High-Impact Negotiation Frameworks: 4/5

End-Stage Tactics - Part 4 of a Series of 5 Posts

Jul 27, 2024

Welcome to the fourth part of my series on High-Impact Negotiation Frameworks. The previous posts covered foundational negotiation principles and early and middle-stage tactics. Today, I will delve into end-stage tactics that help you close the deal and ensure both parties feel satisfied with the outcome. These strategies are crucial for sealing the negotiation and achieving favourable results.

The Importance of End-Stage Tactics

End-game tactics in chess are crucial because they determine the game's final outcome. Unlike the opening and middle game, where players have many pieces and complex positions to manage, the end game is about precision, strategy, and maximizing the potential of the remaining pieces. Mastering end-game tactics allows players to convert slight advantages into victories, navigate complex positions with fewer pieces, and leverage every opportunity to checkmate the opponent. Just as in negotiations, the end game in chess requires careful planning, foresight, and the ability to capitalize on every small advantage.

End-stage tactics are essential for bringing the negotiation to a successful conclusion. Like the endgame in chess, this phase requires careful planning and execution to secure a win. By employing these tactics, you can finalize the agreement, address any last-minute issues, and ensure both parties feel they have achieved a good deal so that they leave with goodwill toward each other—goodwill that will be critical in the future for the next negotiation.

Remember that life is long, and so are memories. If both sides feel you have Won the negotiation and they have lost, they will spend time and effort to return the favour. And at some point in the future, they will. Good negotiation is about preventing these eventual zero-sum games. It is critical to ensure your partner feels they won while you know you also won. If you can repeat this over time, you will build trust and a great relationship. It will make the next negotiation a conversation rather than an argument.

End-Stage Tactic 1: Good Guy/Bad Guy

The Good Guy/Bad Guy tactic is a well-known strategy where one negotiator plays the role of the reasonable "good guy" while the other plays the role of the tough "bad guy." This tactic is designed to create pressure without direct confrontation, so you should look out for it when dealing with two people. You'll see it being used on you in one form or another.

Detailed Strategies and Tactics:

Identify the Tactic: The first step in countering the Good Guy/Bad Guy tactic is recognising it. When you notice the other party using it, call it out. This can be as simple as saying, "Oh, come on, you aren't going to play Good Guy/Bad Guy with me, are you?" This often embarrasses the other party and causes them to retreat from the tactic.
Create Your Own Bad Guy: If you encounter this tactic, you can counter it by creating your own bad guy. Use a fictitious higher authority as your bad guy. For instance, "I'd love to do what you want, but my boss is very strict about sticking to the program." This can make your position seem more rigid and less negotiable.
Go Over Their Heads: If you are dealing with a buyer and head buyer, consider calling the owner to discuss the tactic. For example, you might say, "Your people were playing Good Guy/Bad Guy with me. You don't approve, do you?" This can pressure the original negotiators to abandon the tactic.
Diffuse the Tactic: Tell the good guy, "From now on, I will attribute anything he says to you also." This can diffuse the tactic by making both negotiators equally responsible for the tough stance.
Let the Bad Guy Talk: Sometimes, just letting the bad guy talk resolves the problem, especially if he's obnoxious. Eventually, his own people will get tired of hearing it and tell him to knock it off.

Examples:

Car Sales: Imagine you're at a car dealership, and the salesperson is playing the good guy while the sales manager is the bad guy. The salesperson says, "I'd love to get you a better deal, but my manager is very strict." You can counter by saying, "Oh, come on, you aren't going to play Good Guy/Bad Guy with me, are you? Let's work this thing out together."
Business Negotiation: You're negotiating a contract, and the other party's lawyer is playing the bad guy while the business manager is the good guy. You might tell the business manager, "Look, I understand what you two are doing to me. From now on, anything he says, I will attribute to you also."

Key Points to Remember:

People use Good Guy/Bad Guy more than you might believe. Look out for it whenever you're dealing with two or more people. It's an effective way of putting pressure on the other person without creating confrontation. Counter it by identifying it. It's such a well-known tactic that when you catch them using it, they get embarrassed and back off.
Don't be concerned that the other side knows what you're doing. Even if they do, it can still be a powerful tactic. Negotiating with someone who understands all of these tactics becomes more fun. It's like playing chess with a person of equal skill rather than with someone you can easily outsmart.

End-Stage Tactic 2: Nibbling

Nibbling involves asking for small additional concessions after reaching the main agreement. This tactic leverages the other party's desire to finalize the deal and move on. Using the Nibbling tactic, you can get a little bit more, even after agreeing on everything. You can also get the other person to do things they had refused to do earlier. The principle of Nibbling tells you that you can accomplish some things more easily with a Nibble later in the negotiations. Children are brilliant Nibblers. If you have teenage children living at home, you know they don't have to take any courses on negotiating.

