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Top Negotiation Hacks from Mark Raffan --The Negotiation Ninja #5925 · Financial Survival Network

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  Well, aside from planning and preparation. Within that, I think you first
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  need to think about what is it that we're trying to create? Right,
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  we had that at the beginning, But then how am I going to get
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  there? Because you may say to me Mark, I want a quote unquote
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  good deal, to which I'm going to say to you, cool story.
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  So does the other person what does a good deal mean for you? What
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  constitutes a good deal? So you might say, well, I want to
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  make more money, I want to reduce risk, I want to improve communication.
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  Could be a number of different things you do. But then I would
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  say, okay, break those down. What are you going to actually negotiate
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  into the deal to ensure the successful achievement of those things. You're listening to
• 0:39
  Carrie Let's's Financial Survival Network, where you get valuable information you just can't find
• 0:45
  anywhere else to thrive in today's trying times. You need the Financial Survival Network
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  now more than ever. Go to Financial Survivalnetwork dot com and get your free
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  newsletter and gift. Financial Survival Network now more than ever. Ed Welcome.
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  You are listening to watching the Financial Survival Network of your host Kerry Lotz.
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  Well person, you're about to hear from really happy to brain you. It
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  builds himself as the negotiations Ninja. And your name is Mark or fan Mark
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  trait to have you on the show. Hey, negotiation. Everything in life
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  eventually becomes a negotiation, right, it always does, always will. Everything
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  about living day to day is about negotiations. So being that that's the case
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  of being a good negotiator. Is it about winning or is it about getting
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  both sides or all sides what they want or getting closer to what they want?
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  Yeah? Good, good. First question, I'm going to say something
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  controversial. Ridles the hop when win is the biggest lie that's ever been told
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  in the negotiation world. But so is wood loose because it's built on the
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  same premise. When when presupposes that both parties can win, that's not possible.
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  If you've been in the business world in general, you know that to
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  be true. But even let's just say, for example, that both parties
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  could win, then you would need to know what the complete value of that
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  deal is over the lifetime of that deal, which is almost impossible to know
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  as well. And you've got to know that with complete certainty. And even
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  if you could know that with complete certainty what the deal is and the value
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  of the deal is over the lifetime of that deal, then you would need
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  to be able to be quote unquote fair with each other a distribution of that
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  value. But what is fair, really fair, is based on what your
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  perception of what fair is, and it's also based on what my perception of
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  what fair is. And so we have to come to an agreement on what
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  fair is. But we can't because it's not objective. It's subjective. And
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  even if we were going to come to an agreement on what fair is,
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  we would also need to be one hundred percent transparent with each other about the
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  value and about our own interests and everything that's going on in our business between
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  each So I would argue that the whole idea is built on faulty ground.
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  Now, the number one objection I get to this, of course, is
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  mark that's not what winmen is about. Win win is about how you feel
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  after the negotiation. It's about if both parties feel like they want Well,
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  that actually makes less sense to me than the first thing, because if it's
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  just making you feel good, then I could do that all day. Right,
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  All I have to do is to emotionally manipulate you during the conversation.
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  So I think the premise that that is built on is a bit faulty.
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  I would caution people when they think about win when that it's now incumbent upon
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  them to create a win for the counterparty. That puts you in a very
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  dangerous position and opens you up to bad actors who would use your good ideas
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  or your collaborative nature against you in that negotiation. So first, I want
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  you to think about what it is the value that you're trying to create for
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  your organization. They obviously want to create value for them, That's why they're
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  talking to you, right, Otherwise they wouldn't be having a conversation with you.
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  So what is it that you're trying to get value out of? So
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  is it a zero sum game? So it's not a zero sum game.
