My wife is currently involved as an executor in the finalising of an estate and recently this has involved the sale of a house. As you do, she engaged three estate agents to value the property and then chose one of them to act on behalf of her and the other executors involved. The estate agent selected had suggested the highest market price and been very optimistic about the prospects for a quick sale at a good return. The advertising of the house led to a lot of interest and nine viewings were quickly arranged. However, before any prospective buyers had looked at the house someone called the agent and offered the asking price over the phone and without visiting the house. This all happened just a few hours after I had asked, purely out of interest, what the executors would accept as a price for the house – they didn’t know, they were adopting a “wait and see” approach.
I reflected on this and my recent experience of talking to negotiators about their current real-life negotiations. These discussions revealed a theme that I have found common in talking to negotiators – incomplete preparation. Not preparing is not, in my experience, a problem for negotiators. The problem is that preparation is often a bit one-dimensional. If you ask negotiators what they want to achieve, they can usually tell you, often in great detail, but they are usually a lot more sketchy about a couple of other important questions – what does the other party want to achieve and, in the light of this, what outcomes might be possible and how do you optimise the outcome to get the best result for you? Add to this the data from Scotwork’s Negotiating Capability Survey which tells us that negotiators are often negligent in preparing questions to ask their counter-party to fill knowledge gaps and to test assumptions and you have the makings of a deal which takes longer to achieve and leaves all parties to it thinking that they could have done better.
When you next think about an impending negotiation, you should be able to articulate what you want and what deal you would agree to (not necessarily the same thing) and what it would take for you to modify your ideal outcome. But, you should also be able to articulate your counter-party’s ideal outcome and likely area of agreement, too. If you can’t do the latter, then you have work to do in the negotiation to get answers to some important questions. Clarity about where a deal can be struck is essential before you can have any real hope of an agreement.
Yes, I know it sounds obvious, but you would be surprised how few people prepare really well and ask the essential “what if…” questions: what if they say that something important to me is impossible? What if they ask me for that deal-breaking thing I know I can’t agree to? What if they want to delay, impose new conditions or do any of a host of other things which might mean my ideal outcome is jeopardised? Clarity of your objective and your areas of flexibility around it as well as a clear understanding of the other party’s key desired outcomes are essential to a good deal. As the writer, Robert Townsend once said in his book ‘Up the Organisation’, “the chances are if you don’t know where you want to be that you won’t end up there”.
Interestingly the offer for the house which my wife is involved in has resulted, predictably, in the need for the executors to clarify very quickly what outcome they want – they will test their estate agent’s advice on the market value of the house by seeing what other bids may be made after viewing but they now are confident that they will be assured of what they originally asked for - even if it probably wasn’t, in this case, the best possible outcome.