John Shulman: Winning with Interest-Based Negotiation

is interest-based negotiation calculating? Darn right it is. If you don't understand your interests, the interests of others, and how to move forward with collaborative solutions where possible, then you're not, you know, you're not thinking. Hey everyone, welcome back to Make It Happen Mondays, where we talk about sales, business, entrepreneurship, personal growth, mental health, and everything in between with guests who I truly respect and I think make a positive impact on the world around us. Now, today's conversation is with John Shulman. He is the founder and president of Algnor. He's an expert in interest-based negotiations with degrees from Harvard College and Harvard Law School. He's also trained and worked with business professionals and sales leaders from hundreds of organizations internationally and has worked on the Harvard Program on Negotiation, Middle East Peace Project, and the United Nations War Crimes Tribunal for Rwanda, which is fascinating.

He's also played professional soccer in Asia and written a couple of books and does all sorts of cool stuff. But the focus on this conversation was negotiations all day long. So if you are looking to up your skill set on negotiations, you're going to want to listen to this one. Starting with the interest-based negotiation approach that he uses. Now, for those of you who don't know, this is based, this is a book called Getting the Yes. That was something I read a long time ago and debunked a lot by Chris Voss with his book, Never Split the Difference. And he actually ripped the book apart a little bit. He's like a little too academic and doesn't have the emotion in it. So that's what I dove into right out of the gate with John about the misperception or some of the things that are still valid with interest-based negotiations and how some of it conflicts with what are the things that we need to do today to be successful.

So after we got through that, then we talked through a lot of very specific things about how to handle intense negotiations with procurement when people are not really looking for that win-win situation. They're looking to just beat you. And how do you gain leverage? How do you play the long game? You know, a lot of different things about quid pro quo versus reciprocity, which you've heard me talk a lot about. And then how AI is really throwing a monkey wrench into all this stuff. Now, again, a lot of tactics. We didn't even get to half the stuff I wanted to talk to him about, about his movie justice, about what he's seeing in the AI world right now. But I think a lot of the concepts we did have a conversation about are very deep and rich.

And I think you get a lot of value out of them if you're in the world of negotiations right now. So I hope you enjoy the conversation as much as I did. Let's make it happen. Hey, real quick, before we get to the conversation, I wanted to chime in and let you know that I just recently relaunched my entire JBSales membership with all new content and different ways to engage. I now have three different programs, core, pro, and elite. The core program gives you access to both of my world-class programs, filling the funnel and driving a close. These are the same programs I've used to train some of the fastest growing companies in the world, like Salesforce.com, LinkedIn, Google, Amazon, and hundreds of others.

The pro membership gives you everything that's included in core, plus all my tactical tips, workshop recordings, all the different GPTs I've been working on, and access to my live events, including AMAs. The elite package is everything in core, plus one-on-one access to me, which I have never offered. You get a monthly one-on-one call with me to help you talk about whatever you want to deal with, whether it's sales, entrepreneurship, business, life, any of it. I'm here to help you get to the next level. As a special bonus, anyone who signs up for the elite package before March 28th gets to join me, the other elite members, and five other sales experts and influencers in New York City for a free training Friday hosted by LinkedIn at their office at the Empire State Building, and tickets to come with us to the Broadway production of Glenn Gary, Glenn Ross, with my favorite comedian of all time, Bill Burr.

It's going to be an incredible event, and I would love to see you there. All you need to do is go to www.jbarrows.com and click on the training link for individuals at the top of the navigation and see what the details are for each program and sign up today. Now let's get back to the conversation. John Shulman, welcome to Make It Happen Monday podcast, my friend. How are you doing today? Hey, I'm good, John. Thanks so much for having me. I'm excited about your show. I love what you do. Thanks, man. I appreciate it. Yeah, I was looking forward to this one because I've been a Chris Voss disciple for a few years. I had him like early days, and I remember him saying once, because I remember the book Getting to Yes, and we're going to get into negotiations.

For people listening right now, we're going to get into negotiations. We're going to get into tactical stuff here. But to set the stage a little bit, he really doesn't, he tears apart a little bit of the getting to yes, like components of it, as far as it's a little bit too logical, and it's not enough emotional and negotiation. So I've kind of leaned in that direction, like, oh yeah, Chris Voss. But I, that was like years ago, right? And, and so it was years ago that I, that I listened to getting, or that I read Getting to Yes. And it was years ago that I read, uh, you know, never split the difference. And obviously a lot's changed, but some of the fundamentals are still there. So before we get going though, before we get going on that, that's kind of to set the stage for what I want to start this conversation with when we get to the meat of it.

But before that, John, I always love to know people's origin stories. I mean, I know you went to Harvard Law. I know, you know, you wrote, you were going to get into the movie that you wrote, but could you give us the, your origin, origin story, like growing up parents, like why, where'd you catch the sales bug? Like did, you know, was it nature and nurture and, and, and what got you into this profession, if you will, from, from what I can't read on LinkedIn? No, it's great. Great question, John. Actually, it's funny. I, um, I started out, uh, in Minnesota, grew up in Minnesota and, um, basically I always wanted to be a lawyer, a civil rights lawyer, human rights lawyer. And, uh, I met my wife, uh, in law school and she, uh, she's originally from Haiti, but grew up in New York.

And the two of us, um, had the same passion that we wanted to, you know, really make a difference. And we practiced law together, uh, for gee, uh, you know, like 10, 15 years in Minnesota. And, um, and it was, it was this idea of making a difference, really helping the underdog, helping people who were struggling against a lot of power and a lot of, you know, systems that were not responsive. And that was really what we focused on. But what was interesting is as lawyers, when we went into the legal system, we found that it's really slow. It's really hard. Um, it's basically a very conservative forum to try to make change in some ways it can be great because you can make big change, but in other ways, you know, you're following all the process.