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  So then the question is, sometimes you can make too good a deal for
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  yourself where it's so bad for the other party that the deal is going to
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  blow up, it's going to fall r So it isn't just about achieving all
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  your objectives at the expense erect of the counterparty. And right, yeah,
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  I'm not saying that mutually beneficial deals aren't possible, But I'm saying it's not
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  your job to ensure they get a great win. So let I think the
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  philosophy behind this is very very important philosophically speaking. Don't go into it making
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  it your job to ensure that they get a win. That's their job,
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  their job to ensure that they get a win or value from the negotiation.
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  But if you make too good a deal and their value isn't there, that
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  deals can fail. Right, So you don't want to Yes, you want
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  to pursue your objectives, but within reasonable latenits right? Sure? Can I
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  counter that with a counter argument? Sure? What do we determined as reasonable?
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  Is reasonable based on what your perception of what reasonable is? If it
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  is, what is that based on? Is that based on data or is
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  that based on fear of rejection? Where most people would now for you,
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  for example, you may be in a position where you're like, Okay,
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  I've got forty five years of experience doing this, I know what quote unquote
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  reasonable is. For the vast majority of people that I speak to, reasonable
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  is based on fear of rejection. I would say that reasonable is where both
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  parties gain from the transaction. You might gain more, and that's okay,
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  but there's a benefit to both sides, Whereas if it's undre reasonable, then
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  the costs to one party are two great, and it's going to make it
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  the outcome of this deal negative and the deal may never happen as a result.
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  Yeah, I love where your head's at. What I would caution for
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  people, though, when they think about this, is be very cautious of
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  how you determine what reasonable is versus what reasonable is it. Because if it's
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  if it's what you determine as reasonable, is that I get a gate,
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  or even if either side gets more, that's fine. If all I have
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  to do at that point to say, well we're gaining on this is unreasonable,
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  like why am I not getting? Ay? So okay. So,
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  just like a lawsuit case in court, I assume negotiations are wanted loss on
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  preparation and often revation alone. Right Yeah, Oh, I mean the vast
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  majority of the time, most people are winging it, and I think we've
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  probably got the media to blame for that. I mean, if you watch
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  any major commercial type V like a Wolf of Wall Street or a Boiler Room
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  or something like that, you see these amazing salespeople create deals out of seemingly
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  thin air. The reality is that's not true. It comes with a lot
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  of preparation, right, and preparation. So I think Sun Sou said,
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  you know, you have to know your enemy, but you need to know
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  yourself even better than you know your enemy. Yes, amen to Sun Sue.
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  Correct. And he also said tactics without strategy is the noise before defeat.
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  But most people think that negotiation is all tactics, like how you say
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  the thing, the case of your words, how you inflect on certain things.
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  Though most of it comes down to the strategy and preparation that you have.
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  All right, So what other tools do you break to the negotiating table?
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  Well, aside from planning in preparation. Within that, I think you
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  first need to think about what is it that we're trying to create? Right,
• 7:56
  we had that at the beginning, But then how am I going to
• 7:59
  get there? You may say to me Mark, I want a quote unquote
• 8:01
  good deal, to which I'm going to say to you, cool story.
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  So does the other person what does a good deal mean for you? What
• 8:11
  constitutes a good deal? So you might say, well, I want to
• 8:13
  make more money, I want to reduce risk, I want to improve communication,
• 8:18
  could be a number of different things you do. But then I would
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  say, okay, break those down. What are you going to actually negotiate
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  into the deal to ensure the successful achievement of those things. So I'll give
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  you an example. Ha Here they wanted to redo the pool house facility.
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  So you know, I basically figured out what they wanted, talked to the
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  guy, and then you know, he puts forth a proposal. Then they
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  come back with a bunch of changes which were meaningless, didn't really save anything,
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  And I'm trying to explain. Look, contractors, they know how to
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  get you here. You've either got to cut corners or when you change something,
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  they're going to get hit you with a change order and they're going to
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  make that money back. So you're better off just acknowledging the fact that they
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  need to make a profit regardless of what the number is. If if you
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  push for too good a deal, you're going to get hit with change orders.
