Henry Kissinger was once asked if he already knew what the Soviets would propose at an upcoming summit meeting. He said, "Oh, absolutely-no question about it. It would be absolutely disastrous for us to go into a negotiation not knowing in advance what the other side was going to propose."

  Can you imagine the cost of getting that kind of information? The budget of the C.I.A. is top secret, but experts think it is almost $4 billion a year, even now that the Cold War is over. So, governments think it's important enough to spend that kind of money. Doesn't it make sense that we at least spend a little time to find out more about the other side, before we go into negotiations? Why do countries send spies into other countries? Why do professional football teams study the replays of their opponents' games? Because knowledge is power and the more knowledge one side is able to accumulate about the other, the better chance that side has for victory.

  If two countries go to war, the country that has the most intelligence about the other has the advantage. That was certainly true in the Persian Gulf War-the C.I.A. spies had photographed every building in Baghdad, and we were able to completely take out their communication systems in the first few bombing runs.

  If two companies are planning to merge, the company that knows the most will usually end up with the better deal. If two salespeople are vying for an account, the salesperson who knows more about the company and its representatives stands a better chance of being selected for the account.

  Despite the obviousness of the important role that information plays in a negotiation, few people spend much time analyzing the other side before starting a negotiation. Even people who wouldn't dream of skiing or scuba diving without taking lessons will jump into a negotiation that could cost them thousands of dollars without spending adequate time gathering the information they should have.

  Why are people reluctant to gather information? Because to find things out, you have to admit that you don't know, and most of us are extraordinarily reluctant to admit that we don't know.

  So the first rule for gathering information is: Don't be over confident. Admit that you don't know and admit that anything you do know may be wrong.

  I used to be afraid to ask questions for fear that the question would upset the other person. I was one of those people who say, "Would you mind if I asked you?" or "Would it embarrass you to tell me?" I don't do that any more. I ask them, "How much money did you make last year?" If they don't want to tell you, they won't. Even if they don't answer the question, you'll still be gathering information. Just before General Schwarzkopf sent our troops into Kuwait, Sam Donaldson asked him, "General, when are you going to start the land war?" Did he really think that the General was going to say, "Sam, I promised the President that I wouldn't tell any of the 500 reporters that keep asking me that question, but since you asked I'll tell you. At 2.00 AM on Tuesday we're going in"? Of course, Schwarzkopf wasn't going to answer that question, but a good reporter asks anyway. It might put pressure on the other person or annoy him so that he blurts out something he didn't intend to. Just judging the other person's reaction to the question might tell you a great deal.

  If you want to learn about another person, nothing will work better than the direct question. In my own experience-now that I'm no longer afraid to ask-I've met only a few people who were seriously averse to answering even the most personal questions. For example, how many people get offended when you ask them, "Why were you in hospital?" Not very many.

  It's a strange fact of human nature that we're very willing to talk about ourselves, yet we're reticent when it comes to asking others about themselves. We fear the nasty look and the rebuff to a personal question. We refrain from asking because we expect the response, "That's none of your business." Yet how often do we respond that way to others?

  When you get over your inhibitions about asking people, the number of people willing to help you will surprise you. When I wanted to become a professional speaker, I called up a speaker I admired, Danny Cox, and asked him if I could buy him lunch. Over lunch, he willingly gave me a $5,000 seminar on how to be successful as a speaker. Whenever I see him today, I remind him of how easy it would have been for him to talk me out of the idea. Instead, though, he was very encouraging. It still astounds me how people who have spent a lifetime accumulating knowledge in a particular area are more than willing to share that information with me without any thought of compensation.

  It seems even more incredible that these experts are very rarely asked to share their expertise. Most people find experts intimidating, so the deep knowledge that they have to offer is never fully used. What a senseless waste of a valuable resource-all because of an irrational fear.

  Power Negotiators understand the importance of asking and of taking the time to do it properly. What's the best way to ask? Rudyard Kipling talked about his six honest serving men.

I keep six honest serving-men.
(They taught me all I knew);
Their names are What and Why and When
and How and Where and Who.

  Of Kipling's six honest serving men, I like Why the least. Why can easily be seen as accusatory. "Why did you do that?" implies criticism. "What did you do next?" doesn't imply any criticism. If you really need to know why, soften it by rephrasing the question using what instead: "You probably had a good reason for doing that. What was it?" Learn to use Kipling's six honest serving men to find out what you need to know.

  You'll get even more information if you learn how to ask open-ended questions. Close-ended questions can be answered with a yes or a no or a specific answer. For example, "How old are you?" is a closed-end question. You'll get a number and that's it. "How do you feel about being your age?" is an open-ended question. It invites more than just a specific answer response.

  "When must the work be finished by?" is a closed-ended question. "Tell me about the time limitations on the job," is an open-ended request for information.

  Power Negotiators also know that the location where you do the asking can make a big difference. If you meet with people at their corporate headquarters, surrounded by their trappings of power and authority and their formality of doing business, it's the least likely place for you to get information.

