We all have to negotiate in life, whether it’s asking for a bigger raise, nailing down details of a contract or even getting your kids to do their homework. But how does one become a good negotiator? Attorney and negotiating strategist Corey Kupfer shares the tips in his book, Authentic Negotiating: Clarity, Detachment, & Equilibrium — The Three Keys to True Negotiating Success & How to Achieve Them. He recently joined the Knowledge at Wharton Show, which airs on Sirius XM channel 111.
An edited transcript of the conversation follows.
Knowledge at Wharton: I get the sense from your book that there is a level of dishonesty out there in negotiations that’s maybe even more than people would think.
Corey Kupfer: Well, there are two things. One I would describe as inauthenticity or manipulation. A lot of negotiating training, unfortunately, is based upon game playing. Not only is it inauthentic, but it actually doesn’t really work, especially in higher-level negotiations.
Knowledge at Wharton: The subhead of your book lays out the three keys that you think are important to this process: clarity, detachment and equilibrium. Can you go through them all briefly?
Kupfer: Sure. That brings us to the other part of authenticity, which is being authentic with yourself. It’s not just about being honest with others. It’s about doing the internal work to make sure that you are true to what you really want.
The first piece of that is clarity. I’m amazed at how often people go into significant negotiations without the level of clarity they need to be sure about exactly what works for them, and what doesn’t work for them. That takes external research, but it also takes a lot of internal work to get to their inner truth.
Knowledge at Wharton: The clarity part of the book was interesting to me. You talk about the fact that it needs to be something that doesn’t include ego that much.
“People don’t fail in negotiations because they don’t know some tactic. … When they fail, it’s because of the things that come up with them emotionally.”
Kupfer: In my experience — and I’ve been doing this for over 30 years — people don’t fail in negotiations because they don’t know some tactic, or counter-tactic, or technique. When they fail, it’s because of the things that come up with them emotionally or internally. Ego is a big one. It can show up in that boisterous, “I know better, I’m not listening” way, or if you look at ego as somebody’s true identity, which is not necessarily true to who they are, sometimes it shows up in people not fully owning their value. Their ego, their identity of themselves, can’t really hold their value. And they give away too much in negotiating.
Knowledge at Wharton: To a degree, then, ego becomes a weakness, right?
Kupfer: Absolutely. The best negotiators you see not only have that clarity, but they’ll be able to maintain detachment. And what detachment means is that if you and I are negotiating a deal, I probably have a preference we get the deal done. Otherwise, why am I spending my time talking to you? But ultimately, I need to be detached about the outcome. I need to say, “Hey, what are the objectives that I’ve gotten clear about during my clarity process? Can I meet those objectives in this deal that I’m negotiating with you? If I can’t, that’s OK. No hard feelings. You’re not a bad person. It’s just that your objectives and my objectives don’t happen to meet at this time.”
So, my ego is not engaged. … I’m not upset with the other party. I don’t have judgment around it. I just know that your objectives and my objectives don’t meet right now. I trust that we will either do a deal in the future, or maybe we won’t. Or that another deal will come along from someone else. Or that it’s just not meant to be at this time, and it’s all OK. That’s the detachment part.
… You can’t let your emotions get away from you. If you do, you’re going to lose your objectivity. Not only are you going to potentially say the wrong things and cause problems for the other side, but you’re going to lose your clarity. You’re going to lose your connection to your truth. You’re going to lose your connection to what you want to achieve out of the deal.
The first thing I would say to people is: “Listen. Before you go into a negotiation, take the preparation time that you need.” Too many people skimp on that. “And do what you need to do.” For some people, the way they get centered, the way they get clear, the way they get connected to their truth in life, is maybe they meditate, or they pray, or they go out for a run, or they speak to friends and bounce their ideas back and forth. Some people are more analytical. They do spreadsheets, and they figure it all out.
But whatever it is you do to get clear, and to get centered, you need to allow time for that before every significant negotiating session, so that you’re much less likely to get triggered into emotions. That’s one of the ways you can do it.
