9 Powerful Negotiating Tools and Strategies

Have you ever felt unprepared going into a negotiation?

What if you had a Swiss army knife of negotiation tools that could help you handle any scenario?

In this episode, I'm going to arm you with the most powerful negotiation strategies from the book Never Split The Difference so that you know how to walk into any negotiation with confidence and come out on top.Hey, everybody, and welcome back to my channel.

I'm Doug Howard, and I'm your go to leadership coach and consultant. Here on this channel, we share weekly insights, tools and stories to help you level up your leadership skills. So if you find value in these videos, don't forget to hit that subscribe button and ring the bell to stay updated on the latest episodes. If you enjoy this video, make sure to give it a thumbs up.

In today's episode, you're going to gain a detailed instruction manual on nine powerful negotiation tools and strategies. By the end of this video, you're going to be equipped to handle any negotiation scenario with confidence.

Strategy #1 - Tactical Empathy

Let's dive into the first tool and it's called Tactical Empathy. Tactical empathy involves understanding the emotions and perspectives of your counterpart and using that understanding to influence the negotiation itself.

Here's how it works. It's very simple. By acknowledging and validating the feelings of the other party, you instantly build rapport and trust with them. This works because people are more likely to cooperate with you when they feel like you understand them. This approach leverages psychological triggers and it leverages the psychological need for validation and human connection. When you use this tool, the other party feels understood and validated, which reduces the tension and it increases their willingness to collaborate with you.

Here's how you utilize this tool to your advantage. As you're building rapport with the other person, use the rapport you build to guide the negotiation towards mutually beneficial outcomes. You do this by listening actively, acknowledging their feelings and showing a genuine interest in their perspective. But a mistake you want to avoid when doing this is make sure you don't fake empathy and make sure you don't dismiss their concerns when you realize them.

Now, here's a few examples for how this works.

Let's take a look at a business negotiation and you think the other person is worried about budget you keep hearing them say things like we don't have enough money for this or I don't know that we'll have this in our budget. What you should do is acknowledge that by showing tactical empathy and what you do is you say something simple like, it sounds like you're really worried about the budget constraints. Now this is gonna provoke them to say something like, yes It's been a major concern for us or yes, the budget is a major concern for us. This is going to provoke them to respond with something like, yes, the budget is our primary concern.

Which then gives you the opportunity to respond with, given that concern, what can we do to ensure that the project stays within your budget?

The advantage of doing it this way is by showing tactical empathy up front, you're not ducking around their main concern. Instead, you're giving them an opportunity to explain what the real concern is. When you do this, they might open up and share what is their budget constraint or what is the budget challenge? Maybe it's not the budget itself, but it's getting the decision maker above them to open up the budget for what you're proposing to them. But my point is you're using tactical empathy to provoke them to show that you understand the problem, and then it creates an opening for you to work together on solving that problem.

Like I said, the advantage here is that this opens up a discussion about possible solutions while showing that you understand their problems.

I want to show you a few more examples how this works. Let's say as you're talking with someone about a proposal, you're noticing that the main concern they have is related to time. You could say something like, I see how the tight deadline is stressing you out. Now doing that just shows again, this is tactical empathy, it's showing that you understand their problem, even if they haven't specifically said that they're worried about the time constraint. But if you're noticing them say things like, I'm worried we won't have the time to get this done, or I'm worried that we won't be able to deliver this before the December deadline, whatever the case may be, call it out. I can see how the tight deadline is stressing you out. That's gonna provoke them to say something like, absolutely, we're under a lot of pressure, which gives you the opportunity to say, how can we adjust the timeline to make this more manageable for you? Doing this in this scenario would help you negotiate a more realistic timeline with them. That way, you're working together to solve the actual problem.

Next example I want to give you is I want to show you more of a leadership example, as a manager. Maybe you notice that someone on the team isn't feeling like they're valued. They're not feeling like they're being appreciated. This happens a lot of times with managers where you're sensing that this person on the team isn't feeling like they're being recognized or acknowledged by the boss or by the company.

