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    You are here: Investing : Articles : Negotiating

    Achieving POWER in all your Negotiations
    By Keith Cunningham
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    Have you ever been in a negotiation and felt like the other side had more power than you?

    I know that this has happened to me and when it does, I remember a trick I have. This technique will prevent you from ever feeling powerless again. The key to this is to remember why you are in the negotiation to begin with.

    Anytime you are in a negotiation, you are there for one reason and one reason only: To do better than your alternatives. You are negotiating to see if you can improve upon your existing situation. If you can, then you are better off than you would have been otherwise; and if you can't, then you have your fall back position, which are your alternatives.

    To increase your power in a negotiation, simply improve the quality or the desirability of your alternatives in the event that the negotiation is unsuccessful. Remember High Need Equals Low Power and Low Need Equals High Power. It makes sense, doesn't it? If you are very needy in a negotiation, then you will probably have very poor or very limited alternatives, so you will feel powerless.

    I remember the power of alternatives when I need to borrow money from my banker. I always go see several bankers to pitch my deal. I usually can get a couple of them to write me a term sheet or a commitment letter. If I have alternatives, then my negotiating position is much stronger. The same thing applies to getting a raise at work.

    I can think up a thousand great reasons for my boss to give me a raise, but I am always in a weak position if she says "NO!" So, when I get ready to ask for a raise, the first thing I do is find another job. I find someone else who thinks that I am worth more money than what I am currently making. With another job in my hip pocket, now when I ask for a raise, I am dealing from a position of strength and not weakness because I have a great alternative. You will see this happen a lot; someone quits their job and their boss offers to increase their salary by 50% to keep them.

    You are probably thinking that it is a lot of work to go find another job just to get a raise, and you are right. But that is the thing about having great alternatives and thus, power. Usually your alternatives are not sitting limply in front of you waiting to be used.

    You must create your alternatives in order to maximize your power. And remember, you are in the negotiation to begin with to achieve a better outcome than your alternative, so the better your alternative going into the negotiation, the greater the chance of your achieving an outcome that you like, whether the negotiation is successful or not.

    Finally, in order to have maximum power, you must have more than one alternative. You don't really have a choice until you have at least three options. If you have no choice, it's called slavery. With two choices, it's either/or. But with three options, you truly do have a choice, freedom and lots of flexibility. Before your next negotiation, think about what you will do if this negotiation is unsuccessful and develop some great alternatives before you ever start the negotiation. You will be amazed at how much power you have!

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