Renovating a room? Three more reasons to get multiple quotes

I’ve previously advised you, when hiring a contractor, to obtain several quotes. And I’ve so-advised for a specific reason—a reason that most negotiation instructors would fully endorse: because you’ll then have an alternative, providing leverage over the preferred contractor’s price. But I’m here to suggest some less recognized but no less important reasons to engage with multiple parties—reasons that can easily make your contracting more negotiable.

Consider just three:

  1. You learn about the issue: We’re currently pondering a bathroom renovation and have invited several contractors over to offer their ideas. And simply by talking to several independent parties, I’ve learned all kinds of interesting and esoteric things about bathrooms—from the building codes about medicine cabinets to the standard height of a toe kick (in addition to what a toe kick is). Had I talked to just one party, I would’ve amassed few such nuggets of information—nuggets that will inevitably inform the final decision.
  2. You hear lots of ideas: You’d think: one bathroom, one set of possibilities. But then you’d be wrong. Each contractor has offered an entirely different vision for the same space, multiple layouts with markedly different advantages and disadvantages. Had I talked to just one party, I might’ve been showering in some awfully strange places or paying to move some awfully expensive pipes.
  3. You learn about your own preferences: Talk to a neoclassical economist, and they’ll probably tell you that you understand your own preferences. Talk to me, and I can tell you that, if I had any a priori preferences about a bathroom renovation, I had no idea what they were. But in the process of conversing with multiple contractors, I’ve come to develop some rather refined renovation preferences. Slate floor? Only if it’s smoothed. Oval mirror? Looks awfully nice between some rectangular cabinets. Only by talking to multiple parties did I come to understand myself.

So, talking to multiple parties is not just about driving the price down. It’s also about understanding whatever it is you’re negotiating about—as well as yourself. Without that, no discount will make your bathroom negotiable.

Success as a steadily improving BATNA

How can you know your life is broadly successful? The question is often asked, but rarely from the perspective of negotiation research. So let me share an answer implicit in that research, an understanding of which can make life negotiable: you can measure success, in part, by the trajectory of your BATNA.

Huh? Let me explain.

BATNA, or best alternative to a negotiated agreement, is your next best alternative to any particular negotiation. Put simply, it’s your plan B. In general, successful people tend to see the number and quality of their BATNAs steadily increasing over time. Just a couple quick examples:

  • Multiple job offers: The most successful people tend to have employers fighting for their services rather than the reverse. In other words, they have many alternatives to any particular job. Thus, they have the luxury of choosing the best option.
  • Multiple life choices: The most successful people have many choices about how to live their life. They can choose to continue working, as most of us must But they can also choose to take some time off, sail the world in a small schooner, or simply take a mental relaxation break. In other words, they have many alternatives to their current way of living.
  • Multiple friends and colleagues: The most successful people have many people, both friends and colleagues, beating a path to their door—whether to have a beer or start a project. In other words, they have many alternatives to the relationships they find less than fully enriching.

Across several definitions of success, then, the common denominator is a consistently improving BATNA. So if you’re looking for a way to measure your success, you might consider the trajectory of your BATNA.

Declaring yourself a negotiation superhero—By considering your plan B

Worried about an upcoming negotiation? Dreading the back-and-forth? The fast ones your counterpart is sure to pull when you’re not looking? Well, don’t fear: here’s a research-based suggestion that can make negotiations negotiable: actively thinking about your BATNA.

I’ve repeatedly discussed the importance of BATNA: your Best Alternative to Negotiated Agreement, or simply your Plan B. As noted by me and countless other negotiation researchers, having and knowing and improving your BATNA lets you walk away from an unproductive negotiation. Less appreciated, I think, is the way that actively thinking about your BATNA before a negotiation can steel you for some upcoming bargaining—at least when your BATNA is decently attractive.

To see what I mean, imagine you’re about to talk to a flooring contractor who is likely to quote you an unattractive price. Imagine further that you have another decent quote in-hand, and you’d like to get your flooring upgraded but really don’t need to. You detest negotiation in general—and especially with pushy salespeople. Accordingly, you’re dreading the upcoming interaction and secretly hoping he calls to cancel.

In this situation, most people are so consumed with worry that they simply forget about their BATNA. Somewhere in the back of their brains, they know that they can always walk away from an overly pushy contractor, but they don’t actively focus on the fact that this guy is just one minor blip in a long list of potential next steps.

But why not?

Why not stop, forget about the pushy contractor, and refocus on the fact that you don’t really need this guy’s flooring, or really any flooring at all? Thinking like that, you’ll realize that it’s the pushy contractor who should be nervous: It’s he who stands to lose a large chunk of change if you don’t like his proposal—he who’d better fear the formidable you and your ability to bolt. Thinking like that, you can confidently place your hands on your hips, puff out your chest, and declare yourself a negotiation superhero.

So the next time you’re fearing an upcoming negotiation, stop thinking about it! And refocus on the fact that you don’t really need it, that you have a plan B.