So as the manager, you could spark a conversation with them in the appropriate setting and say something like, Hey Jim, it seems like you're feeling undervalued in this project. This can provoke them to say, Yes, I do. I don't feel like my contributions are being recognized by the team or by the company. That gives you the opportunity then to provoke a discussion by saying, How can we ensure that your efforts are acknowledged appropriately?

Again, this helps address their need for recognition, but it also makes them more cooperative to discuss this and work together with you to figure out how can you solve this problem? In this case, it's how can you make sure that they feel like their work is being acknowledged and recognized? So you're taking something that's a problem, and you're using tactical empathy to draw out what the real problem is and open them up to feel like, okay, this other person understands where I'm coming from. Now I can work together with solving this instead of it being a tug of war. It's you guys both pulling in the same direction to figure this out. It's not really a negotiation anymore. By doing this, you're reframing the situation as a problem for you guys to work together to solve, because you're on the same page, there's mutual understanding, and that's the first step towards working together.

The general idea here is to pay close attention to the other person's feelings, their concerns, their emotions what is bothering them about this deal? Sometimes you got to look beneath the surface because they might not be saying the exact thing that is the problem. You want to listen closely to the language. You want to read their body language. But the idea is. to call attention to the thing that they're concerned about with the thing you're trying to convince them about or negotiate with them. Then you want to use that to show that you understand their concerns and provoke them to reframe the situation and look at it as how can we work on this together? How can we change this? How can we solve this problem? Tactical empathy is the key to building trust and creating an open dialogue, because then it makes it easier for both of you to find beneficial solutions.

Strategy #2 - Mirroring

The next tool I want to talk about is called mirroring. Mirroring involves repeating the last few words your counterpart just said, and you're doing it in a way that builds rapport, and it encourages them to reveal more information and more context behind what they just said.

Here's how this technique works. By subtly mimicking their words, you create a sense of connection, which prompts them to elaborate, but more importantly, this gives you more context behind what they're thinking or what they meant and what they just said to you. This helps you compose a better response, that's better for your negotiation. Here's why this works. People feel more comfortable and understood when their words are mirrored because it literally makes them feel like you understood what they just said, but this technique also leverages a psychological principle of rapport building through similarity. By repeating back what they said it makes them feel comfortable because they just said it. So they feel like, Oh, you get me, you understand where I'm coming from, but maybe I need to provide a little bit more context to help you understood more what I meant. When you use this tool, the other party feels heard and they often end up providing a lot more detailed information to you than they were originally going to share with you.

So here's how to use this to your advantage. You want to use the additional information to better understand their position and find a common ground. You do this by repeating key phrases with a questioning tone at the end to invite further explanation. But don't overuse it and don't make it sound robotic. Cause then it's going to blow up in your face and you're going to sound like you're manipulating them or playing games with them. So I'm gonna give you a few examples of how this works.

If you're negotiating with someone and your counterpart says, I'm really tight on budget. You simply respond by saying tight on budget? You say it in a simple, not challenging way, but just I'm confused. Help me understand. You're saying in a tone like that, tight on budget?

Now, when you do that, your counterpart's going to respond with something like, yes, we're tight on budget. We've had several unexpected expenses this quarter, which gives you the opportunity to respond with unexpected expenses? Then they can respond with, yes a major project overran its costs last quarter.

Then you can ask, how did that happen? I don't like how this is sounding.

To give you a better idea of how mirroring works. I'm going to walk through a sample negotiation conversations right now between you and a counterpart.

No, I really like the solution, but honestly, I'm really tight on budget right now.

Tight on budget?

Yeah. We've had several unexpected expenses this quarter that we didn't account for in our original budget this year.

Unexpected expenses?

Yeah. We had a major project earlier this year and it basically overran its costs. So we didn't budget for it and we didn't hit the profits we needed to and that's been hurting us the rest of this year with our profit margins.

