Legitimate power refers to power associated with a position or office. For example, a vice president of a major corporation or the head of a government department has power that comes with her position. Whoever holds the office holds the power, regardless of their intellect, competence or personality.
Legitimate power is often expressed through an impressive title, a magnificent office desk and chair, and a luxuriously appointed conference room. The holder of such power has influence with political big-wigs and corporate titans, instant access to the media, and an army of lackeys to do his bidding. He wears expensive tailored suits, sports a fine Swiss watch, and entertains clients at the most exclusive clubs. It is easy to see how anyone not part of his exalted circle could feel intimidated.
I’m sure you’ll find everything to
You may not have a fancy title like your negotiating partner, but some titles are just a lot of hot air. Despite your counterpart’s senior title, power suit and club membership, you may be dealing with a weak negotiator. You will be painfully aware of your own deadlines, sales targets, budget constraints and other pressure points. However, you probably don’t know what pressures your counterpart is under, and it is unlikely that she will tell you. Everyone has problems, worries and weaknesses, even Donald Trump and Sir Richard Branson.
Most people tend to overestimate their own pressures and weaknesses, while assuming their counterpart has a stronger position than she really does. When you face a seemingly powerful negotiating partner, it’s a good idea to remind yourself that she may have problems of her own. Perhaps she is under pressure to conclude a deal with you, and may not have as strong a hand as she is leading you to believe. You must ignore the trappings of power and focus on your interests.
Traditional sources of power, such as money and position, are less important than they used to be.
Fast Fact
Expertise
An expert is a person who possesses extraordinary skill or knowledge in a particular area. In today’s complex, highly specialised world, expertise is a more important source of power than a title.
For example, I’ve had teenagers help me with computer problems. Despite their youth and lack of a title, these youngsters have power over me due to their superior expertise in the field of computers. When they tell me I need a new thingamabob, I get it. When they say it costs X dollars, I pay it.
Expertise is perhaps the most important form of power today, and anyone can develop it. What type of expertise do you have? How can you develop more expertise in that area, or in complementary areas? By increasing your expertise, you increase your negotiating power.
Perhaps your expertise is well-known. If not, you must let the other party know (subtly, of course) that you are an expert. Make sure he is aware of your credentials. Ask questions that show a high level of understanding, use the appropriate jargon, and refer to other experiences where relevant. You may be able to influence the other party and achieve a more favourable outcome if he recognises your expertise.
Projecting expertise is subject to posturing and hype. It would pay to remember this when you find yourself negotiating with a so-called expert. Do not be taken in by the title, smooth talk or cocky demeanor. It could all be an act. In any case, he is only human, and you both stand to gain from the negotiation.
If you truly are dealing with a bona fide expert, do not be intimidated. Experts are not always right, and their opinion is often just that — an opinion. In almost any major lawsuit, each party will engage an expert. These experts will contradict each other on every critical point. They cannot both be right! Don’t assume the expert opposite you is right either.
Information
Information is another source of negotiating power. The more you know about your counterpart, the subject of the negotiation, and your respective industries, the more power you have. For example:
What does your counterpart really need
• ? What are his true interests?
What are his psychological and ego needs? Who are his constituents or stakeholders
Who are his competitors
• ? What competitive pressures is he facing? What is his
• negotiating style? What tactics does he use? What is his financial situation
• ? What are his budget constraints?
Does he have any
• deadlines or time constraints? What is his business cycle like?
Are there any relevant trends or changes occurring in his industry
• ?
Is there anything in his background or track record of interest to you
• ?
It is easier to gather information before you begin bargaining. Once you begin talking with your counterpart you may find him reluctant to disclose much information, and he may be suspicious of your motives. Begin gathering information as soon as you realise you have an interest that you will have to negotiate to satisfy.
Let’s say you want to buy a new computer. Most people would simply go to a dealer, look at a few models, and buy one they think would be suitable. They may later find that it does not meet their needs or that they paid too much for it.
A good negotiator would first determine exactly what her needs are. Then she would research various models that could meet those needs. She would then compare prices at different dealers for her top two or three choices. A really good negotiator would even research the dealers to learn about their business practices and negotiating styles.
It is particularly useful to get information about the other party’s needs and interests. Understanding the other party and his interests can give you a tremendous advantage. Find out everything you can about your counterpart, his company and his needs.
Note that people have many needs, and not all of them are obvious. Do not overlook psychological or ego needs, which we discussed in Chapter 4. You can find a lot of valuable information online, in industry directories and in trade journals. Annual reports and other company publications are full of useful information. You might also talk to people who have previously dealt with the person or organisation you will be negotiating with.
You can even talk to other people within your counterpart’s organisation. When shopping for that new computer, wouldn’t it be useful to speak candidly with a service technician before you approach a salesman? Wouldn’t the technician give you valuable information about the pros and cons of various models, even competitors’ models, that the salesman would not mention while he is selling to you? That technician would be so flattered that you asked for his opinion that he would lay it all out for you!
Information is like gold. Begin gathering information as early as possible.
With all the information available online, it is easier than ever to boost your negotiating power.
Fast Fact
The fastest and easiest way for me to increase my negotiating power is with information.