Episode #449: Jeanette Nyden
Meet
Jeanette Nyden
Jeanette Nyden is a Contracts Attorney and Negotiation Expert, with more than 20 years of experience drafting and negotiating a variety of agreements, author, educator, and business consultant, Jeanette helps non-lawyers negotiate complex contracts by creating and delivering best in class learning programs.
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In this episode of Sales Reinvented, Jeanette Nyden, a seasoned expert with over 20 years of experience in drafting and negotiating complex contracts, explores the power of collaboration in negotiation. She shares her insights on how adopting a collaborative mindset can lead to more successful and mutually beneficial outcomes in high-stakes deals.
Whether you’re negotiating with customers, suppliers, or partners, Jeanette’s approach emphasizes building relationships and aligning shared goals to achieve success. From understanding the balance between strategy and tactics to learning how collaboration can counter aggressive behaviors, this episode will equip you with practical tips to navigate negotiations with confidence and integrity.
Outline of This Episode
- (1:00) Jeanette defines the difference between negotiation strategy and tactics
- (2:44) Jeanette’s go-to negotiation strategy for high-stakes deals
- (3:57) Jeanette’s three favorite negotiation tactics for leveraging tough deals
- (6:10) Normative leverage and how it applies to collaborative negotiations
- (7:35) The role of planning in developing negotiation strategies and tactics
- (8:51) How do you determine the most effective negotiation strategy?
- (11:16) Recognizing and countering aggressive negotiation tactics
- (15:24) Jeanette’s top three negotiation do’s and don’ts
- (18:53) Navigating a sticky real-world negotiation
Collaboration as a Key Negotiation Strategy
A hallmark of Jeanette’s approach is collaboration. She shares how her primary negotiation strategy, particularly in high-stakes deals, revolves around creating a collaborative environment between the parties.
She argues that fostering a “we” mentality—where both sides see themselves as partners working toward a shared goal—often yields the best results. When negotiating on behalf of suppliers or buyers, the relationship is not only about short-term gains but about long-term collaboration.
Jeanette points out that when both parties feel valued and recognized, they are more likely to engage in mutually beneficial agreements. By focusing on collaboration, negotiators can not only secure deals but also lay the foundation for future partnerships that are more resilient and lucrative.
The Three Types of Leverage and Their Application in Negotiations
Jeanette explains that there are three key types of leverage in negotiations: negative, positive, and normative leverage, each serving a distinct purpose in influencing outcomes.
- Negative leverage involves using pressure to force a decision, such as setting deadlines or ultimatums, to push the other party into agreeing to terms. An example of this might be telling a supplier that they must accept an offer by a specific deadline, or the deal will no longer be available.
- Positive leverage is about offering something of value to the other party in exchange for a concession. This could involve sharing crucial information or providing a benefit that strengthens the other side’s position, which then encourages them to meet your demands in return.
- Normative leverage is rooted in shared interests, values, or industry standards. It involves aligning with common goals that both parties can agree on, such as a mutual commitment to transparency or a standardized pricing model. By using normative leverage, negotiators create a sense of fairness and partnership, where both sides are guided by agreed-upon norms, fostering collaboration and long-term success.
Each form of leverage plays a vital role depending on the specific situation, helping negotiators navigate complex deals and find mutually agreeable solutions.
Determining the Most Effective Negotiation Strategy
The key to determining the most effective negotiation strategy lies in a clear understanding of your goals and the specific context of the negotiation. Jeanette explains that the first step is to ask critical questions:
- What is the ultimate objective?
- Are you aiming to establish a long-term partnership, negotiate a cost-saving deal, or secure a one-off transaction?
The answers to these questions shape the approach. For example, if the goal is to develop a strategic alliance, collaboration and cooperation will be the foundation of the strategy. However, if the goal is to negotiate a price reduction for a short-term purchase, a more transactional and performance-based approach may be necessary.
