Never Split the Difference

Never split the difference is a branch non-fiction book within behavioral psychology that details negotiation and neogitation strategy.

A series of FBI negotiation failures lead the FBI to put aside logical/economic negotiation models aside in exchange for more emotion/psychology models of negotiation. The author came of age during the foundation of these techniques, and views them as practical tools for daily negotiation.

Tactics of negotiation:

• Active Listening
• Voice Patterns
  • Late-Night FM DJ Voice: deep, soft, slow and reassuring. Calming and exudes control. Downwards inflection
  • Positive/playful: should be the default. The voice of an easygoing, good-natured person. The key here is to relax and smile.
  • Direct/Assertive
• Mirroring
• Confront without Confrontation
• Slow. It. Down. Slowness avoids the other person not feeling heard, and undermining trust
• Put a smile on your face → positivity creates mental agility in you and your counterpart.
• Tactical Empathy
  • Labeling negative feelings and fears can help diffuse them
• Nos clarify and begin a negotiation
  • Asking a question that will generate a “No” can often compel the counterparty to provide a response and clarify their position. E.g. “Do you want the company to be embarrassed?”
• Calibrated Questions
  • In order for calibrated questions to be successful you must have self-control and emotional regulation.
    • Pause and consider options rather than reacting emotionally
    • Do not counterattack when verbally attacked, reply with a calibrated question
• That’s Right is a key to negotiations
• Guaranteeing Execution
• Negotiation One Sheet
• Ackerman bargaining:
• When asked to set the first anchor, wriggle from it by discussing what another entity might charge.
• How to be assertive smartly:
  • Strategic Umbrage - “I don’t see how that could ever work.”
  • Why questions - Why would you ever leave your existing contract? Why would you ever go with my company? → Why would you do that? Where that is your goal.
  • I statements allow you to hit the pause button and make the counterpart take a step back. “I feel __ when you _ because _”
• Salary Negotiation

Assorted Concepts

• Thinking Fast and slow:
  • Our animal mind is fast, instinctive, and emotional
  • Our second mind, is slow deliberative and logical
  • System 1 (animal mind) guides and steers the more deliberative side. In effect, we react emotionally to a question which informs and creates the answer.
• A negotiation between two people is more like a negotiation between two people is often like a four people talking at once. The two people verbally, and then the voice in each persons head who is hashing the arguments and subject to bias.
• “A good negotiator prepares, going in, to be ready for possible surprises; a great negotiator aims to use her skills to reveal the surprises she is certain to find.”
• “Don’t commit to assumptions; instead, view them as hypotheses and use the negotiation to test them rigorously.”
• Don’t view a negotiation as a battle of arguments
• A negotiation is about convincing the counterparty that the solution you want is their own idea. Ask the counterparty questions that open paths to your goals.
• Behavioral Change Stairway Model (BCSM)
• Compromise is often a bad deal
  • Never split the difference… creating solutions always emerge from some amount of risk, annoyance, confusion, and conflict.
• Time and deadlines pressurize a deal, rarely are deadlines as firm as they appear.
  • Keeping your deadlines a secret is not necessarily beneficial, being clear about your deadline can also generate progress as the opposing side knows when negotiation is over for one side, it’s over for the other side too.
• “No deal is better than a bad deal”
• Increasing specificity of threats indicates getting closer to real consequences at a real specified time.
• Fair is a relative concept and often has to do with framing and context.
• Three ways fair are used:
  • “We just want what’s fair” → an implicit accusation that the other party is not being fair
    • Countered with “Okay, I apologize. Let’s stop everything and go back tow here I started treating you unfairly and we’ll fix it.”
  • “We’ve given you a fair offer.” → Shifts focus to the counterparty’s lack of understanding of fairness.
    • Countered with “Fair?” → Pause
  • Early on in the negotiation, “I want you to feel like you are being treated fairly at all times. So please stop me at any time if you feel I’m being unfair”.
• Know the emotional drivers behind a decision and you can frame the benefits of a deal in language that will resonate.
• Prospect Theory
  • It’s not enough to show you can deliver the other party what they want, you have to show them they have something concrete to lose if the deal falls through.
• Anchor and adjustment effect
• “That’s not to say, “Never open.” Rules like that are easy to remember, but, like most simplistic approaches, they are not always good advice. If you’re dealing with a rookie counterpart, you might be tempted to be the shark and throw out an extreme anchor. Or if you really know the market and you’re dealing with an equally informed pro, you might offer a number just to make the negotiation go faster.”
  • “Here’s my personal advice on whether or not you want to be the shark that eats a rookie counterpart. Just remember, your reputation precedes you. I’ve run into CEOs whose reputation was to always badly beat their counterpart and pretty soon no one would deal with them.”
• Salary Negotiation
• Establish a range, expect the counter party to come in on the low end.
  • Counter by recalling a similar deal which establishes your “ball park” albeit the best possible ballpark you wish to be in.
• Pivot to non-monetary terms
  • Offer things that aren’t important to you but could be important to them. Or if their offer is low you could ask for things that matter more to you than them.
• When you do talk numbers, use odd ones
  • Numbers that end in zero seem like placeholders where “precise” numbers feel like they were arrived with specificity
• Surprise with a gift
  • Offering a wholly unrelated surprise gift because they elicit reciprocity
• A change in negotiators by the other side almost always signaled that they meant to take a harder line.
• Asking for things triggers reciprocity and avoidance dynamics,
• Unbelief is active resistance to what the other side is saying, which is usually how a negotiation start. It is antithetical to persuasion.

