(530) 467-5690 Chris@TeachU.com

There is a dangerous assumption that most people make in business negotiations or transactions. This false assumption often leads to poor, sometimes disastrous, outcomes. What is it?

Let’s start by defining “transaction”. As I use the word transaction in this context, I mean an interaction. This can be any interaction with anyone at a business. It can mean an interaction with someone inside or outside of your business. So then, any interaction in business is termed a transaction.

Here’s an example. I have a printer that is constantly failing. It often jams. Sometimes my computer won’t “recognize” the printer which means I have to save everything and shut down my system hoping that the computer will recognize the printer after re-booting. It’s a pain. My printer is 5 years old. I need a new printer.

I ask my supervisor for a new printer. This is the beginning of a transaction. My supervisor can approve or disapprove my request. That will end the transaction.

Now, back to my deadly false assumption.

When I explain my printer issue to my supervisor, I assume that his decision will be based on what is best for the company and what is best for me to be able to produce for the company.

Unfortunately, this assumption is often wrong. The consequences of a wrong assumption can have grave consequences to me. My assumption is wrong because actors in a transaction often make decisions based on their own self-interest rather than the interest of the company. If my supervisor wants to show her boss that he can control the wild spending habits of us lackeys, he’ll deny my request and then tell his boss about how he “saved” the company $200. I didn’t ask for a new car so I saved the company $40,000 with that reasoning! Silly? Yes, but it works. (Too bad)

Is it really in the best interest of the company to deny me a functional printer? No.

It can be worse.

If my supervisor doesn’t like me, he could report to his supervisor that I seem to “always need something” and “this guy is costing us a fortune”. Because I asked for a tool to do my work I end up on the carpet having to explain my wasteful ways. In trying to do what is right for the company, I find my job on the line. There’s a recession on boy! Read the papers!

I won’t offer a solution to this dilemma now. Sorry, time and space do not permit.

However, before entering any transaction you must, must, must consider what you think might motivate the decision of the other actor or actors. (Note: This can get real messy in a group dynamic.)

If you address the true basis for the other actor’s decision, you improve your chances for a better outcome. You might even eliminate a very bad outcome by cancelling the transaction. If my boss is out to get me, I had better keep my unreliable printer and my mouth shut.

Think about this before you ask or propose or pitch. Many proposals fail because we think the buyer would want the best thing for the business when in reality they want to keep all possible golf dates open. 

Chris Reich

TeachU