Here is another extract from the self-reflection journal in the Conflict Management and Negotiations class at GWSB MBA program.
Capital Mortgage Insurance
A great case with multiple take home lessons. For me, the most important one was about the necessity of thorough preparation for negotiation. Specifically – analyzing the data with numbers.
The Capital Mortgage Insurance (CMI) has been in the process of acquiring Corporate Transfer Services (CTS) for a few months now with some significant setbacks and stalls.
The most striking difference in the positions of the negotiating parties was their level of preparedness and ability to substantiate their claims. CMI did a very thorough job by researching the industry which was not their own core competency yet. At the same time the folks at CTS were coming with outrageous numbers and they could not even defend their claims with any solid data.
Therefore, the lesson for me is – always prepare for negotiation with some solid number-crunching and analysis. Numbers, especially if appropriately analyzed, or at least properly presented, have mesmerizing effect on all parties in the negotiation.
There are generally two types of people in their relations to hard numbers:
- Those who can understand and therefore appreciate them.
- Those who cannot understand them and therefore fear them.
Whichever type of the person is sitting at the negotiating table against you, you will always have a much better position by having some numbers to back your claims. Your opponent will either be scared of numbers you present and therefore will most likely get mesmerized into agreeing with your argument. Or, if the opponent has a hang on the numbers too, he/she will appreciate the numbers you are presenting in your argument.
The only thing to remember with numerical data analysis is that you’d better be as thorough as possible with those numbers. For one thing it is very easy to come to faulty conclusions if your original assumptions or data manipulation are faulty in the first place. This can be extremely costly mistakes. Even if your opponent does not have a hang on the numbers, you can shoot yourself in the foot by miscalculating and misinterpreting the data.
On the other hand, if your opponent has a good hang on the numbers, they will most likely come up with their own analysis and interpretation. In this case you would have to be able to intelligently substantiate and defend your position. Lesson: Get a hang on the numbers. You will always be better off, than the other way around.