It takes a lot of time. Often it takes money and we got frustrated and it was actually my wife. You mentioned getting to yes. She was, uh, in the class with Roger Fisher, the author of getting in law school. Yeah. She, she also happens to have been a, uh, classmate of and good friend of Barack Obama too. No way. Oh wow. Talk about circumstance, right? Being in the right place. So, so we, we, we, we love these ideas around interest-based negotiation. And what happened is we started applying these ideas in, um, in lawsuits and it was human rights cases. Uh, we were fighting against the segregation in the school system in Minnesota, which to this day is still a problem. Um, and then we started using it in business cases.

We were often representing, uh, companies that were being shut out of markets, uh, through any competitive activity by bigger companies or other more entrenched companies. And, uh, what we found is again, do you really want to leave it to the courts or maybe are there opportunities to negotiate a resolution? And one of the big things we learned about is you need at least to have a strategy. If you're the underdog to build leverage, to build your, your strength, your power up enough that at least the other side takes you seriously. And then you're in a better position to have a negotiation. But ultimately what we found is by using the techniques of interest-based negotiation, some of which obviously are very well, um, communicated in getting to yes, we found that we could actually work with clients, greater sense of agency to take control, make a difference without waiting for the legal system to, you know, sort of roll to its end.

And, um, and what happened was, uh, like 25 years ago, uh, one of our big clients, 3M said to us, we love this stuff. Um, teach it to us. We want to use it as a big business process. And, you know, I thought, well, we're lawyers. And they said, wrong answer. So 25 years ago, my wife and I started this company aligner, uh, for the purpose of, um, you know, helping organizations with negotiation. And then to your, you know, where we ended up with the sales side is obviously, you know, sales negotiations are such a key piece of success. And, um, so we ended up kind of moving more and more into sales negotiations. So we do a lot of work in that, in that space, but yeah, it's been a, it's been an interesting journey.

We're still, still a lawyer, but, uh, what I do is really around, you know, negotiation, methodology, strategy, that kind of thing. Well, I tell everybody, you know, I like even people who are vehemently against them, like you're in sales, whether you like it or not. And, and, and you can fight it. You can fight it if you want to, you can pretend like you're not, but ultimately I could pick a thousand examples on a day-to-day basis that you negotiate. If you have kids, you're in sales, you negotiate all day long, right? If you're going for a new job or a new interview, you're negotiating like period, right? So the skill of sales, I think is one of those things. And that's why I'm such a passionate, you know, uh, promoter of it when done right, right?

When done wrong, I think it's one of the worst. Cause I think there's a fine line between manipulation and influence. And so let's talk about that, right? Yeah. How do you, how do you think about manipulation? What's what, what is that to you? I think ultimately, if I were to bring it down to it, I would say negotiations is about trying to convince somebody that I'm right. I'm sorry. Like manipulation is, is about trying to convince somebody that I'm right and you're wrong and, and using tactics psychology wise to, to get you. And that's kind of like a little bit of my unfavorable component of getting the yes. Like part of the concept is you go, you'd a bunch of these little yeses and it kind of preconditions.

And I know what that does. And I can understand where Chris Voss comes from this because there's an uncomfortableness of feeling like you're being manipulated, even though you don't know you're being manipulated, right? It's like, Oh, don't it's like a timeshare pitch, right? Oh, when was the last time you took a vacation? Oh, where'd you go? You went to Hawaii? Oh, what hotel was that? Oh, it was this one. Oh, this one right here. How much did you spend for that? 12,000, $1,200 a night? Well, you see here, you could get it for 200. Wouldn't you want it for 200? Yes, I do. Right. And then all of a sudden it's like, yes, yes, yes, yes, yes. And then they, and then they get you on the yes, but there's so much buyer's remorse when that happens, because I feel like I'm being manipulated, not influenced in my own best interest.

So that's how I would put it. Yeah, I love it. So a lot of the work I do, we get to a place where people say, wow, this is like magic because you can just see what to communicate, how to communicate it, how people respond, and you're able to move things forward in ways that feel like magic. So then anybody with a conscience has that moment, right? Where they go, wait a minute, is this manipulative? And so here's what I've learned over the years, which I, you know, I love your example because it's, it's, it's dead on. So here's the question is, is, is interest-based negotiation calculating? Darn right. It is. If you don't understand your interests, the interests of others and how to move forward with collaborative solutions where possible or where, you know, necessary imposing consequences, then you're not, you know, you're not thinking.

So it is calculating, but manipulation is a very specific thing. And as you said, we, we feel nasty, man. We feel like, well, you know, we feel abused. We feel really bad when we, when we think somebody is manipulating us. So the line that I've learned to draw, I think is really, really super clear, which is if you are trying to get somebody to do something that you want without regard to whether it satisfies their legitimate interests, you've crossed the line into manipulation. Hey, I hope you're enjoying the conversation so far. I want to take a quick minute to share with you what I'm working on these days with my new JB sales membership. It includes live monthly training delivered by me on my two signature courses, which are filling the funnel and driving a close that cover all aspects of the sales process.

It also includes monthly workshops that I'll be running on specific sales skills and different tech skills like chat GPT and how to leverage AI throughout the entire sales process. Finally, the membership gives you access to my entire online catalog with every course and every tip I've ever done. And as an exclusive offer to my podcast listeners, if you go to jbarrows.com, click on the individual membership link and use coupon code podcast at checkout, you'll get 25% off. Now let's get back to the conversation. Okay, so let me ask you this because I totally agree, right? It's one sided. But there's so many sales reps who have the mentality of the means justify the end. The end justifies the means.

