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Your Weekly Walkaway - Say what!? A 19% pay increase!?! 😲
The Weekly Walkway highlights negotiation in its ‘good’, ‘bad’ and sometimes ‘downright ugly’ forms. Newsletter Issue No. 16 (14th January 2023)
What to expect?
Quotes of the Week - “Splitting the difference is wearing one black and one brown shoe, so don’t compromise.”
Tactic of the Week - Never Split the Difference
Thought of the Week - Say what!? A 19% pay increase!?! 😲
Remember: You are a negotiator!
You are always managing some form of conflict, a difference of opinion or interest.
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QUOTES OF THE WEEK
This week on quotes of the week, we’ve selected 3 of our favourites from the popular negotiation book by Chris Vos - Never Split the Difference: Negotiating as if Your Life Depended on It, and would suggest the Royal College of Nurses Union (see👇 in our Thought of the Week) consider adding it to their reading list this year…
“Splitting the difference is wearing one black and one brown shoe, so don’t compromise.”
“For those people who view negotiation as a battle of arguments, it’s the voices in their own head that are overwhelming them.”
“Negotiation is not an act of battle; it’s a process of discovery.”
Chris Vos - Never Split the difference
TACTIC OF THE WEEK
Never Split the Difference
We've all heard it before. During a negotiation, someone suggests we meet in the middle or split the difference, which may seem like a tempting offer. ‘Yeah, why not split the difference?’
Well, let me tell you why not…
By suggesting splitting the difference, you may be giving the other person insight into what you will and won't do as a negotiator, how far you will go, and in other words, what your walkaway point is.
Splitting the difference is often suggested in the heat of the conversation and is rarely a well-thought-through tactic. It informs you that the other person is nowhere near their walkaway point. Nobody would jump to their best offer / their walkaway point without due consideration. And the fact they have suggested splitting the difference tells you this is still a pretty decent deal for them, even with the difference split.
How to respond..?
'Thanks for that offer, but I can’t accept it; however, if you were to…’ and make your counter-proposal.
THOUGHT OF THE WEEK
Say what!? A 19% pay increase!?! 😲
The United Kingdom is currently experiencing a wave of union strikes, with a number of different groups of workers engaging in industrial action. This includes Rail Workers, Paramedics, Royal Mail employees, Teachers, Nurses, and members of the Border Force, among others. These strikes result from these groups of workers demanding pay raises that reflect the difficult work they do, the challenging conditions in which they work, and the high levels of inflation that are currently being experienced in the UK.
The Rail Workers, for example, are seeking pay increases that would help to make up for the long hours and difficult working conditions that they face on a daily basis. Similarly, Paramedics are asking for pay raises that would reflect the high levels of stress and responsibility that come with their jobs. Royal Mail employees also seek increased compensation as they work to ensure that the country's mail and parcels are delivered efficiently and on time.
Teachers and Nurses, meanwhile, are requesting pay raises that would help to address the high levels of burnout and stress that are common in their respective fields. They are also asking for recognition of the challenging conditions that they work in, such as large class sizes and heavy workloads.
Overall, these strikes reflect the growing frustration of workers in the UK who feel that their contributions and hard work are not being properly recognized or compensated.
I’m not going to comment on the rights and wrongs of their requests, but I do want to zoom in on some of the tactics being used and will focus on a big ask from the Royal College of Nurses. Their Union, headed by its General Secretary, Pat Cullen, has recently been quoted asking for a 19% pay increase. That’s it; you heard it right, 19%! The Royal College of Nurses feel that the nurses have been taking a pay cut in real terms for the last decade or so, and therefore this 19% is to get them on an even keel and pay them what they are worth.
Whether this demand is right or wrong, any negotiation training course worth its salt will tell you to open extreme or open ambitiously but with credibility. i.e. ask for more than you actually need so that you can trade back from that extreme opening position.
There are a couple of reasons for this:
Firstly by trading back, you are seen as being willing to engage in the negotiation and willing to move; also, by opening extreme, you can trade back from a number that wasn't your genuine belief and genuine objective. It just means that you are able to move back to another; that is your genuine objective.
Secondly, by trading back from your extreme opening position, you are also able to provide satisfaction to the other party that you are engaged in the negotiation, the satisfaction that they've got you to move, the satisfaction that they are eroding your original ask and provide them with a sense they are winning.
The most important factor to consider when opening extreme is that that opening also needs to be credible.
Credible within the market you're in, credible with the expectations that you could actually achieve it, and my concern is the Royal College of Nurses (RCN) asked for 19%, and it simply is not credible; and cannot be given by any government, regardless of their political leaning.
Another concern I have is that after opening so extreme, Pat Cullen has also said, in the same breath, that she is prepared to meet the Govt halfway on 10%. A huge move from the opening 19%!
If your opening position needs to be credible, any subsequent moves must also be.
How could this have played out differently?
First of all, set a walkaway point. The point at which you will not go beyond, for argument's sake, let's say the RCN won’t accept less than 6%.
By all means, ask for more than you need but be realistic and credible. How about an opening position from the RCN of 12%? Still above inflation, an eye-catching ask but still credible and popular with your members.
Moves must be planned prior to being executed. Move from 12% to 10%, more credible, and although you still won’t be accepted, you have sent a signal that you are prepared to negotiate and your moves are realistic and credible.
Stay on 10% for a while and anchor it. Repeat your number, get it out there, and talk to your 10%, not the government’s 4%.
Have your next move planned, 8.5%?
Don’t offer to meet in the middle or split the difference.
This only shows the other party you have much more movement to make before you reach your walkway point. It also assumes that the two parties have equal bargaining power and that their initial positions are equally valid. However, this is more often than not the case. One party may have more information or be in a stronger position than the other. In addition, meeting in the middle can lead to a compromise that is less than optimal for both parties.
Overall, it's important for both sides to approach the current union strikes in the UK with a willingness to compromise and find mutually beneficial solutions. By focusing on their underlying interests, continuing dialogue, remaining flexible, and using strikes as necessary, the government and striking workers can work together to find a resolution that is fair and equitable for all parties involved.
Opening extreme and trading back from that position are valid negotiation tactics that work well when executed properly. However, careful thought needs to be made around the credibility of the opening position and the subsequent moves you make; without this consideration, it loses its credibility and, with it, a lot of its potential power. So do continue a dialogue, do continue to move if the other party is moving towards you, and recognise the power you have as a negotiator. But whatever you do, make sure you are credible!
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