Negotiations: 3 Steps to
By Todd Zaugg
Is your company experiencing any of the
• Eroding margins.
• Longer sales cycle.
• Disloyal customers (constant contracting).
• Reduced market share.
All of these challenges can be traced back to
an inability to effectively negotiate. It’s common
for sales professionals to believe they are
competent negotiators, but then struggle
during powerful real-world simulations. The
truth is, many sales people and managers have
low awareness related to this skill set. What can
be done to sharpen aptitude in this area?
Working to understand the common pitfalls
experienced during negotiations will allow for
action planning that leads to increased
negotiation engagement success.
The undercurrents that significantly impact
negotiations are often overlooked completely.
The life sciences negotiation environment is unique in the fact that the person you are
negotiating with “today” is also someone you
will need to “live” with tomorrow. This creates
an oversensitivity to the delicacy of those
interactions. We should be prepared to ask
tough, penetrating questions in a very “servant”
manner. We need to embrace the inevitable
stress and manage the “tension” toward the
The first step in this training should focus on
a highly actionable negotiation template
featuring these components:
Once these negotiation basics are
understood and mastered, it’s important to
continue the learning process to include the
sales team’s actual negotiation interaction with
the buyer. Our research and experience have
shown that even after excellent preparation, 33 percent of sales people quickly default to the maximum
discount. The primary reason for this is not poor
information or strategy, it’s because the sales people were
not prepared to manage the tension of the negotiation.
People are not comfortable with being uncomfortable
and, as such, they will look to accelerate the negotiation in
order to remove the perceived or actual pain of that
How can this challenge be solved? Sales professionals
and managers have to increase their competency to deal
with interaction tension. There are three steps to
1. Understand the Psychology of the Negotiation.
According to the Harvard Law program on negotiation,
breakdowns in negotiation occur because, “We often
think of ourselves and the parties we work with as
entirely rational, when in fact our individual realities are
firmly rooted in our subjective perceptions, which are
shaped by the particular ways in which our brains and
sensory systems have evolved.” Specifically, they
established these 10 neuro-principles that demonstrate
how individuals are likely to react to negotiations:
• We consume our brain’s resources efficiently, and
create patterns, scripts or memories.
• We predict according to our patterns, scripts or
• We are conditioned to avoid and be far more
sensitive to danger and fear than to reward and
pleasure. Which we seek (“away” v. “toward”
• We first perceive via emotions (unconsciously)
before being able to self-regulate (consciously or by
• We seek safe or comfortable status positions at all
• We relate and empathize in-group (but not “out-of-group”).
• We believe in “fairness” and react negatively to
• We need autonomy/feelings of autonomy and
feel/suffer if it is lost.
• Our “social” stimuli are as powerful as our
• We operate cognitively in two gears (“refleXive” &
“refleCtive” modes): primarily in X-mode.
• We would also add: Understanding your
counterpart’s motivators and their “power.”
2. Increased Preparation on the Psychology of the
Negotiation. Too many negotiation programs focus on
the rational aspects or deal structure whereas research
shows that negotiations are ripe with emotion. Consider
the following to prepare for all dimensions of the
• Awareness of yourself (mindset scripts, patterns)
and your negotiation style; the real opportunity;
common irrational tendencies of all humans; your
counterparts’ past negotiating style and definition of
• Capture value of the holistic impact of your
solution. What are the operational, financial,
clinical and strategic value impacts (e.g. drive more
private pay, reduce readmission rates, etc.). Can you
assign a dollar value?
• Tripped up is a term used to describe conscious and
unconscious games people play or strategies by your
counterpart to diminish your value. Master negotiators
will try to make you uncomfortable during the
dialogue (e.g. your company has a terrible service
record, we are seriously considering your competition,
etc.). It is critical that you work on being com-
fortable with being uncomfortable—
the element of managing
• Identify motivators:
What’s driving your
buyer’s decision? What
are their personal wins
and their rational wins?
Is it budget, competition
or pressure from
upper management for
them to find a solution
quickly or at a lower
• Presenting options is a
powerful concept of
to your counter-part.
The key is to never use the word “no” without
first offering options and concessions.
• Negotiate expanded concepts related to: “stranger
danger” (when they bring in someone you don’t
know); creating “trust treats™” to overcome their
“patterns” (e.g. that sales people cannot be trusted);
framing and reframing key objectives; forced pairing
(e.g. what is more important to you, managing costs
3. Real World Simulations. To enhance negotiation skill
development, a stronger emphasis has to be put on
navigating uncomfortable negotiation dialogue. There is
no substitute for the power of practice in order to
become competent at eclipsing stress to insure clear
communication. As with all skill development, proper
coaching practice to insure its effectiveness is critical.
Effectively executing a plan to address these three steps
has proven to increase sales team competency to
understand and deal with “interaction tension” and ensure
more successful negotiation engagement with the end goal
of moving the needle on performance.
Todd Zaugg is the founder of Matrix Achievement Group. Email Todd at email@example.com.