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Ava J. Abramowitz on Essentials of Negotiation (Trust Quotes #15)

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Ava J. Abramowitz is a lawyer, mediator, and author.  She is also an honorary member of the American Institute of Architects and currently is serving as the first public member of the National Council of Architectural Registration Boards. Not surprisingly, she teaches negotiation at George Washington University Law School; was in-house counsel for the American Institute of Architects; serves as a mediator in the Federal courts in Washington, DC; and lectures nationally on negotiation. 

As befits such an interesting woman, she is married to a man who is quite interesting in his own right, Neil Rackham.

But our main interest in this interview centers around a most remarkable book she has written, titled Architect’s Essentials of Negotiation (The Architect’s Essentials of Professional Practice). While it’s nominally about architects, the fact that it’s so readable outside that profession is a guarantor that she’s talking about universal truths. Let’s dig in.

CHG: Ava, thanks so much for doing this interview with us. I’m excited, because I was so taken by your book. Let me start in a very particular place. Outside of perhaps existentialist philosophers, theologians or therapists, you and I are the only ones I know who refer to the Other—in caps—when we’re talking about the protagonist in a commercial relationship. Why do you do that?

AJA: In all my writing and always in my thoughts, I refer to the "Other" and not the "other side" when talking about those with whom we negotiate. "Other side" implies the people are opponents. "Other" implies they are just not us. It is hard to build common ground with opponents, but a bit exciting, invariably challenging, and sometimes even fun to build common ground with people who, although they want a solution to a shared problem as much as we do, view that problem differently because they have different sets of eyes and experiences. A small change in mindset, but it’s an important and useful one to use and remember. Not a friend. Not an enemy. Just an Other.

CHG: Let’s take the readers right to the punch line: in your view, what is the central message of this book?

AJA: In business and in everyday life, it is far more profitable for all the parties to forge strategic alliances with each other to solve the problems facing them. You need not like the Other. In the early stages of negotiation, you need not even trust the Other. But if you and the Other collectively can solve the problem in a way that meets both of your compelling short and long term interests and needs, you should do it. Solid negotiation skills will get you there. They can be learned.

CHG: Reading your book it seems so obvious that that’s how things should work. Why doesn’t it always turn out that way?

AJA: Sometimes the way people analyze the situation leads them to believe that there is no common ground. I don’t want to get into politics, but right now the United States is so bifurcated that people forget that everyone who is running for office believes in “life, liberty and the pursuit of happiness” and in “truth, justice and the American way.” They may differ on the definitions of those values or how best to achieve them, but at the core the persons sitting across the aisle from them are not an enemy to be destroyed. They are just Others with different views of the problem and the solution.

CHG: Notwithstanding what I said above, this book was written nominally for architects. And in one way, they are unique. Unlike most other professions, there are usually three parties involved in commercial discussions: the architect, the contractor, and the owner. Does that make architecture more complicated than, say, the practice of law?

AJA: Ah, good question, but no lawyer could say yes and survive. After all, the American legal system is not routinely described as “an adversary system” for nothing.  Here lawyers represent parties who may have entered a negotiation with no desire for a settlement. For example, parties may have retained a lawyer to obstruct a solution because they figure that delay is in their interests. Architecture and construction, at least at the outset, are less conflicted. At the start of every project everyone wants the project to come in on-time, on budget, and with no claims. And everyone wants to make a profit.

Additionally, risk is handled differently in the legal setting than on the construction site. Lawyers are taught to think liability first and foremost and to figure out ways to foist liability on the Other, freeing their client to risk without responsibility. Sophisticated parties in design and construction, however, recognize that risk and reward go hand in hand. To them, the easiest way to achieve success is to assign each exposure to the party most capable of managing it, and to give that party all the responsibility and the power—both authority and fee—needed to manage that exposure well. In other words, they forge strategic alliances with and among the parties with mutual success being the overriding goal.

CHG: You know quite a bit about the psychology of sales through Neil. Are there any sales insights that fit with your sense of negotiations?

AJA:  For many a person Getting to Yes: Negotiating Agreement Without Giving In by Fisher and Ury was their introduction to negotiation. There Fisher and Ury set out a staged theory of negotiation that building on common ground should produce a shared solution that meets the parties’ key interests and needs, and solves the problem that brought them to the table in the first place. The book and many of its derivative works, though, are less eloquent on how precisely do you do it.

For me, Neil’s book, SPIN Selling filled in that missing blank. By asking questions, particularly Implication and Need/Payoff Questions, one can uncover the explicit needs of the Other and address them. With that knowledge common ground can be more readily identified and built.

How powerful a tool are questions? Inestimable. Questions reveal the Other’s needs, values, and priorities. They help with elegant option development. They expose problems in your own thinking. Questions are a solid alternative to saying no. They help you manage the negotiation, giving you time to process the information you hear and figure out how you want to deal with it.

Questions help you build trust. There is nothing more powerful than listening and using the information you are hearing to build common ground. Nothing convinces the Other more that you care and are worthy of their trust.

CHG: Part of why this book resonated so well with me is the fundamental stress on relationship; that’s what trust is so much about, too. I know you’ve thought about trust, presumably about trust as it relates to negotiation and mediation. Do tell us what you think about it?

AJA: Trust is a matter of choice.You can choose to trust, or not. You can choose to be trust-worthy, or not. You can negotiate with people whom you trust and with those whom you do not. Trusting appropriately just makes negotiation easier.

