3-D Negotiation: Powerful Tools to Change the Game in Your Most Important Deals
by David A. Lax and James K. Sebenius
reviewed by Michael A. Lally

3-D Negotiation: Powerful Tools to Change the Game in Your Most Important Deals is not the book for Gordon Gekko types, practiced in the simple tactics of win-lose haggling. This book is the The Art of War for deal making. Like Sun Tzu for strategy, 3-D Negotiation is the primer on creating deals with lasting value. Anyone that has ever bought, sold, or traded anything will gain something with even the most cursory read of this work.

3-D Negotiation is a book that will become dog-eared, highlighted, notated, and underlined. This is a reference that you will return to again and again. It is very clearly written in a way that is accessible to everyone. Each point is illustrated with a relevant and detailed real-world (and often personal) example from the authors.

The authors are both graduates of Harvard Business School, co-founders of Harvard's Negotiation Roundtable and developed the executive program on strategic negotiation at the Business School. They have decade's worth of deal-making experience and analysis between them.

Lax and Sebenius take a contrarian approach to much of the current thinking and teaching on negotiation. They seek to move us away from the familiar win-win and win-lose tactical approaches and help us understand negotiation along the following dimensions:

  • 1-D: At the Table - tactics.

  • 2-D: Design Value Creating Deals - getting "below the surface to uncover the sources of economic and non-economic value.

  • 3-D: Away from the table - the setup - setting the table - "ensuring that the right parties have been approached, in the right sequence, to deal with the right issues that engage the right set of interests, at the right table, at the right time, under the right expectations, and facing the right consequences of walking away if there is no deal.

This book focuses heavily on the deal design and setup dimensions. Throughout, the authors reinforce the concept that roadblocks in any one dimension may often be solved in another dimension. The focus is on crafting deals that create long-lasting value for all sides.

3-D Negotiation goes well beyond simply waiting for the other side to talk first once you are all sitting together at a table. Negotiation takes work. It takes planning. It takes analysis and research. And most of all you have to listen. If you are serious about learning the craft of deal design that creates lasting value, Lax and Sebenius are here to help.

The authors have created a comprehensive methodology to deal making. To start, they recommend you complete a 3-D barriers audit "to determine what stands between you and the deal you want." An audit consists of the following exercises:

  • Assess the barriers to the setup

    • Create a detailed "map" of everyone involved, their roles, their full interests and their best no-deal options

    • Plan the sequence of events and process choices

  • Analyze and understand all the barriers to deal design

  • Analyze and understand any "tactical and interpersonal barriers"

They offer the following recommendation: "to help organize the elements of your strategy, map backward from your target deal to the deal/no-deal balance that will most likely induce [the other parties] to make this choice, and then make your way back to the current situation. This enables you to determine the actions you must now take to face them with the right deal/no-deal balance."

As a helpful exercise, they recommend writing the victory speech for your counterparts. The speech should include the reasons "why the agreement they made with you is smart, fair, reasonable, and better than the alternative."

Once you have the end clearly in focus you can then work backward to "craft a 3-D strategy". A 3-D strategy is "aligned combination of moves away from the table, at the drawing board, and at the table in which you":

  • Set up the right negotiation

  • Design value-creating deals

  • Stress problem-solving tactics

In closing, I've had the opportunity to use some of the ideas offered in this book during recent negotiations with a potential vendor. We created a 3-D strategy after we looked at all the players and their no-deal options. We understood as many of the barriers as possible. We quickly identified the ZOPA (zone of possible agreement) and have been living in that zone trying to iron out all the details.) I've found myself picking this book up from time to time and leafing through it. Every time I do, I pull something useful out of it. Their methodology works. We are successfully building a solid partnership that creates and ensures value for both parties for years to come.

Mike Lally is a contact center expert, relationship builder, change leader, and talent developer - author of diligentia.blogspot.com, National Sales Operations Manager for Frontier Communications Solutions and occasional book reviewer for The CEO Refresher. To have your book reviewed and featured in The CEO Refresher please send a review copy to Mike Lally 23 Lost Feather Drive, Fairport, NY 14450.

3D Negotiation

3-D Negotiation:
Powerful Tools to Change the Game in Your Most Important Deals

by James K. Sebenius and David A. Lax
Harvard Business School Publishing
September 2006

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