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Hi, I'm Dmytro Shvets, your host at The Start Global Insights, where I interview experts

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from different countries about local business secrets and international expansion experience.

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No matter if you are selling locally or globally, to establish your presence in the market you

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need to negotiate.

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And this is a skill that needs constant development and practice.

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There are different styles and approaches of negotiations, but one of the methodologies

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is worth paying attention to.

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And I'm talking about the Harvard Negotiation Model or interest-based negotiations.

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And to dive deeper into this methodology, we definitely need an expert.

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And I would like to welcome my today's guest, Linda Netsch, the founder of Align Consulting,

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a general manager at the law firm Flex by Fenwick, and a lecturer on law at Harvard

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and Stanford Law Schools, and a visiting lecturer at Ukrainian Christian University Business

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School.

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Linda has more than 20 years of experience of helping clients to become better negotiators

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and leaders in the US, Europe, Asia, and Middle East.

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And before private law practice, Linda served as an officer in the US Air Force.

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Hi, Linda.

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Welcome to the show.

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Hi, Dmitry.

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Very nice to be here.

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Thank you.

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Linda, could you tell us your story, like the short version of it, how you ended up

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in practicing and teaching negotiations?

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Yeah, well, the short version of that story.

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As you mentioned, I started out my career as an Air Force officer.

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And my first duty station was at Ramstein Air Base in Germany, where we were putting

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together a mobile satellite communication system for NATO and Western Europe.

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And at the time, I had no formal training in negotiation, but I was negotiating all

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the time with other military members, NATO members, civilian personnel, defense contractors.

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So I had a lot of experience negotiating, but not a lot of formal training or theory

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behind things that worked or didn't work.

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And so when I went back to the States and went to law school, at the time, the author

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of Getting to Yes, Roger Fisher, and his colleague Bruce Patton were teaching a course in negotiation

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at Harvard Law School.

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I took that my first year of law school.

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And at the time, I remember thinking it was common sense, as Roger Fisher said, organized

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common sense and not necessarily common practice.

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But I started to notice that as I went out after law school and practiced law and in

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my professional career, I was constantly coming back to some of these principles and ideas

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that were very practical, that you can actually use in real life negotiations and can help

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you be better, help you learn from your mistakes, help you realize choices that might be more

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effective.

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So I hope that's a shorter version of how I ended up focusing on this field.

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Thank you.

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And could you tell what is behind this method of Harvard negotiation?

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What's so special about that?

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Yeah.

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And as you mentioned, you can think about it as interest-based negotiation.

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So it is the notion of interests versus just fighting over positions or demands.

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That's a core part of the negotiation.

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As laid out in the book, Getting to Yes, there are some key aspects, often talked about as

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seven elements of negotiation.

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I think for our purposes, it's helpful to think through at least four of those, one

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being the notion of interests, like what are the things that motivate people?

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And how can you think about options, element number two or one of the seven elements, that

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satisfy those interests?

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And so that's the notion of interest-based negotiation.

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The simple example that actually illustrates the point, I think quite well, it's in lots

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of books about negotiation, is the story of two children arguing over an orange.

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Each child's position is that it's mine.

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Of course, the typical parent response to that would be to cut the orange in half, give

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half to each child, and that is the chosen option.

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However, one child takes the fruit and eats it and throws the peel away.

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The other child takes the fruit and throws it away and uses the peel to flavor a cake.

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That might be an unusual child that watches too many cooking shows.

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Nonetheless, I think it illustrates the point well, which is had the parent understood the

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interests as opposed to just the argument over the positions, there was a solution whereby,

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a meeting value solution, to use that negotiation lingo, whereby one child could have had more

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of their interests met, both children could have had their interests met better with a

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different option chosen.

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So fundamentally, it is understand the primary interest motivating the parties and then think

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through solutions or options which best satisfy those interests.

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And then just quickly, two other of the seven elements that are often talked about through

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the Harvard program, the notion of alternatives, that if you and I are negotiating but we can't

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get a deal that satisfies our interests or we could do a negotiation with someone else

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that better satisfies our interests, that alternative, the lingo that's often used is

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BATNA, which stands for best alternative to a negotiated agreement.

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That's an important thing to think about in your negotiations as well because sometimes

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the best outcome in the negotiation you're in right now is not getting a deal and doing

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a deal with someone else or some other party that can better satisfy your interests.

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And then I guess the fourth element, I often use the term legitimacy, you'll see it in

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many books as standards or criteria.

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That's essentially what are the benchmarks that are relevant in the negotiation which

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might point toward the fairness or reasonableness of one option versus another.

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So things like market comparables or legal precedent or laws in general.