Additionally, Jeanette notes that the buyer’s approach plays a significant role in shaping the strategy. Are they positioning themselves as a partner, or are they more focused on leveraging cost savings? Understanding the motivations of the other party is just as important as knowing your own.
From there, the negotiation strategy can be tailored to meet the specific circumstances, ensuring the best possible outcome for both parties. Jeanette stresses that successful negotiators are adaptable, able to adjust their strategies based on the situation while remaining focused on the end goal.
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What was a pivotal moment in your career that shaped your approach to negotiation, and how did it influence your strategy and tactics?
My approach to negotiation was shaped by my legal training and experience as a trial lawyer, until I took a meditation course at the University of Washington. The mediation course taught me how to move warring parties to a middle ground that benefitted them. Now, I embrace the full range of negotiation styles from the truly adversarial necessary for a small percentage of situations and the collaborative necessary for supply chain negotiations.
Can you share a specific negotiation tactic that has consistently helped you close deals more effectively? Please provide an example where it worked.
Tactics must support the negotiation strategy. For a collaborative negotiation strategy, reframing inflammatory or positional statements to a neutral statement is incredibly important to reach agreements faster. Just last week, a young lawyer working for a Fortune 500 supplier told their Fortune 500 customer that their customer needed them as a supplier more than the supplier needed them as a customer. Therefore, the customer would need to agree to the supplier’s legal terms. I laughed inside at the arrogance and hubris when I heard this. These two companies have been working together for 40 years, and not by taking that position! To reframe that statement I said, “The buying organization awarded the work to your company precisely because your company has been a good partner for a very long time. What I am hearing is that your company would like to have a shared risk approach to these legal terms.” This reframe helped the VP of Sales save face to allow her to move forward in a more collaborative manner.
What is the most challenging negotiation you’ve ever faced, and what strategy or tactic helped you turn it into a win?
Sole supplier negotiations in heavily regulated industries are super tricky. Most people misconstrue the sole supplier relationship. Some folks at the supplier may have a “take it or leave it” position thinking that their customer has no choice but to work with them. Buying organizations may treat the sole supplier like a team of wayward employees, not as a separate legal entity. Turning these conversations around requires acknowledgement that both companies are working together for a good cause, such as manufacturing high quality aviation equipment for commercial airlines. Keeping the focus on the purpose for the relationship will create a more level playing ground on which to negotiate.
What are your top three must-have tools, frameworks, or resources that sales professionals should use to improve their negotiation skills?
For more complex and collaborative negotiations where the supplier and customer must have a cooperative relationship, I recommend:
1) 3 Critical Tools for the Contract Negotiators Toolbox. This eBook offers you detailed guidance to incorporate better pricing, metrics and governance into your next contract. https://bit.ly/ContractNegotiatorsToolkit
2) Checklist for drafting a Gainsharing Agreement. Use this comprehensive checklist to develop a fair, robust and profitable gainsharing agreement at your next deal. https://bit.ly/GainShareFramework
3) The book: Getting to We: Negotiating Agreements for Highly Collaborative Relationships https://www.jnyden.com/books/
With buyer behaviors evolving and AI playing a larger role in sales, how do you see negotiation strategies and tactics changing in the future? What should sales professionals do to stay ahead?
While AI can make writing emails and proposals easier, AI has hallucinated in some scary ways when it comes to the law. In one recent case, AI made up the law. That can be super scary when it comes to negotiating a complex contract in a critical relationship. Until humans can reign in AI hallucinations in the law, use AI to help generate executive summaries of contracts, but do not use AI to write legally binding contract language.
What’s are some simple but powerful negotiation tactics that most salespeople overlook
The single most overlooked negotiation tactic is to incorporate a couple of seconds of silence before answering an obnoxious position, or heated exchange. Silence can calm people down. Silence can take air out of a bully’s tirade. Silence can allow quieter, deeper thinkers to jump in and share important information. A couple of seconds of silence is golden!
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