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Negotiating against the odds

Globe and Mail Update

Peter Johnston is a negotiator, advisor and mediator who has worked with clients ranging from Wall Street bankers to convicted felons. A Harvard MBA, Mr. Johnston's specialty is assisting companies and individuals negotiate with much larger players. He advises people to invest in efforts away from the negotiating table, to ensure that they are in the strongest possible position when they get there. Mr. Johnston is the managing director of NAI, a consulting firm that operates out of Cambridge, Massachusetts. He recently wrote and published Negotiating with Giants: Get what you want against the odds. The book identifies a series of negotiation strategies that smaller players can utilize.

Peter Johnston was here earlier offer tips and insights on how to successfully negotiate when the deck is stacked against you. To leave a comment or join the conversation, please click here

Noel Hulsman, Globeandmail.com, writes: Peter, thanks for joining us today. It's a cliche that you don't get what you deserve in life, you get what you negotiate. And though that may seem excessively cynical, it generally holds true in a business setting. Whether you're dealing with a banker, a landlord, suppliers, customers or employees, your success or failure is often wholly contingent upon your ability to get people onside. From the questions we've received so far, this is clearly terrain people are interesting in learning more about.

Martin Thornell from Ottawa writes: Do you have any suggestions on how to reach the key decision makers, within a bigger organization? Any do's and don'ts?

Peter Johnston writes: Martin: your question highlights one of the many distinct challenges smaller players face when negotiating with giants. Let's start with some common mistakes and then springboard into best practices here:

First mistake: they don't use "connectors" or the right connectors to enter a giant organization -- people who already have connections to the key decision-makers they're trying to influence. If you're trying to pitch a great idea to a big venture capital firm and you contact them via email or mail, without a well-placed connector introducing you, your odds go down signifcantly. Using the right connector signals credibility and helps giants vet good ideas from bad ones.

Second mistake: less effective smaller players access their giants the wrong way, going in too high or too low in an organization. You go in too high and you have senior attention from people who are too busy to focus on you or too removed from the trenches to move your idea forward quickly and effectively. You go in too low and you can get trapped there forever, without seeing your idea gain the backing of key players inside your giant.

Third mistake: they weaken themselves as they gain access to their giant. To attract attention, they offer up steep, arbitrary price breaks, for example, that don't actually meet their interests in the longer-term. Effective smaller players know what they want from the start and stick to standards they've tried and tested over time so that dealing with a giant doesn't undermine them.

Parthi Kandavel from Scarborough writes: Thank you for taking the time to be here. What are recommended strategies you've found useful and pragmatic, regardless of issue, that help invest in efforts away from the negotiation table?

Peter Johnston writes: Parthi, first off, the biggest mistake smaller players make is rushing to the negotiation table without using their influence and planning away from the table to bolster their own size and strength. Here are half a dozen things you should consider doing before going to the table, deciding for yourself what's appropriate for your situation of course:

1) Think about how you can build up the value of your core operations as much as possible before talking to a giant. Many entrepreneurs leave too much value on the table by not taking a few extra steps that could multiply the value they get from their giant in the end.

2) Have a good back-up plan whether it's the status quo or another partner.

3) Develop relationships informally inside and outside your giant that will help you access your giant and get the deal you want.

4) Use the media to raise your profile or your perceived value before going to the table. This can pressure giants or make you look more attractive, depending on the circumstances.

5) If certain laws or rules are favoring your giant, and weakening you, see if you can change some of them. In my book I tell the story of a Brazilian housewife who got fed up with high prices at supermarkets, and successfully lobbied the government to change pricing laws. Those laws allowed HER to negotiate directly with the supermarket chains on behalf of ALL their customers.

6)Think about how you can worsen their alternatives to a deal with you, or their perception of these alternatives.

Shelley J from Hirafu, Japan writes: Hi Peter, What tactics can individuals use against biases, sexism, or racism? Cheers and thanks, Shelley

Peter Johnston writes: Shelley: This is a huge question. I'm going to be really general here but to be clear, there can be a big difference between bias, sexism and racism so a one size answer won't fit all! But here are some initial thoughts:

Unpack your own "baggage", making sure that you're not the one showing bias in how you're viewing your giant's comments or actions.

If your giant sees you a certain way, think about how you can methodically act or react in a way that will, over time, begin to help change any misperceptions or biases they may have towards you.

Have someone who isn't you, and who your giant would be favorably influenced by, talk to your giant about your situation.

In extreme cases, where a giant acts in a way that isn't consistent with existing laws or standards in a given country, have someone blow the whistle on them or blow it yourself. But make sure you're well prepared because this approach obviously has risks. In my book, I tell the story of Cynthia Cooper who blew the whistle on WorldCom executives. She always kept in mind her Mom's advice to her: "never allow yourself to be intimidated."