Knowledge at Wharton: The fact that there are people out there who don’t take the time to prepare enough for an important negotiation really surprises me, to a degree.
Kupfer: Yes. And it’s not just on small stuff. I mean, I have people who go into multimillion-dollar negotiations, multibillion-dollar negotiations, and they don’t prepare. There are a few things that come up. A lot of my clients are entrepreneurs — and I’m an entrepreneur — and there are great things about being an entrepreneur. But sometimes, we are so confident in ourselves, and we’re so willing to just go for it, that we think we have this ability to wing it, or to shoot from the hip — we’ll figure it out.
That’s a good quality in a lot of situations. But in a significant negotiation, that quality that often has us convincing ourselves we don’t need to do the necessary preparation ends up hurting us. Especially when we’re dealing with more significant deals or disputes, and we’re up against people on the other side who have a high level of skill and experience in negotiating.
Knowledge at Wharton: Should there be any difference in being a negotiator when you’re in a startup versus a corporation?
Kupfer: Knowing what position you’re in, having an understanding of the landscape, whatever the difference is, is important. And one of the things that happens with startups, for example, is that sometimes there may be an assumption that, “Hey, we’re early-stage. We’re negotiating for capital, or we’re negotiating with vendors who may be hesitant to work with us, or for partners.” So we may feel like we have less leverage.
No matter how good of a negotiator you become, and no matter how well trained you are, leverage still counts. But if you learn how to be a great negotiator, you’ll be better, no matter what the leverage is. I don’t want to make the assumption that if you’re at a big corporation, you have more leverage than at a startup, because it’s not necessarily always true. But knowing the landscape, and knowing where you are, is important to help design your negotiating strategy.
I deal with this all the time with earlier-stage companies, where for example, they have a big opportunity with a bigger company. The problem is they think they have no leverage. What I always say is, “Listen. If that company, or even that venture capitalist, is sitting down with you, they at least have an interest. There are a million other people they didn’t sit down with.” Just by that fact, you have some leverage. You have to understand, they’re interested. You want to take that into account.
Knowledge at Wharton: How successful can you be if you’re the one not necessarily with the leverage?
“You always have some leverage if you’re at the table.”
Kupfer: The first thing is what I said a little earlier: You always have some leverage if you’re at the table. That’s the first important thing to remember, because too many people forget that. Number two: If you are clear on your objectives — I talk about clarity, detachment, and equilibrium — if you practice that, then you’re going to be in a much better position to be successful, even if you have less leverage. Because everybody always at least has the leverage to walk away from the deal. Again, I don’t mean that from a place of anger, or being upset, or ego. I mean that from a place of clarity.
Even if you are in a position where you have a lot less leverage, if you are clear on what will work for you or what won’t work for you in a deal — say, for example, you are a brand new software developer, and you have an opportunity to meet with Google and sell your product or service to them. This would be the biggest thing that ever happened to you. The fact that they’re meeting with you means that they’re interested. You still want to be clear on what you’re willing to do and not do. (And I’m just using that company as an example. It could be anybody.)
So for example, if they say to you, “Hey, we want you to work for a year for $1,” that deal might not be acceptable to you. By the way, it may. But the point is, there’s a point at which, no matter how good the opportunity is, no matter how big the other side’s leverage is over you, that the deal is not going to work for you. Just getting crystal clear on every term of the deal, and what works and what doesn’t work, actually gives you more leverage, for a couple of reasons. One, you know what won’t work for you, and under what conditions you’re going to say “Thanks, but no thanks.” Number two, when you have that level of clarity and confidence, it actually gives off an energy to the other side where they become more interested.
“If you go into a negotiation from a place of scarcity, or from a place of desperation, they’re going to sense that.”
If you go into a negotiation from a place of scarcity, or from a place of desperation, they’re going to sense that. And not only will they negotiate a better deal for themselves, but frankly, they’re much more often less interested, because you don’t instill the confidence in them that whatever you are selling, bringing, developing, partnering with them on, will be valuable to them. That you’ll be able to deliver it, and that you’re confident in it. Having that confidence yourself actually increases your leverage.