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  And you can't explain thus to these people. They just don't know they
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  have to negotiated right. And important in that is you also knew what you
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  wanted as a part of the leadership of the HOA right, you wanted to
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  ensure a smooth process. You probably had a timeline that you wanted to hit.
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  You probably wanted to reduce some liability as a result of all that,
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  But there were some key things that you probably want to hit too. Very
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  true, Very true. Well, I find it to the fascinating that most
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  people, like you say, they go into a negotiation that wing it.
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  You don't really know what you want, so therefore you don't know if you
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  got it, and you don't know if you wanted or lost. To react
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  to you. But sometimes you make these deals, like you said, it
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  seems everything se as a reasonable The company, you know, a consultant,
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  basically he develops a marketing plan for big companies, household names, right,
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  And he doesn't really want to do it, he doesn't need to do it,
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  but he says, look, I know, I think it's going to
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  work. You're going to give me six percent of revenues in perpetuity, right,
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  And they need him so badly at that point, and seems like a
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  great deal. Twenty years down the road, they're still paying in royalties millions
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  of dollars a year and they just want they'll do anything to fy the door.
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  But they know that they can't get out of it fire. That's all
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  that. Yeah, this is what I mean by in terms of the total
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  value of the deal over the lifetime of that deal. Right like this,
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  that's the perfect example of what I was talking about. So understanding that at
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  the beginning of the conversation and determining that could be very, very beneficial to
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  your organization long term. I mean, think about if you grew business from
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  you know, let's just say, yea, I'm the six seventh figures,
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  right, You've got a one point five two million dollar business, but you
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  grow that into a two hundred million dollar business. Six percent at two million
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  dollars doesn't seem outrageous. Six percent at two hundred million dollars seems crazy,
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  right, So when you think about the scope and scale of the business,
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  that's why that's so important. Exactly what we're talking about here. And yeah,
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  when you were a tenet of size or one hundredth of size, hey,
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  it was get out. It was pie in the sky right exactly.
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  Plan worked and you wouldn't be there without him, right, right, you'd
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  be there without him. But as he had said, I want when you
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  hit twelve two hundred million, I want twelve million a year. You would
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  have told them to take a hike, but when you were negotiating, he
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  never even thought that was possible. So you still want the negotiation. It's
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  just that maybe he made a better deal than you thought he did. Yeah.
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  Absolutely, it's good. Give us some real life examples of the deals
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  that you've helped negotiate for clients and others. Some that have turned out amazing,
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  and some of that have bombed. Well, I'll tell you the one
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  that bombed. It was one of the larger negotiations I've ever done. It
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  was about two hundred and fifty MILI and everything was going hikey, Dori,
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  And we were about nine months into the negotiation, which is fairly reasonable based
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  on a deal of that size, and I was getting stuck in the weeds.
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  I was too deep in the weeds to see it. You know.
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  That's saying you're so deep in the forest that you can't see the forest through
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  the trees. That's where I was right. And we were arguing over venutia
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  nonsense. Little thing was that within the grand scale of the deal didn't make
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  a lot of sense. And were buttonheads over and over and over again,
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  and should have done this way sooner. But I went to the person that
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  I represented and I said, listen, we're stuck. We're stuck in this
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  deal. I don't know what to do. And I got pulled out of
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  the deal and the counterparty side got pulled out of the deal, and they
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  put two new people in place, and they closed that deal in the next
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  three weeks. So the shot them going to the right. Yeah, and
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  we were like seventy five percent done right at nine months, and they closed
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  the last twenty five percent in the next three weeks. And that taught me
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  a big lesson. The lesson is don't let your ego get in the way
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  of your success. That's probably the biggest lesson that I've ever learned in a
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  negotiation, because ultimately, you want to be right in a negotiation. Oftentimes
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  when your ego gets in the way, and so you could let being right
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  get in the way of securing a really important deal for your business, and
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  fundamentally that changes the way that you think about the deal. You end up
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  putting being right ahead of making money. And when you're putting being right head
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  of making money, you're now emotional in the negotiation, and that's bad.
