Transcript chunk part2_23-46min.md

Transcript chunk part2_23-46min.md

[00:23:01–00:23:02] whatever.

[00:23:02–00:23:04] So figure out who the right party is.

[00:23:04–00:23:06] And are you talking with the right party?

[00:23:06–00:23:09] Secondly, it's become a trust and negotiation.

[00:23:09–00:23:12] And I put here that's a function of CCP.

[00:23:12–00:23:17] And my students will recognize it as a function of character, competence, and power.

[00:23:17–00:23:21] For somebody to be trusted, they have to be high character.

[00:23:21–00:23:22] They have to be competent.

[00:23:22–00:23:25] And they have to be empowered to make a decision.

[00:23:25–00:23:30] So you want the right party for you to negotiate with is somebody you can trust.

[00:23:30–00:23:34] The right party for them is that you must be also trusted.

[00:23:34–00:23:41] So if you want to enter high quality negotiations getting high levels of trust based on character competence and empowerment

[00:23:41–00:23:44] are really important things to assess.

[00:23:44–00:23:46] Then know your own baton.

[00:23:46–00:23:47] What's a baton?

[00:23:47–00:23:50] In unison.

[00:23:50–00:23:54] That's the alternative to negotiated agreement.

[00:23:54–00:23:55] Okay.

[00:23:55–00:24:01] This is a term that was developed by Fisher and Yuri in 1981, out of the Hartford negotiation study,

[00:24:01–00:24:11] which they really found that if people could go into a negotiation with an idea of what is their best alternative to this negotiation working out successfully,

[00:24:11–00:24:13] they came out with better end results.

[00:24:13–00:24:16] You go in with far more confidence.

[00:24:16–00:24:18] I've taken it to another level.

[00:24:18–00:24:22] What I go into negotiations now is I figure out, I don't know it for sure,

[00:24:22–00:24:26] but I try to assess what is the other party's baton.

[00:24:26–00:24:32] So I really think hard about what is it they want to achieve and what are their options?

[00:24:32–00:24:35] Because that really helps you kind of assess the whole thing.

[00:24:35–00:24:38] And you're not just thinking my agenda, my agenda, my agenda, my agenda.

[00:24:38–00:24:39] Here's what I want.

[00:24:39–00:24:43] Price, term, remedies, war, and this is what I need.

[00:24:43–00:24:46] And so many negotiators are going in with their own agenda.

[00:24:46–00:24:50] We'll go in and think about what is the lay of the land for the other party?

[00:24:50–00:24:53] And that helps.

[00:24:53–00:24:55] We'll talk a little bit later about Fisher and Yuri's map,

[00:24:55–00:25:00] but I think there are three or four suggestions that they make that are kind of their broad map.

[00:25:00–00:25:02] They're really very helpful.

[00:25:02–00:25:07] This certain difference between battles and wars, what we used to call the elephant ant,

[00:25:07–00:25:10] some people don't know the elephants from the ants.

[00:25:10–00:25:17] Have you ever negotiated with somebody for whom every deal point is something that they have to win?

[00:25:17–00:25:20] You know, everything is competitive.

[00:25:20–00:25:23] Everything that's brought up, they have to win every deal point.

[00:25:23–00:25:24] I'm here to submit to do that.

[00:25:24–00:25:26] That's a really dumb way to negotiate.

[00:25:26–00:25:28] This is a given take.

[00:25:28–00:25:31] If you're going to try to develop relationships the way Nicola said,

[00:25:31–00:25:35] or if you're going to try to come out with creative solutions or whatever,

[00:25:35–00:25:37] you really don't want this.

[00:25:37–00:25:39] I have to win every deal point.

[00:25:39–00:25:41] So know where the elephants are and where the ants are.

[00:25:41–00:25:45] We're willing to lose some battles to win the war.

[00:25:45–00:25:46] Yeah.

[00:25:46–00:25:47] Rachel.

[00:25:47–00:25:48] This isn't an awful point.

[00:25:48–00:25:49] I've done the first place.

[00:25:49–00:25:51] So isn't it going to be my advantage?