Knowledge at Wharton: We’ve talked about some of the reasons why negotiations fail. You list six of them in the book. One I wanted to touch on, which we haven’t really discussed yet, is rigidity. When people think about it, they understand that being rigid in a negotiation can make it tougher to get a deal done. But I wanted you to explain exactly what you mean by rigidity.
Kupfer: Rigidity can show up in a few different ways. One is — and I see this in my role as an attorney, representing clients in deals and that kind of stuff — that sometimes other attorneys are very rigid as to structure. They know how to do things in a particular structure. But maybe that structure, for tax reasons or other reasons, doesn’t meet the client’s needs. And then the deal falls apart, because they’re not creative enough.
I related a little example in the book where I had a client come in to me one time and say, “I want to sell my company. I want to do a reverse triangular merger.” And I said to him, “Wait, hold on a second. I’ve done reverse triangular mergers. I know how to do them. But why do you want this?” And he said, “Well, my friend did his sale in a reverse triangular merger, and it worked out great, and he saved a lot on taxes.”
So I said to the client, “Listen. What we want to do is look at where you are today, what your objectives are, and what you pay me for is to help with the structure. Do you really care about the structure? I think what you care about is achieving your objectives.” He recognized that, and we ended up not doing that deal as a reverse triangular merger. We used another structure. Fortunately, he wasn’t rigid as to structure.
Another type is rigidity in timing. There’s a rhythm and a pace to a deal. When you’re a good dealmaker, you understand that rhythm and pace. You don’t want to artificially push it too hard, and you also don’t want to artificially slow it down, because you can lose momentum. If you push too hard, you can push the other side away. If you slow it down, people lose interest, because the deal’s not moving forward.
Some people come in from a place, because let’s say they’re desperate for the deal, where they push it too hard. Or because they’re not focused enough on the deal, they go too slow. If you have any kind of rigidity about the time, and you don’t let the natural pace of the deal run it, then that can hurt you as well.
“I always talk about having clarity on your objectives, and knowing exactly what works for you, and what doesn’t.”
Then, of course, there’s rigidity on any particular term of the deal. And here’s where I want to draw an important distinction, because a lot of people bring this up: I always talk about having clarity on your objectives, and knowing exactly what works for you, and what doesn’t. That can seem like it’s a kind of rigidity, because if it doesn’t work, it doesn’t work. But I think having that clarity is crucial. What doesn’t work is having a rigid view of how to get there in the negotiation in any way. Because there are a lot of possibilities that may come up, if you’re open to them.
Knowledge at Wharton: The last reason on your list is lack of integrity, and I wanted to ask you how you get past that. Because if you’re trying to make a deal with somebody who has a lack of integrity, that would seem to be a deal-breaker.
Kupfer: Yes, and it often should be. I want to talk about two types of lack of integrity. One is lack of integrity on the other side, meaning that the people across the table are dishonest. You can’t trust them, and that kind of stuff. And I agree with you: If that’s really prevalent, then that’s probably somebody you don’t want to do a deal with. … That should be a deal breaker.
Now, what happens, though, is that sometimes people interpret other people as not having integrity when that may not be the case. I’ll give you a quick example of that, and then I’ll give you the other half of lack of integrity.
One of the things I talk about in the book is how you deal with inauthentic negotiating tactics. And one of those tactics is what they call “quivering quill,” which comes from the old word for the writing instrument, the quill. The pen, right? It’s where somebody asks for one more thing after the deal is fully negotiated. Everything’s been negotiated, you think. You go in to close the deal. And the moment before signing, somebody asks for a concession. In a lot of cases, it’s proper to interpret that as an inauthentic tactic, or the other side not having integrity.
But there are certain cultures where that’s just part of the cultural approach. Nobody’s doing it because they’re lacking integrity. You know, I mention it, but I don’t get into it in the book. There are books written on cultural differences in negotiating. But if you know that’s a cultural difference, then you understand that. If you don’t, you may interpret it as a lack of integrity, when it’s really not. It’s just part of the culture. So, that’s one half of lack of integrity. There’s another half I talk about in the book, which is about integrity with yourself.
