Trust is a two-way street. Trust can be built and trust can be earned. This article focuses on how you can both build trust and earn trust in a negotiation.
As we approach a negotiation, we have certain expectations based on previous experience. We have certain anticipations. Will the other party will be open with us and share information readily? Will the other party accept us and will that party be responsible with whatever agreement we reach?
In short, we want to be treated fairly and we expect the other party to have a similar expectation.
However, we have also had the experiences where we don’t share everything. Rather, we consciously share what we need to share to promote the negotiation. We may hold back certain information that may be beneficial to our position. This is based on how open we believe the other side is being with us. We may be concerned that the other side is not being totally honest. We may suspect they have other motives that may lead to feelings of distrust.
Choose your friends wisely
Referrals drive business. Clearly, developing good relations with clients, vendors and other stakeholders builds trust with them, and they are the ones that drive recommendations about us to others.
Having friends in diverse arenas may help you in ways that may have been unforeseen as you explore interests.
You never know when things may change, and simply by having a wide net may help you. For example, during an economic downturn or major change in your industry, other relationships may come to the rescue in ways you had not imagined.
Think outside of your network too. What are other ways to tap into additional sources? We look for food, water, sex and shelter. We have survived a long time by being cautious of the unknown and anything new. Keep that in mind as you reach out to other sources. Do so, but be careful to not end up in a bad relationship.
A bad relationship can take significant time, energy, mental toil, physical toil and resources.
That’s why relative to negotiations, choose your friends wisely. Good relationships can help build trust. You are known by the company you keep. Others are watching. How do you associate with? What are their reputations? How may those relationships reflect on you?
Know their culture
Understanding the culture of those you negotiate with is key. You want to win their trust. What is their history? What are their interests in this particular negotiation with you? How has it worked out with others? What can you learn from your network that have been in negotiations with them? This is particularly relevant when working with those that are new to you relative to their industry or country.
Having been in negotiations with interpreters it is important to maintain contact with the other party, noting facial expressions and body language while listening to the interpreter. It is also very important to understand what various facial expressions and body language may mean from the other culture. For example, smiling and nodding may only mean that you are being heard, not that you are being accepted.
Learn their jargon. Understand key terms beforehand.
Become familiar with what they do, how they do it, and why they do it. Make sure to explain why relative to proposals and/or concessions. A concession not explained or a request for a concession not explained can cause miscommunication. Often if you are willing to make a concession, you are expecting some kind of quid pro quo. If that is not forthcoming, you may be taken aback.
By explaining why your concession is important and why it is significant to you will help the other side come to a fuller appreciation of the situation.
Ask questions regarding proposed concessions by the other side too. Make sure you understand them. The other side may have made a minor concession from your perspective, but it may be major from their perspective or vice versa.
Build connecting relationships before the negotiation
Building a connecting relationship up front is key. Others tend to reflect treatment. If you are courteous, professional, knowledgeable, caring and considerate others will tend to reciprocate in kind.
If you are very competitive, you likely do not explore the other side and you do not try to develop a relationship. Rather you may only be interested in quantity and quality. The other side may be put off and may not see you as someone they are interested in working with either. Be careful or you may shoot yourself in the foot.
Think about it.
Would you like to work with someone that does not appear to be interested in what you have to say or care about knowing your interests?
This may send a signal that this is a one-time deal and if it is a one-time deal, do I want to be involved with you? Perhaps I don’t even want to take the risk of trying to develop a relationship with you. Perhaps I would be better off walking away now.
By taking the time to have an informal call, or several emails ahead of any negotiation, the probability of success can be significantly enhanced. Research at Northwestern University by Dr. Janice Nadler has demonstrated that
just five minutes of informal conversation had a statistically significant impact on negotiations.
Listen and acknowledge
Listening and acknowledging others takes effort. It takes work to actively listen. We are strongly oriented in our society to plan on the rebuttal while the other party is speaking. Although that can be useful, if we want to build trust first,
calm the fire and focus on what is being said.
Reflecting and acknowledging what the other party had to say is the key. Actively listening means paraphrasing, summarizing, asking open ended questions and listening with empathy. Here is more on this topic.
Make sure not to interrupt
and to give the other party plenty of time to express their perspective. Interrupting can be seen as rude and can kill an otherwise positive interchange between parties. Make sure you listen to and acknowledge the other party’s perspective. Make them feel that you have listened to them.
Trust but verify – ground rules
It was President Ronald Reagan who made the phrase famous of “Trust but Verify”. However, as the last link states, this is not a positive phrase to use in a negotiation today. Rather the lesson is to instead use culturally appropriate proverbs that can better connect and develop positive relationships with the other party. For example, there is a Sicilian proverb that states, “As long as you don’t trust, you won’t be cheated”. Another example is a Persian proverb that states, “Trust in God, but tie your camel tight”. It is clear how each of these proverbs could be helpful depending on who are the other negotiators and their cultural perspective.
In order to make sure both parties are clear, it can be extremely helpful to have worked an agenda out ahead of time and to have some basic ground rules. This is particularly important where each party may have different expectations regarding the duration of the negotiation.
Having standards to fall back on can be very helpful.
For example, for business valuers to rely on the definition of fair market value from the Uniform Standards of Professional Appraisal Practice differentiates the standard from fair value, insurance value, market value, cost value and other definitions. Realizing this key jargon element and making sure everyone understands key definitions and jargon ahead of time can overcome potential misunderstandings.
Explaining for example from your perspective up front that without having something written down as part of the contract it does not exist. This tells the other party that we really want to make sure we tie down as much information into the final contract as possible. By establishing a more conservative outlook at the outset helps the other party to understand your perspective. This also allows you to move off of that perspective by taking a harder line up front as trust develops.
Having researched this issue, I want to share a great article that you may want to reference on this topic from the Harvard Law School Program on Negotiation.
About the author
Mike Gregory is an expert on conflict resolution business to government (IRS), business to business, and within businesses. Mike is an international speaker and he has written 11 books including Business Valuations and the IRS: Five Books in One, The Servant Manager and Peaceful Resolutions. Mike may be contacted directly at mg@mikegreg.com and at (651) 633-5311. [Michael Gregory, ASA, CVA, NSA, MBA, Qualified Mediator with the Minnesota Supreme Court]