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  "full_text": "Be a little bit more of a class, than a,\nkind of a lecture presentation. I learned something about marketing. Cause I was told that the title of this\ninitially was, How to negotiate, when you absolutely have\nto have the deal. Well that is a great ti, I mean, that's a\ntitle. That you would you'd come for. I mean, everybody would have come to hear\nhow you, how do you negotiate when you have to have\nthe deal? You know, everybody wants to know how to\ndo that. They asked me, you know, well, what will\nyou teach them, and I would say, don't get in that\nposition. [LAUGH] Where you absolutely have to have\nthe deal. So it would be a very short session. So I change. The session, to the one that you, you\nsigned up for. Which is conducting effective negotiation. So a little more pedestrian title. A little less exciting, but I think we'll\ngo over some things here that may influence the way you\nthink about negotiations. so, who in here likes to negotiate? Raise of hands. So that's maybe 20% of the class. Who just dreads negotiation? That's even a smaller percent. So the rest of you are kind of\nindifferent. You'll do it. You know, you'll eat your broccoli, if you\nhave to, but you're not looking forward to it, this\nis, the. Negotiation is your vegetables of your\nbusiness life. You'll do it. You know it's good for you. You know you have to do it, but you don't\nabsolutely love it. So, who and, let's just take a second on,\nwhy, those of you who like it, why do you like\nit? What is it you like about it? Now the hands disappear. Yeah? >> Well, compared to my engineering field,\nwhere I knew everything was right or wrong, black or white, in negotiations\neverything's grey, and nobody can say I'm wrong. [LAUGH]. >> So you feel better about yourself. [LAUGH] You don't get any bad, and you\ndon't get any- >> [INAUDIBLE] I get credit, you know? Nobody can say they could have done it\nbetter. >> Yeah, all right. >> Yeah the reason I wanted to go\nnegotiate, is that typically I have heights to take\nhim. I'm, when I negotiate, I'm going to wing\nit. I\"m going to get better on the other side. >> So you are gonna improve your, your-. >> Situation. >> Your situation. Okay, so you negotiate to improve whatever\nsituation you are involved in. >> Conflict situations is just rarely the\ncase you can make a deal without some level of\nnegotiation. So I look at it as just as, as a means to the end, and getting to the end is kind of\nthe goal. On the flip side, doing win-win deals is\nreally a lot of fun. >> Okay. So you see it largely as eating your\nbroccoli, but sometimes you do get to turn it into\ndesert. [INAUDIBLE] [LAUGH]. >> [INAUDIBLE] By working for me. >> I keep thinking of the first George\nBush who made the comment about. How he hated eating broccoli. >> Yeah. >> So I actually like broccoli too. >> Yeah. [LAUGH]. >> Yeah. >> Yeah [INAUDIBLE] that I think the\nwin-win thing is is fun, and it's also like a pizza, it's like\nputting in the puzzle [INAUDIBLE] if you're the\nperson, why why why, how you do you get it all together, and make\nit work. And [INAUDIBLE] win-win, and that's fun if\nyou make it work. >> So, win-win agreements are fun, and\nyou, and you can negotiate. the, the, the higher the percentage of\ndeals you can get that are win-win, the more you\nlike it. Other? >> I think it's a, a unique opportunity\nfor creativity, in business. It's one of the most creative aspects of\nbusiness. >> It does allow you to fashion solutions. According to, usually different kinds of\nfacts, different fact situations, so you get to be, you get to express some\ncreativity other things that yeah. >> We have building relationship, as well\nas the other person. >> Yeah, building. >> You understand better where, what they\nwant, where they wanna go and you can [INAUDIBLE] some\nmore [CROSSTALK]. >> Yeah, and I'll bet you, those of you\nwho said you didn't like negotiation, saw it as a way of destroying relationships, of stressing\nout relationships. So, a lot of it depends on, on, you know,\nwhat are you doing to relationships, as you\nnegotiate with other parties? How about those of you who didn't, let's\nget some more of things that you don't like\nnegotiation. For those who just say, I can do without\nthis. What do you not like? Yeah. >> Just makes me very uncomfortable think,\nto think that, I do not have enough information, to get the\nmost out of this negotiation. And more often than not, I just regret the results, thinking I could have done\nbetter. >> Okay, so you look back on it, and you\nsay, shoot, I got taken. I didn't get as good a deal as I might\nhave gotten. I lost. Other things you don't like about, yeah? >> [SOUND] Most of the time, hopefully,\nthe person on the other side is Or are, is an intelligent\nteam, you're dealing with. But you do get the what I call amateur,\nlike if I pound on the table [INAUDIBLE] in fact can get just, intellectually and\nemotionally tiresome to deal with. >> You can get abused, in negotiations. And there's a whole lot of, there are a lot of issues around power, and\ninformation. If there's a disparity in power, leverage,\ninformation, and you're dealing with a party who's gonna use that and take\nadvantage of that. You can go out of the room feeling abused. [INAUDIBLE] Yeah. [LAUGH] Yeah. I actually met with Donald Trump, in his office in New York, about 20 years ago,\nbefore he was a huge cheese, but he was with a\nwell no, he still had the same hair. [LAUGH] And actually he tried to sell me\nan interest in the Washington Generals. Any of you know the Washington Generals? This was a, a USFL football team, that had\ndrafted Herschel Walker. And so he was very proud of that, and he,\nwas trying to sell me an interest in that, and I\ndidn't fall for it. So, that's my qualification for teaching a\nclass on negotiation. [LAUGH] [INAUDIBLE] Actually my\nqualifications is, I, I have negotiated billions of dollars, of transactions, over the years Literally,\nhundreds if not a thousand different kinds of\ntransactions. I was in the real estate business for 20\nyears [COUGH] and I was actually the chief financial\nofficer of a big real estate company for about ten years,\nso I was negotiating debt deals, and equity deals, and then partner departures, and solving\nlitigation. And, so, my, my life was a diet of\nnegotia, just solid diet of negotiations. And then, when I got done with that, I\nstarted buying companies and it became a different\ndiet of negotiations. So, I've seen a lot of different kinds of\nnegotiations. I've experienced the feeling of looking\nforward to a day. When I'm negotiating, and with great\nanticipation, and really loving it, because I like the people on the other\nside. I like trying to problem solve. I like being creative. I like all those, those elements. And I also have looked at certain days of\nnegotiating, where I dread it. I cannot wait to get the day behind me. So there's nothing intrinsic about\nnegotiations that say you should like it or not like it. I, I remember teaching a real estate class\nhere at Stanford about ten or 12 years ago, and\nasking the class roughly the same question, but i did it in\nthe form of, who of you likes to buy a new\ncar? And that was the most highly correlated\nquestion with who likes to negotiate, and who\ndoesn't. There are some people who absolutely hate,\nthe process of buying a new car, because it feels like you come\nout a little dirty. [LAUGH] You know? You don't have the, it's uneven\ninformation, uneven power. And whatever, so it can, it can be a bad experience Well, who here are expert\nnegotiators? Raise of hands. [LAUGH] Every hand should go up. Every hand in the room should go up. You all are here in life, because you have\nbeen superb negotiators. You would not be in. What is the negotiating? Negotiating is getting what you want, at a\nprice that's acceptable to you. So you have paid prices, to be at this place in your life, that you're happy\nwith. So you are expert negotiators, and I wanna\nventilate that a little bit, and let you really kind\nof. Peer into what it is that you're, you've\nbeen so good at. But, first of all, here's maybe a little\nbit of a map for you to start thinking about the\nterrain of negotiation. All of the conversations