5 Lessons in Negotiation from an FBI Hostage Negotiator

30:05Exactly. Yeah. And so that's how I want it. When I, when I want to, when I want to maybe go someplace. I'll, I'll trigger the decision via no versus yes. And, you know, there's all these, uh, words when it comes to negotiation, the sort of classic words, you know, compromise, uh, tell me, but tell me your thoughts on compromise. Do you think the United States Congress is, deserves an A plus rating? No. But they compromise all the time, don't they? So if you think politicians are awesome, then you think compromise is good. And that's a crazy thing about it because everybody preaches compromise.

30:54How do you feel about compromising your principles? Not good. Yeah, it gives you an instantaneous, uneasy feeling inside, right? Right. So it's compromise is to, by definition, make something lose-lose. And that is not compatible with a long-term relationship of trust and prosperity. It's compatible with being a C player. Mediocrity. Compromise correlates very strongly to mediocrity. And you got to decide whether or not you're good with mediocrity. And so what's the replacement to compromise? Because I don't think anybody goes in saying, I can't wait to compromise. They sort of feel like it's a necessary evil.

31:40I guess we'll have to compromise in order for us to agree. And I think that's where people land to settle for that. That's the mediocrity part. So what's the more effective, more powerful way of thinking besides expecting to and accepting that you need to compromise? Well, let me find out where you're coming. Let me make you feel heard first. If I can make you feel completely heard on your position, my guess is more than 30 % of the deals will be made in my favor on the spot. And about half of the deals are made on the spot once the other side feels completely heard. But let's say it's only 25%, and it's well more than that.

32:27All right, so now you've knocked out, you've just accomplished, you have to negotiate 25 % less because you just made the deal by making the other person feel worried. Just knock 20 % of your work off the table. Now what happens to the remaining 75 %? Their position's going to move closer to yours, and they're going to be more honest with you about what exactly that position is. They're going to tell you what they perceive their must-haves to be. They're going to move away from their throwaways right away. So I'm either going to make the deal on the spot or I'm going to find out what we really have to negotiate about immediately, which is also going to save me a massive amount of time.

33:10Now, there's a difference between compromise and high value trades. And, you know, I'm not 100 % sure whether or not this is a great example, but I like it. steel is 2 % carbon and 98 % iron. So let's imagine that carbon and iron were two negotiating factors. And he said, we got to compromise and go 50-50. Because we need a 50 % representation here. Now, in point of fact, 2 % of one person's idea and 98 % of the other person's idea made a stronger ally that mankind had never seen before. So your real challenge is, what's the blend, not the compromise? Right. What's the blend? You know, there was a guy who came on this podcast and he said something great.

34:11I don't know if this aligns with your philosophy. And he told me something that really helped me in negotiating. He said, you know, most people when they go into negotiation, they see themselves on one side of the table and then the other person on the other side of the table. And it's sort of me versus you. And I'm tugging this way. I'm pulling this way. And you're pulling that way. And he said, this is a guy who buys companies. And he said, the best thing we did was we realized that that's the wrong mental model. The right mental model is me and you are sitting on the same side of the table.

34:37And across the table is the problem. Maybe the problem is you think the price is X and I think it maybe is Y. You know, there's some problem that's preventing us from just doing this deal instantaneously. but it's not me versus you. It's us together jointly looking at this problem on the other side of the table. And that was a very like effective visual metaphor for me. Is that something you would, I don't know, agree with? Is that something you would, uh, you probably know more about that than I do? No, no, I agree completely. I mean, for the longest time on my side, we've always said the adversary is a situation.

35:04And what you just did was explain what that model looks like through that example. And it becomes very real when you describe it that way. And yeah, that's a very smart way to describe it. And where does leverage come into this? Because, you know, when I've negotiated, I always think about, you know, leverage. Deals I feel, you know, I do, but I'm not 100 % happy with, not too happy with. It's typically because I felt like the other side had a lot more leverage in the situation and this was my best option to go with. It was 98 % their blend and 2 % mine. And in other situations where I have leverage or create leverage or I apply leverage, you know, I tend to feel like I do better.

35:44But is that too simplistic? Like, how do you think about the word leverage? Because for me, that's always been key in negotiation. It's not simplistic. It's a step up from floundering entirely to, you know, and it's going to sound harsh. I mean, you get yourself to B-level negotiator there. You'll never get yourself to A, A-plus on leverage because leverage is the ability to inflict time. And if you're making deals based on the ability to afflict harm, these, these are not, those, those don't go for stable long-term relationships. They don't go for the other side, sharing information with you.