So for instance, let's use one of my least favorite negotiators on the planet, Grant Cardone, right? Fuck him and everything about him. Sorry. He literally teaches people to screw other people over, right? And I could see as a sales rep, well, these techniques work for me, so they're going to work for you. So even if or let's use let's use the Jordan Belfort of the stocks, right? They convinced themselves that look, whether you know, you need this or not, I'm going to make you a millionaire. So I'm going to manipulate the shit out of you to get you to do what I need. Because ultimately, I think my false narrative in my head is, it is ultimately you're in your best interest, but you just don't know it yet.

So I got to push. So how do you break down that? Like, for a sales rep who thinks they're doing it for the right reasons, like, and has been convinced that they have and, and, and using these techniques to, to take advantage of people because they think it's ultimately in their best interest. How do we break that? Yeah, that's a great question. So what's interesting is the first question a sales rep has to ask him or herself is, is this the only time I'm going to deal with this customer, this buyer? If it is, if I will never see this person again, and I am never going to deal with them again, then you can, I think, logically persuade yourself that this is a purely transactional interaction, right?

Now a note on that. I have been in negotiations where I thought I would not see this person ever again. I was actually hired as a consultant to be sort of the hard ass and really the tough guy. And I did what was needed on behalf of my client. It was a really tough negotiation. Well, it, it was a global, I was a global client. And so the negotiation that we handled was in Belgium and it was ugly. It was painful. And as soon as I got out of there, I thought, thank God, I don't ever have to deal with these people again. I flew, my next meeting was in China. I flew from Belgium to China. I'm in the hotel and I'm not making this up. The elevator doors open. And who am I standing face to face with?

That same person. Like, oh shit. That, that guy was like, oh shit. I mean, so one of the things that we assume in trying to convince ourselves that, you know, the, the, the, the ends justify the means is, well, I'm never going to deal with this person again, whatever. And, and I actually was hired to write the negotiation curriculum for the National Association of Realtors, commercial real estate arm, which is the CCIM Institute. And so these are, think about commercial real estate transactions. These are, you know, tens of millions, hundreds of dollars, sometimes billions, um, major, major development projects. And I thought, you know, real estate, oh shit, that's the ultimate transactional area.

Right. Um, and so I, you know, I thought, well, I don't know, how am I going to handle this? Because I, all the things I've learned really have to do with where we know we're going to end up probably dealing with people again. So I, I went around and interviewed all the top performers in commercial real estate, uh, in the United States. And I was shocked. They told me, no, we don't do like high, low game where we beat each other up for real. We fake it. We basically do a choreographed dance for the benefit of our, our, uh, clients. So they look like we're negotiating hard, but I'm, you know, anybody dumb enough to like play hard ball, hard ass negotiation, you know, on deals of that magnitude, they're not going to last the biggest city in the New York city will seem small.

Right. And you're going to be like, people don't ever want to deal with you. And so what I learned is wherever you're dealing with people more than once, you gotta be, you gotta be avoiding manipulation because they're going to, you might get away with it once, but not twice. And so for the sales rep who thinks, you know, I can, yeah, I can, I can take advantage. They're never going to know. They're never going to find out. I'm never going to deal with them again. Good luck with that because word gets around. The other thing I've learned is the guy you dealt with at this company, you open the door, you know, all of a sudden it's like, oh shit there, you know, they switch companies, right? This happens all the time.

So word gets around and, and, you know, it's a, it's basically a very short term win. If it even is a win, you know, when you manipulate people and more often, uh, you know, my wife, uh, tells me that the first lesson she learned in, uh, the course by Roger Fisher, the author of getting the S was if you win early on, you basically lost because you, you, you, you, you've, you got a new enemy now for whenever you want to deal with them. So yeah, it's really important to be, to be careful about that and, and, and, and respect that line. When you, when you manipulate, you're essentially creating, if at best, the short-term win, that's almost always going to turn into long-term pain for you. Yeah.

I've learned too many times in my life that karma is a bitch. Like, and shoot like, and there's, there's, I mean, thankfully for whatever reason, I was always, you know, getting into business early days. Like I always kind of had that long-term mentality of like, Hey, I'm going to do a bunch of stuff now to earn the rights so that later on, if I need something, I can, I can ask for that favor. Right. And, and give a little bit more than I would expect to get in return, even though there is an equality to it. And I want to get to that as far as negotiations. That's another dangerous area though, too. Yeah. I mean, yeah, go ahead. Well, it was really just thinking that negotiation starts at the end when it comes to price.

Right. Cause if you don't frame it as like, from the minute you and I start having this conversation, we are negotiating and now it doesn't have to be a hardcore negotiation, but you need to think of it that way. Because if you just give everything and expect at the end, you're going to get your thing, you're, you're done because you've given up everything and you have nothing to leverage anymore. And now they know they can take advantage of you. So, so that's a great point. So there are really two ways to handle that, you know, that challenge of where are we going to end up? Cause that that's what matters, right? I mean, how we get there matters a lot in terms of relationship, but where we end up substantively also matters.

Nobody's saying, wow, it was a great process. I'm so glad, but I got screwed at the end and it was a terrible deal. It's okay. Everybody looks at both. Everybody wants to know how are we going to come out? So the first thing to your point I've learned is do your preparation, do your homework. I've worked, uh, across the globe, you know, across industries, some of the biggest, most successful companies to come across. I have once in my entire career, come across one group that told me, and I couldn't believe it, but they explained why that they couldn't prepare and figure out what the end point should be in advance. Only one ever. And it was in a huge company. And the reason they told me was the product was literally so new.

