Hi, I'm Dmytro Shvets, your host at The Start Global Insights, where I interview experts
from different countries about local business secrets and international expansion experience.
No matter if you are selling locally or globally, to establish your presence in the market you
need to negotiate.
And this is a skill that needs constant development and practice.
There are different styles and approaches of negotiations, but one of the methodologies
is worth paying attention to.
And I'm talking about the Harvard Negotiation Model or interest-based negotiations.
And to dive deeper into this methodology, we definitely need an expert.
And I would like to welcome my today's guest, Linda Netsch, the founder of Align Consulting,
a general manager at the law firm Flex by Fenwick, and a lecturer on law at Harvard
and Stanford Law Schools, and a visiting lecturer at Ukrainian Christian University Business
School.
Linda has more than 20 years of experience of helping clients to become better negotiators
and leaders in the US, Europe, Asia, and Middle East.
And before private law practice, Linda served as an officer in the US Air Force.
Hi, Linda.
Welcome to the show.
Hi, Dmitry.
Very nice to be here.
Thank you.
Linda, could you tell us your story, like the short version of it, how you ended up
in practicing and teaching negotiations?
Yeah, well, the short version of that story.
As you mentioned, I started out my career as an Air Force officer.
And my first duty station was at Ramstein Air Base in Germany, where we were putting
together a mobile satellite communication system for NATO and Western Europe.
And at the time, I had no formal training in negotiation, but I was negotiating all
the time with other military members, NATO members, civilian personnel, defense contractors.
So I had a lot of experience negotiating, but not a lot of formal training or theory
behind things that worked or didn't work.
And so when I went back to the States and went to law school, at the time, the author
of Getting to Yes, Roger Fisher, and his colleague Bruce Patton were teaching a course in negotiation
at Harvard Law School.
I took that my first year of law school.
And at the time, I remember thinking it was common sense, as Roger Fisher said, organized
common sense and not necessarily common practice.
But I started to notice that as I went out after law school and practiced law and in
my professional career, I was constantly coming back to some of these principles and ideas
that were very practical, that you can actually use in real life negotiations and can help
you be better, help you learn from your mistakes, help you realize choices that might be more
effective.
So I hope that's a shorter version of how I ended up focusing on this field.
Thank you.
And could you tell what is behind this method of Harvard negotiation?
What's so special about that?
Yeah.
And as you mentioned, you can think about it as interest-based negotiation.
So it is the notion of interests versus just fighting over positions or demands.
That's a core part of the negotiation.
As laid out in the book, Getting to Yes, there are some key aspects, often talked about as
seven elements of negotiation.
I think for our purposes, it's helpful to think through at least four of those, one
being the notion of interests, like what are the things that motivate people?
And how can you think about options, element number two or one of the seven elements, that
satisfy those interests?
And so that's the notion of interest-based negotiation.
The simple example that actually illustrates the point, I think quite well, it's in lots
of books about negotiation, is the story of two children arguing over an orange.
Each child's position is that it's mine.
Of course, the typical parent response to that would be to cut the orange in half, give
half to each child, and that is the chosen option.
However, one child takes the fruit and eats it and throws the peel away.
The other child takes the fruit and throws it away and uses the peel to flavor a cake.
That might be an unusual child that watches too many cooking shows.
Nonetheless, I think it illustrates the point well, which is had the parent understood the
interests as opposed to just the argument over the positions, there was a solution whereby,
a meeting value solution, to use that negotiation lingo, whereby one child could have had more
of their interests met, both children could have had their interests met better with a
different option chosen.
So fundamentally, it is understand the primary interest motivating the parties and then think
through solutions or options which best satisfy those interests.
And then just quickly, two other of the seven elements that are often talked about through
the Harvard program, the notion of alternatives, that if you and I are negotiating but we can't
get a deal that satisfies our interests or we could do a negotiation with someone else
that better satisfies our interests, that alternative, the lingo that's often used is
BATNA, which stands for best alternative to a negotiated agreement.
That's an important thing to think about in your negotiations as well because sometimes
the best outcome in the negotiation you're in right now is not getting a deal and doing
a deal with someone else or some other party that can better satisfy your interests.
And then I guess the fourth element, I often use the term legitimacy, you'll see it in
many books as standards or criteria.
That's essentially what are the benchmarks that are relevant in the negotiation which
might point toward the fairness or reasonableness of one option versus another.
So things like market comparables or legal precedent or laws in general.
