Nolan Martin :
Hey everyone! Thanks for joining us on the NEGOTIATEx podcast. We are continuing our conversation with bestselling negotiation author and expert, Keld Jensen. If you haven’t already checked out part A of this show, be sure to do that first. Let’s jump in the conversation with Keld.
Aram Donigian:
Now emotions, personal chemistry, that was one tool in chapter three, where you cover a number of tools. And if you named them elements. We’re not going through all of them. Sorry, folks. I know you’d probably love, but that’s why you gotta go pick up the book so you can get all 103. Keld, do you have a personal favorite from chapter three where you talk about all these tools? We hit on emotions already, so sorry if we stole it, but is there a personal favorite or is there one in there in particular you said, I’m going to give this to the listeners as a little nugget. This one, take this, exploit it, use it, and you’re going to improve significantly in your next negotiation.
Keld Jensen:
There’s so many, I mean, what’s an important one?
AD:
So you were harassing me earlier about having so many kids, right? It’s like you’ve got, now you’ve got 103 children. So how do you pick your favorite?
KJ:
Yeah, it was back to my kids. I was listening to a conversation. My oldest son came to my wife just last week and said, which of us do you love the most? And my wife, being a brilliant negotiator, looked at him and said, I dislike all of you at the same level. And I just love that answer because, you know, she didn’t prioritize one of them, and there was no one that I love more than the other, I dislike all of you. And he just said, oh, okay and walked away. He was obviously hoping to be named the one that had, that was loved the most.
AD:
If you can’t come up with one, I’ve got one. I’ll ask you to pull on the thread on, which is negotiating non-negotiables. It’s always an interesting term when we’re sitting down at the table and, you know, isn’t everything negotiable, but how do you navigate the non negotiables?
Negotiating The Non-Negotiable: Exploring Flexibility In Standard Contracts [02:47]
KJ:
It’s actually a great one because quite often you are back to big organization negotiating with small organizations, right? Big organizations have, they’re world champions in saying this is non negotiable. This is our standard contract, we cannot negotiate that. And sometimes you’re sitting there wondering is anything negotiable because they just claim everything is just like a standard and this is the standard contract. So you’re absolutely right. And it’s a great question because is there stuff that is non negotiable? Of course there is.
Somebody that is controlled by law is non negotiable, right? But besides that stuff is negotiable. And what I often talk about, I think we mentioned that at our last podcast, is that we need to negotiate on how to negotiate before we start negotiating. So, even before we sit down with a counterpart, I would actually have them in a more relaxed format, share with us is there anything that you can negotiate and why. They have to explain why, and it’s a standard thing is not an answer. Is it because there’s a cost associated with it that you don’t like to pick up? Is there a risk you can calculate? What is the reason that you’re not able to negotiate this thing?
And perhaps it is non negotiable. And then we just need to pocket. But we need to understand why is it non negotiable. Because most stuff is actually negotiable. And quite often I see negotiators that are just saying, we can’t negotiate that. And the reason they won’t negotiate it is because they have a cost associated with changing that variable, right? But when you make them admit what it is, then they might be sharing I have a cost of 5,000 by changing it. That’s why it’s non negotiable. And then you might say, back to the talk about necroeconomics, that’s wonderful because my benefit is 10,000. So if I compensate you 5,000, then you’re not suffering.
And I can utilize the benefit of my side. So suddenly it becomes negotiable, but that is actually related to something else. And now you’re just asking if I have a favorite, and one of them, which is really important for all of us in the world right now, is the ability to listen. I think as human beings, we have lost the ability to really listen. And by really listening, not listening to prepare what you want to say, but actually understand what it is the counterpart is saying. I’m often using the phrase replace the word what the counterpart is saying, replace the word from the counterpart with the sound of a cash register.
So when somebody raises a topic saying, I would be interested in change of delivery time. Don’t say, no, that’s not impossible. That’s non negotiable. Or don’t say, sure, we can do that. Ask a question. What is the value to you by doing it? Because the second our negotiator raise a topic, it’s because they have a financial interest. Otherwise they wouldn’t raise that topic. And your challenge as a negotiator is figuring out what is that value behind their request?