They, they just didn't know what, what they had no idea. It was a, it was a service product without any cost. And it basically, they didn't know, um, what the market would bear. They had no idea because it was brand new and there was nothing any like it. Nobody had ever done anything with it. I thought, oh, okay. So they were literally using the negotiation process as a way to figure out where, what people would pay. Yeah. What people are going to pay. That's the only time ever. So my point there is number one, as you said, know your end point, right? You got to go in you that, what does that mean? It means you got to know what the market is. You got to know what your leverage is. You got to know what the expectations and the capabilities are of the person you're dealing with.

Let me, let me ask on that point, what, what's your philosophy on kind of knowing your walkaway line, right? So you have to know, right? That's what we're talking about. That's what we're talking about. You've got a desired end point that should be based on the market. And then you have very close to that, pretty much your walkaway. Let me explain the relationship between the two. So this, I mentioned there were two ideas. One is prepare preparation, know your end point in advance, which is also relevant to your walkaway. The second point is always negotiate a package. What does that mean? That means at a certain price point, there are certain things in terms of whether it's product or service, I'm willing to include that if you really can't pay that.

And, uh, you know, when we get to a walkaway, the walkaway point is for a different package. So you're not going to get the Mercedes. If you pay the price for the Chevy, it's a different package. You get the Chevy package. If you pay the Mercedes price, you get the Mercedes. That's the one I want you to do. Right. But if at the end of the day, you just can't do it. You don't have the budget. It doesn't work for you for whatever reason. And I've got a secondary package, then that's my walkaway, but it's a different package. It's not, it's not the same. You don't get the same stuff for the price. This is why I always recommend reps like lead with what they should buy. Right. So, so don't like, like regardless of what they say the price is, tell them, Hey, this is a service product, all this stuff.

Here's what you told me. This is what the right solution is. Exactly. And when they say, well, that's way too expensive, you could, you could take things away from it. Okay. Okay. Well, we could take the service part out of that and that'll drop it to this. It's like, whoa, whoa, whoa, whoa, whoa. Like, like we need that. It's like, well, you have to pay for it. Right. Yeah. So now here you're doing what all great experienced sales professionals do is you're going through it really fast. So let's, let's slow it down. You said total best practice. So let's explain what you really said step by step by step. So first of all, as you said, let's not start with the price, right? If I have a premium price and a premium package, I'm not worried about communicating the price upfront, nor am I soliciting from my customer what's their desired price or their target price.

Let's start with exactly what you said. What are your needs? What are you really trying to achieve here? What, what is it you need that we may be able to help you with? Right. So we start there. Now we're not going to rush through that part, which by the way, most professional, you know, professionals do. They rush through that. Oh, let's get to the solution. No, we're going to sit on your needs to make sure we understand them so that you understand that I understand exactly what you need. We're going to talk it through. We're going to confirm. I might even have some ideas about things that you didn't even think were possible that you really need. Maybe I walked in and saw that you're, you got a chaotic workspace and, you know, one of the things you could use is something that's going to help you get some clarity, you know, clarity around that, that you didn't even, weren't even aware of.

Let me, let me give an example of that. I actually had a top performer in a company that was selling it solutions. And she happened to be in the New York metropolitan area. That was your territory. And everybody's like, how do you just crush it every year? She's top performer. Right. And she's selling the same stuff. Everybody else is. They're like, is your territory better? Cause they're supposed to be relatively even turns out she has a side passion for, um, uh, interior design and decoration is she loves. So when she goes into every potential customer, the first thing she does is look at how they use their office space. And then she gives them unsolicited, you know, advice and thoughts on things they might do has nothing to do with what she's selling.

But of course it does because what they're doing is they're buying from her, not just the it package, but also that amazing advice. So they don't think about it that way, but they would never switch. And so you're trying to figure out, you know, what can I as a human being set aside what I'm offering for sale? What can I do to help you meet your needs? And as you said, maybe, maybe, and this is something you said, and you said it real quick. So I want to slow it down. You said, maybe I can do something for you right now and you will do me a favor down the road. So one of the things we have to do is think long-term enough that it doesn't mean if we have a good interaction now and I help you out with something it's quid pro quo in this moment in this transaction, but it does mean that I need you to know that I did that for you.

You need to associate that with me uniquely, right? Because then the next time I come back, you're going to remember, Hey, John, Hey, he's that dude who came in and helped me with whatever. And by the way, didn't even ask for something specific in return. This is why, and this is why I tell reps all the time, like be a problem solver, forget about being a sales rep, be a problem solver and surround yourself with vendors and resources that also support your buyer. And when you get into the conversation discovery and understanding their needs and everything else, when something comes up that isn't, might not have anything to do with you, bring it to the table. That's why for me, like for instance, you know, I, there's so many AI chatbots that I'm using these days to do different things.

They're all free. Right. But I'm like, holy shit, like a 10 K analyzer. Are you kidding me? Like this thing's bananas. So they're all tangential to what I do. Right. So when I'm in a, or like we talked about in the preface, like this book, even I'll be like, Hey, have you read this? Like indecision versus no decision. They're like, Oh yeah, that's, I'm like, you should probably read this. Right. And, and, or have you checked out? Oh my God, you talked about like major account selling. Like do you, you know, do your reps use 10 Ks and that is pretty arduous. Well, have you seen this 10 K analyzer? And literally I've had people get off the phone and then call me back and say, John, we want to move forward with you.

And I say, well, can I just ask why over the competition? I know, you know, you were looking at other options here and they're like, well, because every time we got off the phone with you, we learned something and it had nothing to do with what you were trying to sell us. It was literally every conversation we got off and said, Holy shit, we need to talk about that because we should be doing things differently or whatever it is. They're like, I want our reps to be like that. So when, when they're talking to clients that every single interaction is value oriented and that builds up your credibility so that later on, they're not just beating you up on price. You're, you're having a conversation about what their needs are and getting flexible and creative with it as opposed to just dropping your pants.