So things that are outside of just the pure power or will of the parties that inform which
options among those that are discussed feel most justified and most reasonable to both
parties.
Interesting.
I actually use the same example in my courses when I mentioned negotiation based on interest.
I use the same example but I'm using lemon, not the orange.
And I talk about wife and husband in the case so I don't need to attract parents for this
decision.
Yeah.
And you know, even those kind of simple examples, I think they really illustrate something that
happens in real life more often than maybe we're aware of that we're arguing about a
particular demand or option or offer without really stepping back and thinking through,
wait a minute, what really matters to the parties here?
What really are the variety of interests that can be satisfied?
And can we figure out a way to bridge the gap and get a deal that actually works for
both sides?
Yeah.
And actually get more for both sides, not for only one.
And in connection to that, the question is what are the alternative negotiation methods?
In my life, I visited a lot of these small courses for negotiations and they are teaching
you how to convince other people, buy your product, how to win the negotiation, how to
be the best of the best and actually go with the biggest value for yourself from negotiations.
There are certainly different styles and approaches to negotiation and we certainly see them in
the world in general.
And I think so there might be more of a, if we think of interest-based negotiation, this
notion of you can get a deal that's better for both sides, that might be creating value,
that kind of mindset versus a much more I win, you lose, zero-sum approach to negotiation.
We've certainly all seen that play out.
Some people think that's the way to go.
I figure out how to outsmart you, out-manipulate you, scare you, threaten you and get more
for myself that way.
Very much a mindset of focused on claiming as much for oneself as you can.
And that's out there in the world.
We will encounter people who have that mindset.
And then it's just important when I personally encounter people who I assume have more of
that attitude, then I'm going to be just much stronger around my alternatives, around coming
up with strong standards, benchmark criteria that support a point of view that I'm comfortable
with, understanding the interests of the other side, even if it's just giving small wins
to a win-lose person such that they have that part of their own interests met.
So I think you can be consistent in your...
For me, I feel like I can be consistent in a model that makes sense to me.
I'm just going to use the elements differently if I find someone who has a much more of a
distributive or zero-sum attitude toward negotiation.
So you actually can use this method even if the other party is not using that.
So if the other party is using this zero-sum approach.
Absolutely.
While you were talking, I remembered when I learned negotiations first time, and that
was in 90s after the Perestroika in Ukraine in the streets of Kiev.
So that was the best place to learn negotiation for me at that time.
I was a teenager and we had this gangs of bad guys walking around.
And then when you met them, then you could either fight, but you were alone and there
were many of them, or negotiate.
And I was doing both, actually, exercises.
But at some time, I understood that it is much more better to negotiate.
Yeah, absolutely.
And I think you're illustrating that kind of diagnosis between whether I should negotiate
or I should walk to my alternative.
And if your alternative is a fight, especially one you might not win, then it's particularly
important to think through a different approach and not choose your alternative, but to figure
out a way to negotiate even if the other side doesn't seem necessarily obviously willing
at the outset.
So it's quite a good thing to teach negotiation at schools, I think.
It would definitely help to diminish fights between children and this type of bullying
activities.
Yeah.
And I think in an educational setting, whether it's in grade schools or in your post-graduate
programs or professional education, just the beauty of being able to run simulations and
see the results help you see the differences between a choice that is very much around
manipulation and fighting versus a choice where you're actually looking to try to build
deals, build relationships, understand interests.
You get a little bit of evidence that comes out of that experience when you can see the
outcomes and the impact on long-term relationships and the impact on your own reputation.
Yeah, you can actually hear a lot of times about the approaches and methodologies, but
if you do not use it, if you didn't experience that feeling with your own body and language,
then you won't understand how to use that.
And actually what I was reading about the Harvard approach and I was looking at the
courses at the Harvard website, there are a lot of simulations.
It's like the core of the education system.
Yeah, you know, what Roger Fisher used to say, the Getting to Yes author was, you know,
negotiation is a skill, much like if you were learning to play tennis or to ski, you can
talk about it, but unless you actually get out there and practice and participate and
do the actions of negotiating, you're not going to improve or not going to necessarily
learn the lessons, much like if you were learning to play tennis, you've got to take some swings,
you've got to hit some tennis balls and that helps you learn.
And so it's very much that the power of negotiating is that you can always learn.
I learn every time I teach the course, I still learn every time I interact with different
people, different groups, I see different aspects of negotiation.
It's kind of a lifelong learning experience and it's a skill.
True, true.
