By Heather Lauf
One of the toughest tasks for many people, including farmers, are situations that require negotiation. But there are ways to start developing your own negotiation skills right now, says negotiation expert G. Richard Shell.
Shell once appeared as a guest on the Modern Farm Business podcast, hosted each week by Dean Heffta of Water Street Solutions. As author of the book Bargaining for Advantage: Negotiation Strategies for Reasonable People and professor of legal studies, business ethics and management at Wharton School, Shell offered listeners insights on becoming more effective negotiators within their farm businesses.
Start with awareness
Many businesspeople, including farm leaders, often wonder what effective negotiation looks like. “Good negotiation comes from self-awareness—your sense of your own personality, emotions and self-perception,” said Shell. It also hinges on what he describes as “situational awareness.”
“Situational awareness is when you’re able to size up what’s going on with the other person and how they perceive the situation,” he said. With that knowledge, the negotiation can be navigated more adaptively.
Shell describes two different camps of people when it comes to negotiation: cooperative and competitive. Cooperative people generally move toward helping others, building relationships and social awareness, while those who tend toward the competitive side are more focused on their own goals and driving to reach them—seeing negotiation as a game or sport.
“All of us are adaptive, so even if you’re cooperative, you need to be competitive sometimes, and vice versa,” said Shell. “I believe you should play to your strengths. Know which side is the stretch for you, and which is the sweet spot.”
What side are you on?
It takes reflection to determine which “camp” you’re in when it comes to negotiation. Shell suggests asking yourself a few questions: Who are you at your best? What gives you a sense of excitement and vitality?
Shell offered advice for those who find they tend more toward the “cooperative” side. “If you sense your anxiety to negotiate over price in a competitive situation, that’s probably a sign you’d prefer a cooperative relationship,” he said.
In that case, it’s very important to prepare and “do your homework” ahead of time around the competitive aspects of the negotiation, he suggests. “Set your goals carefully and commit yourself to them. Do enough preparation so you believe your goal is legitimate and fair. Thinking of who else you’re negotiating on behalf of can be a good habit to get into, as can imagining that you’re accountable to someone else for the outcome of the negotiation.”
Shell also spoke to those on the “competitive” side. “It’s important to remember that negotiation is give and take—like a tennis game. If all you’re thinking about is defeating the other person, then they may not want to play with you again.” For this group, the phrase “win-win” is important to keep in mind. “Of course you want to win—that comes naturally to you,” said Shell. “But you need to give the other side the sense that they’ve won as well.”
Shell describes negotiation as a railroad track, which requires two rails—the “outcome” rail and the “relationship” rail. “Competitive people are very focused on the outcome rail, and need to think more about the relationship rail,” said Shell. “Try going out of your way to ask questions about how the other person is doing. Learn their situation. Show them respect. Try to get into their shoes and find out what their stresses are.”
To hear the full podcast with Shell (episode 21) and more exclusive insights each week for your farm business, listen to the Modern Farm Business® podcast at modernfarmbusiness.com or find it on Apple Podcasts, Spotify, Google Play, Stitcher, or wherever you download your podcasts.
This piece originally appeared in Water Street Solutions’ free quarterly newsletter, Smart Series. A new issue will be releasing in a few weeks. To subscribe, visit waterstreetconsulting.com/smartseries