you have in life,\nif you think broadly about it. Everything that you've done has been a\nnegotiation. For those of you who are married. You're negotiating all the time. With your spouse, with your children. In your job, you're negotiating all the\ntime. In school you're negotia. I mean, conversations, are in effect, a\ngive and take, and there, and there's a give-get transaction, and usually, the\nmore informal they are, the more successful\npeople feel. When you do it with friends and family, usually, they feel more successful, then\nyou get into these, sort of sty, where we think about negotiations, entrepreneur, is in this\narea of stylized negotiations. Where there are agreements, there are\ncertain things that we negotiate, we sit down at a table, somebody takes notes,\nwe write it up. And there's certain things that we trade off, and then finally, very formal\nnegotiations. These are typically ones that are done, in\narbitration, or litigation, where there are rules of\nevidence, where there's a very structured, narrow thing, and that\none is not a very fun one, although I've now spent four\nyears in litigation. I'm good enough. In fact, I had one attorney say that I was\nthe best witness he had ever run into. And I started liking negotiation or\nLitigation after that. [COUGH] This was an opposing attorney,\ntoo. So you feel pretty good about that. So what makes for successful negotiations? In across all of those. If if I recognize, so many people from my\npast in here, it's gonna be hard not to cold call, on Angie here,\nor [UNKNOWN] or Nicola. So what, what makes for successful negotiatia, if you think about successful\nnegotiations. What do you think about? I've just had a successful negotiation. What's your self talk? Yeah. >> Set the right expectations. >> Okay, expectations are, your\nexpectations, you've set 'em the right way going in. They've been met, therefore you've\nachieved your objectives. That's a successful negotiation. Yeah. >> [INAUDIBLE]\n[INAUDIBLE] and [INAUDIBLE]. >> Okay. >> [INAUDIBLE] Is also, why [INAUDIBLE]\nhow do we [INAUDIBLE] how do we [INAUDIBLE] oh, that\nis bottom line. Or, that is something that I should fight\nfor. And then [INAUDIBLE]. >> Okay, so, some of it is how you, how\nyou define the terrain. How the other, how you and the other party\nperceive it, and then are you able to execute, in that\nperceived terrain. Bonny? >> [INAUDIBLE] win-win. It's easy to define what winning is on\nyour perspective, cuz u're happy. But I see when on the other side, is that the person, the residual effect after they\nwalked out of the room, and as time goes on, that they're\nnot upset, and they don't try to undermine and negotiate\nwhatever the result was. So they were happy too. >> Okay, so you are thinking more broadly than a lot of business people, think about\nnegotiation. I mean, these are, what I would call\nenlightened comments about negotiations. Here's what most business people are\nnegotiating. This is the essence of most business\nagreements. These five things. So, they're focused on getting the best\nprice, getting the most attractive terms. Making sure that whatever time frames for execution or deliverables, whatever\nare acceptable. Making sure the warranties are in place. And then if things go wrong, they've got\nremedies. They may be legal remedies. They may be economic remedies. They're probably a combination of both. So, most business negotiating, which is in\nthis stylized category, in the middle, is so focused on me getting what I want in\nthese five areas. And people don't think more broadly than\nthat. If [SOUND] people who do a lot of\nnegotiating around these things, talk about these techniques. Does anybody not run into these before as sort of things that are taught in\nnegotiation classes? Are any of these new to any of you,\nsurprising? >> The bathroom. The bathroom one is a, is a commonly used\ntechnique. Feed the person a lot of water, and a lot\nof food [LAUGH] and then just keep talking,\nkeep the pressure on. So, using the bath, bathroom breaks is a\npowerful, if you're using techniques, you know, there, and\nwhat do I mean by plane? They've got a plane to catch. Their schedule, exactly. They've gotta catch a plane, and so you\njust carry on the negotiation. You speak slowly. You make things drag out. You disagree at the last minute. Just as they're running for their plane,\nand say oh, you do the Colombo thing, you know oh, one\nmore thing. You know, have any of you been subject to\nany of these? What does it feel like? >> Well [COUGH] is what you have to assess\nwhether it's a, it's, it's it's always incompetence, or\nis it actual bad faith? And that can be difficult. And it's annoying to have. To have to even have that [CROSSTALK]. >> Either case, what do you, how do you\nfeel? If you're dealing with an incompetent\nparty, or a bad actor? >> Wasting your time [INAUDIBLE]. >> It makes you angry. >> Yeah. >> [INAUDIBLE] Very few people, don't\nrecognize these. If you're on the other side of the table, it's not like oh, my gosh, what is\nhappening? I don't know, I don't understand, this is\nsure working on me! You know, most of the time you perceive immediately these techniques, and\nyou resent them. Or you're angry about them. So, in term of techniques that people\nteach, you know, I think these are\nanti-successful agreement techniques. You may get a deal done. But you're unlikely to get a deal that is lasting, enduring, flexible, where you\nbuild relationships. Where you create solutions. But these are used all the time, mostly\nby, investment bankers. I'm just kidding. [LAUGH] Sorry, sorry, I know. [LAUGH] Roy, could you turn that tape off\nup there? [LAUGH]. I have one other technique which I run\ninto quite a lot dealing with competitors. Which is the, during a set of conflicts, long, long negotiations, maybe over the\ncourse of months. The, you, you discover that in the course\nof this supposedly good faith negotiation the competitor, for example, has been\nactually promoting something completely different\ntalking to somebody else. And the explanation you get when you\nprotest is, I'm very sorry we had no idea that was going\non. >> The impersonation of-. >> Deny, deny, deny, right? >> Yeah or just innocent you know I had no\nidea or oh, my god. >> Same organization. >> Yeah. Yeah. Which puts you on your heels, puts you at\na disadvantage, maybe there are others, anybody in here experience other\nobvious techniques that are being used to gain\npower. Yeah, John. >> We were locked in a room once. [LAUGH]\n>> Yeah. >> I think it was kinda amateurish back in\nthe early days in eastern Europe, that we just\nclimbed out the window. [LAUGH] >> I bet there are a lot of interesting\nstories. That was another one, so, yeah. >> Language, there's a [UNKNOWN] in terms\nof a, an experience having, having negotiations in China where I was\nsitting across the table from a gentleman who, spoke or at least didn't\nclaim to have spoken any English. >> Yeah. >> And so I had a translator, fortunately. And so that was one kinda, it's an\ninteresting barrier. Cuz I was pretty sure that he understood. >> Mm-hm. >> English. And for a variety of reasons, and smoke\nwas also another one. >> Yeah. >> He was an avid smoker. And I can't stand smoke, and, and I tried my hardest to make sure that he didn't\nknow that. Because that's really affected, kinda, the\nway it helps to have everyone to spend in this, you know, four\nby eight room. >> Yeah. >> It was very interesting. >> So, making things physically\nuncomfortable or getting a leg up. There's another way that I see language\nused and that is abusive language. You know, people that start dropping F\nbombs, or shouting, you know, cursing at you,\nwhatever. They believe they get a leg up. And in some ways, most of us kind of\nreact. We, we go a little bit on our heels when\nsomebody starts cursing at us, or they raise their\nvoice or something. I mean, as tough as you may be, if\nsomebody starts doing. There's something in the inner child of\nall of us that recoils a little bit, and is back on\nour heels. Now, it can cause you to come back in like\nmanner. It can cause you to get to that level yourself, which may or may not be a good\nthing. Comment? >> So I had actually the opposite happen\nto me once where we were having