Leadership consultant Ciarán Fenton outlines key steps in developing your negotiating skills as an in-house lawyer.
All lawyers are negotiators. It’s central to what they do. During my corporate career, I worked on many deals and, once we had agreed heads of terms, I used to love watching the commercial lawyers strut their stuff. The skill with which they traded clause changes was, to me, often mesmerising: ‘… yes, but not without our prior approval… agreed, but such approval not to be unreasonably withheld or delayed…’. And on they would go for hours.
But surprisingly, to me at least, not all lawyers are good negotiators in all situations. On the other hand, scores of non-lawyers I know excel in all negotiations, whether it’s a seat upgrade, a child’s bedtime or a multi-million dollar deal.
My hunch is that, at heart, all lawyers are litigators. It’s because of their awesomely tough adversarial training. Not only must they be right, but the other side must be wrong and, over time, their identity comes to be associated with always being right. The pressure of work doesn’t help.
I know one GC who admits that he is ‘a crap negotiator’, even at home. Another GC told me that many lawyers in his team struggle to see the bigger picture in negotiations, are too narrowly focused, and consequently lose the plot. I wonder if female lawyers make better negotiators. I have no evidence that this is true, but my gut tells me it is, because they are often, though not always, more issues-driven.
Good negotiation is about securing a win-win outcome, not win-lose. This necessarily involves compromise and, above all, an ability to sell. Many in-house lawyers achieve much less than they could because they hate the process of selling. They fear rejection, are uncomfortable asking for anything, and don’t know how, exactly, to sell well.
Many in-house lawyers achieve much less than they could because they hate the process of selling.
Fear of rejection is deep-rooted. It is linked firmly to a dislike of being and appearing needy. Experts tell us that this revulsion indicates a history of difficulty in negotiating needs in formative years. If you were able to negotiate and satisfy your reasonable needs at home and school, then you are likely to be able to do so in adulthood, leading to a natural ability to sell and negotiate well when the need arises. The opposite early years’ experience, however, is more common.
Much of my work is in helping clients deal with this hard-wired behaviour, because they have no option but to negotiate if they are leading complex change, restructures, M&A, conflict, adverse trading conditions, first 100 days, earn outs, or trying to win at interview. Whatever the context, they must succeed at selling themselves and their ideas to people.
The selling process is key to good negotiation. Good selling technique, which is core to developing good negotiating skills, can be reduced to three questions:
Needs analysis is the step on which many lawyers stumble. The other side’s needs may not be logical or rational, but they are always driven by feelings.
Step 1, therefore, is to find out how the other side feels about the issues, but lawyers are not known, usually, to prioritise feelings.
The way to find out what the other side feels is to ask lots of open ‘biased’ questions – who? What? When? Where? How? – and to listen closely to the nuances of the feelings expressed in the answers. Some lawyers believe that their training requires them to be the brightest person in the room, but if they want to become good negotiators, they need to confront the limits of their training, especially in a commercial environment. They must listen not just to catch someone out, but to understand them.
You can check that you have bottomed out the other party’s needs by using two simple techniques: first, briefly summarise back to them your understanding of their needs. If you get it right, watch for a physical response – often a nod. This, as the psychologists tell us, is the involuntary sign people give when they feel heard. The second technique, which I have used in negotiations and works every time, at least for me, is that when you feel you’ve asked the last question, ask another. This stretch in your self-discipline will, usually, bring to the surface a deeper truth.
If lawyers want to become good negotiators, they need to confront the limits of their training, especially in a commercial environment.
Step 2 is short, because it’s straightforward (albeit difficult): you must demonstrate, rather than assert, that your proposal will meet their specific needs, as well as yours.
Step 3 is to close the gap between their needs and your proposal. Start by asking yourself: ‘If 10 is we have a deal, and zero means we don’t, where are we now?’. Unless things have gone horribly wrong, the typical answer is ‘seven’. Next ask: ‘What has to happen for you to turn the seven into a ten?’, and then, say nothing. This silence is crucial. No matter how uncomfortable the silence becomes, don’t break it except to repeat the question. They will fill the silence.
When you are clear on the points which make up the gap, you must then address each point carefully in turn. There are various techniques you can use to close the gap, but the most important is to remind the other side about the shared purpose of the negotiation. This purpose can get lost in the heat of the negotiation. Unless there is a shared purpose, there isn’t a negotiation. It’s an imposition.
It is useful to confront which part of the selling process you hate most, and why. For some, it’s the fear of rejection; for others, it’s the shame of having to ask for anything. High emotional intelligence is essential to good negotiation. High EQ is about empathy, self-awareness and the ability to negotiate your needs productively.
Once you have isolated your fear and its origin, the final step is to become comfortable observing your process or, to use the current jargon, to be mindful. Mindfulness is about separating yourself from your thinking, as in: ‘There I go again not asking for what I want, just demanding it’, but in a manner which is not self-destructive.
Then you can to start making small changes in your behaviour. Changing just 10 interactions in every 100 in a typical negotiation is just 10 per cent change. That’s small change, and small change is hard to do. But it’s worthwhile, because it creates a virtuous cycle: the more you change yourself, the more success you will have in your negotiations.
Ciaran led a webinar on how to develop your negotiating skills as an in-house lawyer on 27 June. You can access a recording of the webinar below, but you will need to sign up to our Professional Development Centre first - it only takes a few minutes.