Today we are going to talk about negotiating, specifically in the real world. It's important for the entrepreneur to know the basic strategies and tactics of business negotiations, so that you can choose what strategies and tactics to employ, and also know enough to keep a lookout for them when the other side tries to use them.

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Let's start with one cute little setup that you may have heard of already: good cop/bad cop. You’ve seen it on TV down at the precinct house, but believe me, it works just as well at any business or legal negotiation.

When you decide to play this game, you and your partner assume the roles of someone who is very agreeable, good cop, and someone who is very disagreeable, the bad cop. Adopting these personas makes it much easier for the team to say no, or for the team to disagree, or for the team to pretend like they're upset, or dissatisfied, or disinterested. Bringing forth this or any other type of negativity, is the specific and strategic role of the bad cop.

Consider this — we’re all nice people. It's very hard to be negative when you are normally a pretty positive person. It's just not in the positive person’s DNA. But a member of a negotiation team, when in the role of the bad cop, can very easily, and often with quite a bit of fun, be the person who says no. Be the person who laughs with scorn. Be the person who rolls his eyes. Be the person who scoffs at deal points and says “no way.” The role of the bad cop is to say no, to be disagreeable, be disinterested, be ready to walk away from the table, be ready to work with other people, be ready to throw the whole negotiation in the trashcan because the bad cop believes — or rather, pretends to believe — that there's a better deal to be had somewhere else.

All this negativity could be a bad thing, if it wasn't balanced by the good cop persona. The good cop is the balance to the bad cop. And this is the only way that this game works. For the bad cop to be the bad cop, there must be someone else in the room on the same negotiation team, who can smile, be friendly, tell the bad cop to simmer down, tell the person across the table “don't worry we'll work it out,” and otherwise keep the mood light, airy, positive, and moving in the right direction. I'm sure you can see that if every member of your negotiation team is either overwhelmingly positive, or overwhelmingly negative, things are going to quickly go off track, but a good partnership of good cop and bad cop can be very effective at making sure that your overall team presents an overall attitude of friendliness and good cheer, and also has the teeth and the tenacity to stick up for itself and insist on a good deal. Done well, this is often the best way to be forceful at negotiating, while still preserving goodwill and positive vibes after the negotiation.

And I must say, either one of these roles can be pretty fun to play, provided that you have the comfort and confidence that your partner is going to play the opposite. It’s much easier to be the bad cop knowing that the good cop is standing by to smooth everything over. Of course, it's got to be proportional. If the bad cop is going stand up, and march across the room to kick over a trashcan, then the good cop need to be willing to jump up, run around the table, and give everyone over there a shoulder massage. The antics must be proportional and in balance.

Smart Pricing Strategy | The Making Business Fun Podcast Episode #102

The Making Business Fun PodcastBy Eric GoeresFeb 20, 2022