Whenever I read about the application of the red herring, a decoy, or any trapping negotiating practice, all I can think of is Admiral Akbar screaming, “It’s a trap!”
Anyway, enough geeking out. Don’t be a jerk! Trapping in negotiation isn’t wrong, but it’s kind of a dick move. The red herring is a classic trap and it has been used on me more times then I care to admit. Knowing how to identify trapping practices and defend against them is essential to your long-term success as a negotiator.
The red herring (come to think of it, Akbar looks a bit like a red herring) is designed to take your attention away from the real issue. It got its name from a guy named William Cobbett (a poet and animal rights activist) who apparently dragged herrings or kippers through a field to divert hounds away from chasing a hare in a hunt. Its been used ever since to describe a decoy of an attempt to lead a person away from the actual issue that’s being negotiated.
Basically this it how it works:
Let’s say you’re trying to sell bearings to a very large manufacturer of rotating equipment in Texas. You’ve been persistent in your approach with this company but they’ve never taken an order from you. Finally, after months of calls, you finally get a legitimate opportunity to sell a large order to this company. Securing this order would be huge for your career and for your company, so you’re incredibly excited about the potential sale.
While you’re in the procurement offices of this company, the buyer makes your day and gives you a HUGE order for bearings, BUT, it comes with the condition that your manufacturing lead time be reduced to 2 weeks. You know and he knows that you can’t meet that lead time. Your average lead time is at least 4 weeks. To get it down to 2 weeks is virtually impossible. You are deflated. All that hard work and the potential sale suddenly seems to be slipping away.
The buyer notices your dismay and says, “Maybe there’s something we can work out.” And he tells you to hang out for a bit while he goes into the back to make a phone call with his manufacturing folks. You’re losing your mind with anticipation, praying that you’ll be able to close this deal. Finally he returns and says, “Okay, I’ve got a solution, but its going to require a little creativity on your end. I can make your 4 week lead time work, but in order to save time on my end with shipping, we’re going to need to expedite the shipment and we’re likely going to need to put it on overnight trucking to get here. I can’t afford to do the freight and give you the order, so I need you guys to cover the freight costs.”
You’re relieved! You can still make this sale. You’re so overwhelmed with joy that you agree to the deal. A few months later, at a conference, you meet up with a friend and get to chatting about how you secured this deal and how it was such a huge deal for you. Your friend tells you, in confidence, that he thinks you got swindled. Turns out that the company you sold to has such good manufacturing practices that it hardly ever rushes orders. Later on, you discover that the buyer used the lead time issue to get free freight. You did get swindled.
This red herring approach catches people all the time and its important to keep a close watch on things and not get too emotionally invested in the deal. When you get too emotionally invested, you open yourself up to mistakes.
To defend against the red herring, you need to be ready to turn the tables. If you get an unrealistic demand and you feel like you’re being set up like in the case of our bearings example, start asking questions:
- Is getting the lead time down to 2 weeks the only thing left I need to do to close this sale?
- Can you put that in an email so I can take the to my leadership to see what we can do?
- If I can make the reduced lead time work for you, what can you do for me?
9 times out of 10 you’ll be able to set a counter trap for the other party and they’ll back down/give up critical information/give you the deal without you sacrificing anything.