and is not only relevant to businesses or crisis situations, claims Roger Dawson, one of the world’s top expert in the art of negotiating.
“We are negotiating all the time. From the moment you wake up in the morning, I bet you’ve gone through half of the negotiations already. Where should we have breakfast? Which movie should we watch tonight? These involves family negotiations,” offers Dawson during an interview with The Leaderonomics Show.
Being a full-time speaker since 1982 and having trained executives, managers, and salespeople throughout the United States, Canada, Asia and Australia, Dawson was inducted into the Speakers Hall of Fame in 1991. The founder of the Power Negotiating Institute is also the author of 17 books on negotiation and other business topics.
His book Secrets of Power Negotiating was a best seller for 15 years and its third edition has just been published.
GET A WIN-WIN SITUATION
Negotiation is not the art of making concessions, but is the art of not having to make concessions, says Dawson.
He continues: “Thus, if you claim that you do not negotiate because the price of what you sell is fixed or you don’t have a lot of price flexibility in what you’re selling, you need to be a much better negotiator than someone who does.”
Knowing how to negotiate right and to a structure win-win negotiation will not only get us what we want, but will also get the party we are negotiating with what he wants, too.
Contrary to the belief that the better negotiator wins and the other loses in a negotiation, Dawson teaches on what he terms as “power negotiating tactics”.
“It is whereby you can get what you want and yet, you have the other person feeling as if he had won in the negotiation,” he elucidates.
This tactic ensures that we become more successful in life, yet be relieved of any pressure and friction.
Dawson advises that first and foremost, we should never say yes to the any proposals made at the first instance, as “it would automatically make you think that you could have done better or something must be wrong.”
ASK FOR MORE
In addition, he stresses that we should “always ask for more.” Asking for more and reluctantly backing off from that position so that the other person feels as though he had won is, according to Dawson, a powerful tactic in a negotiation.
Dawson explounds that by “asking for more”:
1 It makes it a lot easier to get what you really want.
2 You might just get it. The only way you can find out is to ask.
3 It raises the perceived value of your product or service. Hence, when a salesperson gives a discount from the perceived value of the said product or service, this gives an impression on the potential buyer that he “won” in that negotiation.
4 It creates a climate where the other person has a “win” with you.
5 It prevent deadlocks when you deal with an egotistical person. Deadlocks are likely when you’re dealing with someone who is proud of their ability to negotiate and you don’t give them room to win.
In this challenging business environment, nothing affects the bottom-line of a company more than the ability of your people to negotiate well. Every negotiated dollar contributes towards a bottom-line dollar.
As a matter of fact, all the expenses of your business are going to stay, negotiators or not, Dawson remarks.
On people who are not born to be negotiators, Dawson quips, “There is no such thing as a born negotiator! Birth announcements in the newspaper will never say ‘Today, a negotiator was born’. It is a learnt skill and that’s what I have been doing for 29 years.
“What I teach is to be street-smart, so you don’t go to college to learn it,” he emphasises.
Dawson shares on how he started out in the real estate industry in California, where he was based in a company which had 28 offices and 540 sales sergeants, by accident.
“I was working for a big departmental store chain in the United States and was constantly transferred around. So, I would buy a house and when I moved, I would buy another and rent the first one out.”
Soon, Dawson had four houses that were rented out. It only occurred to him after 13 years that he was making more money in real estate than working full time in this company. That’s when he decided to be in real estate to have access to good deals and “that’s when things started to change for me.”
Dawson subsequently took over the company during a buyout, where the company had US$400mil worth of business, 20% of which were falling out.
“In the real estate industry, from the time the buyer and seller signs the contract to the time it actually closes, you lose about 20% of that business formally,” he shares.
“So I figured if I can teach the people how to negotiate better, we will pick up that extra business.”
Roger and his team successfully cut the fallout rate into half just by better negotiating skills.
“It’s not complicated, it’s not rocket science, although it’s something not taught in high schools or colleges for some reason.”
It was never a consistently smooth ride is this industry, as “you make a lot of money in the good years and lose a lot in bad years.”
But there was no looking back for Dawson, who realised that in real estate, he could make in a month what it took him to earn in a year in the departmental store business.
CHANGE IN USE CHANGES VALUE
“There’s an expression in real estate that goes – Change in use changes value,” says Dawson.
He continues: “If the value of your property goes up gradually because of inflation, a change in the use of that building – taking a house and getting it zoned commercial or converting an apartment into condominiums, would dramatically cause a jump in its value.”
“By analogy, I think people are like that too. They don’t realise that very often they are stuck in a rut, doing the same thing for years and getting increases in pay that only equals the amount in inflation,” Dawson muses.
Realising unexplored challenges and that there are things they can learn to do and be expert at, would cause an exponential growth in their income, he adds.
WALK AWAY POWER
Walk away power is the “essential power to convince the other side that you are prepared to walk away. It’s the No. 1 pressure point in negotiation. It involves developing options before going into the negotiation,” explains Dawson.
“As an illustration, if you are keen in a piece of property, the smartest thing to do before you start negotiating is find two other houses which you would be as happy with. It doesn’t mean you’re not going to get the one you want, but it does mean you will be a more powerful negotiator.”
Having options also give you an edge in the psychological sense, which translates into power in negotiation.
For a fresh graduate about to join the workforce, Dawson advises: “Impress potential employers with negotiation skills! If you can say to them – I have training in negotiation, I know how to negotiate – that goes a long way.”
For the chief executive officer, Dawson has this advice to offer: “Train your people in negotiation. It’s a critical contributory factor to the bottom line of the company.”
Dawson offers these essential tips on negotiation:
1. Don’t be conflict-averse
Dawson trains a lot of doctors and physicians, and most of them dislike being in the face of arguments due to the need to build long-term relationships with people.
“What they really want is for people to like them. In negotiations, strive to make people respect you, instead of liking you. And they respect you when you have good negotiation skills and you stand up for what you believe in.”
2. Think of negotiation as a ball game
In a racquet game with an opponent, one would do everything within the rule of the game to win. Analogously in a negotiation, stand up for what you want and equip yourself with the necessary negotiation skills to obtain it, he concludes.