The Art of Negotiation, Essay Example

My first time buying a new car was a learning experience. In retrospect, I wish I and my husband had done more homework before proceeding; still, it seems our instinctive understanding of negotiation helped us avoid feeling that the salesman had completely taken advantage of us. In order to better analyze the situation, and to help recall my memories associated with the sale, I decided to do a bit of studying on the art of negotiation.

Interestingly, I discovered that many of the academic resources available on the art and skills involved in negotiation are focused on the intricacies of cross-cultural negotiation. These articles examine the ways in which the negotiation styles of those from the United States often differ from those of other countries, with an emphasis on negotiations between Americans and those from Asian countries such as Japan and China.

The bulk of the articles I studied looked at four basic steps of negotiation: Non-task, Task, Persuasion, and Agreement. The Non-task portion of negotiation involves the basic introductions between parties, the exchange of “small talk,” and the discussion of issues unrelated to the actual negotiation, as the parties get to know each other. The Task portion involves the two sides getting started on the actual negotiation process, where each side presents their needs and wants (though it should be remembered that neither side of a negotiation is likely to “put all their cards on the table” at the outset). The Persuasion portion of the negotiation involves the two sides giving and taking, with each side making some concessions and also making some gains (Gulbro&Herbig, 2009). In a typical sale negotiation, the salesperson is concerned with maximizing profit, while the buyer is concerned with spending as little as possible, and getting as much as possible for the price being paid.

The research involving cross-cultural negotiation noted repeatedly that the negotiation styles between Americans and Chinese or Japanese negotiators often clash. Americans have a tendency to want to make the Non-task portion of the negotiation as brief as possible; the idea there seems to be that many Americans view this portion of negotiation as more of a formality than a necessity. Those from some Asian cultures, on the other hand, view the Non-task portion of the negotiation as perhaps the single most important function of reaching agreements. As many Japanese and Chinese negotiators see it, the building of trustful relationships between the two sides is seen as imperative for any successful negotiation. What some researchers discovered is that before cross-cultural training became commonplace for American salespersons, managers, and negotiators working overseas, the management and negotiation styles of Americans often proved unsuccessful in other countries. American managers were often seen as being disdainful of those whom they managed in other countries, while American salespersons often “gave in” too quickly in negotiations, simply because they grew impatient with the slow pace at which Japanese or Chinese negotiators conducted business (Gulbro&Herbig, 2009).

What I found most interesting about these studies is how easily these differences in negotiation styles could be translated to negotiations between Americans, where one side is selling a product and the other side is buying the product. When my husband and I were shopping for a new car, we were not trained in the art of negotiation, while all of the salespersons with whom we came in contact did have such training. Because of this imbalance, I realize in retrospect that my husband and I were like the Japanese, in the sense that we placed a significantly higher value on the Non-task portion of negotiation than did most of the salespersons we met. The majority of these salespersons seemed to view the Non-task portion as more a formality than a necessity, and time after time the salespersons we met at various dealerships seemed to be merely going through the motions of the Non-task portion, addressing it in what seemed like a more “automatic” way than a truly personal way.

It was this tendency to rush through the Non-task portion of the negotiation that left us displeased with one salesperson –and therefore their entire dealership- time after time. We actually spent several days looking at many different makes and models of cars. There were any number of cars that seemed as if they would fit our needs; we were did not have our hearts set on one particular type of car before we began looking. It seemed that we were instinctively searching for a salesperson whom we could trust and with whom we could build some sort of relationship, however brief, before we would even consider taking any further steps in the buying process.

At each dealership we visited, the typical approach of a salesperson was to see us on the lot, come over and introduce him- or herself, and then try to get us into a test drive on whichever car we happened to be standing closest to as quickly as possible. Almost never did anyone take the time to determine what it is we needed and wanted before settling on a model of car to show us. Each time this happened, we grew more disillusioned, and after the first or second time, we began to simply leave the dealership while the salesperson was dashing inside for the keys to the test-drive car.

