The importance of information in a negotiation

It goes without saying that before going into a negotiation you need to get as much information as you can about the item being negotiated and about the other negotiation players. Even in the case of a simple sales/purchase transaction, you need to know technical information about the product in question, market trending for similar products and what are the real needs of your negotiation partner. Never be afraid to ask for more info about a product you want to acquire.

Here are some tips about how to handle information during negotiations:

1 Never throw new information too late in the negotiation process

Every time you bring new information to the table, the person you are negotiating with tends to have a reflex response: “That is not what we initially discussed!”. And if you do this too late, the risk of having a failed negotiation increases. This kind of quick refusal represents just a reaction, not a position. Usually the ones who react negatively to your proposal just need time to evaluate and get accustomed with the thought. That is why it is so important to give this information earlier in the negotiation because with enough effort and time dedicated, any ‘no’ can be transformed into a ‘maybe’ and then into a ‘yes’.

As an example we have the initial reaction of the american people when president Richard Nixon was charged with obstruction of justice. The first time the idea appeared, 92% of the people asked about it were against the charges, and their answer was similar to “I have never heard of such a thing before” and “this could generate a dangerous precedent”. Three months later, the same people were asked again about their thoughts on the matter and the ones who opposed the charges were now less than 80% and a year after that 60% of the people were convinced the charges were a good idea. Why this dramatic change? Because the people received more information and they got accustomed with what was initially considered a strange new idea.

For most people it is easier and more comfortable to ignore certain things without being bothered about a lack of knowledge, so keep in mind that a change in vision, perception or expectation will become acceptable only if it is presented gradually.

2 Be aware of subtle unintentional and non-verbal clues

While negotiating, you can get a lot of information if you pay close attention at the behavior of the ones you are negotiating with. You can spot non-verbal clues such as sounds (voice intonation, putting an accent on some words that can contradict the spoken message) or visual signs (body language, gesticulation, eye contact). This is the kind of information that you can use to know when to change your approach if the people you are talking to seem bored, uninterested or anxious. There is no need to be told what is happening when you are presenting a certain idea to your boss and he is looking on the window the entire time while tapping with his fingers on the table. Use the information you get to change the approach and thus improve the final result.

Herb Cohen described in his book, ‘You can negotiate anything’ the way he used unintentional clues to obtain a better price from an insurance company after a house was damaged. He had in mind that 350$ will make a good price, but when the insurance representative first came he said something like : ‘What would you say about a first offer of only 100$? ‘. Right there two keywords can be spotted: first offer – which means another one will also come, and the word only – even the representative knew this was a bad offer. So, knowing all that, all the author said was: “Well, I don’t know about that…” to which the insurance guy kept on raising the sum 100$ at a time, until the final agreement was set to 950$. And all of that without pushing anything, just observing the key words used and the non-verbal communication and responding with “well, I don’t know about that…”.

3 Be aware of the information you are giving away

Like we saw earlier, a lot of clues that you may want not to disclose may slip away in a non-verbal manner. It is wise not to provide more information than needed at a certain amount of time: just keep a calm, relaxed attitude during the negotiation.

Also, “In order to obtain collaborative results in a competitive environment, you need to play the game” – Herb Cohen.

Let’s take the following example: I want to buy something from you and I only have a budget of 1500$. How do I negotiate the price and also send you the message that I have a certain limit I will not go over? What would you think if my first proposal is 1000$ and the next one 1400$? Because you see me as an adversary, given the big difference between the first two offers, you may conclude that I have 1600, 1800 or even more than 2000 dollars. Experience teaches us that the oscillations of behavior during concessions are a very precise barometer of the true limit of authorization.

A more wiser approach will be for me to provide a first proposal of 900$ which you will refuse. The next ones will be in order: 1200, 1350, 1425 and 1433.62$. The last discouraging price and the fact that I made the difference between offers smaller and smaller will most probably convince you that I can not go over 1500.

To summarize, because information is so important, you need to be very careful of what and when you transmit to the other negotiation players, be very aware of subtle clues your adversaries may unintentionally send you and always, always, do you homework before a negotiation.

In the next post we will talk about the last pillar of the negotiation equation: Power.