issues and then we\ncouldn't come to an agreement and then they came back and\nthey were actually, you know, they could do more, more than\nwhat they were saying. If they gave me everything so they were\ntreating me with kindness and then they went behind my back\nand changed it again. So it was the opposite of using the\nabusive language. >> So it's kind of the limp leg. >> It was [UNKNOWN]. Yes. >> Yeah, where people use different\ntechniques to deceive and. >> So Joe, I have a feeling your gonna\ntell us ways to do actually do this that aren't\nthese ways, but let's use these guys examples, where\nyou actually are faced with people like this on the other side of\nthe table. And how do you actually take control or\nsort of set it on a positive tone, especially\nif you're in a situation where you're sort of\nfeeling like, this is the company I really wanna\nbuy. >> Mm-hm. >> Or this is the job that I really wanna\nget. >> Yeah. >> And you don't really have as many\noptions. But these people are actually coming at\nyou with these techniques. >> Yeah. >> What would you advise us to do? >> Well, let's have the group, I'll, I'll\ngive you my, the way I react to it. But anybody in the group, you know,\nsomebody is using one or more of these on you. Yeah? >> Just call em on it. >> So calling them on it is one really\n[UNKNOWN]. You know, I've actually done this in a, in a litigation, where the opposing attorney\nwas deposing me. And he stood up and got right in my face\nand started to shout at me, he said why did you do\nsuch and such. And you know, it really is off-putting. And you're, you're, the, the. All it shows in the transcript, is, why\ndid you do. [LAUGH]. >> Such and such. That's all it shows. That's all it shows. And if you answer the way you're feeling\nwhen somebody gets in your face and shouts at you in an accusatory way, you\nsay, well, you son of a gun. I'll tell you the reason. You know? And you'll do it in a way that isn't\neffective. The most effective thing that I found was\nexactly what you're saying. I say why are you standing up and raising\nyour voice? That goes on the record. [LAUGH] But, it's, that's the most, copied\ndown way of doing exactly what your saying is. You're really call him on it in a nice\nway. Why are you raising your voice? What makes you shout about that question? Why are you standing up? Why are you pacing the floor as you get\nall of it on the record? Now, you don't need to get it on the\nrecord in a normal negotiation, but calling him on\nit is one thing. What's another way that you could deal\nwith that? >> I, I'd start asking questions. That where I start to do. >> Questions are very effective, you know\njust asking, just posing questions. You know, that's always a, a very\ninoffensive way of taking the volume level down, getting\ninformation, cooling people off. Another way. >> You gotta reach a higher plane, cuz if\nyou're in this type of mode and the other person's not in good\nfaith in most negotiations we're gonna be doing, you need to have a relationship, and, and the relationship usually a lot\nmore important than the actual deal you finally\nend up with in a lot of cases. So, I mean, I think you do have to call\nhim on it. You have to say, you know, what's your\npurpose here? >> Yeah. >> And you guys, if he's doing one and\nyour doing another, it doesn't make sense. You guy's have to be both wanting a deal, and both wanting the best, you know win\nwin. >> Sometimes [INAUDIBLE] have such power,\nand such an advantage, and you really do need the\ndeal. That they get away with more that it's\ntough to raise them to that level. When there's such a disparity in terms of\ninformation or power, that it can be very tough to do. I tell you what I try to do is make it completely ineffective, just make it so\neither I ignore it, I just don't pay attention to what it\nis they're doing, by that I mean, I don't\ndrink water. You know, I am able to outlast, my bladder\nis better than their bladder. You know. Or I I will plan my trip with an extra night of hotel room and I'll have an extra\nflight out the next day, so I'm not even anxious\nabout I'll let him know I'm leaving at 5 o'clock\ntonight. That oftentimes they'll push the thing. And I just don't sweat it. We stay and then, then pretty soon to me\nit becomes a question of let's keep staying\nhere, let's keep working. You know, I've missed my plane let's work. It's 11 at night, no problem. I can keep working. Well, I mean you kind of make it so that\nthe game that they setup, hurts them. So they really pay the price for whatever\ngame they setup. So make it ineffective. So these techniques, really can sometimes\nwork marginally in the short run, on some\npeople. But they're not really very powerful long\nterm techniques. Now, if you look at textbook discussions\nand negotiation, you run into these terms. And I'm not gonna talk about, I wanna talk really today about very practical,\nreal world situations. But these are, this is the terminology. I know some of you are gonna take classes\nor have taken classes in negotiation. These will not be unfamiliar terms to you\nin the lexicon of negotiation. So here are some practical keys to\nsuccessful negotiation. And these will look just so simple minded,\nwhich is in fact what most really practical\nthings are. Born of experience. But the first thing is negotiate with the\nright person. I'm gonna tell you a half a dozen stories\nhere before we wrap up, where you'll see how I learned\nthese particular lessons, I think. But get with the right party. You would be amazed at how many\nnegotiations go on with the wrong party, with the unempowered lieutenant, with\nsomebody who really is not the, the decision maker,\nwhatever. So figure out who the right party is. And are you talking with the right party? Secondly is become a trusted negotiator. And I put here that's a function, of CCP,\nand my students will recognize this. This is a function of character,\ncompetence, and power. For somebody to be trusted, they have to\nbe high character, they have to be competent, and they have to be\nempowered to make a decision. So you wanted, the right party for you to\nnegotiate with, is somebody you can trust. The right party for them, is that you must\nbe also trusted. So if you want to enter high quality\nnegotiations, getting high levels of trust based on character competence and empowerment, are really important things\nto assess. Then know your own BATNA. What's a BATNA? >> Best Alternative to a Negotiated\nAgreement. >> In unison. [LAUGH]. >> Best Alternative to a Negotiated\nAgreement. Okay, this is a term that was developed by\nFisher and Ury in 1981 out of the Hartford negotiation\nstudy, which they really found that if people could go into a negotiation\nwith an idea of what is their best alternative to this,\nthis negotiation working out successfully. They came out with better end results. You go in with far more confidence. I've taken it to another level. When I go into negotiations now it's, I\nfigure out, I don't know it for sure. But I try to assess what is the other\nparty's BATNA? So I really think hard about what is it\nthey want to achieve, and what are their\noptions because that really helps you kind of assess the whole\nthing and you're not just thinking my agenda, my\nagenda, my agenda. Here's what I want: price, term, remedies,\nwarranty. This is what I need. And so many negotiators are going in with\ntheir own agenda. Well, go in and think about what is the\nlay of the land for the other party, and that\nhelps. We'll talk a little bit later about Fisher\nand Ury's map, but I think there are three or four suggestions that they\nmake that are kind of their broad map. They're really very helpful. Discern the difference between battles and\nwars. What, what we used to call the elephant\nant. Some people don't know the elephants from\nthe ants. Have you ever negotiated with somebody for\nwhom every deal point is something that they have to\nwin? You know, everything is compared,\neverything that's brought up, they have to win every deal point. I'm here to submit to that's a really dumb\nway to negotiate. This is give-and-take, you're, if, if\nyou're gonna try to develop relationships the way Nichola\nsaid, or if you're gonna try to come out with creative solutions or\nwhatever, you