Why are we losing all our good people?
LIKE MANY
EXECUTIVES,
YOU KNOW
A LOT ABOUT
NEGOTIATING.
BUT STILL
YOU FALL PREY
TO A SET OF
COMMON
ERRORS.
T H E BEST
DEFENSE IS
STAYING
FOCUSED ON
THE RIGHT
PROBLEM
TO SOLVE.
• LOBAL DEAL MAKERS did a Staggering $3.3 trittion
by James K. Sebenius
APRIL 2001
worth of M&A transactions in 1999-and that's only a fraction of the capital that passed through negotiators' hands that year. Behind the deal-driven headlines, executives endlessly negotiate with customers and suppliers, with large shareholders and creditors, with prospective joint venture and alliance partners, with people inside their companies and across national borders. Indeed, wherever parties with different interests and perceptions depend on each other for results, negotiation matters. Little wonder that Bob Davis, vice chairman of Terra Lycos, has said that companies "have to make deal making a core competency."
Luckily, whether from schoolbooks or the school of hard knocks, most executives know the basics of negotiation; some are spectacularly adept. Yet high stakes and intense pressure can result in costly mistakes. Bad habits creep in, and experience can further ingrain those habits. Indeed, when I reflect on the thousands of negotiations I have participated in and studied over the years, I'm struck by how frequently even experienced negotiators leave money on the table, deadlock, damage relationships, or allow conflict to spiral. (For more on the
87
Six Habits of Mereiy Effective Negotiators
rich theoretical understanding of negotiations developed by researchers over the past fifty years, see the sidebar
"Academics Take a Seat at the Negotiating Table.")
There are as many specific reasons for bad outcomes in negotiations as there are individuals and deals. Yet broad classes of errors recur. In this article, I'll explore those mistakes, comparing good negotiating practice with bad.
But first, let's take a closer look at the right negotiation
EXECUTIVES,
YOU KNOW
A LOT ABOUT
NEGOTIATING.
BUT STILL
YOU FALL PREY
TO A SET OF
COMMON
ERRORS.
T H E BEST
DEFENSE IS
STAYING
FOCUSED ON
THE RIGHT
PROBLEM
TO SOLVE.
• LOBAL DEAL MAKERS did a Staggering $3.3 trittion
by James K. Sebenius
APRIL 2001
worth of M&A transactions in 1999-and that's only a fraction of the capital that passed through negotiators' hands that year. Behind the deal-driven headlines, executives endlessly negotiate with customers and suppliers, with large shareholders and creditors, with prospective joint venture and alliance partners, with people inside their companies and across national borders. Indeed, wherever parties with different interests and perceptions depend on each other for results, negotiation matters. Little wonder that Bob Davis, vice chairman of Terra Lycos, has said that companies "have to make deal making a core competency."
Luckily, whether from schoolbooks or the school of hard knocks, most executives know the basics of negotiation; some are spectacularly adept. Yet high stakes and intense pressure can result in costly mistakes. Bad habits creep in, and experience can further ingrain those habits. Indeed, when I reflect on the thousands of negotiations I have participated in and studied over the years, I'm struck by how frequently even experienced negotiators leave money on the table, deadlock, damage relationships, or allow conflict to spiral. (For more on the
87
Six Habits of Mereiy Effective Negotiators
rich theoretical understanding of negotiations developed by researchers over the past fifty years, see the sidebar
"Academics Take a Seat at the Negotiating Table.")
There are as many specific reasons for bad outcomes in negotiations as there are individuals and deals. Yet broad classes of errors recur. In this article, I'll explore those mistakes, comparing good negotiating practice with bad.
But first, let's take a closer look at the right negotiation