Detailed Strategies and Tactics:

Wait for Agreement: The principle of nibbling is to wait for a moment of agreement in the negotiations and then go back and nibble for a little extra. This can be small, like an additional service or a minor discount.
Show Costs in Writing: To prevent the possibility of being nibbled, show the other party what any additional concessions will cost them. List extended terms if you ever make them available, but show what it costs them to do that. List the cost of training, installation, extended warranties, and anything else they might nibble.
Use Higher Authority: Indicate that you don't have the authority to make additional concessions. Protect yourself with the Higher Authority tactic and Good Guy/Bad Guy.
Make Them Feel Cheap: The counter tactic to the nibble is to gently make the other person feel cheap. Smile and say, "Oh, come on, you negotiated a fantastic price with me. Don't make us wait for our money, too. Fair enough?"
Be Prepared for Post-Negotiation Nibbling: Sometimes, the other person wishes they had nibbled on you during the negotiation, so they decide to nibble on you afterwards. You can avoid most of this unpleasantness by negotiating all the details upfront and getting them in writing. Don't leave anything to "We can work that out later."

Examples:

Retail Purchase: You've agreed on the price of a new TV, and just as you're about to pay, you ask, "Could you throw in free installation?" This small request is an example of nibbling.
Service Contract: You've finalized a consulting contract and then ask, "Could you include an additional training session at no extra cost?" This is another example of nibbling.

Key Points to Remember:

With a well-timed Nibble, you can get things at the end of a negotiation that you couldn't have gotten the other side to agree to earlier. It works because the other person's mind reverses itself after it has made a decision. They may have been fighting the thought of buying from you at the start of the negotiation. After they have decided to buy from you, you can Nibble for a bigger order, upgraded product, or additional services.
Being willing to make that additional effort separates great salespeople from merely good salespeople.
Stop the other person from Nibbing on you by showing them, in writing, the cost of any additional features, services, or extended terms and not revealing that you have the authority to make any concessions.
When the other person nibbles at you, respond by making them feel cheap in a good-natured way.
Avoid post-negotiation Nibbling by addressing and tying up all the details and using tactics that cause them to feel they won.

End-Stage Tactic 3: How to Taper Concessions

Tapering concessions involves making progressively smaller concessions to signal that you are reaching your limit. Avoid making equal-sized concessions or a large final concession, as this can create unrealistic expectations.

Detailed Strategies and Tactics:

Avoid Equal-Sized Concessions: This creates expectations that you will continue to make concessions. For example, if you make a 600 concession followed by a 400 concession, the other party might expect another $200 concession.
Don't Make a Large Final Concession: This can create hostility and unrealistic expectations. If you make a large final concession, the other party might think they can push for even more.
Taper Concessions: Start with a reasonable concession and make progressively smaller ones. For example, start with a 400 concession, then 300, then 200, and finally 100. By reducing the size of the concessions that you're making, you convince the other person that they have pushed you just about as far as you will possibly go.

Examples:

Real Estate: You're negotiating the price of a house. Start with a 5,000 concession, then offer 3,000, then 1,500, and finally 500. This tapering approach signals that you are reaching your limit.
Business Contract: You're negotiating a service contract. Start with a 10% discount, then offer 7%, then 5%, and finally 3%. This tapering approach helps manage expectations.

Key Points to Remember:

How you make concessions can create a pattern of expectations in the other person's mind.
Don't make equal-sized concessions because the other side will keep pushing.
Don't make your last concession a big one because it creates hostility.
Never concede your entire negotiating range just because the other person calls for your "last and final" proposal or claims they "don't like to negotiate."
Taper the concessions to communicate that the other side is getting the best possible deal.

End-Stage Tactic 4: The Withdrawing an Offer Tactic

This tactic involves withdrawing an offer or a feature of the offer to create urgency and force a decision. Use this tactic when the other side is grinding away to get the last penny off your price. You don't have to use it when the other person is negotiating in good faith with you. You use it only when you feel the other side is grinding away to get the last penny off your price.

Detailed Strategies and Tactics:

Use Sparingly: Only use this tactic when the other side pushes too hard. It's a gamble, but it can force a decision and usually make or break the deal.
Withdraw a Feature: Instead of raising the price, withdraw a feature of the offer. For example, "I thought the extended warranty was still available, but it ended last week."
Insist on Resolving Internal Problems: If this tactic is used against you, insist that the other side resolve its internal problem first. For example, "I understand there's an issue, but let's resolve that first and then continue our negotiation."

Examples:

Car Sales: You're negotiating the price of a car, and the salesperson says, "I just realized the special offer we were discussing ended last week. I can't offer that price anymore." This creates urgency and forces a decision.
Appliance Purchase: You're negotiating the price of a refrigerator, and the salesperson says, "I thought the free delivery was still available, but it ended yesterday." This withdrawal tactic can push you to finalize the deal quickly.

Key Points to Remember:

The Withdrawing an Offer tactic is a gamble, so use it only on someone grinding away at you. You can do it by backing off your last price concession or withdrawing an offer to include freight, installation, training, or extended terms.
To avoid direct confrontation, make the bad guy a vague Higher Authority. Continue to position yourself as on the other person's side.