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So things that are outside of just the pure power or will of the parties that inform which

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options among those that are discussed feel most justified and most reasonable to both

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parties.

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Interesting.

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I actually use the same example in my courses when I mentioned negotiation based on interest.

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I use the same example but I'm using lemon, not the orange.

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And I talk about wife and husband in the case so I don't need to attract parents for this

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decision.

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Yeah.

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And you know, even those kind of simple examples, I think they really illustrate something that

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happens in real life more often than maybe we're aware of that we're arguing about a

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particular demand or option or offer without really stepping back and thinking through,

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wait a minute, what really matters to the parties here?

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What really are the variety of interests that can be satisfied?

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And can we figure out a way to bridge the gap and get a deal that actually works for

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both sides?

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Yeah.

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And actually get more for both sides, not for only one.

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And in connection to that, the question is what are the alternative negotiation methods?

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In my life, I visited a lot of these small courses for negotiations and they are teaching

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you how to convince other people, buy your product, how to win the negotiation, how to

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be the best of the best and actually go with the biggest value for yourself from negotiations.

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There are certainly different styles and approaches to negotiation and we certainly see them in

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the world in general.

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And I think so there might be more of a, if we think of interest-based negotiation, this

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notion of you can get a deal that's better for both sides, that might be creating value,

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that kind of mindset versus a much more I win, you lose, zero-sum approach to negotiation.

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We've certainly all seen that play out.

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Some people think that's the way to go.

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I figure out how to outsmart you, out-manipulate you, scare you, threaten you and get more

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for myself that way.

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Very much a mindset of focused on claiming as much for oneself as you can.

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And that's out there in the world.

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We will encounter people who have that mindset.

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And then it's just important when I personally encounter people who I assume have more of

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that attitude, then I'm going to be just much stronger around my alternatives, around coming

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up with strong standards, benchmark criteria that support a point of view that I'm comfortable

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with, understanding the interests of the other side, even if it's just giving small wins

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to a win-lose person such that they have that part of their own interests met.

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So I think you can be consistent in your...

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For me, I feel like I can be consistent in a model that makes sense to me.

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I'm just going to use the elements differently if I find someone who has a much more of a

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distributive or zero-sum attitude toward negotiation.

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So you actually can use this method even if the other party is not using that.

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So if the other party is using this zero-sum approach.

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Absolutely.

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While you were talking, I remembered when I learned negotiations first time, and that

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was in 90s after the Perestroika in Ukraine in the streets of Kiev.

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So that was the best place to learn negotiation for me at that time.

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I was a teenager and we had this gangs of bad guys walking around.

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And then when you met them, then you could either fight, but you were alone and there

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were many of them, or negotiate.

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And I was doing both, actually, exercises.

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But at some time, I understood that it is much more better to negotiate.

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Yeah, absolutely.

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And I think you're illustrating that kind of diagnosis between whether I should negotiate

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or I should walk to my alternative.

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And if your alternative is a fight, especially one you might not win, then it's particularly

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important to think through a different approach and not choose your alternative, but to figure

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out a way to negotiate even if the other side doesn't seem necessarily obviously willing

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at the outset.

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So it's quite a good thing to teach negotiation at schools, I think.

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It would definitely help to diminish fights between children and this type of bullying

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activities.

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Yeah.

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And I think in an educational setting, whether it's in grade schools or in your post-graduate

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programs or professional education, just the beauty of being able to run simulations and

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see the results help you see the differences between a choice that is very much around

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manipulation and fighting versus a choice where you're actually looking to try to build

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deals, build relationships, understand interests.

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You get a little bit of evidence that comes out of that experience when you can see the

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outcomes and the impact on long-term relationships and the impact on your own reputation.

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Yeah, you can actually hear a lot of times about the approaches and methodologies, but

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if you do not use it, if you didn't experience that feeling with your own body and language,

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then you won't understand how to use that.

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And actually what I was reading about the Harvard approach and I was looking at the

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courses at the Harvard website, there are a lot of simulations.

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It's like the core of the education system.

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Yeah, you know, what Roger Fisher used to say, the Getting to Yes author was, you know,

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negotiation is a skill, much like if you were learning to play tennis or to ski, you can

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talk about it, but unless you actually get out there and practice and participate and

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do the actions of negotiating, you're not going to improve or not going to necessarily

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learn the lessons, much like if you were learning to play tennis, you've got to take some swings,

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you've got to hit some tennis balls and that helps you learn.

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And so it's very much that the power of negotiating is that you can always learn.

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I learn every time I teach the course, I still learn every time I interact with different

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people, different groups, I see different aspects of negotiation.

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It's kind of a lifelong learning experience and it's a skill.

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True, true.

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I totally agree with that.