So you just use the word value and you, you know, let's, and you use the word needs. So let's define value. Value is the prospect or customer's needs or interests being satisfied because that's how they define value. You just, you just explained it in a perfect way, right? Cause that's the reality. So then after we've confirmed their needs and, and they know, Hey, this, this guy really understands where we're coming from, what we're after. Then what we do is we take whatever we have in our offering or to your point, maybe tangential things that we can bring into the conversation. And we show how these could satisfy those needs that they, that they definitely have. Now at that point, they're excited.

They're like, this is great, but what's in their mind? Oh shit. I can, I afford this, right? The price, right? So you said, we give them all this stuff. And then what happens is if they decide or they're thinking can't afford this, what we're doing is, Oh shoot, then they won't get this. That's gone. And they won't get this. That's gone. And you said exactly what they always say. Wait, wait, wait, wait, wait, wait. Hold on a minute. The moment they say that back in their pocket, back in their pocket, keep bringing everything back. Right. Because the research is really, really clear on this. The more they think they have something, they put three times the value on it. Explain that. What do you mean when they say they think they have something?

When you go to buy a new car, it's an incredibly expensive machine. There's, I mean, you know, there's all kinds of risk in putting you in a vehicle. They don't really know you, right? But they're going to put you in a vehicle. What, I mean, what do they do? They say, take a test drive, drive it around. Why would they do that? The reason is simple. It's the same reason when you're in the bazaar, in the market, in the Middle East, and you look at a carpet, they wrap, they show it to you, they wrap it up, get it ready for you. Because the more you feel that you have something, if you're going to get it, the benefit of it, the more value you put on it. So we're willing to pay in, in general about three times, or sorry, we, we are, we believe there's three times as much value of things that we have compared to, to what we don't have.

So for example, if I was, if I was willing to pay a dollar for a can of soda, but somebody wants to buy my can of soda, I want, I feel like they should pay me $3 for it. So what that means in terms of sales process and negotiation is most of our work is what you described in terms of the conversation about their needs and how we can, you know, what they're looking for, how we can help meet their needs without getting to the stuff they don't like. If that's the premium price, that's toward the end. So, but it's all a package, right? So the more time we spend on how they're going to get all these benefits and all this value by satisfying all their interests, their needs, the more likely they are to reduce their resistance on the price because they see more value because the more they feel like they have it, they envision it, they imagine it, the more likely they are to say, all right, let's do it.

I mean, that's basically how it works. So, so what you want to spend most of your time talking to them. If, if let's say you're selling a solution that's going to help them save money, you want to be calculating out all the savings you want, you know, they want to be looking at that number thinking, got to get that guy. And you're going to show, you're going to, you're going to bring in their people and talk about, well, here's how we're going to do it. And they're, you know, they now have a plan. You, the more you can make it real for them that they've got this, they're going to get that. The more likely they are to go for it. So let's, let's break down because I think, you know, we, we've been glossing over a little bit of interest-based negotiations, you know, kind of assuming that a lot of people know what that is.

Right. And from my perspective, and let me, let me make sure I understand this. Right. Cause again, it's been a while. I had to do a little refresh here, but it's focused on interest, not position. So like, they're going to say, Oh, I want a discount. Is it really that? Or is it just because they have budget constraints, right? Like that's, that that's the right. Then you separate the people from the problem. So it's, I'm not negotiating with you. We're negotiating against this problem, which totally generate multiple options before deciding. So this is my approach of, instead of like a discount, I tell people, take the word discount out of your vocabulary, change it to creativity or flexibility.

We can get creative with our, with our options here. We can, we have flexibility with our pricing and that, that changes the dialogue. Use objective criteria. So kind of interesting norms. And then this is the one I wanted to pick on though. Seeking a win-win outcome. Yeah. So that's, that's just basically fluff. That's just fun. I'm not going to say it's bullshit because there's an idea, there's a concept underneath it, but you, you, you tell me what's win-win. So, so this is, yeah. So, I mean, in general, it's, I ultimately, I got what I wanted. I might've given up a little bit of the stuff that I, you know, I didn't find that important, but ultimately I got the core of what I wanted. And so do you.

And we have a mutual agreement here that we're walking away, not somebody didn't win and somebody didn't lose. I think that's more, instead of a win-win, I just want to make, like, I'm walking in to make sure that, that I'm not losing and you're not losing. Cause he, when that happens, it's a short-term relationship. So I mentioned at our, at the outset that I, you know, started out in law litigation and what they taught most lawyers is a good negotiation outcome is both sides are equally miserable. We both lost, we both lost equal amounts. So you're, so you're flipping it. You're saying, well, at least we didn't lose too much or, you know, we didn't lose. Right. So, so there's a mute. So let me, I'm going to break out the things you mentioned.

So there's mutuality. You said you got to get something that you want, but you all, but the other person also has to get something. Right. You said you gave up something. Uh, that caught my attention because I'm curious about how much you're willing to give up where it still feels like a win. Right. Okay. And then the idea is the other person also gave up something too, probably. Right. Okay. So now, now, now I'm, I got the mutuality part in a positive way, but I'm also, you know, I, I have three kids. Fortunately, they're all, uh, uh, young adults now. So I'm beyond the, uh, early years where every time I traveled for work and brought home like soccer jerseys, um, what do you think the first thing that happened?

Each, each kid's comparing my Jersey to what she got. Right. So we're comparing too, aren't we? Yeah. Always. Right. And so in real life, it sounds cool to say win-win and I'm getting what I need, but I gave up a little, but we're also comparing. So let's, let's talk about that a little bit. So do we both get the exact same thing in win-win? No, we don't. I'm so glad you said that, John, because, you know, I need a little bit more than you, you know, it's just the situation I'm in. So we're going to make sure you get something that's good. You won't lose too much, but I need, I probably need about 60% of the value on this, on this deal. So, right. Yeah. So, you know, and so if you're, uh, if you're trying to develop the business and you're thinking like, well, okay, you know, at least I get 40%.