I totally agree with that.
Talking about what you just said that you, with different people, with different situations,
you are learning different approaches and as you had so much experience in different
countries, in different areas of the world, have you experienced this feeling of different
approaches of negotiation within different countries or different cultures?
Certainly you notice differences.
I think the biggest surprise for me, again, having taught this material to groups of people
all around the world, is how much more similar we are than I would necessarily, than you
might think when there's an analysis of the differences in cultures, language, governments,
et cetera.
So yeah, if you think about even within a country the size of the United States, I live
in California, but I was born in the Midwest and I've lived in the South.
Those are three very different cultures, if you will, that despite the fact there's a
shared language, same shared history to some extent, shared government to some extent.
And I think you see it throughout the world too.
If I go to Japan, there might be a different kind of cultural norm about communication
and negotiation expectations.
Or if I'm in the Middle East or in Ukraine.
I think the important thing is that the fundamental principles are the same.
They just need to be adapted to the context.
So for example, every person, let alone every culture, has a set of norms and behaviors
that might be different than other places.
And awareness, I think one of the most important things when you're negotiating with other
cultures is be humble and realize you might not understand a lot about what the expectations
and the norms are within that culture.
And be open to even everything you've read that tells you about how people negotiate
in Japan or how people negotiate in China.
Those are stereotypes.
Sometimes they're right, sometimes they're way off.
So learning in the moment by observing behavior, asking good questions, not getting too wedded
to your own assumptions, that's a helpful way to think about negotiating in different
parts of the world.
But every person has a set of interests.
Negotiation is about coming up with deals or options.
That applies.
It just might be measured by different criteria in different cultures.
Every negotiation has an alternative.
It might be a bad one.
It might mean you're going to fight instead of get a deal.
But those ways of analyzing what's happening, you can use the same tools.
But again, you've just got to understand that what people's interests are and what the norms
of a particular society are vary throughout the world.
While you were talking, I was thinking about the approaches again.
So there are several courses or education directions that are teaching about how to
negotiate in Japan or how to negotiate in the Middle East.
What you should know, how they behave, what is the culture.
I remember in my school, in the high school, there was a course about intercultural communication
and they were teaching us what is the distance that is okay for some other nations.
And then you should consider that while you are negotiating.
And then you understand when I was already working with different countries and when
I was in different situations and then understood exactly what you said.
It might be true.
So they might have these rules or norms.
But first thing, that they are already expecting that you will do some mistakes as a foreigner.
And the second thing is that in reality, it is not so strict.
So it is so generalized that there are a lot of different subcultures in the culture.
And even if you are negotiating in your home country, in some cases, you think that you
know the norms, but the norms of the other parties are totally different.
And in this case, there's a privilege of interest-based negotiations when you are expecting to understand
the other party and you are listening more than you are talking, then you can actually
find out whether you are right or you are wrong.
And even if you are wrong, then if you are a good listener and the other party knows
that you are willing to understand them, they will correct you and then you will learn immediately.
Absolutely.
And I think that point about listening skills, I don't think that people haven't thought
about listening as one of your strongest negotiation tools, but it really is.
If we think about a lot of negotiation is predicting consequences and understanding
likely responses from the people you are negotiating with.
And the better you understand the people you are negotiating with, what motivates them,
what they think is persuasive, what they think is the norm that applies, the more you understand
that, the better you can be at anticipating their likely response or the consequences
of a choice or proposal that you are making.
And how do you learn what motivates them?
Well, again, it's those asking good questions, listening to the response, paraphrasing or
summarizing to make sure you understood correctly.
And then if you didn't, they will give you them the opportunity to correct you.
So those skills, while I guess they would be quote unquote soft skills, are incredibly
powerful in getting better at just understanding the perspective of people you are negotiating
with.
You can't influence people very well if you don't understand them at all.
And so the better you get at diagnosing what they care about, how they see the situation,
the better choices you can make around what you are putting into your own proposals or
offers, the more persuasive you can be in negotiating with those counterparts.
Just remembered this case from the fiction book about like far away space, like in the
galaxy some planet was discovered.
And so the humans from Earth started to negotiate with locals from that distant planet.
And I was reading from the negotiator point of view, I was thinking like how it is at
all possible to negotiate with aliens when you don't understand not even the interest,
you don't understand the language.
And then they began to use some basic, like very core communication activities, the pain
and the gain and what do you need and what is good for you, good for me.
And these are so basic things that are actually negotiatable in any culture or even between
species in some distant future.
