The Coronavirus crisis has taken the world by storm. When so much of life is up in the air, how do we need to change our negotiation tactics? Do we NEED to change our tactics? What are some strategies we can use to navigate this pandemic? Today’s episode of Negotiations Ninja is a Q&A with Gary Noesner and Allan Tsang, with Shane Ray Martin moderating.
Gary Noesner is a former FBI Negotiator and author of “Stalling for Time: My Life as an FBI Hostage Negotiator.”
Allan Tsang is a negotiation coach for entrepreneurs and professionals and the founder of 88 Owls. He helps negotiators get what they want without unnecessary compromise.
Shane Ray Martin is a speaker who’s passionate about negotiation, sales, and positivity. His goal is to help entrepreneurs become more self-confident and be more fulfilled.
Outline of This Episode
- [5:20] Don’t rush the negotiation
- [9:45] Should you prepare differently during COVID-19?
- [11:58] The foundational principle of relationship building
- [17:56] Reaching out to existing vendors mid-contract
- [22:35] Handling high-stakes negotiations
- [30:15] Who should negotiate their salary right now?
- [33:28] Clients demanding extended payment terms
- [41:48] You have to ask the right questions
- [44:48] Should you consider a contingency model?
- [47:18] Final words of encouragement
Do NOT embrace the “need for speed”
During the Coronavirus crisis, it can be easy to allow your emotions to take over—even as a trained negotiator—and rush decisions. But you shouldn’t respond too quickly without a strategy in mind. You need to slow your thinking and the way you’re addressing your negotiations to avoid being forced into unnecessary concessions.
Likewise, Allan points out that letting time go by allows the mental pain in the mind of your counterpart to intensify. That pain doesn’t resolve—and they’ll be the ones left awake at night thinking about your negotiation. Gary agrees that you must study the situation, get the right input, and develop an effective strategy for moving forward. You must use your time wisely.
Relationship building is the foundation of negotiation
The Coronavirus crisis may not be an ideal time for negotiation—but it is an ideal time to shore up your relationships. Reach out to your clients and ask how they’re doing. How’s their family? How are they coping? Let them know you’re thinking about them while being sincere and genuine. The relationships you build and maintain during this time will go a long way when we are on the other side of the pandemic.
Allan found a selfless way to serve his clients: When he found out some of his clients in Hong Kong didn’t have masks to wear for their daily commute, he bought boxes of masks and spent hundreds of dollars to ship them to Hong Kong. Simple yet compassionate speaks volumes about who you are as a human and a negotiator.
How to reach out to existing vendors
Communicating with existing vendors about how your company is handling the COVID-19 crisis should start formally. Have your CFO write formal letters to existing contracts—and those you plan on opening—and lay out the facts. These are difficult times, and these are the areas where we need your grace or help.
Then you follow-up with your contact at a senior level. Be straight with them—we are going through a crisis, and we can’t make high pricing work. Ask them to talk about what makes sense and be direct: we don’t have time to argue back and forth, so let’s find a solution that makes sense for both parties.
Your business can’t afford to have your ego get in the way of doing the right thing. You HAVE to do what’s right for your business and its survival. Check your ego at the door, bolster your self-confidence and forge ahead.
How to respond to demands for extended payment terms
Everyone is scrambling to hold on to cash and trying to renegotiate payment terms. How should negotiators respond?
- Have a strategy: You can’t extend payment terms at the expense of your own business. You need cash flow to stay afloat as much as everyone else does.
- Know your walking away point: If you can’t operate at the position they’re demanding, it may be time to part ways.
- Get them to understand your position: Use mirroring tactics. Ask the right questions. I.e. “How are we supposed to be a bank during this crisis. Does that seem reasonable?” You have to be direct and make them understand the impact of their request.
Allan shares an alternate strategy—he never walks away from deals, because you have to be 100% certain you don’t ever want that deal. Instead, he encourages the counterparty to walk away, i.e., “If this isn’t what you want, you let me know, and I’ll close this file.” It puts the decision-making in their court—and loss-aversion kicks in.
Gary proposes another thought—play “good cop bad-cop” if you aren’t the final decision maker: “Let’s find somewhere to meet in the middle because my boss will NEVER approve this.” Often, it’s not even a tactic, but the simple truth. You must find a way to negotiate and compromise on both sides of the table.
Do you want to learn more about framing discovery questions? Offering contingencies?
How to manage your emotions in a time where everyone is afraid? Who should or shouldn’t negotiate their salary? Listen to this whole episode as we work to answer your burning questions.
Resources & People Mentioned
- Stalling for Time by Gary Noesner
- The Like Switch by Jack Schafer and Marvin Karlins
- Netflix: Money Heist
- Curb Your Enthusiasm
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Connect with Allan Tsang
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