"I rely on Stuart Diamond’s negotiation tools every day"
— Christian Hernandez, Head of International Business Development, Facebook
"Practical, immediately applicable, and highly effective."
— Evan Wittenberg, Head of Global Leadership Development, Google
"Prof. Diamond encourages women to use their differences as advantages in negotiations – it is empowering and enabling."
— Umber Ahmad, Executive Director, Platinum Gate Capital Management, Former VP, Goldman Sachs
"Invaluable in helping me to achieve my goals whether on the field, in the office or at home with my children."
— Anthony Noto, Chief Financial Officer, National Football League (NFL)
In this interview, Business Standard reporter Devina Joshi talks with Prof. Stuart Diamond about the role of emotions in negotiations. Originally published in Business Standard here.
What does it really take to be a good negotiator?
Focus on other people and their needs to figure out what you can give them so they can give you something in return. You have got to be empathetic but dispassionate. You can’t be emotional; if you are, you lose. It is important to focus on your goals; make sure your actions are meeting your goals, that you’re not getting distracted. And finally, you have to be able to treat each situation differently. You need to find out the tools and methods for each situation. There are no stereotypes. The only rule is that every situation is different. We have to be future looking as we can’t fix yesterday.
How can negotiation help in creating value for businesses and their clients?
Negotiation helps people meet their goals. I have found that if we have different needs, we can trade them through negotiation. I’ll give you an example. Four months ago, one of Google’s negotiators wanted their fibre-optic installation done in Southern US. The price was $6 million. The Google negotiator went to the vendor for a discount and asked him, ‘What can Google do for you?’ The vendor in turn said that if he received a letter of reference from Google, he could grow his business on the basis of it and in turn, reduce the price.
Google agreed, and in exchange for a letter of reference, the vendor decided to give Google a price of $6,000. The vendor gave the company a 99.9 per cent discount – that’s how valuable that letter was to the vendor. This is what negotiation can do – when you’re trading items of unequal value to both parties, it can boost your business. You need to figure out what people value.
The problem is that people don’t get enough information about the other party. They must be more curious. I have been a journalist earlier with The New York Times, so I believe I know how to get information from people.
What are the biggest mistakes people make when they enter a negotiation? How can you avoid being exploited in negotiations?
Fighting yesterday is the biggest mistake. How do you prevent being exploited? You don’t take risk, except incremental. You say, ‘I’m not comfortable with this situation, how can I be more comfortable?’
Is it really important to get everyone on the same page? Isn’t effective negotiation likely to lead to homogeneity, which in turn can adversely affect the output of an organisation? Aren’t different points of view conducive to better output?
No, it isn’t crucial to get everyone on the same page. Studies show that the more people disagree, the diverse their views, the more value they add and the more the creativity produced. In fact, with its diverse population, India should be in much better economic shape than what it currently is if only most people valued those who are different. Silicon Valley is the most diverse place in the US. If you don’t value diversity, you have Rwanda Genocide. If you value diversity, you have companies like Google.
Less than 10 per cent of the reason why people reach agreements has anything to do with facts, it has more to do with emotions, as you once said in your Google talk sessions. Would you say that decisions at a corporate level are influenced more by emotions than facts? How does negotiation help in such situations?
Yes, only eight per cent of decisions have to do with facts and all sorts of decisions, including corporate, are influenced by emotions. Decades ago, in the US, former football player OJ Simpson was on trial for murdering his former wife. He walked free despite a yard of DNA evidence against him. Why? Simply because the jury didn’t like the prosecutor. So, it really doesn’t matter if you’re right; you won’t get people to agree unless they like you.
I gave a speech to 400 people from Microsoft a few years ago. I began the talk by telling them I googled Microsoft this morning, typing in three words, ‘Europe hates Microsoft.’ I got five million hits in a tenth of a second. Why did that happen? I asked them to think about the attitude they project to the public. This is more important than the product that is offered to consumers.
A negotiation is not a contest. It is not a stressful event. It is just a conversation where emotional payments need to be given, whether that is an apology, a concession etc. Effective negotiation is not about logic. Studies show that the more important the negotiation is to the people involved, the more emotional they are. When people get emotional, they stop listening. And if they stop listening, they won’t be persuaded.
Speaking of emotions, in your book Getting More, you have stated that emotion reduces people’s information-processing abilities as it destabilises a situation. What do you think should be the ideal emotional temperature of an organisation?
Calm and empathetic. The right emotional temperature would equal the statement ‘I love you but I’m not crazy’.