really don't want this, I have to win every deal\npoint, thing. So know where the elephants are and where\nthe ants are. Be willing to lose some battles to win the\nwar. Yeah? >> Wouldn't be to my advantage just to\npoints there where I know, I don't feel so\nstrongly about. Wouldn't the other party be doing the same\nthing? >> They should be, and you should, I mean,\nin really effective sort of win win negotiations, you share\nwhat you're trying to achieve. Lei Coca has a great line you know he was\nthe guy that turned around Chrysler. And he said you know, when I want to achieve something, I tell the other\nparty exactly what it is I'm trying to achieve, and what\nprice I'm willing to pay to achieve it. And that's really kind of the starting\npoint where it's sharing, so there's a lot more sharing of information in that\nkind of a model of negotiation. It doesn't always, it not always something\nyou can do. And I, you know, getting back to these\ntechniques, I would say don't worry too much about takings, you\nhave to be aware of them. You have to be careful, and it tells you\nsomething. Somebody is using, I, I was thinking when\nsomebody is shouting at me or walking out of the room or throwing\nthings, there is information in that. It's like, I had a partner one time in the\nreal estate business who looked at a joint venture\ndocument that was this thick. And he looked at it and he picked it up\nand he says, and any document that's that thick,\nthere's something in it for me. [LAUGH] And in a way, anybody who's\nthrowing things and screaming and shouting and\nslamming doors or locking you in rooms, or anything like\nthat, there is something in that for you. You know, you can get the high moral\nground, you can at least get information. So don't worry too much about them, but be\naware of them. And then really understand what the other\nparty. This is kind of back to the figuring the\nother person better. But if the more you can understand their\nvalues and I'll tell you stories in a minute that\nillustrate each of these. The more you can understand really what it\nis that drives them, what's important to\nthem, the more likely you are to craft a solution to\nthings that satisfies what it is that's important\nto them. so, here, you've all seen this before. Just to pause on it for a second. Those of you who dread negotiations\nprobably have experienced some of this win-lose\nexperience. Those of you who said you really enjoyed\nthem have probably experienced more of the, the\nleft hand column. Okay, so here's seven situations that have\nsort of illustrated these points for me, and I only tell you\nthese not because I've had some unique\nnegotiating experience, but because you may recognize in some of these things\nyour own experience. You may be able to tie it in to your own\nexperience and internalize it in your own way so that it really does\nbelong to you the first one. I, I taught a negotiation session in the\nreal estate course here at Stanford a number of years ago, and I had a version\none and a version two of this. In version one, the instructions were, I\nwant you all to have fun. So this was the three party negotiation. There was a buyer, there are two or three properties a buyer, a seller, and a\nlender. And they had to come up with a tripartite\nagreement. And so everybody went off in these\nnegotiating teams, and made deals. The instructions were have fun, be\ncreative, learn everything you can about real estate and everything, and then just\nreport back on your experiences. Well, here's what happened. There were reasonable deals made. They were made quickly. They were relatively easy to understand\nand document. And there was a lot of camaraderie. People came out of it saying, man this\nwas, this was a fun exercise. We like each other. Aren't Stanford MBA's cool? I just really love my classmates. So that was kind of the outcome. So that was negotiations 1.0. So then we change the instructions. Okay, the objective is to win. You know? You're going into this negotiation, the\nidea is you wanna win. Your grade's gonna be influenced by it,\nand the results are gonna be published in rank order, and you need to make a report\non how you feel about it. What would you guess the change in results\n[LAUGH] was. >> Some deals made. >> Yeah, fewer deals were made. >> Slowly. >> They were made more slowly, a lot more\ntime was expended. I mean, tons more time, people said this,\nnegotiators actually said, took longer and was tougher than\nanything they had done. >> At Stanford. [LAUGH]. >> People are frustrated. >> People are frustrated and they hated\ntheir classmates. [LAUGH] They said I will never do business\nwith these turkeys again. I had no idea these people were such jerks\nyou know. So fundamentally change, with the mindset\nand I said with the mindset that means my fault. But the economic outcomes weren't any, but\nthey were fewer, as somebody pointed out, a lot more complex deals, a lot of more\nunworkable, undocumentable, unenforceable, and the\ninterpersonal relationships were strained. So you can see by having this mindset of\nwe've gotta win, and it's a zero sum, and it was\ndefined. I mean there were so, I mean, there's so\nfew things in most business negotiations. There was so little data that price, term,\ntime-frames, warranties, and remedies were about the only thing that\npeople could work with. Well, I mean, they just went in and\npummeled each other, just beat each other to bloody\npulps. [COUGH] So, that's the first story. And I'll let you draw your own conclusions\nfrom these. The second was is when I was first\nstarting in business I had a deal that I was working on in [UNKNOWN] or\nas they say [UNKNOWN] Spain. Did I do that right? Any of the Spanish speakers? [UNKNOWN] And we were going into a bank\nthere to borrow money. And we walked in, and it was clear within a few minutes that they really weren't\nquite expecting us. There, so they ushered us into this\noffice, with a guy that said oh, well, you know, so he sat down to\nlisten to us. And as we were sitting there negotiating\nover, financing this office building, two guys in white coats came in,\nand they took the painting off the wall. And a few minutes later they came back in\nand took the credenza. [LAUGH] And then they unplugged the phone\nand walked out with the phone. [LAUGH] Pretty soon they came in and took\nthe desk put it on a dolly and went out with it. We're sitting there in these chairs\ntalking and all of the furnitures been moved out. [LAUGH] Well it turns out this guy was\nnot. Really, the person who had anything to do\nwith me, he was just a courtesy party. We said, well, these guys are here,\nthey're from the United States, make them feel good, and so the\nnegotiation went all of. This kind of, I will tell you, my point on\nthis is goes back to make sure you're\nnegotiating with the right party. We had absolutely, this guy could not have\nmade any deal with us whatsoever, but we didn't\ncheck it out, so we sat there talking across an empty office about a deal that was never\ngonna happen. Well, that's an extreme example of\nsomething that we all do a lot of times. We end up negotiating with parties without power, without the ability to make a\ndecision. So you really want to think that through. The 3rd one, was also early on in my\ncareer. I was a chief financial officer in my late\n20's, of a big big company. I was supposed to make a joint venture\nwith a life insurance company. And, so I'd studied all the joint\nventures, then I figured out what I wanted on this deal, and what a win-win, I mean I had all, I was steeped in all these things\nand. So, I sat down with a, a very senior, 50 years life insurance executive, and we\nstarted going through the deal points, and there were eight or ten\nof them, and about after I'd been sent no, we're\nnot gonna do that in about the eighth deal point, I had\nrose, then I had rose in the ninth deal point\nand said you know, we really need to have this,\nyou've said no on eight of them, and he said Joel, sit\ndown. Just take notes. Your job here is just to take notes. [LAUGH] You know, we're not negotiating\nanything. Just take notes. We're the life company. We've got all the money. You're just the developer. Take notes. And, so it was clear to me that what that\nnegotiation