Okay, I'm understanding but how did that happen?

By simply repeating back the last few words or paraphrasing the key idea that they just said to you, by paraphrasing that back to them, this provokes them to provide more context, because it makes them feel like maybe they weren't clear. People are deep down motivated to be understood, so they're going to provide more information if you provoke them like this and all it takes is just a little nudge.

All you have to do is just repeat back the last few words they said to them. This helps you understand their constraints, and in this situation that I just walked through, this helps you better understand their financial constraints and it gives you more ideas and options to find ways to accommodate them.

Strategy #3 - Labeling

The third technique I want to go through is called labeling. Labeling involves identifying and verbalizing the emotions or dynamics that you observe in the other person. By naming their emotions, you show understanding and you can steer the conversation in your favor.

Here's why it works. By using this technique, it helps the other party feel heard and diffuses negative emotions up front and early before they fester and grow bigger. This technique taps into the need for emotional acknowledgement and validation. When you use this tool, the other party feels understood and they often become more cooperative and open with you.

Here's how you utilize this to your advantage. You want to use their openness to guide the conversation towards mutually beneficial outcomes. The way to do this is you use phrases like it sounds or it seems or it looks like to label their emotions. Now, when you do this, don't label their emotions incorrectly or dismissively. But I want to show you a few examples of how to use this.

It sounds like you're feeling overwhelmed by this project.

Yeah, honestly, this project is a lot to handle.

What can we do to lighten the load?

At the beginning of this example, you labeled their emotions by saying, it sounds like you're feeling overwhelmed by this project. Now, before you did that, this was something that was probably building up in the other person. They weren't really admitting this, and maybe they were embarrassed to admit it, or maybe they didn't want to show their hand. But by you labeling it and calling it out, now the cat's out of the bag. They feel comfortable with using that as a talking point, by saying, okay, you're right. We are overwhelmed by this. That gives you something to work together on and this will open up a discussion on how to make the project more manageable for them and for you as well.

Now, I'm gonna walk you through another example. Let's say you're sensing that the other party that you're trying to convince or negotiate with, let's say you're sensing that they're not fully bought in on whatever you're proposing to them. You could say something like this.

It seems like you're not entirely convinced about this proposal.

No, you're right. I'm not really sure that this proposal meets our needs.

What specific concerns do you have?

By labeling their concerns up front and basically calling out that they're not convinced about the proposal. Now it gives you a talking point with them to help identify and address whatever their specific concerns are.

As a side note, I recommend using this in interview techniques, whether you're the interviewer or the person being interviewed. Asking just the flat out question of, is there any reason you wouldn't consider me for the job? That makes people feel comfortable with calling attention to, okay let's talk about it. I'm concerned that you don't have X, Y, and Z skills.

Labeling helps validate the other party's feelings and encourages openness, which makes the negotiation go a lot smoother for you and the other person.

Strategy #4 - Accusation Audit

The fourth tool I want to walk you through is called the Accusation Audit. The Accusation Audit involves addressing and preempting any negative assumptions or objections that the other party might have about you or the proposal.

Here's how it works. By acknowledging potential criticism up front, you instantly disarm them and build trust with them. This works because it shows transparency on your part, and it reduces defensive reactions on their part. This approach leverages the psychological principle of disarming criticism by addressing it first. When you use this tool, the other party feels more open and less defensive, which leads to a more productive negotiation. You can utilize this to your advantage by using their openness to address concerns proactively and build a stronger case for your proposal.

The best way to do this is by listing out possible objections and addressing them directly. But when you do this, don't exaggerate and don't downplay their objections. Here's a few examples of how the accusation audit technique works.

You're probably thinking this offer is too good to be true.

Yes. If I'm being honest, this offer does seem too good to be true.

Let me explain the details for how we can achieve these terms realistically.

