Have you read about corporate raider (“activist investor”) Carl Icahn’s antics at Yahoo? Icahn’s up to his old tricks, buying up enough company shares to make it into the boardroom, then lobbying his cause–in this case, that Yahoo be sold to Microsoft–until other board members either agree or get Cahnned.
The business with Icahn got me thinking about the business of negotiation. Icahn, 72, still has enough fire in his belly to negotiate with the best of them. He’s proven time and again that it’s not about who’s right or wrong, but who drives a harder bargain.
People have studied the art of negotiation to a fault. However, many aspects can be simplified. Sun Tzu, his seminal “The Art of War” stated “Know thy self, know thy enemy.” In the language of negotiation, those two tips are fundamental.
Familiarizing yourself with a few other tenets–thy topic, thy allies, and thy laws–will get you on the road to successful bargaining, with anyone, anywhere.
Witness these five essential things to know before bargaining hard:
1. Know thy Topic
In the language of negotiations, he who plans, wins. Know everything you can about the circumstances of the negotiation. What are the characteristics of the market you’re dealing with? What is the extent of the opportunity you may have? For example, if you’re negotiating a salary for a new position, research what others in that position make. Do you have any additional skill sets that could up your salary range? Who are you competing against? What is your market in general doing? Where are your growth opportunities? With solid backup, you’ll be able to tackle most issues that arise during the negotiation process.
2. Know Thyself
If you have a thin skin and are prone to temper tantrums, bear this in mind as you enter the negotiation. Taking things personally takes away from objectivity. Irrational behavior, in turn, may lead you to agree to something you’ll regret later.
Once again, preparation will help you stay objective. Write down all the objections you can imagine your counterpart to make. Then, write down a reply for each. Ideally, in the process of negotiating, this kind of preparation will help your memory overrule your urge to throw something.
3. Know thy Enemy
What are the other party’s objectives? What does she want from you? What are her priorities? What’s her reputation like? Take 30 minutes to list everything you know about the other party, her company, her professional history, her needs, and her wants. When things come up, you’ll be equipped to respond with a level head.
4. Know thy Laws
Trying to sell something? It would behoove you to be part of a trade association, Chamber of Commerce, or another organization that represent industrial authority. If you’re a buyer, know in advance the regulations, standard procedures, and review agencies associated with the product being sold. Invisible authorities are hard to argue with during negotiations.
5. Know thy Allies
Who’s your posse? If you’re a buyer, they may be your suppliers. If you’re a seller, they’re your customers. If you’re a job-seeker, they’re your achievements and references. Know your best allies off the top of your head. If you have many, memorize an impressive-sounding number. If you have few, make the ones you do have sound special.
Long after Sun Tzu’s time, Sir Francis Bacon stated that “Knowledge is power.” When it comes to bargaining and negotiating, this couldn’t be more true. With these five tips, you’ll have both power and knowledge at your side.