was about. That negotiation was not gonna be one in,\nin that series of discussions. But, I was really going to just document\nit in a way that we had, a chance to do our business, and we\nhad options in the future. You know, so that wasn't the only option\nthat I had. [COUGH] Limited partners, I, I recall\nearly on thinking that I wanted to develop a a\nbrand. I wanted to be seen as a certain kind of\nnegotiator. And I, part of my brand was going to be\nthat I would calculate exactly what a deal was\nworth, and then I wouldn't budge. On the price I was, I wanted to be known\nas somebody who knew the value of what it was\nI was offering. And so if I said, this is a million dollar investment, I didn't wanna\nsettle for 950,000. You know, I really wanted to say, It's a\nmillion dollar. And I guess if you want to trade two\nnickels for dime, I'll do that, but I'm not gonna trade a\ndime for one nickel. So, I really wanted that to be my brain. Cuz I realized I was going to be in this business a long time and do hundreds\nof deals. So in negotiating with these limited\npartners I became very stiff on this. And it was only when I got options, and\nwhat happened to me in this in, in one case, a guy said well I'm\nnot gonna do the deal. I need to do the deal at 950 thousand not\na million. I went out that night and called another\nlimited partner, investor group and said I'll tell\nyou what. If you'll do this deal at a million\ndollars, I can document the deal tonight. And I can give you all these other things,\nbut I need the agreement tonight. So, and the guy called up the next day to resume negotiations I can say, sorry I've\nalready done that deal. So, I was able to establish that I don't\nmove on price. And it worked for a while until, we, the\nguy and I became really good friends. We ended up doing 300 deal together over a\n20 year life span. So, a lot of transactions. About 50 deals or so into it, he said\nJoel, he says, I just gotta tell you, I like to\nnegotiate price. I don't feel good, unless I can negotiate\nprice. So, if you want it to be a million\ndollars. Tell me it's a million fifty. [LAUGH] Just tell me it's a million fifty. I'll come back with a million, and then\nwe'll both feel good. [LAUGH] And, so we negotiated that, the\nlast 250 deals we did, I would go in about five or 8% higher than\nwhat I would accept. He would knock it down. He'd feel good and I'd feel good. So you, you, kind of going in and having\nsort of a, sort of a reasonable back, a, a rule, what I'm\ncalling ROR, our rules of the road. If you gonna have serial negotiations with\nsomebody, develop rules of the road. Senior partner departure. This is a situation, there was a billion\ndollar transaction. So it's a big deal. And this was 15 or 20 years ago. So it's a very significant transaction. And the partner came to me and said, you know, I want to, let's agree going into\nthis negotiation. Let's agree on values. Let's agree what these properties are\nworth. And then we'll make the trade. And on this particular case I thought, you\nknow, the biggest mistake we could make was, would be to\nagree on the values. Let's disagree on the values. So, you set up whatever you know, the\nproperties better than I do. You value them however you wish, and then\nI'll select. And the very fact that we didn't agree on\nvalues. Allowed me to select deals where I thought\nI was getting more than my fair share. He then was able, because he said guys, he\nwas fine with the, with the deal, because he\nrepresented what the values were. It was just applying the percentage to the\nvalues he'd set. So we were able to get a transaction done. My departure. So I left the Crow organization with the\nreputation of being a conciliator. With the reputation of being reasonable. With the reputation of being a win-win\ndealer. I'd settle all the litigation that crow would had for 20 years, departing\npartures. I was seen as somebody who was litigation\naverse. And because that had become my brand, my\nnegotiating brand, when it came to that, they filed\nlitigation. Against me, realizing that he'll never\nfight. This guy's such a pussy, such a conciliator, he's such a giver, he'll make\neverything. I really had no place to go. I had set myself up with my brand. So, I want, from that I want you to think very carefully about the brand you\nwant to have. The last story is one that I think you'll\nremember. >> So what happened? >> We ended up in four years of\nlitigation. >> No [INAUDIBLE]\n>> So I now have a new brand. [LAUGH] I'm now known as the ferret. No, it's interesting, because I think what\nmy brand has become is I am somebody who is very reasonable, who\nwill do win-win negotiations, but if you get to the point where you cross me and my\nprinciples or if you do something that I really think is completely unfair then I become very\nstiff. So, you don't want to get into litigation\nwith me, but you don't need to. So, that's, that's a better brand than the\nbrand I had before, which was the guy will never\nsue. He will never get into litigation. So, you really wanna think carefully,\nbecause that brand, and part of my message, here is that there are no\nepisodic negotiations. You may think it's an episode. You may think you're going in and having a\none-off, deal with somebody. That person talks to somebody else who\ntalks to somebody else who talks to somebody else, and pretty soon everything\nis we live in a very connected world. So think carefully. If you're doing a lot of negotiation for a living, think very carefully about the\nbrand you wanna have. Now, I apologize to my students, former\nstudents for this next one, because several of you seen this, but I had a, [COUGH] a negotiation with my daughter over this\nlast topic. So, I'm out here teaching at Standford. And I come out for basically ten weeks,\nwhen I teach here. So, she's back in another state, and we\ncorrespond by email. I get back a couple of times, she and my\nwife get out a couple of times, but we're basically\naway from each other. So here I get this email from her. Dear Dad, did you hear I'm getting a rat? Won't that be cool? The pet store lady said that you can train\nrats to fetch and stay. I wanted to get mice, because they are\ncuter and don't have a disgusting tail, but mice just run away,\nand they never become your friend. Rats will sleep on you, and I'm sure dad\nyou'll become great friends with my rats. [LAUGH] I'm thinking of naming them Ritzy\nand Scraps. Won't that be cute? And you can even see them when they're\ntiny babies. Take deep breaths if you're getting\nnervous. [LAUGH] I will pay for them and the cage\nwith my very own money. All you and mom have to do is buy the\nfood, which really doesn't cost much. I've already done everything else. I think I'm ready, it's okay, I can take\ncare of them. I've proven I can take care of animals, I\neven sweep up the cats barf. >> [LAUGH]. >> I can handle it. So, you can trust me to take to care of\nRitzy and Scraps. They already have names. I hope you're doing well at Stanford. Isn't this warm and fuzzy? I'm doing well here, same normal things, practicing soccer, whining to mom about\ngetting rats. Just, so you know, she already said yes. [LAUGH] Is this a negotiator? This 11 year old kid, I mean some of this\nstuff, when I ask who are the expert negotiators, I promise you we are born\nknowing something about negotiation. Just see you know, she oh, yeah, I'm sure\nshe's sick of the same conversations can I get a\nrat, mom? Please, I'll do my practicing that's my\nsecret in life. Promise to do my practicing. [UNKNOWN] So here's this, this is the\ninitial volley. This is the negotiating position. She's kind of laid out her negotiating\nposition. So you're sitting out here, 1,500 miles\naway, thinking no way. [LAUGH] She has crossed the barrier I'm\nunwilling to cross. So, here's my response, and I want you to\nnotice this, because this is, this is a real life\nnegotiation. And I'm gonna have you predict how it came\nout. >> [INAUDIBLE]. >> What's that? [LAUGH] Good point. Dear Elise are you nuts? I have been killing rats at the house in\nWoodside they are not cute they're not nice they are not controllable they stink\nthey eat everything, they make little black\npoops everywhere. And I have to clean up the mess. Just this week, I bought some