Deal World Rule #10 - Listen Until You Feel It

 image credit: Kevin Walsh (kevinzim - flickr)

Good negotiators know how to ask the right questions. But great negotiators have a far more powerful weapon in their arsenal – they know how to listen, truly listen, to the answers. Mental understanding is not enough. You must listen till you can feel the story that the other person is experiencing. What they say and how they say it opens up a window into their world – skilled listening allows you to look inside that window. What’s the point in planting the right question if you don’t reap the resultant fruit?
 

Listening effectively is one of the golden tools of differentiation. Most people think they have this tool. But few do. If you listen effectively, your deals will prosper. Here are some quick tips to becoming a true listener:
 

1. Do not begin with the end in mind. When listening, temporarily open your mind. Start with a blank canvas. Don’t assume anything. Ask and let the others paint the picture. Take in the picture without pre-conceived notions.

2. Understand the context. Figure out the other person’s situation and analyze the surrounding circumstances. Understand how this individual sees the issue, what he or she is trying to communicate and why.

3. Be focused and let them finish. Attention is the one of the scarcest resources on the planet. It can be excruciating to allow the person to finish without interrupting. Let them finish. Do not multi-task while listening! You sacrifice focus if you multi-task. You cannot simultaneously e-mail and listen. It is a big illusion that you can divide your attention. Slow down and totally focus on the questions and on the answers.

4. Get to the end of the thread. People often answer questions inadequately (or answer a different question than the one asked). Others usually accept the incomplete answer and move on. But you shouldn’t. Ask “why” until you get to the real answer. Generally the real answer is usually 3-6 “whys?” deep.

5. Ask questions like Colombo. Colombo (an awesome listener) was always working to get simple questions answered that told a story. Prepare like a good detective and ask questions aimed at eliciting answers capable of forming a clear picture of the entire story.
 

6. Affirm and Confirm your understanding . After you’ve listened, affirm and confirm your understanding -- ask the person: "So what I heard you say is ..."

*Some of these ideas are discussed on a cool web site: Communication Nation – How To Listen.

If you really start to listen you will really start to learn. People who learn more develop more expertise and do a better job. Listening creates alignment with others and fosters effective results. Do you truly listen? If so, congratulations. If not, start today.

Deal World Rule #9 - Use A Knowledge Trap

I once knocked my wife’s wedding ring down the drain in our kitchen sink. It could have turned ugly. Good thing sinks have traps.

Knowledge can also go down the drain if we’re not careful. We often hear, read, or see outstanding content, have “aha” moments only to later let these key learnings slip away, lost in the sands of time. That’s why we need a knowledge trap -- to prevent today’s takeaways from becoming tomorrow’s drainaways.

At the Studio, we review a ton of content every day. In order to preserve the important takeaways, we use a knowledge trap. The trap is sprung through 3 questions:

1. What are the big ideas in this content?
2. How do these ideas apply to my business (my life) to create ROI?
3. What tools can be developed to utilize (i.e., use and teach) these ideas and their benefits?

We use the answers to these questions to draw a picture that captures the key learnings. (click here for an example).

This technique can take a large amount of content (e.g., an entire book), condense it down to its essence, and depict this in a picture that we can use over and over again to refresh it in our minds and for our clients.

Do you use knowledge traps? If so, congratulations. If not, start today.

Deal World Rule #7 - Simplicity

The Simplicity Principle. One of the maxims we live by in the WieseLaw Contract Studio is – “Simple, But Not Easy.” In the world of deal making, there are far too many people who have an unfortunate talent for making things overly complex.

You should do the opposite – bring refreshing simplicity to your deals by doing the following:

• Have Courage. Reduce to what is needed. People, especially lawyers, often feel the need to overcomplicate deals. Have the courage to include only what is needed.
• Shorter is better. Although it is harder to craft short, tight and concise deals, we know they are more effective. As Blaise Pascal* once famously said:

“I'm sorry this letter is so long, I did not have time to make it shorter.”

*This quote, in one form or another, has also been variously attributed to Mark Twain, George Bernard Shaw, Voltaire, Winston Churchill, Marcel Proust, Rudyard Kipling, Henry David Thoreau, Abe Lincoln, Ben Franklin, and Larry Thomas, among others.