36:21That'll, that'll change everything because you've got leverage, you're a threat. And why would they give you important information if you're a threat and vice versa? How much leverage do they have on you? Holy shit. I can't give them, I can't tell them that. They'll have more leverage. Oh, my God. So it can be useful in some situations, but it'll never get you to the best outcome. And because in many cases you can talk, you can think about when you made a better deal because of leverage, then that becomes really addicting, really satisfying. and you lose track of the deals that you should have made, but you didn't because you didn't have, thought you had leverage.

37:04Or, you know, it's a very limiting factor. It gets you, you know, into a passing grade and it just doesn't get you to the top of the class. Gotcha. And so what does get me to the top of the class? So we've talked a little bit about it, right? I truly listening, using labels to collect information, plus make the other side feel, you know, heard and understood. What else is kind of key to get me to the top of the mountain when it comes to negotiation? Well, what you're really negotiating, what people really don't understand is how important trust is. And trust is based on how predictable you are.

37:47Take out the word trust to put in the word predictability. you automatically become more trustworthy because you're predictable. And so then the ability to collaborate as we deal with issues, because there's always going to be issues. You know, making the deal is the beginning. You got to get into implementation. And if we don't trust each other, then problems are going to crop up and we're not going to tell the other side. If we've compromised, I'm going to resent that compromise. And when problems crop up, I'm going to keep my mouth shut because it's going to hurt you. because I didn't like the leverage you used on me.

38:23I didn't like the way you forced me into this deal. Yeah, you know what? Threaten me? Fine. Fine. Make me cooperate. Make me tell you about problems in the early stages as opposed to when they're turning into delaying mine has gone off. It's really an issue of how we're going to do the implementation. and so the whole issue of you know do we start and then and then you're even going to talk about how we're going to cross a bridge bridges when we get to them because there are going to be problems you know i i i'm at a training a long time ago before the book came out a ceo said this is my um cfo and i want you to teach him how to put clauses in contracts that'll penalize the other side for non-performance.

39:14And my thought was, if penalizing the other side for non-performance is your biggest problem, it started a lot sooner because you're not making great deals. You're telling me you can't get your deals implemented. That's what you're telling me. So you need to back way up and find out what the problem was well before that because implementation is where it's at. And if we don't trust each other, if I can't count on you to work through problems with me, it's going to cost us a lot of money. All right. This episode is brought to you by Mercury. They are the finance platform of choice for over 200 ,000 companies.

39:53Shouldn't be surprised because I use it myself for not one, not two, but I have eight different Mercury accounts. I have seven for different companies that I'm a part of. And then I have my own personal account because now they have personal banking, which is a really cool feature. I highly, highly recommend it. Like I said, I use it myself. And the reason why is because the way that Mercury works is beautiful. It's very intuitive. And you could tell that it's actually made by a startup founder. It's an entrepreneur. You could tell it's made by somebody who used other banking products in the past and didn't like all the different rough edges and annoyances and decided to actually fix it himself.

40:23And really, any type of entrepreneur you are, let's say you're an agency, well, one of the things every agency has to do is be able to send invoices, easily create them, send them to customers, and stay current on your balances with all your customers. Well, you can do that inside Mercury. And so I think that Mercury is great. Highly recommend you check it out. And thank you for sponsoring the show. For more information, check out Mercury.com. Mercury is a financial technology company, not a bank. Check show notes for details. What are some examples of kind of the great deals you've seen? Maybe the great deal makers or great deals that you've seen.

40:55I think Oprah is a great deal maker. And visible examples of that. And she gets Lance Armstrong to come on TV and answer yes or no questions.

41:10Straightforward as to whether or not he doped and whether or not he did things. Now, I'm not acquainted with Oprah. I am acquainted with Lance, and I like Lance a lot. And when you look at the totality of the circumstances, you get quite a different picture as opposed to somebody giving you a very narrow view. but anyway the lance armstrong interview he wasn't caught off guard by those questions that was the negotiation between him and her in advance as to whether or not he was going to get on camera and what she was going to ask him you don't see anything in the media about lance armstrong being upset with oprah winfrey which means they negotiated a great deal up front that they were both good with, and then they executed it.