decon, to\nput out where the rats live. >> [LAUGH] >> The next day I found a dead rat near the pool, and another one trapped in\nthe garage. Just to be clear, how, about how I feel, I\nmust inform you, that we smashed it's head in\nwith a [INAUDIBLE] >> [LAUGH] >> I'm a negotiator, come on. [LAUGH] It was fat and ugly. By the way, I think its name was something\nlike Ritzy. [LAUGH] In any event, one of the big\nreasons I was getting so excited about coming home was to get\naway from the rats. Now I may as well stay, huh? See how hurt. I'm just hurt, I'm appealing to this young\ndaughter. now, what would like next, a python, or\nhow about some Ebola virus? >> [LAUGH]\n>> Or maybe you could raise maggots. Anyway, I still love you and miss you and\nwill see you next week. Love, Dad. >> [LAUGH]\n>> So how did this negotiation come out? Straight egg. What's that. >> He get's the rats. >> She get's the rats exactly. She got the rats. Now why would an expert professional\nnegotiator with $10 billion worth of deals under my belt. Given to this 11 year old kid on some\nstinking rats. >> Imbalance of power. >> [LAUGH] That's a great point. Or besides your mom had already said yes,\nso real imbalance of power. To me this is the difference between\nknowing the elephants and the ants. You know, I was willing to lose a battle\nto win the war. And the war, what I wanted, winning for\nme, defining winning for me was raising a child who's responsible,\nwho loves me, who will listen to me on things that really do\nmatter, and, so I was really willing to take a kind of\ndifferent view of this. Now again, now, the really gratifying part\nof this story is. In the end she gave the rats back to the\npet store lady, after the pet store lady had told her she would\nbe feeding them to the snakes. So she disliked the rats as much as I did\nin the end, and she came away saying, dad you\nwere right about the rats. [COUGH] So now. >> What was that. [INAUDIBLE] change [INAUDIBLE]. >> she, I arrived home and the rats were\nthere. >> [LAUGH]. >> [INAUDIBLE]. >> Bothering [NOISE]. no, no, that was done, it's a done deal,\nmom had already said yes [LAUGH] it was do you\nwanna hold them dad? [LAUGH]. No I think I'll pass on that [LAUGH]. So, I think we've covered most of this,\nthis idea of episotic versus serial, think serial in your mind,\nas you think about your brand. Outside versus inside. This last was a very much of an inside\nnegotiation. You'll have negotiations with third\nparties, and with people who are really close, whether they are employees partners, brothers sisters\nchildren spouses. The inside ones are by far the toughest. Negotiations, they're the least forgiving\nand they're the most important ones to lose. So this idea that every negotiation is a\ncompetitive game that you have to win, it really helps you\nget over. The more inside negotiations you do in\nyour life the more that you realize you don't have\nto win. Certainly not every deal point and you\ndon't have to win every negotiation. So don't think of it as a competitive\ngame. This idea about, jus lik, I just like this\nquote. Don't wrestle with pigs, you get dirty and\nthey enjoy it. So be very careful who you negotiate with. And that means generating options, that\nmeans always having other people to talk with and to do\nbusiness with. If there's the worst thing in life, is to\nget in business with people that don't have the same values you\nhave, that you don't respect. I mean, it is misery. It's a different kind of misery from just\nabout everything you know, except being married to somebody\nwho makes you miserable. [COUGH], then this idea of being\nreputation building. I've given you my examples of that. But. Here are some alternative reputations you\nhave. One is, I'm tough, I'm unbending the legal\ndocuments govern. I've known a lot of people who are that\nway. And often they are people who have a lot\nof money [INAUDIBLE] and they really believe that's a really\nsmart way to do business. Guess what happens? In the end they may not have a lot of money they may not have the same position\nof power. And they may not have a friend when things\ngo against them. Live by the sword, die by the sword. You can be flexible, be, reopen, open to\nreworking the, the life company joint venture partner I told you about who just\nsaid, take notes, Joe. Turns out, he was one of the most flexible\npartners you could ever have. So the documents were the documents were\nthe documents. He couldn't negotiate them, he didn't want\nyou to negotiate them, just take notes. But when it came to working out the\nproblems of living in the real world of doing business, he\nwas extra ordinarily flexible. And so I kept doing business with him. I probably did 25 deals with him over my\nlife in real estate. Because he was such a great partner. He was a tough negotiator documenter but\nhe was a great partner. You can have this, reputation being eager\nto make deals. Where you just say I do a lot of singles\nand doubles. I don't do home runs. The other is that. People, there are some people in the\nnegotiating world who just say I only do home runs. If I don't, get a four bagger, if I don't\nhit a home run, if I don't win the thing, it's, those are\nthe only deals I'll do. So you need to decide what your reputation\nis there. We've talked about these last couple of\nthe last one is this Fishy Fisher and Yuri. Trained problem solver and we'll talk for\na second about Fisher and Yuri. Yeah, comment? [INAUDIBLE], [INAUDIBLE], we're talking\nabout basically these selector, that they, [INAUDIBLE], what do\nyou do when you're in the situation; where let's\njust there's event that you need to associate\nwith. Mm-hm. And they are, we really need their thing,\nthere's. There's not another alternative out there. You don't agree with their values. Yeah. What do you do in that kind of situation? In some cases you just have to suck it up\nand negotiate with them. In some cases you can get another party in\nthe organization you negotiate with. In other cases you can talk to them and\nsay okay, here's where I think our conflict is coming, and\nget to a deeper level. And talk with him about that. I used to have a partner that would say to\npeople you know we're not making a deal on this what would it\ntake to make a deal? And that was effective in certain\ncircumstances you know what would it take to get this relationship on a better footing or\nto develop a more long lasting give take\nrelationship? and sometimes you can get that real with\npeople. My, my views going back to the very\nbeginning is generate options so you don't have one vendor that you really rely on, or one alternative source of\nfinancing. I mean, I like having a lot of options, so and I, I realize that's a bit of a\nPollyanna. You can't always do that. I mean we just did a deal with one of the\ncompanies I'm involved in where they, they were about 40% of our\nbusiness, they were really important. We had to get that deal done. So consequently we took notes and got the\ndeal done. So you gonna do some of that. There's not a panacea to every negotiating\nproblem. You are gonna deal with difficult people. You're gonna have win lose negotiations. You are going to have some things that you\ndread. But I'm just saying that you can nudge\nit's so that it a happier experience. It is more of a win, win experience, and\nthe better you choose party. So here, here mindsets that I've got when\nI go into your shoes. What time do we end Marcello? Where did Marcello go? 8:12. 