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Talking about what you just said that you, with different people, with different situations,

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you are learning different approaches and as you had so much experience in different

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countries, in different areas of the world, have you experienced this feeling of different

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approaches of negotiation within different countries or different cultures?

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Certainly you notice differences.

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I think the biggest surprise for me, again, having taught this material to groups of people

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all around the world, is how much more similar we are than I would necessarily, than you

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might think when there's an analysis of the differences in cultures, language, governments,

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et cetera.

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So yeah, if you think about even within a country the size of the United States, I live

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in California, but I was born in the Midwest and I've lived in the South.

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Those are three very different cultures, if you will, that despite the fact there's a

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shared language, same shared history to some extent, shared government to some extent.

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And I think you see it throughout the world too.

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If I go to Japan, there might be a different kind of cultural norm about communication

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and negotiation expectations.

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Or if I'm in the Middle East or in Ukraine.

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I think the important thing is that the fundamental principles are the same.

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They just need to be adapted to the context.

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So for example, every person, let alone every culture, has a set of norms and behaviors

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that might be different than other places.

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And awareness, I think one of the most important things when you're negotiating with other

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cultures is be humble and realize you might not understand a lot about what the expectations

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and the norms are within that culture.

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And be open to even everything you've read that tells you about how people negotiate

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in Japan or how people negotiate in China.

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Those are stereotypes.

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Sometimes they're right, sometimes they're way off.

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So learning in the moment by observing behavior, asking good questions, not getting too wedded

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to your own assumptions, that's a helpful way to think about negotiating in different

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parts of the world.

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But every person has a set of interests.

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Negotiation is about coming up with deals or options.

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That applies.

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It just might be measured by different criteria in different cultures.

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Every negotiation has an alternative.

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It might be a bad one.

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It might mean you're going to fight instead of get a deal.

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But those ways of analyzing what's happening, you can use the same tools.

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But again, you've just got to understand that what people's interests are and what the norms

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of a particular society are vary throughout the world.

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While you were talking, I was thinking about the approaches again.

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So there are several courses or education directions that are teaching about how to

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negotiate in Japan or how to negotiate in the Middle East.

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What you should know, how they behave, what is the culture.

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I remember in my school, in the high school, there was a course about intercultural communication

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and they were teaching us what is the distance that is okay for some other nations.

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And then you should consider that while you are negotiating.

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And then you understand when I was already working with different countries and when

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I was in different situations and then understood exactly what you said.

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It might be true.

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So they might have these rules or norms.

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But first thing, that they are already expecting that you will do some mistakes as a foreigner.

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And the second thing is that in reality, it is not so strict.

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So it is so generalized that there are a lot of different subcultures in the culture.

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And even if you are negotiating in your home country, in some cases, you think that you

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know the norms, but the norms of the other parties are totally different.

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And in this case, there's a privilege of interest-based negotiations when you are expecting to understand

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the other party and you are listening more than you are talking, then you can actually

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find out whether you are right or you are wrong.

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And even if you are wrong, then if you are a good listener and the other party knows

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that you are willing to understand them, they will correct you and then you will learn immediately.

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Absolutely.

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And I think that point about listening skills, I don't think that people haven't thought

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about listening as one of your strongest negotiation tools, but it really is.

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If we think about a lot of negotiation is predicting consequences and understanding

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likely responses from the people you are negotiating with.

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And the better you understand the people you are negotiating with, what motivates them,

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what they think is persuasive, what they think is the norm that applies, the more you understand

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that, the better you can be at anticipating their likely response or the consequences

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of a choice or proposal that you are making.

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And how do you learn what motivates them?

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Well, again, it's those asking good questions, listening to the response, paraphrasing or

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summarizing to make sure you understood correctly.

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And then if you didn't, they will give you them the opportunity to correct you.

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So those skills, while I guess they would be quote unquote soft skills, are incredibly

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powerful in getting better at just understanding the perspective of people you are negotiating

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with.

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You can't influence people very well if you don't understand them at all.

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And so the better you get at diagnosing what they care about, how they see the situation,

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the better choices you can make around what you are putting into your own proposals or

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offers, the more persuasive you can be in negotiating with those counterparts.

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Just remembered this case from the fiction book about like far away space, like in the

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galaxy some planet was discovered.

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And so the humans from Earth started to negotiate with locals from that distant planet.

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And I was reading from the negotiator point of view, I was thinking like how it is at

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all possible to negotiate with aliens when you don't understand not even the interest,

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you don't understand the language.

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And then they began to use some basic, like very core communication activities, the pain

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and the gain and what do you need and what is good for you, good for me.

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And these are so basic things that are actually negotiatable in any culture or even between

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species in some distant future.

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Yeah.

