The magic question that turns transactions into relationships
In short, I believe that many good things – personally and professionally – come from putting relationships ahead of any individual transaction.
I also believe that the process of conducting a transaction is a powerful opportunity to build a relationship. Why? Because a transaction is an opportunity to create an outcome that someone else cares about. Create a better outcome, and the person on the other side will appreciate that, and think of you positively for future transactions as well (usually a good thing.)
But how do you do that in practice?
The first important step is to go into any negotiation with the right mindset. Stanford Professor Richard Pascale said it best in a class I took when I was in business school:
Negotiation is the process of finding the maximal intersection of mutual need.
This to me is a very powerful construct. Negotiation is not about getting the most of what I want. The best negotiations (transactions) leave us both better off.
However, in my many years of practicing this mindset, I’ve found there is often a roadblock to finding these maximal intersections of mutual need. And it is a surprising one:
People tend to ask for what they want.
While that sounds like a very reasonable thing to do, it doesn’t lead to the best outcome for either of us.
Generally, you conduct transactions because you are trying to solve a problem. Let’s say, for example, your child has just hit school age and you and your spouse determine that you need to send him or her to an expensive private school because of a learning disability. You have a problem though – you don’t have enough current income to make ends meet with this new school. So you come to me, your boss, and ask me for a raise. I, your boss, have my own problems. I want to make you happy, but I can’t pay you above what everyone else makes just because you need it more. So I say no. Problem not solved.
What you missed out on, by asking me for what you wanted, is that you missed the opportunity for me to help you solve your problem – which is what you really want.
This is generally what people do. They ‘solve’ their problems using only their brain, considering only the options they know to be available. And by doing so, they miss the opportunity of applying someone else’s brain – a brain with other assets and other knowledge about available solutions – to the task.
Let’s replay the above problem. Same situation, but now you come to me, your boss, and you say, “I have a problem. My kid needs to go to private school because of a learning disability and I can’t afford it.” Maybe I can’t give you a raise, but maybe I know of a scholarship or support program that may be available to you, maybe I know of a new school starting up with lower tuition, maybe I’ve had experience with a great public school with a special program that you can apply to transfer to. Maybe I know someone with a child older than yours, who went through the same issues and found a great solution, someone I can introduce you to who in turn might have a great solution to your problem. The point is, maybe I can help solve your problem without paying you more money.
In short, the problem with people asking for what they need, is they used only their brain to figure out what they need. It is far more powerful to also use the brain of the person on the other side of the table.
So, next time you are in a negotiation, instead of stating what you (think you) need, or even asking the other party what they (think they) need, instead ask this:
“What problem are you trying to solve?”
From my experience, this question is literally magical when used in a negotiation.
First of all, it takes the focus off what I want. Even though I have my own problems in the back of my head, right now I will focus on you, which makes you feel really good about me just for doing it. My credibility goes up with you.
Then, I have the opportunity to apply what I know, who I know, and what I have, to solving your problem. And as I’ve often found, the things I have that you don’t know about can create a superior solution for you that also works better for me.
When I then lay out for you what problem I am trying to solve, a similar thing happens. There is a powerful, subtle shift that occurs when we move from you-versus-me to let’s-work-on-our-problems together. We build a relationship above and beyond what we are working on right now, and we develop a pattern of communication and a level of trust that will make anything we do together in the future easier.
I have countless examples of how this has worked for me, but rather than tell you mine, I’d suggest instead you simply go try it for yourself.
What have you got to lose, except for a few problems you are trying to solve?
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