What is that cost that makes them turn down that variable? So really listening is important. We have in the world of negotiation, we have a wonderful expert, Dr. Dan Shapiro at Harvard who is talking a lot about that. I love whatever he’s doing in his book. I can only recommend his work. And he talks about that he feels that we are tribal more than ever. We put ourselves in groups that we agree with. And then everybody else is stupid, they’re idiots because they disagree with us. And I honestly feel disagreement is healthy because disagreement create progress. If we all just sit down and read about everything all the time, we’re not moving anywhere.
So disagreement is a good thing, but we need to understand empathy. And we need to show empathy as well to understand that you may know and have a different opinion than me. I respect your opinion, but I disagree and then we can disagree, agree to disagree or do whatever but I think we move back to Dr. Dan’s appearance and we move into a world where the second Nolan disagrees with me. I’m just sitting here going blah, blah, blah. I don’t want to listen to him because he’s obviously done. Anyway, long answer again, but that would probably be one of my favorites, the listening part and the non negotiable is very important.
AD:
Do you find, and do you find the power reciprocity plays into listening that if I, you said, if you’re tuning Nolan out, blah, blah, blah, blah, does he end up doing the same with you? And then vice versa. If you create space and you demonstrate that you’re actually listening, is it more likely he’s going to hear you?
Reframing Negotiations: Emphasizing Collaboration Over Confrontation [07:08]
KJ:
That’s a great question. I would personally, I would doubt it. I think that, back to how to negotiate. I think, and a lot of people, when I say that, look at me, like I just arrived from another planet, I often say, we have to sit down and discuss how we want to negotiate, including the listening part.
What do we do when we disagree? What we do with trust is declining. Are we allowed to verbalize that? Are we allowed to verbalize that we disagree? And how we disagree and what should we do when we reach a disagreement? What happens when personal chemistry is not working out. Should we verbalize that as well?
So, to me really, now it sounds really weird what I’m going to share with you guys right now A lot of the stuff i’m sharing in this book It’s actually a waste of time if you understand what I mean, because in my world negotiations is really not playing a lot of tactics or tricks or trying to outmaneuver the counterpart. It’s not a hostage negotiation. We’re sitting down with two organizations trying to create and distribute value, and the best way of doing that is just talking person to person. Just, remove all the crap, be honest and transparent without becoming naive, and just treat it as a brainstorming exercise.
How can we make 2 plus 2 equal more than 4? Now can all negotiations be like that? Obviously not. I’m not dumb. So you will have a lot of negotiations that will stay in positional negotiations here as I’m one win at the expense of the counterpart. And for that type of negotiation, a lot of the stuff in this book is extremely relevant.
But if you are in what we call a perfect SMARTNERSHIP negotiation, which is basically Partnership 2.0, you don’t need a lot of the tools because you have agreed that we’re just sitting down here and we’re being transparent. We will share our cost and values and our purpose is really to generate success for you, but not in my expense. I often tell our clients, start the negotiation by saying the following to the counterpart. I’m here today to help you reduce your risk, cost and liabilities and help you improve your profit.
Are you interested in me helping you doing that? What happens all the time when we do this in reality is the counterpart is quiet for a moment and then they say yes because they are maybe a little suspicious, but they will say yes. And then you move on by saying, wonderful. And I believe that your purpose here today is help me reduce my cost, risk and liabilities and help me improve my profit. Are you willing to do that?
And if we can agree on that, we are sincere and honest. Then we have just moved the whole negotiation to a different level. Because now we move it from this positional game into collaboration, where we’re really sitting there to figure out how can we create value.
Now, the next challenge is then when we have created value. Then we need to agree on how to split that and that could turn into something nasty, but that’s a whole different story.
NM:
When we work with our clients, we always ask them, hey, learn something from that last negotiation and improve it. I know you talk about your post negotiation audits. What are some things that you ask them to reflect on and improve before the next negotiation?
The Role Of Pre & Post-Negotiation Checklists In Ensuring Success [10:03]
KJ:
I think it’s great, wonderful advice that you give your clients because that is really important. I mean, sitting down, evaluate a negotiation after you’re done is really essential. Everything, it’s not only the outcome, because people, negotiators have a tendency, I don’t know whether you agree with me guys, they have a tendency just to focus on the outcome. Hey, we made a million dollars. Okay, that’s wonderful.