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And it's about being curious about the people you're negotiating with or your counterparts.

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As you were talking, as we're talking about the broad topic of listening, from my own

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experience this year in Ukraine, one thing that I experienced as an outsider was how

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obviously we didn't share a common native language.

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Everyone's speaking English because I don't speak Ukrainian.

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But I was surprised at the curiosity, the good questions, the good active listening

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of the people that I was working with and encountering and what the impact on me was,

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it felt so much more comfortable than one might think if again, you don't share a common

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language, a lot going on in your part of the world.

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But the skills of just being what appeared to me genuinely curious, genuinely interested,

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asking good questions, willing to share your own point of view, those fundamental communication

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skills are super helpful with negotiation, but they also just are good for a human relationship

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building because again, for me, it felt as at an odd time in history to be working with

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folks in Ukraine.

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I just remember I haven't felt so comfortable.

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I'd even say safe if you could say that word.

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I think it's about the communication style of being curious, asking good questions, just

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feeling like you're really present in the conversation, in the negotiation.

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It has a positive impact.

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If we get back to our topic of negotiation, the more you're making the counterpart feel

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that they're trusted, that they're involved, that they are welcome in the negotiation,

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not everyone.

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You've got to be careful.

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If you're negotiating with that zero sum person, you might have to take a different approach.

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But when you see your counterparts are actually interested in doing a deal, understanding

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how to make it better, curious about you as a person, I think it creates a much better

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environment for a much more likely value creation process of negotiation.

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I'm just thinking that maybe it depends not on the nation or the cultural aspect, but

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on the level of adulthood of the nation.

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What is the level of their development?

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What is the level of basic needs satisfaction?

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Because if you are not satisfied and you don't have something to eat yet, then you don't

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think about somebody else's interests or you don't even imagine that you can talk in this

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way.

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That's why you are negotiating within the zero sum because you needed so much this attitude

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or feeling a feel of power or whatever it might be.

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The more I work with Western culture, with developed countries like Sweden, for example,

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Denmark, they are so relaxed.

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They just don't care.

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So they do not expect that you will cheat them.

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The more you are going to the East and to the less developed countries, I didn't have

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too much experience with Africa, for example, but I had a lot of with post Soviet Union

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countries.

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Then when I went there, I felt like I was again in 90s in the streets of Ukraine in

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some cases.

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This type of negotiation of showing you the power and masculinity and that they need to

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win and you need to lose.

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In these cases, you are gathering this information.

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I actually brought this cultural information about this type of cultures and I could teach

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about that.

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I could say that in Azerbaijan, they behave like that, or in Kyrgyzstan, they behave like

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that.

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But in the same case and in the same time, in the same countries, I met a lot of people

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that were highly educated, developed, and they were negotiating in other style.

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It was really not the country-based or cultural-based treat, but more about these levels of personal

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development of spiritual development of people and what they value in life.

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And then the bigger value they have, the easier communication goes.

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They are not so frightened.

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And the more frightened they are, the worse negotiation goes.

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What I say sometimes is that all people in the world are good people.

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And if they are doing something wrong, it means that they are suffering.

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They have something bad going on with them.

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Either they are frightened or they are not getting something to eat or something very

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bad.

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That's why they are angry.

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That's why they are not negotiating and thinking about your interests, but thinking about their

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interests.

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Yeah.

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And the information that they might be consuming may or may not be accurate, which could motivate

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different behaviors.

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Yeah.

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Yeah.

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Yeah.

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I think that's right.

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It took kind of back to that first principle of what are their interests.

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Your interest is just basic survival and the norms you've been exposed to are very much

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zero sum.

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It's natural that you would be suspicious.

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That tends to me at least describe an environment which is very low trust, very much zero sum

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you and I lose, which just means I've got to be careful that just my main focus is going

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to be protecting myself and having my basic needs met.

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That's just a very different context than, hey, let's figure out what you have that's

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good for that is useful to me, what I have that's useful to you, whether we can put those

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things together to get a deal that's good for both of us.

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That's just a completely different context than my life depends on getting as much as

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I can no matter what in this particular situation.

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Yeah.

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True.

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Your experience and insights were so interesting that I just could not compress them into one

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episode.

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We kept talking for more than one hour and I decided to split our conversation in two

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parts.

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The next part will cover the negotiation culture in the US and stereotypes about that.

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We will also dive deeper into the Harvard Negotiation methodology and discuss tools

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and approaches that you can use in your negotiations.

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So stay tuned and if you have not done it yet, subscribe to the Start Global Insights

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on all major platforms for podcasts not to miss the second part of our conversation with

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Linda Nech, a practicing negotiator and lecturer at Harvard and Stanford Universities.