[00:25:51–00:25:54] Just put points there that I don't feel so strongly about.

[00:25:54–00:25:55] Yeah.

[00:25:55–00:25:56] Wouldn't be a part of making the same thing.

[00:25:56–00:25:57] They should be.

[00:25:57–00:25:58] And you should be.

[00:25:58–00:26:01] And really effective sort of win-win negotiations.

[00:26:01–00:26:04] You share with what you're trying to achieve.

[00:26:04–00:26:06] Lee Aikoka has a great line.

[00:26:06–00:26:08] You know, he was the guy that turned around Chrysler.

[00:26:08–00:26:11] And he said, you know, when I want to achieve something,

[00:26:11–00:26:14] I tell the other party exactly what it is I'm trying to achieve

[00:26:14–00:26:18] and what price I'm willing to a pay to achieve it.

[00:26:18–00:26:21] And that's really kind of the starting point where it's sharing in

[00:26:21–00:26:22] from this.

[00:26:22–00:26:25] So there's a lot more sharing of information in that kind of a model of

[00:26:25–00:26:26] negotiation.

[00:26:26–00:26:29] It doesn't always, it's not always something you can do.

[00:26:29–00:26:32] And then I, you know, getting back to these techniques,

[00:26:32–00:26:34] I would say don't worry too much about taking.

[00:26:34–00:26:36] She have to be aware of them.

[00:26:36–00:26:38] You have to be, and it tells you something.

[00:26:38–00:26:41] If somebody's using, I was thinking when somebody is shouting at me

[00:26:41–00:26:46] or walking out of the room or throwing things, there's information in that.

[00:26:46–00:26:50] It's like I had a partner one time in the real estate business who looked

[00:26:50–00:26:53] at a joint venture document that was VISTIC.

[00:26:53–00:26:55] And he looked at it and he picked it and he said,

[00:26:55–00:26:57] can any document that's that thick?

[00:26:57–00:26:59] There's something in it for me.

[00:26:59–00:27:04] And in a way, anybody who's throwing things and screaming and

[00:27:04–00:27:08] shouting and slamming doors or locking you in rooms or anything like that,

[00:27:08–00:27:11] there's something in that for you.

[00:27:11–00:27:13] You know, you can get the high moral ground.

[00:27:13–00:27:15] You can at least get information.

[00:27:15–00:27:17] So don't worry too much about them, but be aware of them.

[00:27:17–00:27:19] And then really understand what the other party,

[00:27:19–00:27:22] this is kind of back to the figuring the other person's bad.

[00:27:22–00:27:24] But if the more you can understand their values,

[00:27:24–00:27:27] and I'll tell you stories in a minute that illustrate each of these,

[00:27:27–00:27:31] the more you can understand really what it is that drives them.

[00:27:31–00:27:36] What's important to them, the more likely you are to craft a solution to things

[00:27:36–00:27:41] that satisfies what it is that's important to them.

[00:27:41–00:27:45] So here you've all seen this before.

[00:27:45–00:27:47] Just to pause on it for a second,

[00:27:47–00:27:53] those of you who dread negotiations probably have experienced some of this

[00:27:53–00:27:56] win-lose experience.

[00:27:56–00:27:59] Those of you who said you really enjoyed this.

[00:27:59–00:28:04] probably experienced more of the left-hand column.

[00:28:04–00:28:10] Okay, so here's seven situations that have sort of illustrated these points for me.

[00:28:10–00:28:15] And I only tell you these not because I've had some unique negotiating experience,

[00:28:15–00:28:19] but because you may recognize in some of these things your own experience,

[00:28:19–00:28:24] you may be able to tie it into your own experience and internalize it in your own way.

[00:28:24–00:28:27] So that really does belong to you.

[00:28:27–00:28:33] The first one, I taught a negotiation session in the real estate course here at Stanford,

[00:28:33–00:28:35] a number of years ago.

[00:28:35–00:28:38] And I had a version one and a version two of this.

[00:28:38–00:28:43] And version one, the instructions were, I want you all to have fun.