After so many disappointing visits to so many dealerships, we suddenly happened upon a salesperson who took an entirely different approach to dealing with us. He was a relatively young man, probably mid-thirties or so, and the first thing I noticed was that he smiled a lot. He seemed to be in a genuinely good mood, and such moods can clearly be contagious. Without speaking, I could sense that my husband was also reacting in a different manner to this salesman than to most of the others; he seemed to quickly let his guard down, and began engaging in a conversation with the salesman.

Rather than immediately insist on shoving us into a test-drive car, this salesman –whose name was Richard- invited us inside the dealership. This technique had been used once or twice before in our search, so we were expecting that Richard would immediately begin pressing us for details about our credit history, the price range we were expecting or willing to work within, and so on. Instead, Richard simply began a conversation with us. Unlike most of the other salespersons with whom we had dealt, Richard seemed to be in absolutely no hurry to complete the Non-task portion of the negotiation. It felt as if we were setting the pace of the negotiation, and that allowed us to relax and further let our mutual guards down.

In the course of the conversation, Richard explained that if he was going to sell us a car, he wanted to make absolutely certain that it was the best car for our needs. At no time did he ask anything like “what will it take to get you to buy today?” or any of the other typical clichés one associates with care salesmen. The conversation we had with Richard lasted well over forty-five minutes, as we discussed everything from the size of our family to whether we would be sharing a car to what type of commutes we faced in coming and going to and from work.

Richard eventually did steer us into the Task portion of the negotiation, as he began to discuss the various models of cars he had available, and pointed out not just the “pros,” but also the “cons” of each choice. We were at a Toyota dealership, and Richard saved the Corolla model for last. He began ticking off the “pros” of the model, and conspicuously left out any “cons.” We asked him several questions that were prompted largely by the “cons” he had mentioned when speaking about the other models. For each question, Richard had a ready answer, one that sounded logical and reasonable.

We finally agreed to take a test drive in a Corolla, and we admittedly fell in love with it immediately. Again, in hindsight, it is easy to see that Richard had us emotionally primed to love the car, and that buying something on the spur of the moment is largely an emotional decision. By the time we returned to the dealership, there was no question that we wanted to buy the car. We had now passed through the Persuasion portion of the negotiation, and we were moving on to the Agreement portion.

At this point, Richard’s approach shifted gears (pardon the pun). He became less conversational and more direct. Despite this change, we remained comfortable with him, as he had already spent the time on the Non-task portion of the negotiation building a trusting relationship with us. We actually did very little negotiating on the price. Richard showed us the sticker price, explained that Toyota was offering a thousand-dollar rebate, and then waived the “dealer fees” (whatever those actually are, they amounted to several hundred dollars). There was something he said during this part of the negotiation that stuck with me; he told us that no matter what price we paid for the car, when we left the dealership, we would definitely see the same car available for both higher and lower prices elsewhere, if we looked hard enough. He then asserted that what was most important was that we loved the car, and that we were comfortable with the asking price.

In most car-buying situations, it is the Task-Persuasion-Agreement parts that often take the most time. Haggling and bickering over price seem to be a commonality in such negotiations. By spending so much time on the Non-task portion of the negotiation, and building a trusting relationship with us, Richard effectively turned that paradigm on its head. By the time we reached the point of actually settling on a price, we trusted Richard when he said he was simply going to save us all time and aggravation by offering us the best price he could right away. We accepted that price immediately, and it was less than an hour later that we were driving out in our new car. Again, in hindsight, I suspect that had we done more homework on that specific model, we may have saved a bit of money, but the truth is that we really did –and still do- love the car. And it was no real surprise to us, as we were leaving the dealership, to see a plaque on the wall proclaiming that Richard was the dealership’s “Sales Associate of the Year.”

Bibliography

Gulbro, R., Herbig, P., (2009) “Cultural differences in international negotiating,” International Journal of Value-Based Management. Vol. 11, N 3.