That's not horrible. Um, you know, you're telling yourself it's a win-win. Okay. You go back to your office, you know, you go back to your team, and everybody's like, what? You, you got, you only got 40% and you're calling that a win-win. So now the next time that you did mention that we go away, so we just went away. Isn't a part of what we think of as win-win. We're going to deal with each other again. Right. We're not, yeah, we're not like, I don't ever want to deal with that jackass. We're like, no, we'll keep working together. So the problem though, is you come back the next time I got 60, you got 40. And what are you thinking now? I got to get my, I got to get, I got to make that equal, right?

Right. I got, and to make it equal means you got to get 60 and I got to get 40 this time. And I'm like, hell no. Are you crazy? So the reason I'm mentioning this is while it sounds good in theory, and people love to say win-win, the truth is nobody can define it in a way that's meaningful. It's not, it's actually not a meaningful concept. So the way I prefer to talk about it is let's talk about a principled negotiation, right? Principled, meaning I'm not asking you to do things that I think are, um, unethical, immoral, or do not respect some form of reciprocity in our relationship. Right. Because if I want to keep dealing with you in the future, there should be some kind of mutual respect in that.

People talk about trust and the reality, I think I've been happily married for over 30 years and I will say, you know, it doesn't start day one, you build it, right? You build trust. And how do you build trust? You build trust by making commitments that are not really long-term, at least initially, they're pretty short and keeping them, right? That's how we build trust. And so you say, hey, this guy is somebody I can work with. She's somebody I can work with because, you know, she said she'd do this and she did it. So when we think about win-win in a more sophisticated way, let's think about it in terms of reciprocity, meaning it matters how each side does. But reciprocity doesn't mean equality.

It doesn't mean every outcome is going to be equal. Why not? Well, let's say you've got a lot of leverage right now. Let's say you've got choices and you don't really need me. Okay. Shouldn't you get some benefit from that? Or flip it around. Let's say I've got a premium product that we developed. We have patents on it. It's really, really a market leader. We just introduced it. And nobody else can do for you what this product can do. Shouldn't I get, don't I have some leverage with that? Darn right. Right. And you're not going to find any sales organization that doesn't expect to receive some kind of price premium if it has leverage. If it has a good product or service that, a brand, whatever, that people put value.

So the question is not whether it's win-win in terms of equal outcomes. It's much more given the leverage each side has and the need for reciprocity if we're going to have a relationship over time, how are we going to deal with each other? So let's take it in two different directions. One is, let's say I have a lot of leverage right now. One thing we know is that leverage doesn't last forever. All you have to do is widen the time horizon. There's no country, nation, nation state. There's no civilization. There's no person who has power forever over you. You just have to widen the timeframe. Now I get that in the moment, it feels like forever when somebody has power over you. Okay. So why is that?

Because when somebody has power over us, when somebody has leverage and they can use it, we resent it. We resent it. We always do. So what, you know, I just said two things that are kind of insane. If you think about sales, on the one hand, I said, if I have a sales organization with a great offering that has an advantage in the market, I expect premium pricing. I know I have leverage. At the same time, I just said, if we want to have long, you know, good relationship with our customers, then there should be some reciprocity and they're going to resent when I use that leverage. And that's, that is the reality, right? I've worked on the, I've actually worked on the procurement side as well with some of the biggest procurement organizations.

Let me tell you, when they're stuck, when they have no choices, all they're thinking about is how do we get up from under this supplier? How do we, how do we get, how do we improve our leverage? So, and I guess that's, that was going to be my question is, is like, when do you, like, how do you deal with somebody who at least theoretically, or how they position themselves? They don't want the win-win situation. They want to win and, and you to lose. And, and, and I, and knowing, so like, let's use, let's use the real world concept of like most of us deal with, right? Done a great job, champion, you've multi-threaded, you have all these people on board and you've missed the step of getting procurement involved early, right?

So now everybody agrees. You've actually probably given up some concessions to your champion to get to the point of the proposal, going out the door and ready to go to procurement. Now, procurement brings it up and says, no context. I don't give a shit who you are. Fuck off. It's 30% off of your price. And that's how we do business. Yeah. And it's like this shut door. I can't talk to you. I like, they won't let me have the conversation with you. It's a flat, or let's do it. The flip side of an existing customer where the new C and I've, I've literally seen this happen where the new CFO comes in and says, every vendor fuck off 30% off the top or else we're not doing business you do period. And now it's like, what do I do?

Like, how do you deal with that scenario? Yeah. So what you're saying, just to be clear is widespread, especially right now, by the way. Yeah. Some of them are sending out these emails. Blanket emails. Yep. If you don't agree by, you know, Friday to a 15% reduction, you know, we're not, we're not telling you what's going to happen next, or you're going to be cut off, which, so, so I mentioned leverage. So one thing I said is when you have the leverage, you want to use it, but we have to use it in a way that is respectful of the relationship. So let me just finish that idea and then come back to this one because they relate to each other. So if I had the leverage in this moment, and it's, and that's also, by the way, relevant to your example, because what if, and I've been in the, I'm often in this situation.

So the person comes in, but I know because of the work I've done, as you just said, in building all these allies and champions, or because of the work I've done historically at the purchasing person who comes in, I may have to, and I've done this many times when you have to do it, I'll go around them to others and say, well, here's what you're counting on. We're not, you know, we, we know we have the leverage and we're saying, we're not going to agree to it. We're just not going to agree to it. And so they then have to work internally with a workaround and say, basically this, this, we need an exception on this one. We're just not going to, and, and by the way, if it matters to them, they will.