41:57And it was no bad blood after the fact. That, to me, that's a great deal. And that's an example and a reason why, and also, and if you look at the totality of Oprah, think about the fact that she's dealt with some of the most difficult to handle people on earth, celebrities who are used to getting their way at all times. And she doesn't have any dust-ups, any arguments with any of them. Now, how is that possible? When in today's day and age, celebrities love to have feuds with each other all the time as a way to gather attention. But that's not her method of operation. And her success is extraordinary, especially thinking about where she started.

42:49and I'd take a very small percentage of her network and be quite happy. Do you have a sense of what she does or how she accomplishes that? You know, the interesting thing is it's very similar to what we did in the Chase Manhattan Bank because I was talking about a woman, talking with a woman in Los Angeles several years ago to work for Oprah and I'm laying all this out. And I said, the last impression is the lasting impression. We did it. The lieutenant did it by instinct at the Chase Bank. I found out later on from, I was at a Gallup poll conference on human nature. You know, the Gallup poll, the longtime collectors of polling data, of course, they're sitting on decades of human performance information.

43:31And this one speaker stands up and says, people don't remember things how they happened. They remember and they don't remember how it started. They remember the most intense moment and how it ended. The last impression is the lasting impression. so i'm laying this on my colleague who worked for oprah and she says oh yeah oprah's lived by that all of her whole life she said in in the entertainment business the joke is in in a limo out in a taxi as soon as they get what they want from you you know you're out hitching out front finding your own way out but at oprah it was in in a limo out in a limo and the philosophy was no matter what happened on any interaction no matter what you had to make sure they felt respected, heard, appreciated, and loved at the very end.

44:19And I've had several conversations related to me when Oprah didn't see something eye to eye with somebody else. And her last words are, well, always, no matter what, I will always love you and I will always be supportive of you. And the last impression is the lasting impression. And she's a master of it. How do you prep for a negotiation? So let's say you're going to go try to make a deal. and some people have this idea of like a, what's it called, BATNA, where the best alternative to whatever, you know, they sort of think about their desired outcome, and then the worst-case scenario, they're going to accept.

44:54Other people do lots of research, and they try to, you know, find as much as they can about the other party to be, you know, fully armed when they walk in. Some people do power moves. How do you prepare for something that's a negotiation in the business sense, in the business context? It's going to be a combination of two things. I'm going to, first of all, I'm going to think about, um, what negatives you're going to harbor about me in advance. And I'm, and, and I'm not going to, and everybody, everybody's got that. Actually, interestingly enough, everybody could do this right away. Even if it's a first interaction, what are the things you want to deny?

45:28I don't want you to think that I'm going to be greedy. I don't, I don't want you to think I'm another slimy salesperson. I don't want you to think that I'm here to maximize my opportunity. I don't want you to think I'm, I'm wasting your time. that, uh, I always tell people, what would you want to deny walking in? That's your gut instinct telling you a negative is there. And you make the shift from a denial to the straight observation. Look, I'm probably going to seem greedy. I'm probably just going to seem like another slimy salesperson. I'm probably going to seem like somebody that's wasting your time.

46:00That then instantly makes me the straight shooter, the honest person. and so i'm going to think about what negatives you're going to you are likely harboring because the brain is 75 negative and that's the fastest way to for me to build a relationship deactivate the negatives and make me look like a straight shirt which increases your trust in me and then there's going to be some stuff that you're going to be thinking about that you're going to be offended if i don't appreciate and you're going to be offended if I don't appreciate how hard you work. The fact that I'm talking to you at all means you have value and that you have legitimate reasons in your own right to be respected and admired.

46:55And it's taking what a lot of people would refer to as flattery, but then articulating that it's not vacuous flattery. It's genuine appreciation from where you're coming from. And I might say something like, you worked very hard to get to where you are today. You have been in this business for a very long time and you know what you're doing. Otherwise, if you didn't, you wouldn't be sitting here in front of me at all. And you have things that are valuable and worthy of my attention and of my respect. And you put those two things together and you kind of get empathy. That's what you were calling tactical empathy earlier?

47:37Right. Yeah. Because there's brain science that backs up that approach, particularly starting with the negatives before the positives. Right. And why is it so important for, I mean, this is going to sound like a dumb question, but like, it just seems like it's the most important thing. so I want to talk a little bit more about it, which is why is it so important for somebody to feel understood and heard? And why do we defy? It seems like what we default to is, I can't wait to make my case so that you understand me and I feel heard, right? It seems like the biggest swing I could make as a negotiator is to let go of my need of that, or at least initial need of that, and really hone in on your need for that.