[00:28:43–00:28:45] So this was the three-party negotiation.

[00:28:45–00:28:46] There was a buyer.

[00:28:46–00:28:50] There were two or three properties, a buyer, a seller, and a lender.

[00:28:50–00:28:53] And they had to come up with a tripartite agreement.

[00:28:53–00:28:58] And so everybody went off in these negotiating teams and made deals.

[00:28:58–00:29:03] The instructions were have fun, be creative, learn everything you can about real estate and everything.

[00:29:03–00:29:06] And then just report back on your experiences.

[00:29:06–00:29:07] Well, here's what happened.

[00:29:07–00:29:09] There were reasonable deals made.

[00:29:09–00:29:10] They were made quickly.

[00:29:10–00:29:13] They were relatively easy to understand and document.

[00:29:13–00:29:15] And there was a lot of camaraderie.

[00:29:15–00:29:19] People came out of it saying, man, this was a fun exercise.

[00:29:19–00:29:20] We like each other.

[00:29:20–00:29:22] Aren't Stanford MBAs cool.

[00:29:22–00:29:25] I just really love my classmates.

[00:29:25–00:29:26] So that was kind of the outcome.

[00:29:26–00:29:28] So that was a negotiation 1.0.

[00:29:28–00:29:31] So then we changed the instructions.

[00:29:31–00:29:34] The objective is to win.

[00:29:34–00:29:36] You're going into this negotiation.

[00:29:36–00:29:37] The idea is you want to win.

[00:29:37–00:29:39] Your grades are going to be influenced by it.

[00:29:39–00:29:42] And the results are going to be published in rank order.

[00:29:42–00:29:45] And you need to make a report on how you feel about it.

[00:29:45–00:29:53] How would you guess the change in results was fewer deals were made?

[00:29:53–00:29:55] They were made more slowly.

[00:29:55–00:29:57] A lot more time was expanded.

[00:29:57–00:29:58] I mean tons more time.

[00:29:58–00:30:00] People said this negotiated an exercise.

[00:30:00–00:30:04] They took longer and was tougher than anything they had done at Stanford.

[00:30:04–00:30:10] People were frustrated and they hated their classmates.

[00:30:10–00:30:15] They said, I will never do business with these turkeys again.

[00:30:15–00:30:19] I had no idea these people were such jerks.

[00:30:19–00:30:23] So it's fundamentally changed by the mindset.

[00:30:23–00:30:24] And I said of the mindset.

[00:30:24–00:30:26] It was my fault.

[00:30:26–00:30:29] But the economic outcomes weren't any of it.

[00:30:29–00:30:30] They were fewer.

[00:30:30–00:30:31] There was somebody pointed out.

[00:30:31–00:30:33] A lot more complex deals.

[00:30:33–00:30:35] A lot of them were unworkable, undocumented,

[00:30:35–00:30:39] unenforceable, and the personal relationship were strained.

[00:30:39–00:30:42] So you can see by having this mindset, we've got to win.

[00:30:42–00:30:44] And it was zero sum.

[00:30:44–00:30:45] And it was defined.

[00:30:45–00:30:48] I mean there were so few things in most business negotiations.

[00:30:48–00:30:53] There was so little data that was price, terms, timeframes,

[00:30:53–00:30:56] warranties, and remedies were about the only thing people could work with.

[00:30:56–00:30:58] I mean they went in and just pummeled each other.

[00:30:58–00:31:01] Just beat each other to bloody pulp.

[00:31:01–00:31:05] So that's the first story.

[00:31:05–00:31:08] And I'll let you draw your own conclusions from these.

[00:31:08–00:31:11] The second one is when I was first starting in business,

[00:31:11–00:31:14] I had a deal that I was working on in Asuka,

[00:31:14–00:31:15] or they say,

[00:31:15–00:31:17] Ahka, Spain.

[00:31:17–00:31:18] Did I do that right?

[00:31:18–00:31:19] Any of the Spanish speakers?

[00:31:19–00:31:21] Ahka.

[00:31:21–00:31:24] And we were going into a bank there to borrow money.