Yeah.
And it's about being curious about the people you're negotiating with or your counterparts.
As you were talking, as we're talking about the broad topic of listening, from my own
experience this year in Ukraine, one thing that I experienced as an outsider was how
obviously we didn't share a common native language.
Everyone's speaking English because I don't speak Ukrainian.
But I was surprised at the curiosity, the good questions, the good active listening
of the people that I was working with and encountering and what the impact on me was,
it felt so much more comfortable than one might think if again, you don't share a common
language, a lot going on in your part of the world.
But the skills of just being what appeared to me genuinely curious, genuinely interested,
asking good questions, willing to share your own point of view, those fundamental communication
skills are super helpful with negotiation, but they also just are good for a human relationship
building because again, for me, it felt as at an odd time in history to be working with
folks in Ukraine.
I just remember I haven't felt so comfortable.
I'd even say safe if you could say that word.
I think it's about the communication style of being curious, asking good questions, just
feeling like you're really present in the conversation, in the negotiation.
It has a positive impact.
If we get back to our topic of negotiation, the more you're making the counterpart feel
that they're trusted, that they're involved, that they are welcome in the negotiation,
not everyone.
You've got to be careful.
If you're negotiating with that zero sum person, you might have to take a different approach.
But when you see your counterparts are actually interested in doing a deal, understanding
how to make it better, curious about you as a person, I think it creates a much better
environment for a much more likely value creation process of negotiation.
I'm just thinking that maybe it depends not on the nation or the cultural aspect, but
on the level of adulthood of the nation.
What is the level of their development?
What is the level of basic needs satisfaction?
Because if you are not satisfied and you don't have something to eat yet, then you don't
think about somebody else's interests or you don't even imagine that you can talk in this
way.
That's why you are negotiating within the zero sum because you needed so much this attitude
or feeling a feel of power or whatever it might be.
The more I work with Western culture, with developed countries like Sweden, for example,
Denmark, they are so relaxed.
They just don't care.
So they do not expect that you will cheat them.
The more you are going to the East and to the less developed countries, I didn't have
too much experience with Africa, for example, but I had a lot of with post Soviet Union
countries.
Then when I went there, I felt like I was again in 90s in the streets of Ukraine in
some cases.
This type of negotiation of showing you the power and masculinity and that they need to
win and you need to lose.
In these cases, you are gathering this information.
I actually brought this cultural information about this type of cultures and I could teach
about that.
I could say that in Azerbaijan, they behave like that, or in Kyrgyzstan, they behave like
that.
But in the same case and in the same time, in the same countries, I met a lot of people
that were highly educated, developed, and they were negotiating in other style.
It was really not the country-based or cultural-based treat, but more about these levels of personal
development of spiritual development of people and what they value in life.
And then the bigger value they have, the easier communication goes.
They are not so frightened.
And the more frightened they are, the worse negotiation goes.
What I say sometimes is that all people in the world are good people.
And if they are doing something wrong, it means that they are suffering.
They have something bad going on with them.
Either they are frightened or they are not getting something to eat or something very
bad.
That's why they are angry.
That's why they are not negotiating and thinking about your interests, but thinking about their
interests.
Yeah.
And the information that they might be consuming may or may not be accurate, which could motivate
different behaviors.
Yeah.
I think that's right.
It took kind of back to that first principle of what are their interests.
Your interest is just basic survival and the norms you've been exposed to are very much
zero sum.
It's natural that you would be suspicious.
That tends to me at least describe an environment which is very low trust, very much zero sum
you and I lose, which just means I've got to be careful that just my main focus is going
to be protecting myself and having my basic needs met.
That's just a very different context than, hey, let's figure out what you have that's
good for that is useful to me, what I have that's useful to you, whether we can put those
things together to get a deal that's good for both of us.
That's just a completely different context than my life depends on getting as much as
I can no matter what in this particular situation.
Yeah.
True.
Your experience and insights were so interesting that I just could not compress them into one
episode.
We kept talking for more than one hour and I decided to split our conversation in two
parts.
The next part will cover the negotiation culture in the US and stereotypes about that.
We will also dive deeper into the Harvard Negotiation methodology and discuss tools
and approaches that you can use in your negotiations.
So stay tuned and if you have not done it yet, subscribe to the Start Global Insights
on all major platforms for podcasts not to miss the second part of our conversation with
Linda Nech, a practicing negotiator and lecturer at Harvard and Stanford Universities.