48:23And if I just did that one switch, I'm a much better trust builder and therefore a much better negotiator. Is that the right summary from what you said? Yeah, it really is. And it's fascinating to think about the fact that people come to the table with such a desire to be heard and to make their case. They can't imagine that's what's driving the other side. It's blinding. And neuroscience-wise, what difference does it make to make somebody feel hurt? I will trigger the release in you of your neurochemicals, oxytocin and serotonin. If you get ahead of oxytocin in interacting with me, you're going to bond with me, and you're going to be far more honest with me.

49:18Oxytocin, it's bonding and truth. serotonin is a drug of satisfaction which means you're going to be less demanding so if i can make you feel heard you're bond with me you're more honest with me and you're less demanding that's a pretty good start for a negotiation

49:36how does uh how does chris voss you know buy a car how do you do it in just day-to-day everyday situations have you had any uh any uh implementation of any of your techniques that on like the low stakes stuff. We've seen the hustle negotiation, but like, what do you do when you're on Craigslist? Do you need a couch or you're, you know, you're at the market? Yeah, well, you know, I tell the other side why what they are selling is worth what they're asking. You know, I make their case because that's what they're going to say to me. So what I've done is I've just now left them with nothing to say.

50:19and then like, see, I can, I can, I can, I can pound you down on price. I mean, I, I, and I still, if I choose to be, I can be, I can really pound you down, but I better never need to come back to you for anything. And there are a few deals that are complete one-offs. so if i'm buying a car depend upon who i'm buying it from i will tell you i do not have great regard for car dealerships across the board i no longer ever get any vehicle i own serviced at a car dealership i don't care what the warranty says because i don't trust them so i don't mind pounding down a car daily. Right. I got no problem with that.

51:15And I will do that to them. I will make their case, and then I will become very passive-aggressive. And my favorite is, how am I supposed to pay that? Well, you would have said all the things that I just got done saying if I hadn't said it first. but now if i said all if i if i took away all the wind out of your sails took all the bullets out of your gun then when i give you the opportunity to point the gun at me you got empty you got empty chambers you got nothing to say yeah i know and you're dealing on a margin and in real short order i'm going to get you down to your bottom line uh and then if i like it we'll make a deal if i don't i'm walking out but i better not i better i better not ever need to come back to you because once I've killed you on price, you are not going to forget that.

52:05And you are not going to lift a finger to help me ever again. Right.

52:12Okay. What about other sort of day-to-day negotiations? This is, I got little kids. I have a five-year-old, a four-year-old and a one-year-old. And so my, my most frequent negotiation is with them. And I'm just curious, do you have any parenting negotiation tips? Maybe it's just don't negotiate at all, but I don't know. I find myself in that pickle a lot. No, well, you know, with your kids, this is, you know, there are ages, um, for thinking, if you will, but you're, what you're really trying to do as, as, um, as a parent is help your kids think. And so recognizing where they are in the stages, I heard a long time ago, up to age five, treat a kid like a king five to 15, you know, work them like an indentured servant at 15, let them go.

53:01there's a lot of brain science that overlaps very closely with that in the development of the brain. But all along the way is you want your kids to feel slightly challenged, and you want them to get them to think. Now, do they have the ability to process that? At about age four slash five, six, they start to cross over into ages where they're starting to process that. and what a lot of parents want to do is just order kids around like go to bed because i'm dad i'm why because i said so i'm because i'm the father that's why right well that's not that's not really helping them think um it's demonstrating to them that the only way you can get stuff done is by through use of force that doesn't mean you want to put up with bad behavior either there's you know one of my favorite videos is something you know this mom trying to talk her five-year-old son into getting in the, into backseat of the SUV and she's come on, you know, and he's crying and making noise and his nine-year-old sister walks up and grabs him and throws him in the SUV and they get up, they, they leave.

54:11You know, at some point in time, you got to toss the kid in the car. Um, but in the meantime, you know, your, your, your job as a parent is to help them think. And it's not to shield them. It's to challenge them and make them better people, help them think. And after all these years of helping people be better negotiators and you teach certain, you know, techniques and certain frameworks for this, what do you think is the most easy to implement of all of the frameworks? Meaning the easiest way to get points on the board and start the process of improving in this area? Well, it's really going to be, there are different ways to repeat back to somebody what they just said.

