Leadership and negotiations: Better skills that will get you better deals

To be most effective, leaders should add a critical skill to their arsenal: the ability to negotiate. UB School of Management expert Kate Bezrukova shares her insights on how to plan and prepare for a negotiation.

Two professionals come to an agreement after a negotiation.

By Kate Bezrukova

Kate Bezrukova
Kate Bezrukova

How much do you know about being a leader?

Decades of research have told us a lot about what leaders do—or what they try to do—as well as how they act and what drives them. In fact, most people, when pressed, probably have a pretty good idea of what goes into being a good leader, even without taking a course on the topic.

On the first day of my undergraduate organizational behavior classes, I sometimes ask students what they think a leader does and what good leadership looks like. Every time, I get responses like “a great communicator,” “inspires others to work hard” and “has a vision for their company.” These are all perfectly fine answers, in many cases backed up by research.

But sometimes we think we know more about leaders than we really do. For example, are tall people really better leaders? It seems unlikely, but many people seem to think so. Research shows taller people get promoted more easily and make more money too. Tim Judge and others found that a 6-foot-tall person makes, on average, $166,000 more during a 30-year career than someone who is 5 feet, 5 inches, even after controlling for age and gender.

The reality is that our views on what makes a good leader are often based on our perceptions of being led, rather than objective metrics of leader performance. Dean Keith Simonton’s research considered 100 personal attributes of U.S. presidents, yet only three traits were correlated with how effective the presidents were: Height, family size and number of books published before taking office (even these reasons may be due to statistical chance only).

So what hope is there for short people or those from other demographically underrepresented groups in a world seemingly biased against them becoming leaders? That’s where a good leadership course comes in—capturing less obvious paths to effective leadership.

For example, one branch of leadership study, called leader-member exchange, focuses on interactions between leaders and followers. On the surface, leader-member exchange sounds easy: The leader says do this, and it’s the subordinate’s responsibly to do it. But have you ever worked with someone, either as the supervisor or employee, and sort of knew what they wanted without giving or receiving explicit directions? That’s the concept of moqi, a Chinese word (pronounced MO-chee) that roughly means an unspoken understanding between two people. In the leadership realm, this can refer to cases where leaders have built up, over time, such a rapport with subordinates they don’t need to give directions.

Wielding power

That brings us to another important aspect of leadership: the use of power. For too many people, power means making people doing things (coercion). But power can also come from more useful sources, including the information or talent you have that others don’t, your charisma or the fact that others depend on you for something.

Moreover, I’m not sure how important coercion is in the workplace these days. After all, a leader can say, “Do this or you are fired!” but in a pandemic-impacted world—where significant numbers are leaving or not returning to their jobs for various reasons—that threat may not carry as much weight as you think.

Negotiating a deal

Rather than trying to force people to do things, leaders should add an important skill to their arsenal: the ability to negotiate. Negotiation is essentially about getting people to do what you want, and generally involves two or more interdependent parties with conflicting interests attempting to resolve their differences.

Interestingly, many people don’t want to negotiate at all because negotiation involves conflict and takes time and energy. Others say, “That’s not my style,” or “I didn’t realize it was an option; I thought the offer was take it or leave it.” Still others feel they have no chance of winning because the power differential is too great (“I can’t negotiate with my boss”) or because a third party will make the final decision.

Yet none of these reasons are as important as the reason to negotiate: If you don’t, people will take advantage of you and you will leave a lot of value on the table.

And yes, even if you negotiate, you may still leave value on the table, so the question becomes: What does it take to negotiate effectively?

The answer is relatively simple: planning and preparation. In fact, negotiation experts recommend spending one minute of preparation for each minute of actual negotiation (so if you anticipate your negotiation may last half an hour, then you need to prepare for at least half an hour).

Below are things you should think through that will make a big difference when you sit down to negotiate:

  • Issues: Items to negotiate that will be included in the formal agreement. Believe it not, sometimes we get dragged into a negotiation without realizing what is even being negotiated.
  • Resistance Point: Your minimum acceptable settlement—the point beyond which you will not go, when you are indifferent to whether a negotiation reaches agreement or enters in impasse.
  • Target/Aspiration Point: Your ideal point, when you get everything you want or the price you are happy to pay/accept.
  • BATNA: Best Alternative to a Negotiated Agreement, a backup plan or plan B. Having a strong BATNA gives you the most power and confidence in your negotiation.

Though many avoid it, negotiation is an important part of everyday life and an essential skill for leaders. An effective leader is likely to have good negotiation skills and be able to tap multiple sources of power and adept at both one-on-one exchanges and relationships with bigger groups. When you develop these skills, the rewards can be nearly boundless for your career.

Kate Bezrukova, PhD, is an associate professor of organization and human resources in the University at Buffalo School of Management. She teaches courses on organizational behavior and negotiations, and is an expert on team chemistry, managing a diverse workforce, negotiations and gender, and conflict management. Bezrukova recently co-authored a peer-reviewed case study—based on the U.S.-Iran nuclear negotiations—that was published by the Kellogg School of Management’s Dispute Resolution Research Center.

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