But the key there is you have to have business leader and business unit support so that, because then they can always back purchasing down always just be aware of that. So that's, that's what I would do in that situation. If I have leverage, right? The challenge is when we don't have leverage, that's the real challenge. So I'm just trying to get in the door, for example, or you know, or maybe we've done some things and there's a new entrant coming in, knocking on their door with a lower price or a new offering or something that's got their attention. Or to your point, a new leader, somebody just came in and they, they have previously dealt with somebody else. And they're like, oh yeah, we need to look at this, you know, alternative to you.

So there are a lot of ways that your leverage can plummet. Now, when you don't have leverage, there, it's a much, you know, it's a much harder sell, obviously, but there are two ways to look at it that I've learned can be effective. One is to look at it short term in terms of maybe what they're planning to do or thinking about doing is, again, if we, let's, let's just take your, your example that we've actually built a bit of a relationship. We know what they really need, what their interests are, what they're trying to achieve. Maybe we know that what they're considering an alternative, like we're not, if we're, assume we're not going to, we're not going to reduce our price 30%. That's not going to happen.

So we can either in that case, show them how an alternative that would potentially meet their supposed requirements on the pricing would not actually satisfy the interests, the needs that we have already talked about. So that's not going to be a procurement conversation, by the way, that's going to be working through those other stakeholders with whom we have already built credibility in a relationship, even though we don't have the business yet, you got to work with them and have them interact internally with procurement. And I'll get back to that in a second. So the second thing we can do is take a longer term view, which is to say, I don't have the leverage right now, but I mentioned that leverage, nobody has it forever, right?

And that includes your customer. So let's say they come in with the 30% demand and I really want to get in the door, but I can't agree to a 30% and plus we've already put together a package. What I would do then is reopen a negotiation about the package. What is it they would get? Maybe, maybe it won't be 30% discount. It might be a 20% rebate or something or something else we can put into your point. We're going to call it, you know, we're going to call it some creative value that we're going to pay for them, but the total package has to change. Now I'm not saying I want to do it, right? What I'm doing, what I'm doing is I'm investing in the longer term relationships. Let me give you an example of this because I've done this.

There was a situation, this exact same thing happened. And what, what was really tricky is it was for a program that they already had scheduled. They had everybody coming in. I was going to be the keynote speaker. And they got this thing on a budget thing where they were just, and you're like, we, what do we do? We got to, we don't have as much money as we thought for it. And I'm like, I knew they were locked in. In some ways I had leverage, but if I use that, they would know that that would be right. And I was trying to get in the door. So what I did is I said, all right, look, just this, because of what you're saying, you know, let's do it this way. Here's how we'll do it. And this will meet your budget requirements.

I need you to know I'm doing it as a favor so that you can see what we can do. And we can look at, you know, some, some more opportunities down the road. They loved the keynote. It was a huge success. What do you think happened when we put together the package for, you know, ongoing work? They used your pricing, right? Of course. Yeah. But what do you think happened on it? What do you think they'd came back with? What do you think happened? I mean, I would assume they used the discounted price that you gave them as your base. You know it, you know it, right? So what I said is, well, unfortunately, as I shared with you previously, that I did as a favor, you know, because of that situation. And, you know, this is what you're dealing with going forward.

But I had the leverage then. Not because everybody loved it. Yeah. Yeah. They loved it. And there was no, and they back, totally back there. And they, they had an internal conversation. Oh yes, he did tell us that. And they completely backed down. So how you use leverage depends on, are you looking at building that longer term relationship? In which case you could adjust the package at times. If you can't go around them to the other stakeholders to get them on, you know, to kick it, get them to back down. The second way you can handle it though, is to be a little harder edged, but in a, in a nice way and share, for example, a cautionary tale, which is to let them know, again, remember we, if we have done our work, we have an offering that we have demonstrated to them.

We'll meet their needs really, really well. Yet they're coming in playing hardball, the procurement people. And we may need to equip our contacts with what I call a cautionary tale, which is sharing with them an example. You don't even necessarily need to identify who it was, but give enough detail that they can figure out, well, it was somebody very similarly situated to them, maybe somebody in their industry or in the same situation they're in. Second, it's got to be something that they think is, you know, realistic and relevant that, you know, it could really happen. It could really happen to them. And third, that it's very painful. The outcome was really bad. So an example would be, let's say, let's say there are regulatory or other reasons why they shouldn't take certain risks and we can help them avoid that.

And we happen to believe that if they go for a cheaper solution, you know, they're actually potentially looking, it could be safety related, could be regulatory, you know, something that you really don't want to take a chance on. I might share with them a story of somebody else I've heard of without sharing who it was that, and walk them through it. And, you know, you guys may want to think about this. I had one situation where it was a major deal and it turned out that, uh, I was working with a large organization and, uh, we got aced out on, uh, the deal by a competitor. We didn't know this, but the competitor's rep was married to, uh, you know, we didn't know. And, but we said, I said, look, share a cautionary tale anyways.

And I said, suggest that they get a six, six months out on the contract just in case, get this a month after they were into the contract, because we were telling them it's not going to work the way you think. They called back and said, thank goodness. You guys had us put the six month out. We've already decided to exercise it. See, that's why you always got to leave that door open. And feel like even on a hard, like it just, I always say to people, look, it doesn't look like we're a good fit at this point, but he keep my card handy. I, and look, good luck with that approach. And I don't say it, but I'm like, when it doesn't work, feel free to call me back. You know what I mean? That, that type of thing.