End-Stage Tactic 5: Positioning for Easy Acceptance

Positioning for easy acceptance involves making a small concession at the end of the negotiation to make the other party feel like they have won. This tactic is crucial when dealing with skilled negotiators who must feel they have achieved a good deal. The car salesperson asks, "If you did invest in this car, would you get the blue or the grey? Would you want the vinyl upholstery or the leather?" Little decisions lead to big ones.

This tactic is about creating a slippery slope. Once your negotiation partner steps on it, lubricate it so they slide all the way down the slope to your goal.

Detailed Strategies and Tactics:

Make a Small Concession: The size of the concession is less important than the timing. For example, "We just can't budge another dime on the price, but if you go along with the price, I'll personally supervise the installation."
Say something easy to accept: Help the buyer get into the habit of saying yes to small things and gradually turn these into big things.
Congratulate the Other Party: Always congratulate the other party to make them feel they have won. For example, "Wow, did you do a fantastic job negotiating with me. I realize I didn't get as good a deal as I could have, but it was worth it because I learned so much about negotiating. You were brilliant."
Never Gloat: Avoid making the other party feel they could have gotten more. For example, never say, "If you'd hung in there a little bit longer, I was prepared to do this and this and this for you."

Examples:

Software Sales: You're negotiating a software sale, saying, "We can't reduce the price further, but we'll include an additional training session at no extra cost." This small concession can make the other party feel they have won.
Event Planning: You're negotiating an event planning contract, saying, "We can't lower the price, but we'll include a complimentary photo booth." This small concession can help close the deal.

Key Points to Remember:

If the other person is proud of their ability to negotiate, their need to win may stop you from reaching an agreement.
By making a small concession at the last moment, you can make the other person feel good about giving in to you.
Because timing is more important than the size of the concession, the concession can be ridiculously small and still be effective.
Always congratulate the other person when you get through negotiating, however poorly you think they did.

End-Stage Tactic 6: Giving Something Back

At the end of the negotiation, think of 'giving something back' out of sheer goodwill. This tactic surprises the other party with an unexpected concession, fostering goodwill and strengthening the relationship.

Detailed Strategies and Tactics:

Surprise Element: Ensure the concession is unasked for and a pleasant surprise. It's not the size of the concession but the surprise and timing that delight customers.
Express Goodwill: Communicate appreciation and build trust. For example, say, "I've enjoyed this negotiation with you. You were a tough but fair negotiator, and I feel our companies have built up trust. I can see us working well together, so here is something extra from my side. I will personally review the status of the implementation of the project from my side and set up an internal system which updates me on the status every week. If there are any issues, I will personally make sure it is fixed."
Offer Additional Value: Provide something of value that enhances the deal. For example, "In appreciation for your business and our new relationship, I'm happy to throw in three months of service for free."

Examples:

Project Management: After finalizing a project contract, you say, "I will personally review the status of the project's implementation from my side and set up an internal system that updates me on the status every week. If there are any issues, I will personally make sure they are fixed."
Subscription Service: After agreeing on a subscription service, you say, "In appreciation for your business and our new relationship, I'm happy to throw in three months of service for free."

Key Points to Remember:

Make sure the concession is unasked for and a pleasant surprise. Customers delight in the surprise and timing, not the size of the concession.
Express goodwill and communicate appreciation to build trust.
Offer additional value that enhances the deal.
People always remember how you make them feel. If you make them feel good at the end of the negotiation, the odds are that the business relationship will prosper, and the next negotiation will be easier.

Summary of Articles 1-3

Article 1: Foundational Principles

Get the Other Side to Commit First
Acting Dumb Is Smart
Don't Let the Other Side Write the Contract
Read the Contract Every Time
Understand and Decode Funny Money
People Believe What They See in Writing
Concentrate on the Issues
Always Congratulate the Other Side

Article 2: Early-Stage Tactics

Ask for More Than You Expect to Get
Never Say Yes to the First Offer
Flinch at Proposals
Avoid Confrontational Negotiation
The Reluctant Seller and the Reluctant Buyer

Article 3: Middle-Stage Tactics

The Vise Technique
Handling the Person Who Has No Authority to Decide
The Declining Value of Services
Never Offer to Split the Difference
Handling Impasses
Handling Stalemates
Handling Deadlocks
Always Ask for a Trade-off

Conclusion

End-stage tactics are crucial for closing the deal and ensuring both parties feel satisfied with the outcome. You can effectively navigate the negotiation process's final stages by using the Good Guy/Bad Guy tactic, nibbling, tapering concessions, withdrawing an offer, positioning for easy acceptance, and giving something back.

Stay tuned for the next post in my series, where I will explore pressure and unethical tactics to help you recognize and counter them effectively.

Sources:

These frameworks have been developed and honed through real-life experience negotiating across markets and industries.

They have been informed by various training programs and books - chiefly Roger Dawson's amazing 'Secrets of Power Negotiating', "You Can Negotiate Anything" by Herb Cohen and "Getting to Yes: Negotiating Agreement Without Giving In" by Roger Fisher, William Ury, and Bruce Patton.