“He who has learned to disagree without being disagreeable has discovered the most valuable secret of negotiation.” - Robert Estabrook

• When you go into a store, rather than stating what you need, you can describe what you’re looking for and ask for suggestions. → Budget is slightly less than what the price is → How am I supposed to do that?

  • You must actually be asking for help

• There is always a team on the other side. If you are not influencing those behind the table, you are vulnerable.

  • Calibrated How questions can be used to determine how you need influence a committee behind a decision:
    • “How does this affect the rest of your team?”
    • “How on board are the people not on this call?”
    • “What do your colleagues see as their main challenges in this area?”
  • These are “Level II” players that are not directly at the table but can make or break a deal.

• “You’re right” and “I’ll try” are two indicators that the counter party are not bought into the solution and you must reset on Guaranteeing Execution.

• Signs of lying:

  • The Pinocchio Effect
    • Use of far more third-person pronouns. They start talking about him, her, it, one, they, and their rather than I, in order to put some distance between themselves and the lie.

• Humanize yourself, use your name to introduce yourself into the counterparty’s thinking.

• According to Voss, there are  three types of negotiators:

  • Accommodators
  • Assertive
  • Analyst

• Zone of Possible Agreement (ZOPA)

• When you are met with an extreme anchor from the counterparty, deflect with a Calibrated Questions, “How am I suppose to do that?”. Alternatively, pivot to terms, detour the conversation to non-monetary issues to make the deal work. “Let’s put price to the side.. what would make this deal work”

• Three Types of Negotiation Leverage

• Set boundaries and learn to take a punch without anger. The guy across the table is not the problem, the situation is.

• Black Swan Event are unknown unknowns that have the potential to completely change the dynamics of a negotiation

  • The other side may not view the information as consequential or important

• “Why are they communicating what they are communicating right now?”

  • To try and uncover Black Swan events

• Know your counterparty’s “religion”, their worldviews that guide their thinking

  • Review everything you hear. You will not hear everything the first time, so double-check. Compare notes with your team members. You will often discover new information that will help you advance the negotiation.
  • Use backup listeners whose only job is to listen between the lines. They will hear things you miss.
  • Observe unguarded moments and get face team

• When you think something is “crazy”, realize that is an opportunity to learn how they see the world. Ways that people seem crazy:

  • They are ill-informed
  • They are constrained
  • They have other interests

• When it doesn’t make sense, there are cents to be made. When a logical choice doesn’t make sense, there are often opportunities to exploit the situation.

• “Finding the Black Swans—those powerful unknown unknowns—is intrinsically difficult, however, for the simple reason that we don’t know the questions to ask. Because we don’t know what the treasure is, we don’t know where to dig.”