But how was the process? Are you happy with the process? How was the trust level? Did you utilize the value and did you go through the agenda? Was it calm? Did you create a good chemistry, and what I find and I guess you guys are doing the same thing So it’s great that you’re doing what you’re doing. But It’s really important that people go through a process. What I’m always saying is that when you bought a plane and the door to the flight deck is open you’ll see the pilot sitting out there with the checklist, right? And every time I bought a plane I’m thinking, is that the first time that he’s flying this plane?
Why is that why he’s sitting with a checklist? Because he’s no clue on how to do it. And obviously not. He’s been flying that plane 3,000 times before, but he knows and the airline industry knows and the FAA knows that he has to sit with that checklist because human beings forget. So the same thing goes with a pre negotiation checklist and a post negotiation checklist.
We need checklists to memorize and remember what is it that we need to do before we negotiate. And what is it we need to revisit afterwards? So that’s why we created pre and post negotiation checklists that are in the book as well.
AD:
Yeah. You talk about process, trust, value as other considerations. The other one is what does this thing look like during implementation? Is that something else you cover in the checklist? Where else do you think about, all right, made a deal now, six months down the road are milestones being hit. Are we meeting those metrics? Where else do you address that?
Viewing Contracts As Milestones, Not Endpoints, In Negotiation [11:45]
KJ:
That’s a wonderful question, really is, because I use another term and that is that a contract is just a pause in the negotiation process, right? Way too often I find that negotiators, they think that negotiation ended when we signed the contract. And I often provoke organization by saying, no, now we’re really starting because yes, we have agreed on the terms of the contract, but as you said, what is going to happen six months down the road.
When one party suddenly are not able to fulfill what they promised in the contract or something is delayed or cost is increasing. Well, here we go, round two of negotiations. And those negotiations are sometimes even more serious than the first one because now you are depending on each other. And I cannot recommend going to court because that’s the waste of everybody’s time, so you have to figure it out.
A very recent study, I just saw, actually claimed that more than 90% of disagreements between companies in the US is actually not going to court. So people are negotiating to figure out a deal before going to court even though they disagree about the content of the contract, which to me is good news. I think that’s great that so many actually figure out that they need to negotiate the conflict instead of just going to court because what is happening in a court case, the judge will conclude and he or she will, you know, decide who’s a winner and a loser. And the funny part about a court case, have you guys ever thought about that, if you lose in a court case, you’re not leaving thinking, okay fair enough, I was wrong. You’re not doing that, you’re leaving the courthouse thinking the judge was an idiot. They didn’t see what we saw so you have not repaired the relationship.
So it’s actually just getting back on track, it’s actually great news that 90 percent of all conflicts are being negotiated. But again, it just shows you that the need for negotiation post contract is huge and perhaps even bigger than pre contract negotiations. So I love what you said that the six months down the line is so important to predict and understand how you need to negotiate that.
AD:
Element 73 is Navigating the Cosmos of Negotiation: Lessons from John Glenn’s Insight. Keld, I had no idea that astronaut John Glenn was such a influence on our world of negotiation. Care to explain?
Evaluating Cost vs. Quality: The Impact Of Procurement Choices In High-Risk Environments [14:05]
KJ:
Yes, there’s a lot of interesting comments there. And one of the comments is that astronauts, several astronauts have actually been saying that why I am shut off to space. I’m just sitting there thinking that every piece of this rocket has been supplied by the cheapest supplier. And, I just love that comment because, there’s a tendency, I’m actually doing a big research right now where we are competing, comparing bidding and negotiation, is there actually a value difference, whether you are in a bidding role, you’re doing a tender and a traditional bidding competition, or you negotiate every single deal.
And I was actually inspired by a rather old Stanford study that clearly identified that negotiation was superior to auctions and dash bidding. It’s back from the eighties. So I’m basically being inspired and repeating that study because you see that so many organizations, not only here in North America, but around the world have a tendency just to issue a bidding war and say okay we need to buy a new component for this rocket ship and the cheapest supplier is going to get the order, right?