  People in their work environment are always surrounded by invisible chains of protocol-what they feel they should be talking about and what they feel they shouldn't. That applies to an executive in her office, it applies to a salesperson on a sales call, and it applies to a plumber fixing a pipe in your basement. When people are in their work environments, they're cautious about sharing information. Get them away from their work environments and information flows much more freely. And it doesn't take much. Sometimes all that it takes is to get that vice-president down the hall to his company lunchroom for a cup of coffee. Often that's all it takes to relax the tensions of the negotiation and get information flowing. And if you meet for lunch at your country club, surrounded by your trappings of power and authority, where he's psychologically obligated to you because you're buying the lunch, then that's even better.

  If you go into a negotiation knowing only what the other side has chosen to tell you, you are very vulnerable. Others will tell you things that the other side won't, and they will also be able to verify what the other side has told you.

  Start by asking people who've done business with the other side already. I think it will amaze you-even if you thought of them as competition-how much they're willing to share with you. Be prepared to horse trade information. Don't reveal anything that you don't want them to know, but the easiest way to get people to open up is to offer information in return. People who have done business with the other side can be especially helpful in revealing the character of the people with whom you'll be negotiating. Can you trust them? Do they bluff a great deal in negotiations or are they straightforward in their dealings? Will they stand behind their verbal agreements or do you need an attorney to read the fine print in the contracts?

  Next, ask people further down the corporate ladder than the person with whom you plan to deal. Let's say you're going to be negotiating with someone at the main office of a nationwide retail chain. You might call up one of the branch offices and get an appointment to stop by and see the local manager. Do some preliminary negotiating with that person. He will tell you a lot, even though he can't negotiate the deal, about how the company makes a decision, why one supplier is accepted over another, the specification factors considered, the profit margins expected, the way the company normally pays, and so on. Be sure that you're "reading between the lines" in that kind of conversation. Without you knowing it, the negotiations may have already begun. For example, the Branch Manager may tell you, "They never work with less than a 40 percent markup," when that may not be the case at all. And never tell the Branch Manager anything you wouldn't say to the people at his head office. Take the precaution of assuming anything you say will get back to them.

  Next, take advantage of peer-group sharing. This refers to the fact that people have a natural tendency to share information with their peers. At a cocktail party, you'll find attorneys talking about their cases to other attorneys, when they wouldn't consider it ethical to share that information with anyone outside their industry. Doctors will talk about their patients to other doctors, but not outside their profession.

  Power Negotiators know how to use this phenomenon because it applies to all occupations, not just in the professions. Engineers, controllers, foremen, and truck drivers; all have allegiances to their occupations, as well as their employers. Put them together with each other and information will flow that you couldn't get any other way.

  If you're thinking of buying a used piece of equipment, have your driver or equipment supervisor meet with his counterpart at the seller's company.

  If you're thinking of buying another company, have your controller take their bookkeeper out to lunch.

  You can take an engineer from your company with you to visit another company and let your engineer mix with their engineers. You'll find out that unlike top management-the level at which you may be negotiating-engineers have a common bond that spreads throughout their profession, rather than just a vertical loyalty to the company for which they currently work. So all kinds of information will pass between these two.

  Naturally, you have to watch out that your person doesn't give away information that could be damaging to you. So be sure you pick the right person. Caution her carefully about what you're willing to tell the other side and what you're not willing to tell-the difference between the open agenda and your hidden agenda. Then let her go to it, challenging her to see how much she can find out. Peer-group information gathering is very effective.

  Power Negotiators always accept complete responsibility for what happens in the negotiations. Poor negotiators blame the other side for the way they conducted themselves. Many years ago, I was conducting a negotiating seminar in the San Fernando Valley, and comedian Slappy White was in the audience. During the break, I told him how much I admired comedians. "It must be fun to be successful like you," I told him, "but coming up through those comedy clubs with all their hostile audiences must be sheer hell."

  "Roger," he told me, "I've never had a bad audience."

  "Oh, come on, Slappy," I replied, "When you were starting out, you must have had some awful audiences."

  "I've never had a bad audience," he repeated. "I've only had audiences that I didn't know enough about."

  As a professional speaker, I accept that there is no such thing as a bad audience, there are only audiences about whom the speaker doesn't know enough. I've built my reputation on the planning and research that I do before I'll get up in front of an audience.

  As a negotiator, I accept that there's no such thing as a bad negotiation. There are only negotiations in which we don't know enough about the other side. Information gathering is the most important thing we can do to assure that the negotiations go smoothly.

Roger Dawson is the author of two of Nightingale-Conant's best selling audiocassette programs, Secrets of Power Negotiating and Secrets of Power Negotiating for Salespeople. This article is excerpted in part from Roger Dawson's new book - Secrets of Power Negotiating, published by Career Press and on sale in bookstores everywhere for $24.99.

Back to Real Estate Investing Articles