It’s a powerful strategy but comes with two obvious caveats: First, it obviously falls flat if your BATNA is bad. If your foot is falling through to the basement and all alternative quotes are unbearably expensive, it clearly won’t really help to consider them (though we often vastly overestimate the unattractiveness of our alternatives). Second, it’s not a great idea to keep thinking about your BATNA when the guy actually appears at your doorstep. Instead, as noted elsewhere, you should shift your attention toward your target when negotiating and only return to your BATNA at the end.

So let this be the beginning of the end of your negotiation fears! Our alternatives are often far better than we think, if we really think about them—and we should.

Preparing to negotiate? Use your “BRAIN”!

Most people know to prepare before a negotiation. If not, then negotiation instructors like me frequently remind them. So the problem is not a lack of awareness about the need to prepare. It’s the lack of a framework describing what to prepare. What exactly should negotiators ponder before arriving at the bargaining table?

Since knowing what to prepare is pretty much a prerequisite for preparing itself, and preparing itself a prerequisite for a negotiable life, let me suggest you use your BRAIN (via the following acronym):

  • BATNA. All good preparation starts with a consideration of alternatives—specifically a negotiator’s next-best alternative if the current negotiation fails (i.e., their Best Alternative to Negotiated Agreement or BATNA). Otherwise, they’ll never know how much power they have or how far to push the envelope.
  • Reservation price. Great negotiators transition directly from their BATNA to their bottom line, walk away point, reservation price. Otherwise, they don’t really have the foggiest idea whether to get to yes or get to no and go with their BATNA.
  • Aspirations. BATNAs and reservation prices are great, but negotiators who spend too much time pondering their alternatives or minimally acceptable agreements (i.e., their reservation prices) tend to get them. To get something better, great negotiators also define their goals, targets, aspirations—actively considering what they really want when their counterpart demurs.
  • Interests. The acronym might as well stop there (and consider the acronym if it did), but the preceding letters alone tend to elicit a very competitive negotiation. Great negotiators know that spending the whole time competing to attain their aspirations, clear their reservation price, or avoid their BATNA results in a competitive scramble over the crumbs of a very small pie. Instead, they know they need to identify and find creative ways of fulfilling both negotiators’ overall objectives (i.e., their interests), and thereby “grow the pie.”
  • Negotiation counterpart. So why not BRAI then? Because that makes very little sense as a word and even less sense as a preparation strategy—the latter because it completely omits the other party. Negotiators who BRAI, and most negotiators do, fail to anticipate their counterpart’s situation and thus find it immensely hard to understand or respect that situation while negotiating. So great negotiators repeat the preceding letters for their counterpart, taking a wild albeit educated guess as to their counterpart’s BATNA, reservation price, aspirations, and interests.

So the next time you sit down to prepare for a negotiation, don’t just use your mind—use your BRAIN! Doing so can’t spell the difference between a smart negotiation outcome and an outcome that everyone deems dumb.

When to part with your Plan B

I’ve often alluded to the need to develop a BATNA: a next-best option or plan B if the current negotiation fails. Any negotiation instructor worth their salt will give the same advice. But the advice also raises a critical conundrum that often goes unanswered: when to let your BATNA go. When’s the right time to exercise plan A and let your fallback option go their merry way?

Since knowing when to part with your BATNA can dictate both your economic outcomes and your long-term reputation, thereby making life more or less negotiable, let’s consider five questions that can inform a decision about letting your BATNA go. If you’d like, consider these questions in the context of two job offers, one of which you prefer (plan A) to the other (plan B):

  1. Am I certain about plan A? Plan B effectively offers insurance against the collapse of plan A. So if plan A is far from certain—if someone from plan A has mentioned but not confirmed you’ll get a job offer, for example—then it’s probably better to retain plan B.

But…

  1. Is plan B starting to feel that way? No one likes to feel like a fallback. If you’ve been stringing plan B along, stalling sketchily while they eagerly await an answer, chances are they will. Since the associated damage to your reputation may start to outweigh the benefits of a fallback, you should consider parting ways.
  2. Would I ever say yes to plan B? Maybe it’s the reluctance to say no, or the fear of cold decisiveness. Either way, people frequently retain BATNAs that they would never in a million years exercise. If you would never say yes to your best alternative—if it’s a job you couldn’t possibly envision yourself doing, for example—it’s only right to say no, and quickly.
  3. Are you preventing your plan B from exercising theirs? Oftentimes, your BATNA’s offer to you is preventing them from exercising their own BATNA, e.g., an offer to somebody else. If you are standing in the way of their doing so for no clear reason, it’s probably better to part ways.
  4. How small of a world is it? If you and your BATNA will never again cross paths—not even on the interweb—then you might consider retaining them a big longer. Are you dealing with a used car dealer in the middle of nowhere? But in the considerably more common situation where you and your BATNA both inhabit a small world, I’d suggest treading much more carefully. Will your stringing-alonging follow you around till the end of time? Will every future employer in your industry / city / profession know how fallbackish your current BATNA felt? If so, then treat them with extreme caution and respect, if only for this fairly self-focused reason.