8:12? So we have till 12. Are you happy until then, or are people\nwanting to get out of here? You're okay? Well, let's talk a little bit about these. And one of the con, one of the mindsets\nthat I think is a really good mindset is that a\nnegotiation is just a conversation. It's just an exchange. You're good at conversations. You talk to people all the time. So, this idea of oh my gosh, we're going\ninto a room, we're closing the doors, we're\nsitting on opposite sides of tables. You know, that feels a lot more\nthreatening than, I'm just gonna talk. About our various interests and try to have a conversation to come up with\nsomething that's mutually satisfying, so think of\nnegotiations as conversations and your good at it,\nthink of negotiations as a series we've\nmentioned think that agreements as [INAUDIBLE]\nwinning it's back to this idea of what is winning, the idea\nis that your agreement should be durable. There's no point in coming to an\nagreement, that it terminates in a law suit six months\nlater. You've not negotiated a good agreement. So you want them, there to be some\nelasticity. Some sense, and usually that is a function\nof how much trust you've developed with your\nopposite party. If you've developed very high trust with\nyour opposite party once you come to an issue the first instinct\nisn't, oh my gosh. Let's go to the documents. What do the documents say? Most of the good deals I've ever made have\nnever once referred back to the documents. Not once, and some of these things have lasted 25 30 years,i mean, my whole\nbusiness career. We never ever once go to the documents. Why? Because we like and trust each other and\nthese are real issues and we sit down and talk it\nthrough. So you want a durable agreement. So that's, that's another mindset they\nhave. Another mindset is, is thinking win win. In other words, to recognize that you're\naccountable to [INAUDIBLE]. A lot of times, people think is the negotiator, they're only accountable\nto themselves. I'm winning for me. There are very rare negotiations where you\ndon't have broad accountability. It's to your employees, it's to the\ncommunity, it's to shareholders. it's to a board. Sometimes this can be a very effective not\nin the room party. That you can use to give you, you some\nbreathing room to pause and say, well, I can't, I wouldn't feel right about this [INAUDIBLE] the\ncommunity. I don't really feel good about dumping\nthis sludge into the river, you know? I mean, you really have an accountability. So this idea that there's an\naccountability outside your own interest is a good mindset to\nhave. [COUGH] Watching your language. I don't think it works to curse, scream, swear, slam doors, walk out of rooms, even\nbluff. I think bluffing is, a fools game cuz all\nyou need to do is bluff once and have it not happen and\nyou have spent your reputation. You are forever more seen as a bluffer. So my, my view on that is just never\nbluff. Never use, what I call high velocity\nwords. Just, you think of the words that just sorta raise people's emotional tension and\ntheir temperature. Just stay away from them. And if somebody uses them on you, ignore\nit. Don't let it work. And you don't let your temperature rise. So watch your language and watch What if\nyou are genuinely upset and you get frustrated\nyou know you are not doing it for effect and your not\nusing a technique that you try to control it all\ncosts? I think you should try to control it. And, here's why. You know, if you, and if part of it is\nyou're setting a baseline, you know. What, whatever your baseline is, it's the variation from your baseline that will get\naffect. So if I say to you, I will never agree to\nthat, that's pretty powerful. If you know me, if you've negotiated with\nme a lot of times,. For me to say, I will never do that. I mean, you really believe. I've just screamed that out. Whereas if I'm throwing things around and\ncursing and, you know, lot of histrionics. I can shout, I'll never do that! And you'll say, yeah, yeah, okay, he'll\ncome back tomorrow. So I think keeping the baseline. Keeping the baseline really low is a very\nsmart thing to do. Plus it keeps your own blood pressure\ndown. I did walk out of it. This billionaire dollar deal that I did\nout here. Where we were swapping a billion dollars\nworth of property. I sat with the partners. There were six of them and one of me. And the most senior of them just said\nsomething that was just completely of the wall and\nunfair. And I just stood up and said gentlemen,\nit's been a pleasure to be your partner all these years I am so sad that\nit has to end this way. I am catching my plain and I will be gone. Give me a call in Dallas if you want to\ntalk about this. And, it was that simple before I could get\nto the airport. I had a call from three of these partners\nto say, please come back, we want to negotiate business, and it\nwasn't that I'd, I, I had gotten up. I'd stood up when they said it, I'd left the room, but my speech was really that\ncalm. And I think they took that as, oh my gosh\nhe is serious. He is really serious. And that's the message, that I'm really\nserious. That's the on that I want to get across, not that I'm chapped and that I'm out of\ncontrol. because, people don't trust that as much. in the end that idea of being trusted. You know if you really want to be an\neffective negotiator be trusted. if the other party can trust you. Over the long run, you'll develop that\nbrand. And you'll develop durable agreements,\nhigh trust relationships, creative solutions, relationships with\nothers that you like, etc. So, I'm just recommending it as a,\ndifferent mindset than a lot people have towards it. Yeah. [INAUDIBLE]. [COUGH]. North America and Wesson, I worked all\nover the world. Getting angry may or may not work, but\nit's not a big surprise when it happens. The rest of the world, I mean if you're always calm, it translates across\nall cultures. Yaah, yes, it's kind of a universal\nlanguage. Clarity. Something in some cultures is just an\nabsolute no no and you've lost... We burned all your credibility. You lose credibility. Yeah, you're seen as an unstable person. Here, people might or might not forgive\nyou. Depending on the industry. Yeah. Some industries are full of wild people\n[LAUGH]. Yeah? We negotiate to an intermediary, an\ninvestment banker, an agent... Or an attorney who's actually negotiating\nan agreement, would, would you use this as a model for find, for\nselecting and intermediary? Cuz that person can often have a\ntremendous impact on your brand as well because they might act completely,\nand they're off on their own. You don't really know exactly what they're\ndoing either. Neither. I think you have to be very careful in who\nyou select, cuz they carry your brand. I've seen more attorneys foul up deals\nthan actually facilitate deals. In fact, I select my attorneys in terms of\nare they deal facilitators. Are they dealmakers, problem solvers? Or are they sort of egomaniacs who throw,\nwho have to be right on every deal point, who have to\ndraft the toughest documents? A lot of times what you'll do in deals is\nyou'll get attorneys fighting. And the attorneys'll fight. And it'll de, destroy the deal and the\nrelationship. So, I number one is I try not to have very\nmany intermediaries on the front line. I don't like. To have agents, brokers, investment bankers, or attorneys negotiating my\ndeals. I like to establish a one on one relationship with the other principal,\nin deals. I really think that's the safest way to\nmaintain your brand. And it's the way to create uh,better\nrelationships, to create better outcomes. It's more work in the short run. It's less work in the long run. I think there is a reason that people use these intermediaries and I think they can\nbe valuable. I think it's always smart to have somebody\noutside the room. Because negotiations are these real time\nthings where you're exchanging things back and forth, back and forth, back and forth,\nand you can make mistakes and it really helps to have somebody,\nwhether it's a board, a partner, an attorney, or whatever who can\ncome in, refine, correct, smooth over. So I like to use them in all those things\na lot of times I'll say I need to run this past\nmy partners. This makes sense to me but let me check\nwith the attorney or the tax council or my\naccountant on this. So you know,I like to have a little bit of\na backed on. So, I use them that way. But I never put them, my attorney will associate with your attorney and make a\ndeal. I think it's very dangerous. Not to say it doesn't work but, yeah. I had this question regarding not, not\nreally going above or below the median as someone, I'm\nvery emotive. That's who I am and what,what I'm hearing\nis. You know, poker face, try not to get hooked into these things, try not to be\nemotional. Which to me is really like, if you said,\nthe best way to negotiate is if you're six\nfoot tall. And I'm five feet tall. Yeah. So, that, to me it's like okay, that, I\nagree, I can see how that would be effective, how\ndo you,. But you're just not six feet