• Patience. Go Slow to Go Fast – Take time on the front end to get all the needed understanding and information to determine what is important and what is unimportant. This is the step most often ignored.
• Design. Create a deal structure and process that is designed to support the clearest deal making.
• Experience. Leverage your lessons of the past and apply them forward toward creating a deal that focuses on what is important and not on what is unimportant.
• Deal Maps. Map out the deal with a picture. Work through the actual deal from start to finish with a deal map.
• Listen. Understand and factor in the interests of the other parties.
• Capture all interests.

Some of these ideas are discussed by John Maeda in The Laws of Simplicity.

Do you embrace the power of simplicity in your deal making? If so, congratulations. If not, start today.

Deal World Rule #6 - Laws of Behavior

There are certain laws of behavior that have become widely accepted over the passage of time. Knowing these laws and how to apply them can enhance your negotiation skills. Allow us to share a couple of our favorites:

The Law of Reciprocity. Simply stated, others will reciprocate in kind based upon the way you treat them. When you give and take in a negotiation, make sure you do so with this law in mind.

For example:

• Set up any concessions with a clear label and definition of what value you are giving up – this invites reciprocity.
• Create a deal culture that fosters a spirit of reciprocity at the outset – announce
• that you expect to create a fair deal for all parties.
• Make contingent concessions – I will yield on X if you yield on Y.
• Release your concessions over time, not all at once – hold some reciprocity ammo in reserve for future exchange.

These ideas are discussed by Deepak Malhotra in Negotiation Genius.

The Law of Reinforcement. Simply stated, people learn to repeat behaviors that are rewarded. This works for good and bad behavior. Reward the behaviors you want to encourage, and not those you want to discourage. Some guidelines you could apply to your deals:

• Be the Change – Act the way you want to be treated.
• Quickly make the connection – Immediately praise desired behavior.
• Be Clear – Your reward should be clear and consistent, such as a nod, offering of an Altoid mint, open smile, eye contact, or a sincere thank-you or compliment.
• Reward behaviors, not moods or intentions – Don’t get caught up in trying to reward an attitude of the other party, stick to behaviors.
• Ignore bad behavior – if that does not work, punish it.

Some of these ideas are discussed by Leigh Thompson in The Truth About Negotiations.

Are you mindful of the laws of behavior during your negotiations? If so, congratulations. If not, start today.

Deal World Rule #5 - Know Thyself

Central to the wisdom of the great sages is this principle -- "Know Thyself." This simply stated, yet difficult thing to achieve is the primary challenge faced by negotiators -- because the hardest person you negotiate against is always yourself.

If you Know Thyself, you will separate yourself from your ego (a horrible negotiator) and from the emotion of the situation. You will create natural flow, which yields clarity of purpose and the strength to confront any fear. There are many paths to self-awareness:

Desire it - This will cause you to see and tune into opportunities of selfawareness.

Seek it - Create a simple journal (handwritten preferred), and take a few
minutes each day to reflect upon the following questions:

• What is your passion? Passion points to purpose.
• What do you value? This is the filter of all major decisions.
• Who do you admire and why? What are their values?
• What would you do if you knew you couldn’t fail? Leaning into your fear is the most powerful exercise for personal growth.
• How would your eulogy sound? You are going to die, embrace that thought so you get off your butt and step into your greatness – NOW!

These questions can be found in a great book - BE by A.C. Ping

Self-Analyze - As you become more aware of the questions to ask, you can start to really focus on how you behave in certain situations and what truly provides happiness. You can usewww.strengthsfinder.com, www.marcusbuckingham.com or Myers-Briggs Personality Inventory as aids.

Feedback - Ask your trusted friends for feedback about your areas of brilliance, strengths and weakness.

Coaching - Get a coach to help you establish a structured approach to tackle all of these questions with effective feedback and continuous self-assessment.

As you grow, learn, and evolve, remember the most important attribute of great negotiators (and happy people) is that they know themselves. Do you know yourself?

Deal World Rule #4 - Use Maps to See the Deal Landscape

Ernest Shackleton, Robert Scott, and Roald Amundsen were among the great explorers of the modern world. Armed with their passion, knowledge, and tools, these intrepid souls boldly ventured into the unknown, in search of great rewards, yet keenly aware that tragedy might befall them instead. Deals are like expeditions. Dealmakers are the explorers. We embark on a journey into new territory, relying on our passion, knowledge, and tools in the hope of reaching our business goals, yet recognizing that the risk of a bad deal is ever present. One critical tool that explorers use is a map.