54:55You know, label, you're focusing on their emotions or affect. Mirrors and paraphrases focuses specifically on what they said. It seems like it's a waste of time and it ends up being a relationship accelerator, which then is a deal-making accelerator. So however you do it, the more you can make somebody feel heard, the less you can be a threat. And yeah, sometimes charm is involved. Charm and empathy are very close. Yeah. But who's the most interesting at the table? If I make you think I'm the most interesting person, okay, cool, we had a great conversation. But are we ever going to make great deals?

55:38Now, if I made you think you're the most interesting person, our likelihood for collaboration is very high. Right. And how do you find that balance or do you need a balance between, like my business partner, Ben, he's like this. He goes into a lunch. He asks so many questions because he's genuinely curious. And he tends to know a lot about the other person and what they're interested in because he's paid attention. He observes and he remembers what they said. He remembers where they went. And he's just, so he'll feed them things that he knows they're interested in, not to manipulate them. He's just, that's like who he is.

56:13I don't know. His nature is to be that way. And he leaves the lunch and they've talked 98 % of the time. He's talked 2 % of the time. He's asked them a couple of questions. He knows everything about them. They know nothing about him. And they go, this was amazing. We got to do this again. This was one of the best. This is so fun. I would love to do this again. And, you know, he comes back. At the same time, I'm curious if there's a sort of a downside to going too far in that direction where, you know, you haven't sort of demonstrated value. or, you know, provided the other side with an, you know, sort of almost like in tech, like an API connection, like an ability to understand what your needs are and how they might be able to help or intersect with what you do.

56:54Is there a danger in going too far down the kind of like let the other side talk route? Well, first of all, curiosity is a superpower. Like it is a superpower. Like it's ridiculous where it shows up in terms of your survival, their survival, long-term relationships, your resilience, your ability to discover new things. Like curiosity, I can tell you so many different ways it's a superpower. So now what's the danger? At some point in time, you got to keep in mind while we're talking. And if you get too curious, then we have a finite amount of time. We got an hour together. If we got an hour together and we get nothing accomplished, what are you going to remember?

57:41where you really enjoy the conversation, but we didn't get anything done. So you might feel like it was a waste of your time. You have to be aware of the progress that has to be made. And my team, what we always do is we set finite periods of time for meetings, period. And we never go over. It doesn't matter where we are. We'll set another meeting before we'll go over a meeting because time is this commodity that is so limited. that if I don't help you manage your time and your interactions with me, then pretty soon you're going to start avoiding me. Well, speaking of, you seem like a guy who is very conscious of his time.

58:20I want to make sure. Wait, it looks like we're 11 minutes over. So I want to make sure. I didn't mind. I enjoyed the conversation. I do want to tell some people about some stuff. Yeah, tell, please. So we've started this new thing called the Black Swan Negotiation Community. And you go to our website and find it. and it really is an across the board amazon one-stop shopping for where you are in your negotiation journey you can't afford anything come into the community because membership is free and get started getting a return on the investment of your time in terms of dollars so you know get started on your journey.

59:06The incremental change could be monumental very quickly. Awesome. Well, Chris, thank you so so much for coming on. Also for, I don't know, all the content that you've put out over the years. I've always picked and chewed on different little bits of it, especially whenever I was in the process of either raising money or selling my company. It was these very brief periods of time, maybe three weeks, four weeks, six weeks, where the value of my years of effort would swing by 50%, depending on how good I was at negotiating and understanding, you know, the other side and being able to find a mutually beneficial deal.

59:39So it's one of these arts where it can make a really big difference in a very small amount of time being, you know, the difference between being bad at it versus good at it versus great at it. And so I appreciate you coming on and helping us be a little better at it today. It was a pleasure. I enjoyed the conversation.

1:00:05All right, let's take a quick break because as you know, we are on the HubSpot Podcast Network, but we're not the only ones. There's other podcasts on this network too, and maybe you liked them. Maybe you should check them out. One of them that I want to draw your attention to is called Nudge by Phil Agnew. And whether you're a marketer or a salesperson, and you're looking for the small changes you could make, the new habits you could do, the small decisions you could make that will make a big difference, that's what that podcast is all about. Check it out. It's called Nudge, and you can get it wherever you get your podcasts.