Clients use proxy measures when deciding whom to trust. It is clear from research that clients look for competence, candor, and concern in the professionals they retain. The more the client sees the consultant being competent, candid, and concerned about the client, the more the client tends to trust the consultant. It is easy to say, “Be candid, concerned, and competent,” but it is not always easy to do and even harder to prove that you are being candid, concerned, and competent.

Try proving you are trustworthy by saying to someone, “Candidly….” Saying that invariably puts the Other instantly on guard. Additionally, it raises an issue where none existed: Were you not being candid before? When will you deceive again? There are clearly ways to prove you are Other-focused. Asking questions helps prove to the Other that what they say, think, and feel is important to you. Disclosure of internal information helps, too, particularly when it makes your motivations and perceptions transparent.

Your book brings this all home. In one of the best books on earning and deserving trust, The Trusted Advisor, you and your colleagues, David H. Maister and Robert M. Galford, take these earlier findings one step further, developing what you called the trust equation where trust is a function of credibility, reliability, intimacy, and self-orientation. You found that the more credible, reliable, and intimate one is with and about the Other and the less self-oriented they are, the more they will be trusted by the Other. Words to live by.

CHG: Let’s get beyond architects alone here. Is there a Single Biggest Mistake people make in thinking about negotiation? Or a Big Three?  

AJA:  To answer that question, let us pin down the kind of expert negotiator I have in mind. Based on Huthwaite research I have come to classify as “expert” those negotiators who share three characteristics: They have a track record of reaching agreements, a track record of their agreements being implemented successfully, and a track record of the Other being willing to negotiate with them again. In other words, I value, as experts, people who, time after time, successfully resolve their principals’ long-term and short-term problems through negotiation and in such a way that the Other is willing to work with them again.

What do these experts have in common? They prepare and strategize for the negotiation before the negotiation so that when they sit down with the Other they have freed themselves to listen, and they listen hard and well. They use the information they hear to locate an idea they can support and build on, ultimately yielding common ground. And even as they close in on a negotiated agreement, they prod. “How will that work?” What if x happens?” “How will it play out if all things go well, and if they do not?” "Is there anything we can do to build success into the effort?"

These negotiators are committed to long-term success of the parties and the agreement. If the agreement is to fall apart, they want it to fall apart before it is signed, so that they can pick up the papers, shake them off, and try again. And that is why they and their clients succeed and the Other is willing to negotiate with them again.

CHG: Ava, this has been a delight. Thank you so much for ‘stopping by’ to chat with us, and for sharing your wisdom and insights.

Disclosure: I am an Amazon affiliate and receive a very small commission for products purchased through my Amazon links.

Negotiation and the Short Term Performance Trap

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Economists and psychologists love intellectual puzzles like The Prisoner’s Dilemma, a game that posits a 2-person bargaining or competition situation.

In The Prisoner’s Dilemma, one person goes free if he “rats out” the other prisoner and the other prisoner stays mum. Unfortunately, if both rat out each other, they each get life in prison.  If both stay mum, they each get off with just a year.

When the game is played with strangers—one time only—the most common result is the double-rat-out.  Oops.

The challenge to economists is to explain why people so frequently do not act “rationally.”

The answer shows up when you play it ten times in a row. With a friend. With eye contact.

But—especially—from playing it ten times in a row.

Then the players quickly learn to cooperate.  (Though sometimes they’ll turn vicious again the last round.  Or maybe not. Think reality TV shows.)

The point is: it’s smart to think collaboration, cooperation, medium to long term focus.  Not a one-time, zero-sum, confrontational me-vs.-you outcome.

The learning for managers, sales managers, brokers, etc. is clear: if you think you’ll never see this customer again, nor have to deal with this customer’s spouse, friend, or cousin, and you think no one will ever hear what you’re about to do, and you’ll gladly trade a good reputation for money—then go ahead, squeeze the customer, try to win the negotiation—treat it like a transaction.

All others: operate on the assumption of multiple transactions—which, for lack of a better term, let’s call relationships.

Assume you will have repeat customers; that your reputation matters, even in terms of simple self-interest; that what goes around comes around; that six degrees of separation in today’s world is a vast overstatement, and it’ll bite you if you don’t believe it.

It’s a simple enough answer. People in social situations routinely act as if they’re a member of an ongoing social group, even if they’re not. (See for example similar results regarding The Ultimatum Game).

That, however, is in social situations.  At the business level, particularly with customers, another belief system often gets in the way.  I hear it frequently.  It sounds like this:

You don’t understand, Charlie; around here, you get measured on short-term results. So there’s a lot of pressure. You have to be a lot tougher on customers—terms, pricing. Trust is nice and all that; but I’ve got a job and a bonus structure and I’ve got to make a living. Go tell it to my boss.

OK, let’s tell it to”your boss.”

Every time you treat a customer from a transactional point of view, you are hurting your long-term profitability. And the short term has a way of turning long-term very quickly. You run out of new customers to squeeze to get all you can in one deal.  And if you rat-out your customer, and your customer rats you out in return, you just bought yourself long-term low profit prison terms.

Put another way:

The best short-term performance does not come from short-term management—it comes from medium- and long-term management done well.

Management, that is, based on the presumption of a relationship, not a series of oppositional transactions. Management based on principles, not self-interest.  If you want to be in charge of your own long-term career, don’t let “your boss” ruin it with short-term management.  Your customers will remember your behavior, not your boss’s words.

Trust makes money.  Prisoners who rat each other out lose money.

Please tell “your boss.”