Do you see what you did there? You politely accused them of thinking the offer was too good to be true. You're probably sensing that through the things they were saying beforehand in the conversation. But by calling it out like this builds credibility, because now it gives you the opportunity to address that concern in a way that's not defensive. And it gives you the opportunity to explain the feasibility of your offer and how realistic it is to achieve it, which should disarm their concerns about it being realistic or feasible.

Here's one more example.

You might think we're pushing this proposal too aggressively.

It does feel a bit rushed.

We're eager because we see great potential for mutual benefit. How can we adjust the pace for your comfort?

This shows your enthusiasm and eagerness without sacrificing it while also being willing to adjust the pace to make them more comfortable.

The accusation audit is the best tool for preempting objections. It helps you build trust and making the other party feel more open to your proposals.

Strategy #5 - Calibrated Questions

Negotiation tool number five, Calibrated Questions. Calibrated questions are open ended questions that begin with how or what, and they're designed to keep the other party engaged and thinking. These questions encourage the other party to share more information and consider your perspective. This technique works because it prevents simple, closed ended yes or no answers, while also fostering a collaborative dialogue.

This technique uses the psychological principle of engagement through questioning. When you question someone, it creates an open loop on their end, and they feel compelled to close that open loop. Now, when you use this tool, the other party also feels involved in the conversation and because of that, they're more likely to share valuable information with you.

If you haven't picked up on this throughout this entire episode so far, the goal in negotiation isn't to convince the other person upfront. It's for you to gain the information that you need to convince the other person. It's for you to pull the information you need to understand what their influence triggers are and what are their motivational triggers and how do they make decisions. Understanding this is important because that's how you use this technique to your advantage. In this technique you're using the information they provide so that you can steer the negotiation towards a favorable outcome.

The most effective way to use this tool is by asking questions that require detailed responses and by asking questions that steer the conversation. But a few mistakes you want to avoid when using this technique.

First, don't use leading questions and don't use questions that can be answered with a simple yes or no. Another mistake to avoid is don't ask why questions. You want to focus on how or what questions, that is questions that begin with the word how or what. When you ask questions that begin with why it can easily be misperceived as challenging, which is going to put the other person on the defense.

Here's some examples of calibrated questions.

How can we make this work for the both of us?

We need to take a look at the terms and we probably need to adjust the terms to better fit our budget.

What specific adjustments would help?

Lowering the upfront cost and extending the payment terms would be really helpful.

How much can you afford up front and what would be a comfortable payment term for you?

These calibrated questions help you understand their financial constraints, which gave you the opportunity to propose a workable solution.

Here's another example of how to use calibrated questions.

What are the main challenges with this proposal?

The only problem we see is that the timeline seems way too tight.

How much additional time would you need?

An extra four weeks would make a huge difference for us.

What can we do to ensure that we meet that extended timeline?

Another thing I want to point out here is that when you ask the questions like this, you're actually deferring the problem to them to solve. So it gives them ownership of proposing the solution. That way it's their idea in this negotiation or at least they feel like it's their idea. That's what's so important about calibrated questions.

You're still driving the negotiation and driving the conversation and driving them to give you more information. But they feel like they're the ones coming up with the solution and you're basically volleying the problem back to them to solve, but they're really solving your problem for you. At the same time. In this example, we just walked through this, allowed you to adjust the timeline to meet their needs. So it feels like a win.

Calibrated questions are a simple tool, but it's a great way to keep the other party engaged and provide valuable information that can be used for you to steer the negotiation towards favorable outcomes.

Strategy #6 - Rule of Three

The next tool I want to cover is called The Rule Of Three. The rule of three involves getting the other party to agree to the same point three times during the negotiation. You're doing this to ensure their commitment and their understanding. By seeking three confirmations from them, you solidify their commitment and reduce the chances of backtracking. It also reduces the risk of them not being clear on what they agreed to, which is a big thing that happens in a lot of negotiations, and that's what causes them to go haywire later on in the process.

Repetition reinforces agreement and understanding. This technique leverages the psychological principle of reinforcement through repetition. When you use this tool, the other party becomes more committed to the agreed terms, which reduces the likelihood of disputes and misunderstandings later on in the process.