[00:31:24–00:31:27] And we walked in and it was clear within a few minutes

[00:31:27–00:31:29] that they really weren't quite expecting us there.

[00:31:29–00:31:32] So they ushered us into this office with a guy that

[00:31:32–00:31:35] said, oh well, you know, and so he sat down to listen to us.

[00:31:35–00:31:40] And as we were sitting there negotiating over financing this office building,

[00:31:40–00:31:44] two guys in white coats came in and they took the painting off the wall.

[00:31:44–00:31:48] Then a few minutes later they came back in and took the credenza.

[00:31:48–00:31:51] And then they unplugged the phone and walked out with the phone.

[00:31:51–00:31:55] Pretty soon they came in and took the desk, put it on a dolly and went out with it.

[00:31:55–00:31:59] We're sitting there in these chairs talking, and all of the furniture has been moved out.

[00:31:59–00:32:04] Well, it turns out this guy was not really the person who had anything to do

[00:32:04–00:32:05] with.

[00:32:05–00:32:08] He was just a courtesy party who said, well these guys are here.

[00:32:08–00:32:09] They're from the United States.

[00:32:09–00:32:10] Make them feel good.

[00:32:10–00:32:15] And so the negotiation went all this kind of, I will tell you my point on this.

[00:32:15–00:32:18] It goes back to make sure you're negotiating with the right party.

[00:32:18–00:32:21] We had absolutely the wrong, this guy could not have made any deal with us.

[00:32:21–00:32:23] So whatever, but we didn't check it out.

[00:32:23–00:32:28] So we sat there talking across an empty office about a deal that was never going to happen.

[00:32:28–00:32:32] Well, that's an extreme example of something that we all do a lot of time.

[00:32:32–00:32:38] We end up negotiating with parties without power, without the ability to make a decision.

[00:32:38–00:32:40] So you really want to think that through.

[00:32:40–00:32:44] The third one was also early on in my career.

[00:32:44–00:32:49] I was a chief financial officer in my late 20s of a big company.

[00:32:49–00:32:54] I was supposed to make a joint venture with a life insurance company.

[00:32:54–00:33:01] And so I'd studied all the joint ventures that I figured out what I wanted on this deal and what a win-win.

[00:33:01–00:33:04] I mean, I had all steeped in all these things.

[00:33:04–00:33:09] And so I sat down with the very senior 50-ish life insurance executive.

[00:33:09–00:33:11] And we started to go through the deal points.

[00:33:11–00:33:13] And they were eight or ten of them.

[00:33:13–00:33:16] And after I've been said no, we're not going to do that.

[00:33:16–00:33:20] And about the eighth deal point, I rose from the ninth deal point and said,

[00:33:20–00:33:22] we really need to have this one.

[00:33:22–00:33:23] You've said no on eight of them.

[00:33:23–00:33:25] And he said, Joel, sit down.

[00:33:25–00:33:26] Just take notes.

[00:33:26–00:33:30] Your job here is just to take notes.

[00:33:30–00:33:33] We're not negotiating anything.

[00:33:33–00:33:34] Just take notes.

[00:33:34–00:33:36] We're the life company.

[00:33:36–00:33:37] We've got all the money.

[00:33:37–00:33:39] You're just the developer.

[00:33:39–00:33:40] Take notes.

[00:33:40–00:33:44] And so it was clear to me that what that negotiation was about.

[00:33:44–00:33:49] That negotiation was not going to be one in that series of discussions.

[00:33:49–00:33:56] But I was really going to just document it in a way that we had a chance to do our business.

[00:33:56–00:33:59] And we had options in the future.

[00:33:59–00:34:03] So that wasn't the only option that I had.

[00:34:03–00:34:07] Limited partners.

[00:34:07–00:34:12] I recall early on thinking that I wanted to develop a brand.

[00:34:12–00:34:17] I wanted to be seen as a certain kind of negotiator.

[00:34:17–00:34:25] And part of my brand was going to be that I would calculate exactly what a deal was worth.

[00:34:25–00:34:28] And then I wouldn't budge on the price.