Dealmakers should use them too. A deal map allows you to see where you are within the whole landscape in relation to the desired destination. Maps clarify and simplify complex terrain. Where are you now? Where is the destination? What risks & obstacles lie in the way? How can they best be navigated? Are you on the best course? You should start with a deal map based on what you know at the outset, and add detail as you uncover it during the expedition. This will help you in the deal, and it will foster greater knowledge transfer and retention beyond the deal.

A picture is worth a million words. Just as it’s better to show than to tell, a deal map is superior to the old memo. Memos may have their place in certain situations, but deal maps should also be added to your toolbox.

This Deal World Rule #4 is about seeing the whole landscape. When you can see what you are doing, in context, you have deeper understanding that makes you more effective at achieving better results.

How do you map your deals? Do you do it in a visual way that allows you to see the whole? Do you fill in the deal landscape with more detail as you move forward? If so, congratulations. If not, start today.

(click picture for the full view)

Deal World Rule #3 - Great Dealmakers Employ Great Methodology

Creating, refining, and consistently applying a strong methodology empowers you to leverage your experience, tools, knowledge and wisdom into a winning formula. You gain efficiencies, reduce your risks, and achieve better results.

Below is a visual overview of our methodology (at a high level) . . . one that we’re continually refining to incorporate the most innovative ideas that we can garner from our experience, from our studies, and from the world’s great thought leaders. It contains 7 phases:

This Deal World Rule #3 is about efficiency, flexible consistency and life long learning. To negotiate great deals, your approach should honor your authenticity and the uniqueness of each deal, while weaving in what you have learned (and continue to learn) about the essential common qualities of all great deals.

When you see great negotiators who appear to be shooting from the hip they actually have an underlying method to their seeming spontaneity. At the start of one deal, I overheard the other negotiator whispering to his colleague -- “Remember, lets be spontaneous … like we planned it.”

How do you approach your deals? Do you do it in a manner that empowers you to collect wisdom along the way? Do you learn from your successes (and from your failures)? Do you incorporate that wisdom into a well crafted and continuously refined methodology? Do you apply that methodology consistently, yet flexibly, to each unique deal situation? If so, congratulations. If not, start today

Deal World Rule #2 - Great Deals Maximize Whole Value

Great deals maximize Whole Value. A deal’s Whole Value is the deal’s potential (normalized to reality) less its costs (actual and intangible). It’s not an exact number but an informed relative value analysis.

To determine a deal’s potential (Reward) you analyze the Deal Value Drivers with the focus of an investment banker. Focus on cash flow relative to key factors:

*Cash Flow = is a term that refers to the amount of cash (or item of value e.g., exposure) being received and spent by a business tied to a specific deal.

To determine a deal’s costs (Risk) you analyze the Deal Value Drivers with the focus of an accountant that went to law school. Focus on the risk and expenses of generating the cash flow for the deal.

Rule 2 is about disciplined focus. During your next deal, focus on the deal’s Whole Value, as described herein. You will find that you have better understanding of what you want (and what you are being offered), which in turn, will direct your actions to achieve greater Whole Value.

In simple terms, its Reward vs Risk.

Deal World Rule #1 - The Value of Your Business is the Sum Total of Its Deals

Welcome to the Wieselaw Negotiation & Contracts Blog, we're excited to share what we learn in our collective experience of doing deals. We call them "Deal World Rules."

Rule 1 - The value of your business (and your life) is the sum total of its deals.

You need great people, content, ideas, money, products and services (“Company Jewels”) to have a successful business… but those things are not enough. Company Jewels need to be connected to commerce toextract their value. Deals connect Company Jewels to commerce. We focus on deals.
Your deal portfolio drives the value of your business. SO – start focusing on your deals, individually and collectively. Great deals increase the value of your business … one deal at a time. Unfortunately, the opposite is true as well (i.e., each bad deal decreases the value of your business).

Rule 1 is about awareness. Just think about it. Where are the dollars and risk for your business generated? Make a list. Check it twice. Are you getting the most from your deal portfolio? Do you even know your deal portfolio? Once you have the awareness you can take effective action to increase the value of your company.