tall. Yeah, I'm not six feet tall. So how do I do that? I think you start out by being yourself. Authenticity is something that will be\nmeasured by the opposing party, which it, which\nwill. [BLANK_AUDIO] Go back to trust a lot. I'm just saying that the, you can\nmodulate. You can, you can keep the swings from\nbeing so wild and, and that will help you, you\nknow? Won't make you 6' tall, but it may make\nyou 5'2\". >> So it's okay to [CROSSTALK]. >> I, I think you need to be yourself. I mean I'm demonstrative too, I mean speak\nwith my hands, I wander around. I, I get excited about idea. I mean it's who I am. So I be, I am that. But I just said there are certain things,\nthere are certain thresholds, that I don't wanna cross\nbecause I spend a lot. If I crush those thresholds, I've spent\nsomething that doesn't return to me what it's worth. So, if you're all over the map, and around\nlike that, you just need to realize you're spending something that's\npretty valuable and, and you don't have any place to go. You know, once you've cranked the volume\nup all the way, there's no place to go. So, leave yourself a place to go and I, I\nthink moderate it. And the final one is be likeable. And I know this is I mean you didn't come\nto Standford to hear be likeable. But I, when I went through litigation I\nremember talking with, I think it was opposing counsel\nafter it was all over again. And he said something like, you know, I\nwanted to dislike, I wanted to hate you. I really wanted to be as angry at you as\nthe plaintiff was. He said, but I couldn't help, but kind of\nliking you, and he said, it, I didn't wanted influencing, I'm a\nprofessional and I did my job but it still had an impact. So I talked to my attorney about it and he says, you know, I've had the same\nexperience where I've got. And he'd, he'd, deposed Ivan Boesky, he, I\nmean you go down the list, people he'd been\nthrough, a whole bunch of them and he said, you know,\ncertain of them were really likeable scoundrels and\nit made a difference. And others, you know, you just wanted to\nfry. And so this idea, there is something in\nall, even the most jaded professionally trained\nlitigator who does gladiating for, for a life, you know, says\nit makes a difference if you like the other\nparty. So I think there is almost no upside in\nbeing a jerk, in being a turkey, I just dont' think it\ngets you anywhere. Well, we're about out of time, I well, let's just see if we've got anymore of\nthese. We talked about agents, being of\nprinciple. We've talked about lawyers as\nmemorializers or agents, disputes. You know, this is in the far end, or the\nformal end of negotiation. Whether you mediate, arbitrate, or\nlitigate. I guess my advice on that is, they're all\nkind of bad outcomes. And you really want to avoid, you really want durable flexible agreements,\nand trust relationships. If you have to get to these litigation and\narbitration are not that different in terms of,\narbitration may be a little shorter and a little less expensive, but you're\nstill presenting information under rules of evidence typically to a special master\nor rented judge or something. So it's very much the same kinda thing. Mediation. That negotiation is a split the baby\nnegotiation. So if you're right, you're gonna lose\nhalf. So I think you, you just want to be, so this is again in this very sty stylis,\nformalized way. The rules of those negotiations very much\nnarrow your outcomes. So, just be aware. Implementing the agreement, flushing out hidden agenda items, outbursts\n[INAUDIBLE]. We've kind of talked about all of those, I\nthink. So Fisher and Ury. Has everybody in here read, how many of\nyou read, Getting to Yes? Only a few of you. It may be so old that people don't read\nit. It's still the classic book on\nnegotiation. I would recommend it to all of you who\nwant to become a better negotiator. Written in 1981 by Fisher and Ury, two\nHarvard lawyers. And they talk about their negotiations in\nthe salt talks. And a lot of data on really sort of what\nworks and what doesn't. They wrote another book called Getting\nPast No. So Getting to Yes is the first one,\nGetting Past No is the second one. Actually the second one is much less read. In fact is there anybody in here that's\nread Getting Passed? Okay, great. Not very many people have read it. It's actually, I think, even a better more insightful book, if you've done a lot of\nnegotiating. Those are two really sort of good\npractical academic texts that give you a good map. And I can usually tell when I'm\nnegotiating with somebody who has studied Ury and\nFisher. It's a different kind of a negotiation. It's actually quite pleasant. So here's the, if you don't want to read it, [LAUGH] here's the Reader's\nDigest version. I'm saving you time. You thought you were wasting an hour with\nme, I'm gonna save you a couple of hours. Basically, the idea is separate, so here\nare the four fundamentals. Separate the people from the problem,\nwhich a lot of people don't do. They merge them, you know? The problem's thorny, therefore I don't\nlike the people. The people who have this issue that is\nbrought before me, because I don't like the issue or it's putting me in an awkward\nposition, I also don't like those people. And so, a lot of confusion, so they say separate those two and focus on interest,\nnot position. Now, in other other words what would you\nlike to see happen? Not what positions are you going to take,\nis the other party gonna take, because positions are not\nnecessarily related to what are really in your interest. People express positions that may not be the actual end point that reflects their\ninterest. Then invent options together for mutual\ngain where you think outside the box you invent\noptions. And then insist if you can, this is the hardest one for me, is figuring out\nobjective criteria. You know what, what would be a winning\ndeal? What would work? And then assess your deal against these\nobjective criteria. That is the hardest one for me, but I've\nseen it work. And then finally for me I'd say know your\nbartner. Figure it out, write it out, know it going\nin and my corollary to that is, calculate the\nother party's bartner. So you really know, that it's not life or\ndeath. There are alternatives and you'll be more\nlikely to have successful negotiations. Now I'm gonna show you there, these are,\nagain more Fisher and Ury things. But if you'll just, this is how they deal\nwith some of this. Dealing with problems and framing things. So I'm gonna flash this slide up and one\nother slide up, and then have you think about, what\nelse this relates to. You know, discuss each, don't blame the\nopponent see the opponents intentions, see the situation, you know from their\nprospective, give them a stake in the outcome. You know, don't react to provocation, step\naway, don't respond reflexively, be an active\nlistener, agree when you can. I used to have a friend that I negotiated,\na guy that became a friend that I negotiated with, who'd start out every\nnegotiation with all of the things we agreed on. So the, you'd go through ten items and\nsay, okay, we agree on this. We agree on this. And you got in this reflexive habit of\njust agreeing. Okay, I agree to that. That works. I agree to that. That works. Okay, that's good. And you'd get done to, then number 11 and\n12 and 13, which were the tough ones. So, these are things that Ury and Fisher\ndiscuss. And would it, you know? I guess I'll just tell you, because we're\nout of time. My take on this is, this is marriage. [LAUGH] You know, this is how I've made a marriage work for 35 years, is basically\ndoing these things. And, and most of the relationships you're\nin are subject to negotiation. If you kind of listen to these best\npractices, your life will work better, your relationships\nwill work better, and your conversations'll be happier, your\nagreements will be more durable, and most of the time you'll feel like you\nwon. Most of the time you won't feel dirty,\nlike you need to take a shower. And negotiations won't be just eating your\nbroccoli but will be something that gives you life, let's your express creativity and build\nrelationships. So, I'll hang around here after if any of\nyou want to discuss this or have any questions, but\nthank you very much. [NOISE]"
}