Poker and the Art of Negotiating

History is full of examples where playing a game prepared a person for real life experiences. For example some research indicates that xiangqui, a Chinese form of chess played in the 2nd Century BC, helped leaders learn the art of war. Today, new research indicates that multi-player on-line games prepare employees for team work and analytical thinking.

While that’s not necessarily a reason to demonstrate leniency when you catch your workers playing games on-line during work hours, it may at least provide some side benefit to their work performance.

A little less high tech, though possibly even more complex, poker offers practice in some very valuable negotiating skills. Top-notch poker players “read” their opponents, carefully observing subtle body language and other cues to pick up information that they will use to move closer to their ultimate goal: winning. Master negotiators do the same. Your sales team’s ability to read their “opponent’s” actions is critical to getting the best deal they can.

Start with the basic fact that when a person does something that is unnatural for them, stress emerges. As human beings we may give off a number of different signals that we’re under stress. In poker these are called “tells.” Having a winning hand—the opportunity to win a pot of money—is often unnatural for an individual, and this causes stress. Weak hands cause a different kind of stress and require even more skill to bluff and see things through to a win.

There is a golden rule in poker that applies to negotiating as well: A strong opponent will try to act weak, while a weak opponent will try to act strong. Knowing this single basic tenet will give you and your people a significant edge over those who are not aware of it. Some observable behaviors that showcase the golden rule in negotiations are:

• Acting Uninterested in a Deal While Still In It usually means that the person is negotiating from strength.
• Hands Shaking or Trembling may be an indication that the person is excited about the deal and is often a signal that they are negotiating from strength.
• Rapid Breathing is almost always a giveaway that the person is excited about the deal.
• Sighing and Shrugging are often demonstrated by a person acting to cover a position of strength.
• Staring Down Other Players is usually done by someone who is trying to appear strong, which probably means the person is negotiating from a position of weakness.
• Holding One’s Breath is often done by inexperienced negotiators when bluffing. Essentially they’re waiting (holding their breath in anticipation) to see if the opponent will take the phony bait.

Some people playing poker will start to chatter and talk things up when they’re nervous. They will do the same thing at the negotiating table. Most master negotiators don’t have a lot of side conversations—they know that a slip of the tongue may give away their position. However, if they know that their opponent is weak, they may engage him or her hoping that the other person may give away their position. And, the weak party often does. So when the very shy quiet guy suddenly starts talking, it’s time to start watching closely. He or she wouldn’t be relaxed unless they were confident.

If your salespeople aren’t getting enough negotiation experience to be able to read another person’s “tells,” or if they don’t know what signals they, themselves, are giving off, perhaps it’s time to break out that deck of cards. If you do, I should add one additional point: If you’re playing poker for fun, you’ll often only have an ego investment in winning or losing. If you’re playing with your own money, you’ll have much more incentive to understand who you’re playing against or how you may be giving away the store. So it’s a good idea for the person you’re working with to have some skin in the game and know they have something to lose so they will pay closer attention to the opposition and genuinely demonstrate the behaviors that may give them away when negotiating.

Dr. Stebbins is an internationally recognized authority on sales psychology. He is the author of PeopleSavvy for Sales Professionals. The entire first chapter focusing on trust can be downloaded here: www.peoplesavvy.com/chapterone.htm

Comments

[Gregory Stebbins]

Thank you Ron and Stacy for your points of view. I knew in advance that this topic would bring up many different comments.

There is a difference between social gambling - Stacy's comments, and pathological gambling - Ron's comments.

Pathological gambling is a progressive disease that devastates not only the gambler, but everyone with whom he or she has significant relationships. The American Psychiatric Association labels this as a "disorder of impulse control."

There are three phases that a person goes through, winning phase, losing phase and desperation phase. The winning phase leaves the person with unreasonable optimism that their winning will continue and they experience a physiological rush resulting in increasing amounts of their bets. The losing phase begins with bragging about past wins, while borrowing money (or stealing it) to cover bets for which they don't have the resources. At this point the gambler begins to chase their losses, instead of closing out their hand. Desperation phase is when pretty much every waking moment is spent focusing on gambling.

I would submit that many salespeople have the first two traits hard wired. As good sales managers we try to identify people who deliver from people who brag about past success but aren't currently delivering. We work to coach them and guide them toward more successful behaviors. In some cases we actually have to terminate them because their self perception doesn't match reality. In large corporations there are Employee Assistance Programs that can help them.

I appreciate both Ron's and Stacy's points-of-view and find validity in both of them.

Thank you both or your posts.

Greg

[Stacy Straczynski]

While I do agree with Ron that poker may not be the best way to teach negotiating--I don't see it as posing as much of a problem as Ron suggests.

I see this as a viable example of how to practice your sales skills in everyday life. I frequently play the game for fun among friends and each player has his or her own method of acting.

When you have a good hand, you hide it. When you have a weak hand, you bluff. That's how you play the game.

With sales, its up to the rep to "read" his client and interpret the signals he is getting. Overtime of "playing" with the same individuals, the rep will be able to determine his client's next move from previous experiences. It really puts the emphasis on how developing and fostering a relationship with a client will pay off in the future.

[Ron Hayes]

Call me a prude but I don't condone playing poker as a way to help with negotiating skills. There is a significant risk of turning someone into a gambling addict and then you end up ruining their life. Even if only 1 in 100 become addicts, is it worth having on your conscience if that one becomes an addict and ruins his/her life? recommending poker as a way to learn negotiating tactics is akin to recommending pornagraphy as a means of education in the classroom.