That’s the requirement. There might be some technical requirements as well but let’s just say they have filtered out the four suppliers they believe that can do it correctly. And the cheapest one is getting the order. Now I don’t know about you guys, but I’ve been advising the construction industry for years and in Europe, I don’t know how it is in North America, but in Europe there’s something called the 15% rule. And it’s an unspoken rule that basically means that everybody knows that the proposal you’re getting will increase by 15% when the contract is signed.
So, you know the construction company will find a way to increase everything by 15% because otherwise they’re not making a profit. But they know they have to go lower in order to get the contract. So it’s basically about cheating each other all the time. So, back to what you said right here. It’s really important to understand the risk of cheat. There’s actually a book written on it what is the consequences of cheat for society and for all of us, that is really essential reading as well. It’s a German author, I forgot his name right now, that wrote about the consequences of just focusing on cheat all the time. So anyway, long story again, but that was just back to the impact of astronauts and negotiation.
AD:
I love it!
NM:
Didn’t think we were going to go there today. That’s awesome. I know that you also discussed this concept of ultimate level in negotiation. What does this level represent and how can negotiators reach negotiation mastery?
Mastering Negotiation: A Modular Approach To Building Expertise Across 103 Elements [16:41]
KJ:
Yes, I’m trying to build 103 elements up in a way where you slowly add one one layer to another. Now the great thing about this book I think is that you don’t need to start in chapter one and then read chapter two and chapter three. You could actually start in chapter seven and then return to chapter two and then jump into element number 73 and go back to element 14.
So you don’t have to read it from page one to page 300 and how many pages down the book? Except for this one, because when you move into that, the mastery level, you really need to be able to look yourself in the mirror and acknowledge that I can do everything else now. So I know all the other elements. I’m pretty good at it. You can wake me four o’clock in the morning and I can just repeat all of them because I know them by heart and I can practice them as well.
Then, and only then, you can then move up to that level where it becomes a little bit more holistic, actually returning a little bit more to my previous book Negotiation Central, where we’re talking about more about the strategy choices, how do you as an organization want to negotiate in general.
And less on, on the tool. So, the ultimate level is really where you focus on, I’m capable of doing everything else. Now I want to be in the 5% group, the absolutely best negotiators. And that’s when I start studying that one. So I wouldn’t start with that chapter. I would finish up with that one.
AD:
So in that chapter, you do discuss the power of teaching. It’s for enhancing our own negotiation skills. I love it when a former student will come back to me and say, I have an opportunity to lead some professional development, training in my organization. Do you mind if I get some of those slides or something from, way back in the day because I got to lead this session. Talk to me about the power of when we become teachers of this material and not just practitioners.
The Evolution of Negotiation As An Important Organizational Skill [18:49]
KJ:
Oh, yeah, I know. I love that. That is the, I think it’s wonderful when that happens. It’s great as you said, when you have a student come back to you and asking for that, because then we’re spreading a message, right? Yeah, we are spreading knowledge and that’s really what we want to do. I often say, and I repeat that all the time, I don’t have a job. I’m sincere about it. I have a mission. I really sincerely want us to improve the way we negotiate and collaborate. And we can do that. I see that every single day.
That’s really what makes me wake up in the morning beside my kids. So it’s really about spreading that message and making people understand not only how important negotiation is. Now when I started this journey in 1998, negotiation was considered a soft skill. So it was something, if you have nothing else to do, you would study in negotiation.
Change takes time and thank God I can report today that in 2024, it has moved up to being recognized as a truly important, heavy skill set from top management, top managers around the world. McKenzie did a study last year among a fortune 500 CEOs here in the US and 93% of them said that negotiation was so important. So within the next three years, they would establish a chief negotiation officer and 96 out of those 93. They said that they believe that they could increase earnings by 5% by doing so.
So the great thing about negotiation is that it’s really moved from being that soft skill into a central spot where every organization recognizes it as something that can really move profits, earnings, interest, relationship and all of that. So, spreading that message that, when you have that experience, a student come back to you and ask for the slide it’s the biggest, best recommendation you can get because there’s some knowledge that they’re going to spread and we need that, because it’s not enough that you and I are doing it.
We need hundreds and thousands of people to spread the message internally because we don’t have the time to do it. So I can only applaud that and say I think it’s wonderful.
