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The Importance of Relationship

Ben Byth
The Importance Of Relationship In Negotiation

People can be amazingly generous with their effort. I ran into a client boarding a short flight from Brisbane to Sydney last week and the interesting thing about this was that they had chosen quite a peculiar flight path. Instead of flying on the 11:00AM flight direct to Perth, they chose to depart six hours earlier on a 5:00AM Monday morning flight connecting through Sydney. Why? So that they could spend an extra two hours in the office working in Perth. Employee of the month right there!


The easiest source of power for an employee to deploy is discretionary effort. If they perceive you are being fair, they give you more (or take away if you are being unfair).


Interestingly, the concept of fairness rings true into most negotiations as your counterpart will have some degree of discretion. This might be around the team they deploy, flexibility on scope, access to opportunities, etc.


So, how to be a tough, but fair negotiator?


It used to be assumed that the best way to achieve objectives was through ‘throwing your weight around’ or even aggressive ‘table thumping’. This is of course the easiest way if you have a lot of power and don’t care about the relationship, but it doesn't make any sense if you need to continue interacting post agreement. If you trash a relationship, you can expect the same in return.


While sometimes it may be appropriate to trash a relationship, more often the opposite tends to be true. Even if it seems like the relationship may not be important now, people tend to have very long memories when it comes to bad behaviour!


Instead, view the negotiation as an opportunity to protect and improve the relationship. You can still achieve a good deal (often even better) while being assertive but fair. Soft on the people, but tough on the issues. Sustainable, long-term relationships are built on reciprocal trust, so we advise you follow these steps to improve your negotiations and relationships with your counterparts. 


  1. Share information to build trust and reciprocity. A sure way to dilute trust would be to withhold information, so it is best to lead by example here! Furthermore, information disclosure can be very useful in helping to illustrate how your requests come from ‘need’ rather than ‘greed’.


  1. Be comfortable with leaving something in it for them. You should be doing deals at your end of the bargaining arena, but they are easier for your counterpart to sign and execute if they perceive they are getting a good deal too. While it isn’t always appropriate, I’m personally more comfortable if there is something still in it for my counterparts.


  1. Instead of saying no, find a way to say yes. Before you say “no” or agree to “half of their demands”, ask yourself “under what circumstances?” could you instead say “yes.” For example, “If you will agree to wear more risk, we could reduce the price.”


And remember, negotiations can and often should be a situation where both parties walk away from the table happy and content with the outcome. 


Happy negotiating!

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