It’s an easy place to go, seeing a lack of integrity on the other side, and saying, “Hey, I don’t want to deal with those people.” But the thing that’s less looked at is when you don’t have integrity with yourself. I’m not saying that you’re a liar, or you’re dishonest. I’m talking about the definition of integrity where you are true to who you are. There’s an integrity, there’s an alignment with your truth. And because a lot of people don’t do the necessary work, or are unable to get in contact with their truth, sometimes they’re out of alignment. They’re out of integrity with their truth. The problem is, if you’re not 100% clear on what you really, really want, and what’s true for you, then you can’t design a negotiating strategy around that. You’re designing a negotiating strategy around something else — something that’s not really true for you.
Then you either end up with a deal that you think works for you and doesn’t, or you realize at some point along the way that you’re out of integrity with yourself. And then you need to adjust. The problem is that you have approached it a certain way with the other side. They’ve gotten certain impressions; you’ve gone down a certain path. Now, you have to change course, and sometimes that can cause trouble.
Knowledge at Wharton: You also talk in this book about people who talk too much in meetings. It becomes a problem when somebody doesn’t know when to close their mouth.
Kupfer: Yes. I talk about that coming, usually, from one of two places. Some people talk too much out of ego. It’s that blustery “I know better than you” drive to talk too much. The other times people talk too much, it’s almost the opposite — where people lack confidence. You see this when somebody comes in for an interview, and they’re really nervous, and they blabber. You know, they just go on and on, because there’s nervous energy. Wherever it comes from, it’s really not useful in a radio interview, in a meeting, or certainly, in a negotiation.
“It’s amazing how people will generally tell you what they really want if you ask the right questions and if you really listen.”
First of all, when you talk too much, you’re probably giving away too much information. Not that you’re trying to hide anything, but you’re not realizing what you’re saying. And you’re not coming from a strategic point of view. The other thing is, clearly, when you’re talking, it’s really hard to listen. And listening and asking follow-up questions in a negotiation is such a powerful approach — because it’s amazing, how people will generally tell you what they really want if you ask the right questions and if you really listen, and if you’re paying attention not only to what they say, but of course their body language. I discuss this in the book — that we have these microfacial expressions that give off information. But if we’re not paying attention to other people, and sensing their energy and what they really want because we’re talking too much, then we miss all of that.
Knowledge at Wharton: You finish up the book talking about a process called CPR.
Kupfer: For negotiating, CPR stands for “Context, Purpose, and Results.” Let’s start with the last one, because it’s easiest for people to understand. This is something I have people do in writing. You really write this out — the results are the specific, measurable results you want to get out of a negotiation. You want to pay no more than this, or less than that. This will be the term of the deal. Whatever it is you want. Those are easy; people understand that. Some people skimp on those, but a lot of people will list the results they want.
But what they don’t do is define the C and the P, so let’s talk about those. I’ll keep going in reverse order. The P is the purpose of the negotiation. It’s the why. Why are you in this negotiation? What I encourage people to do — and what I do for myself — is to really dig deep on that. Let’s take a quick example: You’re going to request a raise from your boss. You’re negotiating salary. The easy thing to say is, “My purpose is to get a raise. My purpose is to make more money.”
You keep asking why. “Why do I want to get a raise? We can really use more money, my family.” Why? “Well, I’ve got a kid going to college.” Why is that important to you? “I never had the opportunity to go to college, and it really makes a difference to me for my kid to be able to have a better life than me.” Now we’re getting to the real why. That’s really different than, “Hey, I’d like to make more money.” … It gives you clarity on why you’re in that negotiation.
Then the next step is the C, which is context. Context is what I call the being: Who are you going to be when you walk into that room? The question you ask yourself is this: To achieve my purpose, what does my context need to be? Who do I need to be? I give an example of a big negotiation in the book. I won’t get into details, but let’s just say there’s a difference.