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Flexible Managers Learn How to Negotiate and Compromise

Battling bulls

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Middle managers who are flexible in their relationships will find it easier to negotiate and compromise at work. These skills will increase their chances of long-term success and career advancement.

Top-level executives have the authority and responsibility to make major decisions based on complex negotiating and compromising. They don’t acquire those skills on the day they are named CEO. They acquire them from decades of experience that began when they first became front-line managers.

Executives have so much power that they may not have to bend much in negotiations, especially with subordinates. Middle managers don’t have that power in many situations. They have power with anyone who reports to them, but their most important decisions often need the approval of their bosses. In many real-life situations, they also have to negotiate with people in other business units, departments, divisions or companies.

It’s a workplace marriage

These managers have something in common with spouses in a marriage. Spouses in successful marriages negotiate and compromise all of the time when their decisions impact both of them. Imagine a spouse who always demands his or her way without any discussion or trying to meet the other spouse halfway. The odds of that marriage succeeding in the long run are low.

Middle managers have four common situations (among others) that often require negotiating and compromising:

  1. Setting annual budgets
  2. Asking for pay raises
  3. Proposing major ideas
  4. Landing a client deal

Each of these situations requires an agreement with someone who has some power of their own. It means that other person can easily say no.

5 Basic Negotiation Tips

Most managers don’t have to prepare for a negotiation with a giant labor union or a billion-dollar client account. They don’t have to read entire books about it or take MBA-level classes. Sometimes the preparation is just a few minutes of clear thinking about the following five principles.

1 — Aim realistically high.

Some experts say bluntly “aim high” as if the sky is the limit, but real-life negotiations aren’t that simple. It is better to set careful goals that are realistic and just slightly higher than ideal. They have a shot at acceptance by the other party.

For example, a manager who is negotiating staff pay raises may ask for 3.5 percent rather than a desirable 3.0 percent, which is higher than inflation. A sales manager can ask a client to spend $10,000 more next year when $5,000 would be a win. No ask should ever get a smirk or snort in response.

2 — Think about the benefits and sacrifices of the other.

A manager who has to negotiate with anyone is often asking them to make a sacrifice. That sacrifice is usually money, labor or other resources. Does that sacrifice also bring with it a potential benefit to the other party?

A middle manager who proposes a $1 million sales budget is asking a senior manager who wants a $1.1 million budget to sacrifice his or her own goal. But the boss may benefit if his or her higher budget turns out to be unrealistic. It’s better to beat the realistic $1 million than fall woefully short of the $1.1 million. In that case, the boss benefits.

3 — Prepare an elevator pitch.

Bullfighting

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The first 90 seconds of the discussion makes a huge difference in how the negotiation will play out. A prepared elevator pitch has a much better chance of steering the discussion in the right direction than an impulsive, top-of-mind beginning.

Experienced managers and employees know soon enough that someone has walked into the office to ask for something. It quickly puts them on guard. A solid, disarming elevator pitch should offer a clear explanation of the purpose of the meeting and put the other person at ease.

4 — Anticipate questions or criticisms.

Anyone who talks more than 90 seconds at the opening of a negotiation without pausing to listen is probably talking too much. Regardless, when that first pitch comes to an end, the other person just might have a response that is predictable. The more managers know the other parties, the more accurately they will prepare for their response.

5 — Be ready with a compromise.

The worst-case scenario in negotiations is a flat-out no. Experienced managers know better than to assume a negotiation with a favorable boss or client will automatically produce a yes. So it’s important to give thought to a compromise just in case.

6 — React thoughtfully to refusal.

If the answer is no, beware anger or frustration that may discourage or shut the door for future discussions. As they say in sales, “no” means “not now”.

Seek a verbal commitment to a future talk when or if circumstances improve. For example, an increase in company profit may lead to higher pay raises in a few months rather than now. A client’s improvement in sales this year may lead to a larger contract next year.

Career Benefits

Middle managers will find that negotiating and compromising on budgets, pay raises, new ideas and small client deals will prepare them for much more challenging discussions in senior and executive management.

A middle manager who asks for a 3 percent pay raise to $80,000 a year is in a simple negotiation. An executive who is negotiating a contract that includes base pay, bonuses, stock options, cadillac plans, club memberships, company cars, golden parachutes and other benefits is undertaking a much more complex negotiation that will almost always involve highly detailed compromises.

The same is true of a sales executive trying to land a $20 million deal with a major client or a general manager negotiating a $50 million budget with the company CEO.

Negotiations and compromises grow in complexity with each step up a career hierarchy. The middle manager who recognizes that truth will find major career benefits in starting to build those skills today.

Scott S. Bateman

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