But it's funny, you know, going back to sales, like what you just explained there to a certain degree is, is the, is the feel fell found approach from objection handling. Right. It's like, actually, I appreciate where you're coming from on that. Right. Like, as a matter of fact, I saw another client do that from a budgetary standpoint, after they implemented it, they realized they couldn't do these things and it actually put them at risk here. And this is what happens. So right. Feel fell found. Right. And the thing about it is it's, you know, cause sometimes I get the pushback. Oh, wow. That sounds really aggressive. Or will they be upset? And my, what I've learned is you, you have to do it in the way that you're comfortable.

It's got to be a totally got to feel comfortable. You said the word, you said the word authentic. It has to be genuine and authentic. You can't just make up a story or read a case study and then use that and be like, Hey, I read a case study where somebody did that. No, go talk to that client, have that conversation with them, understand the genuine issues that they faced and then be, then tell that story when it's appropriate, but don't just do it to do it. Right. And that, and that's the thing. It's like, you gotta, it's a risk analysis. You got to look at, you know, what's it, what's, what's at risk here? Is it worth actually sharing this because maybe, you know, bring back something, but yeah, there's all, these are really powerful tools.

And when you have them in your toolbox, knowing when to use each one and, and, and how to use them, it's really, really powerful. Awesome. Well, we didn't even get to some of the shit that I wanted to, I wanted to talk about your movie. I want to talk about the AI impact. So I think we're going to probably have to do a part two of this. I mean, your Rwanda shit with your war crimes tribunal and the middle East peace project, man, like there's, there's so much to unpack here, but in the interest of keeping it under 60 minutes here, let's end with this. What is, what is your favorite, uh, negotiations tip that, that you think is probably one of the best ones, one people don't know enough about and should be using to this day?

Yeah, for sure. So one of the things that we usually struggle with when we're dealing with really difficult stuff is, oh shoot, I want to collaborate. I want it to work out, but it doesn't look like it's going to work out. So, oh man, I got to go a different path and I've got to, you know, and it's a unilateral path and it's going to be tough. And so we vacillate, we go back and forth between the two, right? We're like, no, I want to collaborate. I want to work this out. I'm going to try to find a way to make this work. Oh shoot. No, I'm on my own. What I've learned over the years is when stuff's really difficult, when you're dealing with adversity, tough, tough stuff, personal, professional, doesn't matter what it is.

It's really important to prepare both paths simultaneously. Figure out if we can work this out, what could it look like? How could I communicate that? Be creative, be disciplined and structured and thinking about how it could meet the needs of others and meet your own, but also really play it out in your mind, work on it, communicate it. At the same time, look at the unilateral path. What's it going to involve? What do I have to do? If I'm going to put consequences on people, if I'm going to have to look for other partners or do other things, what does that look like? And it's really hard emotionally, I think, not just intellectually, but emotionally to sort of grasp that. But it's absolutely the key.

And here's why. When you're dealing with adversity, when you're dealing with difficult stuff, there's one principle that has to hold, which is the status quo that's really bad is not an option. I will not accept the status quo. We're going to make a change. So we're either going to make a change that's collaborative and works, works for me, better than the status quo, or I'm going on a different path. As hard as it may be, that's better than status quo. I like that. You know, my colleague of mine, a friend of mine, Doug Landis, he has this thing where, you know, he's, and he talks about, he's like, look, my job here is to help you make a decision one way or the other. Like whether you decide to go with me and we can go down this merry path.

Fantastic. Whether you decide to stay with your existing solution or your exit, that's fantastic, but it has to be your decision and you have to choose one way or the other. My job here is to help you make that decision. Love it. And I, and I love that idea because I'm not trying to say I'm, I'm here to win. I'm here to earn your business. I'm here to build, you know, be your trusted advisor. No, no, no. My job is to help you make a decision one way or the other. Either stay, you go with me, you go with somebody else and I'm going to be transparent about that and let's go. Yeah. I love it because not making a decision is making a decision. Is making a decision. And it's, and it needs to be a conscious one.

I am consciously deciding, not I'm indifferent, not I'm indecision and I'm just not making a decision. No, I'm consciously making a decision to stay with our existing solution for valid reasons. Yeah. And therefore we're not going to move forward. Great. So there's three possibilities. I'm going to go with you. I'm going to stay with my existing solution or I'm going to delay and defer. And that could be legitimate, but be aware, as you said, be conscious of it. You're making a decision. One of the three, whatever the one you think is the right one. Awesome, John. Well, this is a, like I said, we could keep going on this. And I think we do have to have a round two here in a few months here, see how things have changed.

AI is changing the whole world right now when it comes to this. And I know you're doing a lot of simulation stuff with your group and, you know, role play scenarios with AI, which is fantastic. So tell everybody, uh, how they can find out more information about you. Uh, and is, is it a liner? Is that a liner? Yep. That's right. And for everybody listening out there, it's a L I G N O R. Uh, and it's John Shulman S H U L M A N. So John, where can they find out more information? Where do you want to point people? Yeah. Come to our website, aligner.com and, uh, love to hear from people and, uh, you know, love to hear about the tough stuff. That's what we focus on. We, we like the hard stuff. So that's, uh, kind of where we live.

Awesome, John. Well, thank you so much for coming on, man. I really appreciate it. It was a fun conversation. Yeah. Great conversation. Take care. Absolutely. And everybody, hopefully you enjoy the conversation as much as I did. Like I always say at the end of all these podcasts, go out there and make somebody smile today. Cause no matter how bad your day is going or how bad you think it went, you make somebody smile today. You know, you had a good day and the world needs a lot more of that right now. So thank you all very much. And I will see you on the other side. Hey everyone. I hope you enjoyed that conversation as much as I did with your support and our incredible guests. We're one of the top sales podcasts out there right now.

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