Now here's how to utilize this to your advantage. You want to use the repeated confirmations to ensure clarity and commitment. You do this by using different phrasing to confirm the same point three times. But you want to make sure that you don't make this too obvious or too repetitive. So I'm going to give you a few examples of how to do this.

Here's the first example.

So you agree that we can deliver this by the end of the month?

Yes, that's acceptable.

Just to confirm, you're okay with the end of the month delivery?

Yes, that works for us.

Great, so we'll finalize the delivery by the end of the month.

Notice you said the same thing three different times, but that gave them a chance to speak up if they weren't clear on what you were saying, Oh wait, maybe the end of the month isn't this good because of X, Y, and Z. By calling it out there three times like this, it's going to ensure that they're committed to the delivery timeline.

I'll give you one more example of how this works.

Just to confirm you're comfortable with the new pricing structure, right?

Yeah, it's within our budget.

So the new pricing structure works for you?

Yeah, it does.

Excellent. We're going to proceed with the new pricing structure.

Again, this locks in their agreement and it makes sure everyone is crystal clear on the pricing and the terms of this agreement.

The rule of three ensures clear agreement and commitment, and it reduces the risks of misunderstandings or backtracking later on in the negotiation.

Strategy #7 - Dynamic Silence

The seventh tool I want to cover is called Dynamic Silence. Dynamic silence involves strategic pauses during the conversation to create space for the other person to think and respond. By you remaining silent, you actually give the other party an opportunity to fill the gap. In that gap, they often reveal valuable information that they weren't going to give you otherwise.

Here's why this works. Silence, as we all know, creates a lot of discomfort for us. We want to fill that silence, but if you remain silent, it's going to prompt the other person to fill that silence and speak more freely with you. This technique leverages the psychological principle of discomfort with silence, which again, is going to easily encourage the other person to talk. When you use this tool, the other person is going to feel compelled to fill that silence gap by providing more information or by clarifying their position with you.

To utilize this technique to your advantage, you want to use the additional information that you get from them to better understand their needs and to adjust your strategy on the fly accordingly. You can do this by using pauses intentionally after making a statement or after asking a question. But make sure you don't overuse silence or make it too awkward for them.

Dynamic silence encourages the other person to share more information and it encourages them to provide more valuable insights that can be used to adjust your strategy.

Strategy #8 - Ackerman Model

Tool number eight is called the Ackerman Model. The Ackerman Model is a bargaining strategy that involves making progressively smaller counteroffers to reach an agreement.

Here's how it works. By starting high and making smaller concessions, you signal flexibility while controlling the negotiation process. This works because it creates a perception of compromise and gradual progress for both parties. This technique leverages the psychological principle of reciprocity and incremental concessions. When you use this tool, the other party feels like they are making gains with each concession, which leads to a more cooperative negotiation. To utilize this technique to your advantage, use the structured concessions to guide the negotiation towards your target while still maintaining flexibility.

Here's how to use this effectively. You want to plan your offers in advance, starting with a high anchor and then gradually moving towards your target. But make sure you don't make large concessions too quickly or show desperation.

To show you how this works, I want you to imagine that you are negotiating the price of a car that's listed at $30,000. Let's say in advance, you've already determined that your max budget, or the budget that you want to pay, is $26,250. So there's a big difference there. Instead of beginning with the price that you're willing to pay, you should start by offering a much lower number, like $24,000.

So let's say you start there. Now, you know it's a low offer, so the salesperson is going to counter you with $28,000. Then you offer $25,500, showing a small concession. The salesperson is going to then counter you again with $27,000, but you respond with $26,000, showing another smaller concession.

Finally, the salesperson is going to offer you $26,500, and then you make your final offer at $26,250, slightly improving their offer to show goodwill.

The salesperson is going to take notice of the structured concessions and the final small improvement, so they're going to agree to the deal. This methodical approach not only secures a favorable price for you, but it also demonstrates your strategic flexibility with your counterpart.