AD:
Yeah. Your book wraps up with a beautiful Call to Action, which really echoes what you were just saying. And I know we still got a couple of questions left to ask you, but I just got to read this, which is your 103rd element is the Call to Action. It’s an invitation to start questioning the norms to see negotiation, not as a confrontation, but as a collaborative process of exploration and problem solving. And by doing so, you open up a world of possibilities where you have the power to influence outcomes, create value and forge stronger relationships.
I agree. Keld, it is a beautiful thing when it’s not just us out there sounding this, training this, teaching this, but we have others joining us in that process.
NM:
Keld, you conclude your book with a chapter on the foundational elements of negotiation. When we typically hear of the foundation, we would typically think of it occurring first. Is there a reason you discuss the foundation towards the end of the book?
Embracing The Love For Negotiation: The Key To Mastery [21:52]
KJ:
Yeah, it is. It is a great question and I was actually thinking about it myself when I wrapped up the book because the way I write a book is I don’t start from chapter one. I may start in chapter seven and then finish that and go to chapter three. It’s a whole mess when I’m doing a book. And the reason that foundation is placed where it’s because it’s really a no- brainer. It’s something that it’s so obvious that I was thinking should I even put it in the book because one of the things I’m saying, do you love to negotiate?
You should ask yourself that question. Because what I have found is that a lot of negotiators who is not good at it. If you actually asked them and the answer, honestly, they’re not good at it because they don’t like to negotiate. And I’m sure a lot of our listeners today, if we ask them, honestly, do you actually like to negotiate? Some of them will admit, no, I actually don’t. I dislike it. It’s a confrontation. It’s unpleasant. I don’t like it. And I can only say if you don’t like it, you’re never going to be really good at it because can we all agree as human beings, we are good at something we actually enjoy and like. Now, can we all have a shitty negotiation once or twice a year? Obviously, I certainly do. But in general, we should actually like it.
So, what I’m always doing, working with a client before doing anything else. I’m always asking them, are you looking forward to our negotiation on Tuesday next week? And if they say no, not really, I would rather sit here and do work on the spreadsheet because that, ooh, we could turn nasty and okay. And I put down a little note in my notebook saying, this is probably not going to be that great.
But on the other hand, if I meet a client who’s saying, responding to the same question, yes, it’s going to be great. I’ve been sitting in the office way too long. I want to get out there and, box with a counterpart and create some value and do stuff like that. Ooh, I’m excited. Then I normally put down a little note saying, this is probably going to be really successful. And quite often I’m right. Because when we like something, as I said earlier, we become good at it.
So what I’m also trying to do in this world is actually change the mindset of how people perceive negotiation. And let me share a little secret with you guys is quite often, I find that people who dislike to negotiate, don’t actually know what negotiation could be and should be. They just see it as a conflict confrontation, all serious. And if your whole world is serious on negotiation. Now, if you love confrontation, that’s wonderful. But if you don’t, then it’s going to be a nightmare. So that’s why the foundation is to me something that is obvious. So if you love negotiation, oh, I shouldn’t even say that you’re going to be good at it. So the foundation is something that should just be in place, even before we do anything,
AD:
Keld, we have hit maybe. I don’t know, 10 out of your 103 elements. Folks, you’re going to need to go pick up the book to get the other 93 but Keld, as always, this has been a very enjoyable conversation. As we prepare to conclude, is there anything else you would like to leave the audience with?
KJ:
One more thing that’s very important, and that is for those who choose to pick up the book, there’s actually a free workbook we have created as well, 50 pages where you can work back to learning and training so you can actually practice a lot of the stuff in the book and you can use the chapters in the book to develop your own negotiation process and improve your tools as well. So, if you want the workbook, the book is launching August 27th. So if you want that, just go to the book launch page, connect on LinkedIn and you’ll get the workbook for free.
AD:
Wonderful. Keld, thanks for sharing your work with us. We know you produce a new book about every six months. All right, so we’re going to be looking for you again in about six months to come on again. This is like hosting Saturday night live, right? How many times can you make it back, but we’d sure love to have you on again. And thanks again for just sharing some of the ideas and so many more we didn’t get to. We’ll certainly have to have you back again.
KJ:
Thank you for having me. I enjoy it.
NM:
That is it for us today on the podcast. Be sure to rate, review, and subscribe to NEGOTIATEx podcast, and we’ll see you in the next episode.