[00:34:28–00:34:33] I wanted to be known as somebody who knew the value of what it was I was offering.

[00:34:33–00:34:39] And so if I said, this is a million dollar investment, I didn't want to settle for $950,000.

[00:34:39–00:34:42] I really wanted to say it's a million dollar.

[00:34:42–00:34:46] And I guess if you want to trade two nickels for a dime, I'll do that.

[00:34:46–00:34:49] But I'm not going to trade a dime for one nickel.

[00:34:49–00:34:51] So I really wanted that to meet my brand.

[00:34:51–00:34:55] Because I realized I was going to be in this business a long time and do hundreds of deals.

[00:34:55–00:35:00] And negotiating with these limited partners, I became very stiff on this.

[00:35:00–00:35:03] And it was only when I got options.

[00:35:03–00:35:09] And what happened to me in this, in one case, was a guy said, well, I'm not going to do the deal.

[00:35:09–00:35:12] I need to do the deal at 950,000, not a million.

[00:35:12–00:35:18] I went out that night and called another limited partner investor group and said,

[00:35:18–00:35:21] I'll tell you what, if you'll do this deal at a million dollars,

[00:35:21–00:35:24] I can document the deal tonight.

[00:35:24–00:35:27] And I can give you all these other things, but I need the agreement tonight.

[00:35:27–00:35:32] So when the guy called up the next day to resume negotiations, I could say,

[00:35:32–00:35:34] I'm sorry, I've already done that deal.

[00:35:34–00:35:37] So I was able to establish that I don't move on price.

[00:35:37–00:35:42] And it worked for a while until the guy and I became really good friends.

[00:35:42–00:35:46] We ended up doing 300 deals together over a 20 year license.

[00:35:46–00:35:48] So a lot of transaction.

[00:35:48–00:35:50] About 50 deals are so into it.

[00:35:50–00:35:56] He said, Joel, I just got to tell you, I like to negotiate price.

[00:35:56–00:36:00] I don't feel good unless I can negotiate price.

[00:36:00–00:36:05] So if you want it to be a million dollars, tell me it's a million 50.

[00:36:05–00:36:07] Just tell me it's a million 50.

[00:36:07–00:36:09] I'll come back with a million.

[00:36:09–00:36:12] And then we'll both feel good.

[00:36:12–00:36:17] So we negotiated that the last 250 deals we did, I would go in about

[00:36:17–00:36:20] a year or eight percent higher than what I would accept.

[00:36:20–00:36:21] He would knock it down.

[00:36:21–00:36:23] He'd feel good and I'd feel good.

[00:36:23–00:36:28] So you kind of going in and having sort of a sort of a reasonable,

[00:36:28–00:36:32] what I'm calling ROR, a rules of the road.

[00:36:32–00:36:35] If you're going to have serial negotiations with somebody,

[00:36:35–00:36:39] develop rules of the road.

[00:36:39–00:36:42] Senior partner departure.

[00:36:42–00:36:46] This is a situation that was a billion dollar transaction.

[00:36:46–00:36:47] So it was a big deal.

[00:36:47–00:36:49] And this was 15 or 20 years ago.

[00:36:49–00:36:52] It was a very significant transaction.

[00:36:52–00:36:55] And the partner came to me and said, you know, I want to,

[00:36:55–00:36:58] let's agree going into this negotiation.

[00:36:58–00:37:00] Let's agree on values.

[00:37:00–00:37:03] Let's agree what these properties are worth.

[00:37:03–00:37:05] And then we'll make the trade.

[00:37:05–00:37:07] And on this particular case, I thought, you know,

[00:37:07–00:37:11] the biggest mistake we could make would be to agree on the values.

[00:37:11–00:37:14] Let's disagree on the values.

[00:37:14–00:37:17] So you set up whatever, you know the properties better than I do.

[00:37:17–00:37:19] You value them however you wish.

[00:37:19–00:37:21] And then I'll select.

[00:37:21–00:37:26] And the very fact that we didn't agree on values allowed me

[00:37:26–00:37:30] to select deals where I thought I was getting more than my fair share.

