Malcolm De Leo
Negotiation: The "Compared to What?" Concept
Have you ever been in this situation?
You are working with someone to gain agreement of what needs to be done to move forward. And by move forward, it could be closing a deal for buying something, how you are going to hold a meeting, agreeing to what will be delivered as a service or even what you might wear to a party. When show up. to deliver on what you agreed to, the other party simply says, "This isn't good enough, why can you give me THIS, it's actually what I meant or need".
Usually when this happens to us, we get upset. You could have documented it specifically, taken a picture or even just agreed with words but when someone changes the rules and asks for something you can't deliver it's frustrating. Sometimes, the unorthodox request could be delivered but not at that time, but more often than not people are asking you to either give them something just is impossible or perhaps not doable for a value you agreed to. When we are put in this position, we feel trapped.
The "Drive the car to Australia example" .
Let me make this way more concrete. The drive the car to Australia example is something that often happens when selling technology. This example is a metaphor for behavior that in sales we see everyday. It's maddening, but it happens way more often you would expect.
The drive the car to Australia example goes like this:
Sales person: "Would you like to buy a car?"
Buyer: "Yes, I would. I would like a pearl white car, with a moon roof, premium stereo system, high end rims, the top stereo system, with the biggest engine..." (put any other feature you want in here)
Sales Person: "Ok, here is your list. Do I have everything you asked for? Do we agree on X price?"
Buyer: "Yes everything we agreed to is there. Let's do this"
Sales Person: "Ok, let's sign the paperwork and get going...congrats!"
The deal is done. Everyone agrees on all the price, the terms and the features. Everything should be straight forward from here. So six weeks go by and the buyer comes to get their car at the dealership.
Sales Person: "OK, here is the car. I hope you like it. It has everything we said it would."
Buyer: "Yes, I agree everything is there. But there is one thing I see isn't. Does this car drive to Australia? For me to pay today, it needs to drive to Australia."
Full stop! After careful deliberation of what it costs, what features the car will have upon delivery, the buyer now wants it to be able to drive to Australia. As we all know, there is a big problem, no car can drive across the ocean to Australia. While this seems silly it is a great proxy for what happens in real life. People agree to what will be delivered, they capture it, agree to it and someone will often ask for something they thought it did that is frankly not possible to do. It could be impossible because the technology doesn't exist, there isn't enough time for anyone to deliver what they need or it could be impossible because financially it makes no sense to do. My experience has taught me when this happens it isn't solely because they are being difficult. Oftentimes, the other party is scared to jump. They think they want what they asked for but when it comes time to own the decision; they blink. And when they blink they do so by raising the bar to impossible.
Introducing the "Compared to what?" Concept
When people pull the drive to car to Australia problem, we have to remember that all things tend to be a negotiation when we are dealing with each other (and particularly when doing business). The idea of "compared to what?" is simple. It is a critical moment when we can step back at the absolutely outlandish request like does the car drive to Australia and remind ourselves that a car can't do that. Once we tell ourselves this, we can now challenge our requester and remind them that no car does this. Too often when people challenge us, we simply cave, feel bullied or don't remember to take that step back. In essence, we are reminding ourselves that the person we are dealing with may have no better solution at all even though they are asking for it. I know this seems like a crazy blog post but if I had a dollar every time an outlandish request was met with frantic effort to try to meet it, I wouldn't have to write this blog or work at all. We need to remember that pushing back on something impossible and realizing our counterpart can't actually find what they are asking for is an empowering state to be in. And as stated above, we need to also understand there is a fear of commitment going on as well. It is usually the essence of moving the goalposts so to speak.
Where "compared to what?" fits into the negotiation process formally
Below is a basic 6 step negotiation process. It is written linearly but it is in fact a cyclical process, meaning you can enter it anywhere and need to go through these steps to formally get where you want. Once a negotiation is finished it can begin again if people aren't aligned.
Negotiation Process (mostly modeled after Ury/Fisher Getting to Yes)
Develop Interests (what are my interests/what are theirs?)
Options (what are the ways we can build a bridge to agreement)
Standards (can I find real examples that defend my options position)
Offers (what am I willing to do)
Develop a BATNA (best alternative to negotiating an agreement - your walk away)
Alignment/Action plan (we agree let's move forward)
I know this is quite simplified, but it begins to help us understand where "Compared to What" fits in. In the example above, we have actually moved through the whole process to agree on what car the sales person agreed to deliver to the buyer. Where things went awry is when the car was actually delivered. In fact, it puts us back into this process. So let's figure out where "compared to what?"seems to fit.. I will greatly simplify the analysis for figuring out after the buyer has asked the salesperson if it drives to Australia.
Interests Step: What does each side want.
Salesperson: Take the car we agreed to
Buyer: A car that drives to Australia
Options Step: What can be done
Salesperson: Option 1 - Take the car as is / Option 2 - Keep the car and sell again
Buyer: Option 1 - Take the car as is / Option 2 - Leave and find a "Australia" car.
Standards: Real example that enables the options
Salesperson: No car can do this...there is no standard
Buyer: No car can do this for the price I paid...there is no standard
Offers: What I am willing to do
Salesperson: There is no car like that, honor the agreement or I will keep your money
Buyer: There is no car like that (or find one), I can lose my money or take it (and sell it)
BATNA (best alternative to negotiating an agreement)
Salesperson: Take it or leave it...there is no other option
Buyer: Produce the car that drives to Australia to get what you want.
So you see in a simple (really rudimentary negotiation build out), "compared to what?" is a reminder of a type of standard. The standard here is remembering that sometimes there isn't one. And not being possible is just one "compared to what?". You could also have a request that is doable but can't delivered on time, isn't financially doable, or perhaps the spec they want isn't valid or valuable. The point is, don't forget to think about outlandish requests outside what was agreed to and don't simply jump and say yes when you don't have to. It is very important when negotiating to have ways of reminding ourselves that a person's desire isn't always worth meeting or even possible. So always be willing to challenge convention and ask the simple question of yourself or your counterpart ...
COMPARED TO WHAT?....