So, what is better: a conflict model of negotiation or a collaborative one, and under what kind of situations?
Most definitely, collaborative. This model has four times as much value to give than a conflict and twice as many chances of successful deals too. A typical conflict model involves walking out of situations, power play, using leverage or threats.
Eighty per cent of Indians mistrust each other, so conflict is the model of the day. This is the polar opposite to Sweden’s collaborative model with 70 per cent trust. In fact, Sweden, Finland, Norway, Denmark and Switzerland all have a 60-70 per cent trust-based collaborative model.
As per my research, if India’s model were like that of Sweden, the country would make $95 billion a year in GDP. Indians would have 8 per cent more jobs – which would equal 38 million jobs, double the population of Mumbai. Collaboration is about giving people a chance: being less reactive and more constructive. After the 2008 terror attacks in Mumbai, India and Pakistan didn’t talk for a whole year. That doesn’t solve a problem. It is no country’s fault; it is just a failure to understand how to make it better.
You are Google’s principle negotiation instructor. Now here is a company known for keeping its employees happy, with a work environment that almost spoils them with free perks etc. Can working for a market leader like Google automatically instill a hint of superiority in its employees? Does this influence their negotiation abilities?
It could but it doesn’t at Google because it has very strong values. You can be well-off and successful and still be humble. Yes, there are people in the company who are not the way they should be but by and large, Google is an ethical, straightforward company that cares about its employees.
How do you negotiate with irrational people?
You have to give them emotional payments. Value what they say. Say to them ‘tell me more’. If they place the onus of the solution on you, I will say, why not solve the problem together. I won’t say, this is too expensive, I can’t fix this. I will say, tell me why it is like this so we can fix it.
Be clear about your goals, what you want out of a negotiation. For instance, I can negotiate with my son who cries out for Lego toys – ‘I give Lego toys to children who clean their room, are you such a boy?’ Dito with banks – ‘I give business to banks that give good interest rates, are you such a bank? It is about consultation, not confrontation.
Prof. Diamond recently advised Euronews on how to get the most value out of free trade talks between the European Union and the United States. These expert tips are worth a watch — you’ll find they’re applicable to all negotiations, be they matters of international commerce, or everyday interactions at work and with family.
Today I published a piece on the Huffington Post. It addresses our capacity for good and laments how that capacity is drowned out by our saddening society of conflict. You can read the blog below or at the Huffington Post.
We have created a society so broken that almost anyone can buy guns and kill the most defenseless among us, while adults go on national television and say gun control laws are fine.
We let children grow up seeing the most grotesque forms of violence in video games, cartoons and movies – beheadings, mutilations – and yet it causes a national uproar when for a few seconds an actress’ breast is exposed on TV, that is, the body part where mother’s milk comes from.
Whether on the sports field or on the street, trivial arguments wind up in fistfights or worse, and dozens join in. We speak horribly to each other in stores, in restaurants, in travel, and then wonder why our country drops to 7th in competitiveness because we no longer give each other our best ideas.
We solve our problems by conflict in almost every aspect of our lives – families, business, politics, social settings, and everyone seems to think it’s OK. “Tude,” for “attitude,” for being rude to others, is considered cool. There are whole TV shows about it. The most visible role models fight other people to vanquish them. And then we wonder why confused people think it’s OK to kill children.
We kick people off planes with odd clothes and accents but forget that most big crimes are committed by those who look and speak just like us, taught by our own culture of violence and conflict. We’ve killed or exploited so many innocent people abroad, and wonder why others retaliate against us. Trillions of dollars that could be used for our own progress is wasted on wars we could have solved in other ways.
It is not necessary for our enemies to beat us. We are beating ourselves. We cannot even agree on a set of national priorities that helps most citizens, and we cannot even agree on how to best spend our limited funds. We are going over a cliff and are too busy bickering about it to put on the brakes or swerve out of harm’s way. Meanwhile, rich people steal billions of dollars from those scraping by and financial institutions mislead us all and it’s treated as an intellectual exercise for policy discussion. In other words, hateful behavior might somehow be OK, or OK enough to debate about it.
We are capable of so much that is great, in the arts, in science, in human relations, but it is all but drowned out because we can no longer judge right from wrong. We tolerate a system that once would never have been acceptable. When the history of our civilization is finally written, it will say that we deserved what we got, we reaped what we sowed. Because, ultimately, when things went bad, there were not enough good men and women who stood up, at whatever personal effort, and said, ENOUGH!