[00:37:30–00:37:35] He then was able, because he set dies, he was fine with the deal.

[00:37:35–00:37:37] Because he represented what the values were.

[00:37:37–00:37:40] And it was just applying the percentage to the values he'd set.

[00:37:40–00:37:44] So he was able to get a transaction done.

[00:37:44–00:37:45] My departure.

[00:37:45–00:37:50] So I left the co-organization with the reputation of being a conciliator,

[00:37:50–00:37:55] with the reputation of being reasonable, with the reputation of being a win-win deal.

[00:37:55–00:37:59] So all the litigation that Crowe had for 20 years, the parting partures.

[00:37:59–00:38:03] I was seen as somebody who was litigation averse.

[00:38:03–00:38:08] And because that had become my brand, my negotiating brand,

[00:38:08–00:38:12] when it came to that, they filed litigation against me,

[00:38:12–00:38:14] realizing that he'll never fight.

[00:38:14–00:38:17] This guy's such a pussy, such a conciliator,

[00:38:17–00:38:20] he's such a giver, and he'll make everything.

[00:38:20–00:38:22] I really had no place to go.

[00:38:22–00:38:25] I had set myself up with my brand.

[00:38:25–00:38:30] So I want, from that I want you to think very carefully about the brand you want to have.

[00:38:30–00:38:33] The last story is one that I think you'll remember.

[00:38:33–00:38:37] We ended before years of litigation.

[00:38:37–00:38:41] So I now have a new brand.

[00:38:41–00:38:45] I'm now known as the ferret.

[00:38:45–00:38:50] No, it's interesting because I think what my brand has become is,

[00:38:50–00:38:54] I am somebody who is very reasonable who will do win-win negotiations.

[00:38:54–00:38:58] But if you get to the point where you cross me and my principles

[00:38:58–00:39:01] or if you do something that I really think is completely unfair

[00:39:01–00:39:03] that I become very stiff.

[00:39:03–00:39:07] So you don't want to get into litigation with me, but you don't need to.

[00:39:07–00:39:10] So that's a better brand than the brand I had before,

[00:39:10–00:39:12] which is the guy will never sue.

[00:39:12–00:39:14] He will never get into litigation.

[00:39:14–00:39:16] So you really want to think carefully because that brand,

[00:39:16–00:39:22] and part of my message here is that there are no episodic negotiations.

[00:39:22–00:39:24] You may think it's an episode.

[00:39:24–00:39:28] You may think you're going in and having a one-off deal with somebody.

[00:39:28–00:39:32] That person talks to somebody else who talks to somebody else.

[00:39:32–00:39:36] And pretty soon everything is going to be living a very connected world.

[00:39:36–00:39:37] So think carefully.

[00:39:37–00:39:40] If you're doing a lot of negotiation for a living,

[00:39:40–00:39:43] think very carefully about the brand you want to have.

[00:39:43–00:39:47] Now I apologize to my students, former students,

[00:39:47–00:39:50] for this next one because you've seen this,

[00:39:50–00:39:57] but I had a negotiation with my daughter over this last topic.

[00:39:57–00:39:59] So I'm not here teaching at Stanford.

[00:39:59–00:40:03] And I come out for basically 10 weeks when I teach here.

[00:40:03–00:40:06] And so she's back in another state and we correspond by email.

[00:40:06–00:40:10] I get back a couple of times she and my wife get out a couple of times.

[00:40:10–00:40:12] But we're basically away from each other.

[00:40:12–00:40:15] So here I get this email from her.

[00:40:15–00:40:17] Dear dad,

[00:40:17–00:40:20] you hear that I'm getting a rat?

[00:40:20–00:40:21] Won't that be cool?

[00:40:21–00:40:22] The pet story,

[00:40:22–00:40:25] he said that you can train rats to fetch and stay.

[00:40:25–00:40:28] I wanted to get mice because they're cuter and don't have disgusting tail,

[00:40:28–00:40:30] but mice just run away.

[00:40:30–00:40:32] And they never become your friends.

