Negotiable Leadership

Negotiable Leadership - Two Business Teams

If we were to take a peek at the world’s financial playbook, we’d see the term negotiable front and centre. The concept here is that the price of a good or service, which has yet to be determined, can be altered based on negotiation. Did you know that the ability to negotiate is a huge part of the leadership toolkit as well? Why spend hours talking to an employee to convince them to do your bidding when you can simply make the situation negotiable instead. 

What does Negotiable mean in Leadership?

Let’s say upper management has changed the way you’re meant to approve employees’ time off. The older system wasn’t working efficiently, and too many requests were falling off the grid and getting lost. However, the new system means your team’s newer members have less of a chance of having their requests approved since the focus is now more on seniority. You have many upset employees and specific instructions that you’re forced to follow from those above you. 

So, now what? Now, you negotiate. 

You could come down with an iron first and simply force everyone to follow the new rules word by word. Or, you could try and negotiate a middle ground, for example, something like a first-come, first-served approval system. Likely, this would create a win-win situation for both parties and leave everyone happy.

Successful Negotiable Leadership in Action

The idea in negotiable leadership is to take everyone’s opinions into account and find a solution that works for all parties involved. Aim to build relationships to achieve what you want. Positive relationships are important because they create trust – a key way of convincing your team to get what you want from them.

Take Dan Price from Gravity Savings, for example. When Covid-19 hit in 2020 his company was significantly affected. Their overall revenue was down by 55% in April 2020, compared to March of the same year. His team was worried about layoffs and the possibility of the company going under. As the CEO, Price needed to find a way to keep his employees working and engaged while also cutting costs as much as possible. So, he negotiated a middle ground that worked for all parties involved. He cut his own salary by $1M in order to continue to pay everyone on his team.

While this was quite an extreme choice, it worked as the company was able to stay afloat. Not only that, but he has also built a personal relationship with his team because of this choice. Another positive outcome of this choice is that employees will be willing to stay open to the CEO’s point of view regarding future issues that benefit the company as a whole, even if these ideas do not benefit the employees personally. 

Everything is Negotiable in Management

When conflict arises, most leaders find it easier to make decisions directly on their own–most of the time, without any input from the other affected team members. In their mind, this safeguards any possibility that negotiating with the other side could end up at a dead end. While doing this might offer an easy solution in the short term, it will more than likely cause trouble in the long-term. It is also possible that employees will feel that their thoughts and opinions haven’t been taken into account.

How to be Better at Negotiating 

  • Look for a win-win situation. Effective leaders want to consciously understand the wants and needs of those that are part of their team. They have a strong commitment to their employees’ interests. Also, always aim to find ways to satisfy employee interests while still keeping the organization’s goals into account too.
  • Learn to give in. Find out what each person’s number one priority is, and concede on parts that are not as important for each side. Leaders who know how to negotiate understand that you sometimes need to lose to win and that the ultimate choice should benefit the company as a whole.
  • Always make it personal. Get to know your team and build personal relationships with them. Be truly interested in them as people. You’ll find that in any negotiation, having a set of shared values and common goals will create more common ground for a mutually positive outcome.

Additional Readings

Professional Leadership Institute (PLI) is an educational website providing professionals from all types of businesses with practical education in entrepreneurial leadership. To keep evolving your leadership toolkit, additional PLI resources below will be useful:

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