Prairie Dog from Vancouver writes: Often negotiation requires one to remove themselves emotionally from a situation. Relationships, however, are the ultimate negotiation and it is nearly impossible to remove oneself emotionally. Any advice?

Peter Johnston writes: I didn't know there were prairie dogs in Vancouver!

I actually think the answer isn't to remove yourself emotionally from any negotiation. Successful smaller players corral and channel their emotions into their negotiations appropriately -- being straightforward and passionate about their interests, their giant's interests and the different ways an agreement might be reached. They don't, however, let their emotions attack others personally.

I think it would be helpful to people in marriages/partnerships for example, if they had full information about what other marriages look like to better understand comparables, as you might in corporate deal-making. The irritants that get many relationships into trouble often relate to false expectations about what's involved in relationships. Any time you have significant interdependence, you'll have conflict or you should have conflict to make for a robust relationship. It's not whether you have conflicts, it's how you have them. Think about creating informal contracts with your relationship giant so communication is clear regarding expectations. In the end, as necessary, consider bringing in outside help to help lower the temperature in your discussions.

R.C. from Toronto writes: Lately I'm finding I doing more work and also others who aren't as organized as I am and I'm quite sure you hear this all the time. I'm entry level but have been around for almost 15 yrs. so how do you refuse a supervisor's demand without being cited for insubordination but more importantly how do you persuade management (collectively) to abandon or relax these dracononian and punitive policies?

Peter Johnston writes: Two things you might consider doing, R.C. First, think about a back-up plan, another way you might want to apply your skills in a way that will be valued more highly. That's right, if you've been there 15 years, and you feel like you're not being well treated, look at getting another job.

Second, once you have a better idea of how you might earn a living without your current employer, set up a meeting with your boss away from where you work. You want to signal this isn't going to be a run-of-the-mill meeting. Then, without attacking your boss, explain how you're feeling (talk about the impact of their actions on you, acknowledging this impact may well not be their intention). Talk about the fact you've begun looking for another job, and that your preference is to stay where you are, but that you want to be treated and rewarded appropriately (not using the word "fairly" which is too subjective and way over-used in negotiations in an unhelpful way).

Once your boss has heard you, be clear about anything they've agreed to that meets your interests, write it down in an informal or formal letter, and agree to revisit this pledge over time. Alternatively, your boss may find another job for you, or you may decide after exploring your alternatives that it's time to move on to another organization.

Sabrina McTaggart from Ottawa writes: I've read your book and wanted to ask you about Canada-US water negotiations. By your definition, Canada is already negotiating with the US over fresh water. I was wondering whether you've followed this issue at all, and if so, what advice you would give to Canada, to better position itself with the giant next door. Thanks!

Peter Johnston writes: Sabrina: the biggest thing for Canada to remember as a smaller player in all trade negotiations with the US is that it has a lot to offer the US and should expect a lot in return. Smaller nations and smaller companies often devalue themselves in talks with giants; in fact, that's exactly how their giants want them to feel. The value of NAFTA is that by creating such wide-spread interdependence, it's much harder for special interest groups in the US to threaten blowing the entire trade relationship up over any single issue because there are too many other interests in play. On the water front specifically, I haven't followed the issue closely. I can only say that with water being an increasingly scarce and valued commodity, Canada should tread very carefully before agreeing to anything it hasn't agreed to already. The country needs to revisit and review ALL of its trading interests with the US beforehand, and see where it wants to bolster its interests related to NAFTA, and even unrelated to NAFTA, before fully tackling such a critical issue. If it can't reach agreement right now, Canada must wait until an agreement makes sense.

Mary Lue Emmerson from Victoria writes: What do you think is the most important tool you can use in a negotiation when there is a clear imbalance of power?

Peter Johnston writes: That's a very pointed question. Here's just one answer -- build as many different coalitions as possible, bringing on to your side the resources, support and clout you need to get your giant's attention and keep it. That's what Nelson Mandela did so effectively in South Africa. Everything Mandela did was aimed at building broader support for the ANC and not undermining this support unnecessarily. All smaller players need to reach out to as many other individuals and groups that might share their interests in a given outcome, using these relationships to help right the initial imbalance in power with their giant.

Robert Gierkink from Boston writes: What strategies and tactics did you use to negotiate your book deal?

Peter Johnston writes: Rob, I didn't negotiate my book deal the traditional way. I by-passed major publishers in New York and negotiated all the printing and distribution deals myself. The book is now available in stores across North America, including Chapters in Canada and larger airport stores. It's more profitable this way but more importantly, I get to control the message I want smaller players to hear, without being vetted by a giant publisher. If you read Negotiating with Giants, you'll see that some of these previously untold stories are bound to generate significant controversy and discussion.

Noel Hulsman, Globeandmail.com, writes: I've got more questions, but I've already kept you almost an hour past our appointed time, so I better wrap. Thanks so much your insights and advice today. It's most appreciated. Best.

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