[00:40:32–00:40:34] Rats will sleep on you and I'm sure dad,

[00:40:34–00:40:36] you'll become great friends with my rats.

[00:40:36–00:40:41] I'm thinking of naming them ritzy and scraps.

[00:40:41–00:40:43] Won't that be cute?

[00:40:43–00:40:45] And you can even see them when they're tiny babies.

[00:40:45–00:40:47] Take deep breaths if you're getting nervous.

[00:40:47–00:40:51] I will pay for them and the cage with my very own money.

[00:40:51–00:40:53] All you and mom have to do is buy the food,

[00:40:53–00:40:55] which really doesn't cost much.

[00:40:55–00:40:57] I've already done everything else.

[00:40:57–00:40:59] I think I'm ready. It's okay. I can take care of them.

[00:40:59–00:41:01] I've proven I can take care of animals.

[00:41:01–00:41:03] I even sweep up the cat's barf.

[00:41:03–00:41:06] I can handle it.

[00:41:06–00:41:09] So you can trust me to take care of ritzy and scraps.

[00:41:09–00:41:11] They're you of names.

[00:41:11–00:41:14] I hope you're doing well at Stanford, isn't this warm?

[00:41:14–00:41:16] And I'm doing well here.

[00:41:16–00:41:17] Same normal things,

[00:41:17–00:41:19] practicing soccer, winding to mom,

[00:41:19–00:41:20] about getting rats.

[00:41:20–00:41:23] Just so you know she already said yes.

[00:41:23–00:41:26] Is this a negotiator?

[00:41:26–00:41:29] This is 11 year old kid.

[00:41:29–00:41:31] I mean, so some of this stuff,

[00:41:31–00:41:33] when I ask her, who are the expert negotiators?

[00:41:33–00:41:38] I promise you we are born knowing something about negotiations.

[00:41:38–00:41:39] Just see a notion.

[00:41:39–00:41:40] Oh yeah.

[00:41:40–00:41:42] I'm sure she's sick of the same conversations.

[00:41:42–00:41:43] Can I get a rat mom?

[00:41:43–00:41:45] Please, I'll do my practicing.

[민감정보 가능성이 있어 이 줄은 공개 페이지에서 숨김]

[00:41:47–00:41:49] I promise to do my practicing.

[00:41:49–00:41:50] Love release.

[00:41:50–00:41:51] So here's this.

[00:41:51–00:41:54] This is the initial volley.

[00:41:54–00:41:56] This is the negotiating position.

[00:41:56–00:41:59] She's kind of laid out her negotiating position.

[00:41:59–00:42:03] So you're sitting out here 1,500 miles away thinking,

[00:42:03–00:42:07] no way.

[00:42:07–00:42:08] She has crossed a barrier.

[00:42:08–00:42:10] I'm unwilling to cross.

[00:42:10–00:42:12] So here's my response.

[00:42:12–00:42:15] And I want you to notice this because this is a real life

[00:42:15–00:42:16] negotiation.

[00:42:16–00:42:18] And I'm going to have you predict how it came out.

[00:42:18–00:42:19] What's that?

[00:42:19–00:42:24] Good point.

[00:42:24–00:42:28] Dear Lease, are you nuts?

[00:42:28–00:42:31] I've been killing rats at the house in Woodside.

[00:42:31–00:42:32] They are not cute.

[00:42:32–00:42:33] They're not nice.

[00:42:33–00:42:34] They're not controllable.

[00:42:34–00:42:35] They stink.

[00:42:35–00:42:36] They eat everything.

[00:42:36–00:42:38] They make little back poops everywhere.

[00:42:38–00:42:40] And I have to clean up the mess.

[00:42:40–00:42:44] Just this week I bought some decon to put out where the rats live.

[00:42:44–00:42:49] The next day I found a dead rat near the pool and another one trapped

[00:42:49–00:42:50] in the garage.

[00:42:50–00:42:53] Just to be clear about how I feel, I must inform you that we smashed

[00:42:53–00:43:01] it said in a picture.

[00:43:01–00:43:02] I'm a negotiator.

