Negotiation skills: how to engender trust. Crucial strategies for building trust in negotiations.
Trust in business can be achieved naturally over time. However, negotiators are seldom able to take their sweet time. It sometimes seems much easier, of course, to avoid risky moves and close deals with special care, agreeing to compromises and concessions and limiting the information shared with partners. But at the same time, avoiding risk can mean missing out on other opportunities. This is why knowing how to build trusting relationships with partners is a critically important skill for a modern manager.
Your first step toward achieving trust in negotiations is to demonstrate your credibility to your partners. We present you six strategies that will allow you to establish yourself as a reliable partner at the negotiation table.
THE FIRST PATH TO TRUST: Speak their language.
We recall an incident when representatives of a company participating in a major air carrier’s prospective tender missed out on the opportunity to compete for a profitable contract simply due to ignorance of aviation terminology. One stupid question from the company’s representative took it out of the running for the contract. In this simple example we see how important it is to speak a partner’s language. This principle goes beyond just knowing a foreign language. In this case it’s about nuance, the cultural shades of gray we read between the lines, about everything an interlocutor means but doesn’t say. And it’s no less important here to observe what verbiage the other party chooses for conveying his or her ideas to an interlocutor.
By learning the other party’s position, interests and culture, you’re letting them know that you consider the negotiations and your relationship with your partner a serious responsibility and understand that this responsibility is an integral part of the trust-building process. Moreover, such an approach also speaks of your readiness to reach a mutual agreement through negotiation.
Preparing in advance prior to beginning active negotiation could also help mitigate the results of an unexpected faux pas on your end. Show this to your partners, make them see how much work you’ve done to understand their needs and interests. At the same time, it’s worth pointing out that you hope you’re on the same page about one important thing: the learning process plays a critical role in negotiations and relationship building. Express your hope that in the event of a misunderstanding, which happens often during negotiations, both parties will take it as a normal part of the learning process and double their efforts to understand each other’s position.
THE SECOND PATH TO TRUST: Manage your reputation.
In negotiations, just as in any other field, our reputation precedes us. A bad reputation can end a business before it begins, while a good one can help get you out of dead ends. Effective negotiators realize that their reputation is, without a doubt, an irreplaceable tool in negotiations. The recommendation of a respected third party, who puts in a good word for you and verifies your abilities, makes a strong case for you in any negotiations. An independent third party can contact your potential partner in advance, even before negotiations begin, or participate in the negotiations an intermediary. Likewise, reference letters and messages in mass media become obvious proof of your professionalism.
THE THIRD PATH TO TRUST: Make your “dependence” a factor in negotiations.
The more dependent we are on someone, the more we seek trust in negotiations with him or her. We tend to cope with the psychological discomfort that comes from dependence on someone by believing that person to be trustworthy. In psychology this phenomenon is called the Stockholm Syndrome. Trust between negotiating parties will grow if they think they need each other to complete their individual tasks, and that they have no other way to do so.
As a negotiator, you can begin the trust-building process by letting the other party know about the unique benefits they’ll reap only by collaborating with you. Moreover, you can highlight the losses that would result from an unresolved issue. This technique can be especially useful when you have fewer options and the other alternatives are too “painful” and costly. A negotiator that feels he or she has no other solutions for the current situation may come to trust even an “opponent.”
THE FOURTH PATH TO TRUST: Make one-way concessions.
Negotiations with strangers or opponents usually turn into “settlement negotiations,” where both parties thoroughly calculate what they’ll get from every concession made by the other party. By contrast, negotiations based on long-term collaboration are typically less focused on clearly calculating wins and losses. A well-thought-out one-way concession can work wonders for trust, as it makes an obvious statement to the other party that you consider your collaboration a friendly one, and you value the prospect of long-term mutual benefit and trust.
A true one-way concession bears no obligations, nor expectations of reciprocity from the other party. Such concessions should be neither risky nor expensive for the party making them. At the same time, they should have special value for the recipient. In addition to trust, concessions also demonstrate your professionalism in understanding the other party’s values.
THE FIFTH PATH TO TRUST: Always point out your concessions.
We all know that our deeds speak for themselves and are often more important than words. In negotiations, however, our deeds and actions and be regarded in different ways. Negotiation concessions are an effective tool for building trust and can elicit reciprocation only if the recipient regards them as concessions. Parties in a negotiation often tend to regard concessions from the other side with skepticism. They are quick to undervalue each other’s contribution, since doing so frees them from the moral obligation to respond in kind. As a result, many concessions remain unnoticed or unrecognized. This can lead to misunderstanding, hard feelings, harsh negotiating tactics and disagreeable behaviour on the part of the aggrieved party.
In the 1991 book Behavioural Theory of Labor Relations, the authors illustrate the following scenario. After grueling negotiations with a labor union, an industrialist realized he no longer wished to continue the dispute. He decided to begin the next stage of negotiation with the caveat “no bargaining.” He made a more than generous offer to the union, increasing wages more than could be expected even from a week of negotiation. But instead of being beside himself with delight, the union leader said they would need time to consider the offer. This response shocked the industrialist. But should he have reacted that way? The union, anticipating the start of another protracted stage of negotiations, apparently concluded that this was not a final offer and that the following week would bring even more benefits. This difference in how the industrialist and the union approached negotiations led to a mass strike in the end.
In conclusion: In negotiations there’s no reason to let your concessions speak for themselves. When agreeing to a significant concession, be sure to point out how much in means to you and what you’re giving up. This will not only enhance your reputation, but also encourage your partner to respond in kind and take your mutual trust to a higher level.
THE SIXTH PATH TO TRUST: Justify your demands.
Clients, contractors and counterparties begin negotiations already having an opinion of the other side, its motives and intentions, and it’s not always a positive one. If the other side insists on a version of a contract more favourable to them, they‘re considered greedy and dishonest. However, circumstances can differ…. Maybe a company’s management isn’t prepared to approve the offered terms or budget limitations make it necessary to take an uncompromising position.
Psychologists believe that people tend to see themselves in a more “favourable light” than others. This is most often apparent in conflict situations. This is why it’s so important for you to be able to convincingly justify your demands in negotiations.
Your initial offer, which the other party will consider extremely unfavourable, could worsen or even destroy trust between you. An offer from you based on serious arguments will maintain and, most likely, strengthen your trust in each other.
Let’s examine the case of an author conducting negotiations with a literary agent regarding the publication of his books abroad. The agent tells him that his commissions in international agreements are higher than in domestic ones. The author doesn’t like this explanation; he’s upset and angry. He thinks it’s a clever ruse to get more commission money out of him.
But the agent explains his position: he’ll have to split his percentage with the literary agent in the other country. Because of this, his net profit from an international contract is a lower percentage compared to domestic agreements. While this explanation does not, in fact, address the author’s issues, it could assuage his concerns and make him more agreeable, empathetic, and trusting.
TO SUM UP: Maximise overall benefit.
Trusting the other party’s abilities and “fighting spirit” allows negotiators to take risks as necessary for achieving overall goals and to comply with agreements in a constantly changing social, economic and political environment. Trust in negotiations is critical when your income, security and peace of mind depend on the motives and actions of the other party. And using the aforementioned strategies, negotiators can build the trust essential for getting maximum results.
Develop your negotiating skills and perfect your mastery in making profitable deals!
Article written by Eduard Trymbovetskiy