The Ackerman model uses structured concessions to create a sense of progress and cooperation, leading to a favorable negotiation outcome. But the key is for you to understand what your limits are and what are the stepping stones between where you're going to start and where you want to end in that negotiation in advance so that you're not making emotional decisions during the process.

Strategy #9 - Black Swan Theory

The last tool I want to talk about is called the Black Swan Theory. The Black Swan Theory involves uncovering hidden game changing pieces of information that can significantly impact the negotiation.

Here's how it works. By actively seeking out these hidden factors, you're going to gain leverage and insight about your counterpart. That's going to help you understand the full context and motivations of the other party. This technique leverages the psychological principle of seeking unknown variables to gain a strategic advantage in your negotiation. When you use this tool, you're going to quickly uncover critical information that can change the course of the entire negotiation. Then you're going to use that uncovered information to adjust your strategy and create more favorable terms for you.

To do this technique, you want to ask probing questions and listen carefully for unexpected insights. When you're using this technique, don't assume you know everything and don't ignore subtle cues from them either.

Here's a few examples for how to use this technique.

First, you can start with asking open ended questions to uncover hidden motivations about your counterpart.

What's driving your decision on this project?

We have a major client review meeting coming up.

In this situation, it revealed a critical timing factor that you can use to your advantage.

Another way to use this technique is by paying attention to inconsistencies or unusual behavior in your counterpart.

We can't go below $50,000.

Why is $50,000 the limit?

It's a directive from our finance team.

What if we structure the payment differently?

In this example, you uncovered internal constraints that you can navigate around. Now you know that they're limited by the budget from their CFO or from their finance team, so that means you either have to figure out how do you get a meeting with the finance team to negotiate with them, or now you know that you have to revise the deal so that you can stay within that financial constraint. But before searching for that information, you didn't know what you were up against.

Another way to use this technique is by searching for non verbal cues that indicate underlying issues that you're not aware of. For example, let's say your counterpart looks very uncomfortable when you're discussing deadlines with them. You could say...

It seems like the timeline is a significant concern.

Yes, it is. We're already behind schedule.

This allows you to adjust the timeline to meet their needs.

Another way to use this black swan technique is by using mirroring and labeling, which are techniques we discussed earlier in this episode, but using these techniques to explore unexpected responses from them. For example...

You mentioned a potential delay.

Yeah, we're facing supplier issues right now.

Supplier issues?

Yeah, all of our suppliers have been very inconsistent lately.

How can we mitigate that risk?

Taking this approach helps you find solutions to their underlying problems that they weren't really sharing with you, and that they most likely weren't going to share with you unless you were searching for that black swan.

One more tip when using the Black Swan Theory. Be prepared to adapt your strategy based on new information that reveals itself to you. For example...

Our budget was cut at the last minute.

A last minute budget cut?

Yeah, we're in a state right now where we need to completely re evaluate our priorities.

I completely understand. But how can we adjust our proposal to fit within the new budget?

Taking this approach allows you to realign your proposal with their new constraints.

The Black Swan Theory helps uncover hidden factors that can significantly impact a negotiation and which ultimately provides you with strategic leverage.

These nine powerful negotiation tools and strategies can equip you to handle any negotiation scenario effectively. By understanding and applying these techniques, you can navigate negotiations with confidence and achieve your desired outcomes.

If you want to learn how to take these tools and put them together to become a better negotiator, check out my next episode called How To Negotiate Anything. This episode will guide you through combining all of these strategies into a cohesive approach for any negotiation scenario.

check out my FREE pdf download - “OPTIMIZE ENGINEERING
TEAM EFFICIENCY”

Strategies to Dominate Productivity in Today's Shifting Landscape

Your company is tasking your team to produce more, with less - and you're struggling to figure out how to get it done.

Download this FREE handbook to gain insights into the 5
essential strategies engineering leaders and companies need to catapult your team's efficiency - even with limited resources!