[00:43:02–00:43:03] Come on.

[00:43:03–00:43:06] It was fat and ugly.

[00:43:06–00:43:11] By the way, I think its name was something like Ritzy.

[00:43:11–00:43:14] In any event, one of the big reasons I was getting so excited about

[00:43:14–00:43:17] coming home was to get away from the rats out.

[00:43:17–00:43:20] Now I may as well stay.

[00:43:20–00:43:21] See how hurt?

[00:43:21–00:43:22] I'm just hurt.

[00:43:22–00:43:26] I'm appealing to this young daughter.

[00:43:26–00:43:28] What would you like next?

[00:43:28–00:43:31] A python or how about some Ebola virus?

[00:43:31–00:43:33] Maybe you could raise maggots.

[00:43:33–00:43:36] Anyway, I still love you and miss you and we'll see you next week.

[00:43:36–00:43:38] We love that.

[00:43:38–00:43:42] So how did this negotiation come out?

[00:43:42–00:43:43] It's predict.

[00:43:43–00:43:44] What's that?

[00:43:44–00:43:45] She gets the rats.

[00:43:45–00:43:48] She gets the rats exactly.

[00:43:48–00:43:50] She got the rats.

[00:43:50–00:43:55] Now why would an expert professional negotiator with $10 billion

[00:43:55–00:44:00] worth of deals under my belt given to this 11 year old kid

[00:44:00–00:44:02] on some stinkin rats?

[00:44:02–00:44:04] It mounds the power.

[00:44:04–00:44:05] Yeah.

[00:44:05–00:44:08] It's a great point.

[00:44:08–00:44:11] Besides her mom had already said yes.

[00:44:11–00:44:14] So a really balanced power.

[00:44:14–00:44:17] To me this is the difference between knowing the elephants in the

[00:44:17–00:44:18] ants.

[00:44:18–00:44:21] I was willing to lose a battle to win the war.

[00:44:21–00:44:25] And the war, what I wanted, winning for me, defining winning for me

[00:44:25–00:44:30] was raising a child who's responsible, who loves me, who will

[00:44:30–00:44:33] listen to me on things that really do matter.

[00:44:33–00:44:35] So I was really willing to kind of take a different,

[00:44:35–00:44:38] part of this story.

[00:44:38–00:44:43] And the end, she gave the rats back to the pet store lady.

[00:44:43–00:44:46] After the pet store lady had told her that she would be feeding

[00:44:46–00:44:48] them to the snakes.

[00:44:48–00:44:51] So she disliked the rats as much as I did in the end.

[00:44:51–00:44:56] And she came away saying, dad, you were right about the rats.

[00:44:56–00:44:58] So now.

[00:44:58–00:45:08] She arrived at home and the rats were there.

[00:45:08–00:45:10] She said, father, you're good.

[00:45:10–00:45:10] You're done.

[00:45:10–00:45:12] It was a 10-year.

[00:45:12–00:45:14] Mom had already said yes.

[00:45:14–00:45:18] It was, do you want to hold them down?

[00:45:18–00:45:22] No, I think I'll pass on that.

[00:45:22–00:45:26] So I think we've covered most of these.

[00:45:26–00:45:29] This idea of episodic versus serial.

[00:45:29–00:45:32] Think serial in your mind as you think about your brand.

[00:45:32–00:45:34] Outside versus inside.

[00:45:34–00:45:37] This last was a very much of an inside negotiation.

[00:45:37–00:45:41] You'll have negotiations with third parties and with people

[00:45:41–00:45:44] who are really close to whether they're employees, partners,

[00:45:44–00:45:47] brothers, sisters, children, spouses.

[00:45:47–00:45:51] The inside ones are by far the toughest negotiations.

[00:45:51–00:45:52] They're the least forgiving.

[00:45:52–00:45:54] And they're the most important ones to lose.

[00:45:54–00:45:58] So this idea that every negotiation is a competitive game that

[00:45:58–00:45:59] you have to win.

[00:45:59–00:46:03] It really helps you get over the more inside negotiations you do