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  Yeah, you got to be objective and emotionally uninvolved. Correctly, you love
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  cut the deal and it popped the champagne. So this is an example where
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  you got so tied up in the details that you forgot what the goal was.
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  That's right. Luckily your client didn't, So becoming a hand drance,
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  that's right. Right, So all right, and that is that? What
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  a great lesson. I mean, it's not great for how you feel after
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  after that happens to you. You're like, oh my god, I'm a
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  loser. What have I done? But it's an important lesson to learn.
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  Yeah, well you came back down to earth, you know exactly, Hey,
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  because of the success. Look, I'd always say you learned way more
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  from your failures than you do from your successes. You know, you should
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  treat your failures like gold or the lessons you learned from them. So what
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  about one where worked out the opposite where you were the hero everybody deciety?
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  Yeah, I mean the opposite is also true. I've worked on many deals
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  where I haven't. The goal is to not be a hero. Strangely enough,
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  the goal is to ensure that I represent the need of the business that
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  I'm representing in the best way. Possible, and when you always keep that
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  top of mind, you're always more successful. One such deal in particular,
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  similar kind of industry, similar kind of situation. We're able to get the
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  feedback from the client about what it is they were trying to achieve down to
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  the nth degree. We were crystal clear about what is it that we wanted
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  to achieve during the negotiation, and we had a range of acceptable outcomes for
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  each of those things. Going into the deal. Made that transaction a lot
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  easier because we were very clear about what we could do, what we could
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  not do, where we wanted to be, where we didn't want to be.
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  And I didn't have to go back and forth with the client. I
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  didn't mess rever represent the client's need, I didn't get stuck in the minutia.
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  It was much much easier to be able to get things done. And
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  I think that's the major message that I want to leave with everyone today is
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  be very very very very clear about what it is you want to achieve and
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  how you think you might want to achieve it, because once you're clear about
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  that, the negotiation goes much sooner. I know there's a lot of people
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  who try to be cagey with that sort of things in negotiation, or they
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  say, well, if I just ask for what I want, that's too
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  on the nose. I find the opposite is actually true. I find the
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  more direct you are, the better it's going to be. Right any So,
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  what about the concept of envisioning or visualizing the completed deal as you want
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  it? Love that working from the end result to the you know, it's
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  kind of law of attraction, the new ag type stuff. But I find
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  it really works. It works. It does work because you get a clear
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  vision of what success looks like for you. And I think where most people
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  think that that sounds maybe to fluffy is you're probably thinking high level at not
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  breaking that vision down. So if you want success, like what does the
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  successful deal look like to you? How does it end up? But then
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  working backwards from that to create the concrete steps to be able to achieve that
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  is where you be to be. If like the end state of visualization is
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  too fluffy, work backwards from that. So are where we find you on
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  the web? How do we connect with you? The easiest play to find
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  me is right on the website negotiations dot Ninja or connect with me on LinkedIn
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  and you can just search my name Mark Grafin on LinkedIn and I'm happy to
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  connect. Just make sure that you said you listened to Carrie's podcast, because
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  that's why I'll know how to connect with you. Excellent. Really appreciate that.
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  Hey, you got a question from Mark and myself. If you've been
• 17:49
  stuck in the negotiation, it hasn't worked out, or it has worked out.
• 17:53
  Who want to hear from you? Shoot me an email kl at Kerrie
• 17:56
  lets dot com. Go to the site of Financial Survival Network dot com show
• 18:02
  notes to this interview. You'll have Mark's link right there. Just click it.
• 18:06
  Go ahead. While you're there, sign up for your free newsletter.
• 18:07
  Mark. Been a pleasure. Thanks someone for stopping by. Thanks so much
• 18:11
  for having me Kerry appreciate it. Thanks for listening to Carrie Letz's Financial Survival
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  Network, your solution to today's trying times. For the latest, go to
• 18:21
  Financial Survivalnetwork dot com. Financial Survival Network now more than ever