In sum, good negotiators know to cultivate a BATNA. Great and responsible negotiators know to never string a BATNA along unnecessarily. Here’s hoping that these five questions help you navigate these ethically fraught waters.

What’s my alternative?

The road to regrettable yet avoidable workplace mistakes is littered with the absence of three small words: what’s my alternative? A failure to ask this simple question, I submit, can account for a major portion of our worst workplace decisions. To avoid such decisions and make our lives more negotiable, let’s look at a few of the perils associated with failing to consider our alternatives, along with some simple examples of each.

  1. Walking away from a good deal. Perhaps the most pernicious consequence of failing to consider our alternatives is the risk of walking away from a positive situation. Why would anyone do that? Often because of a flurry of emotions. Consider the many regrettable instances when people mouth off to their superiors or become embroiled in workplace conflicts, thinking they can easily find another job if they have to. But can they? Unfortunately, the labor market is rarely so obliging.
  2. Accepting a bad deal. Quite the opposite, failing to consider our alternatives can lead us to stick with an inferior option. Consider the huge proportion of Americans who consider themselves locked in a dead-end job. Many of them certainly are, given a host of economic and social challenges beyond their control. But at least some of them are not: At least some of the people who consider themselves trapped in a dead-end job could in fact pursue a less stressful or less demanding job, or even found a viable business, if only they entertained such alternatives seriously.
  3. Wasting time deliberating. Many people spend a great deal of time pondering what to do when there is realistically only one thing they can do. Should I accept my boss’s offer to lead that important project? If I really have the option to decline, it’s worth the careful thought. But if my career implicitly depends on my acceptance, then it’s better to confront a lack of alternatives than to pointlessly give myself an ulcer.
  4. Becoming complacent. People and firms often rest on their laurels—failing to innovate or experiment with new ways of working or doing—because they overestimate the costs of failed experiments or underestimate the costs of continuing down a well-trodden path. In other words, they fail to carefully consider the alternatives to doing nothing, so nothing is often what they do.
  5. Submitting to whatever someone says. Many individuals and firms have their favorite vendor or preferred service provider. Look to no one else for service X or product Y! While this approach might make everyone feel good, it’s not particularly likely to produce a favorable agreement. Think about it: even if the preferred vendor is benevolent, how motivated will they be to offer an amazing deal if they know that you’ll accept their terms regardless? Not very. So it’s good to have friends, but when you are bidding for business, it’s also good to have alternatives.

In sum, this negotiation professor believes that a major swathe of our most regrettable yet avoidable decisions can in fact be avoided by considering our alternatives carefully. The next time you make that major decision? Consider considering your alternatives first.

Negotiation lessons from the safety patrol

I recently volunteered to serve as safety patrolman for my neighborhood. In essence, this involved trolling around the neighborhood at night, making sure no one (i.e., no teenager) was breaking community rules (e.g., loitering at the community beach) or even breaking the law (e.g., defacing said beach).

Since my duties tended to bring the community’s interests (and my own) into conflict with the interests of others (i.e., teenagers), these duties introduced several opportunities to negotiate. Accordingly, the experience reminded me of several important negotiation principles, which I thought I’d share in the hope of making life more negotiable.

  1. Interrupting other peoples’ interests is not particularly pleasant. Who wants to act as the killjoy that spoils some lovestruck teenagers’ lovely evening on the pier, shining a flashlight right in the face of affection? Not me, nor many others I know. In general, I remembered that interests consisting of interrupting other people’s interests are not particularly pleasant to pursue. With that said…
  2. It’s easier when you’re representing others. While less than lovely to give some young lovers (or young tokers) the boot, it was made much easier by the underlying motive: I wasn’t being a killjoy of my own accord. I was doing the community’s bidding, essentially representing the will of several hundred people. In general, I remembered that representing other people often strengthens your resolve. What’s more…
  3. Symbols help. The job of patrolman does have some benefits. I got to drive around with a flashing orange light on my car and wear a flashy orange vest apparently stolen from the Village People. Ridiculous to me and anyone who knew me, these symbols were quite intimidating to teenagers, for whom they legitimized my annoying requests. Perhaps for this reason, the experience also reminded me that…
  4. Most people comply. Thankfully, precious few teenagers protested. Sure, there were the aspiring few negotiators who tried to convince me that they were, for example, “just enjoying the lighting show.” But even these enterprising young negotiators agreed to clear the beach, as per community rules, after a further request. Perhaps they realized that…
  5. It’s good to have an obvious and powerful alternative. Any lip from these teenagers and I had the community and county’s approval to reel in the long arm of the law (i.e., call the police). A strong alternative for me, albeit not one I was particularly eager to engage. A weak alternative for the teenagers, who would find themselves with a rap sheet before even completing their FAFSA.

These examples are probably a bit tongue-in-cheek, but the lessons are real. They highlight, once again, that negotiations truly surround us. And they reminded me—and can remind us all—that negotiating power comes from the surrounding situation at least as much as your prowess.