The 3 Ps comprise our systematic approach to negotiation. There's no magic here; just a simple set of disciplines. That's what a system is or should be. Follow the disciplines and you'll make better deals. Ignore them and every deal will be left to chance. And without them to empower you, you may revert to the habits of insecure negotiators, ranging from being overly aggressive to dangerously submissive.

Many people view negotiation as an event—haggling or trading offers at the bargaining table. To be an effective negotiator, that view must change:

That is the essence of the 3 Ps. Prepare, Probe, and Propose. You prepare for the negotiation before it occurs. You probe for information before and during the negotiation. You propose after preparing and probing. You continue preparing and probing as you respond to an offer…and so on, until a deal is struck. Even then, the negotiation isn't over because the deal made may well lead to future deals.

As with all disciplines, these demand diligence. The 3 Ps, each explained and demonstrated in detail in Chapters 5, 6, and 7, are like exercise, homework, vitamins, a good night's sleep, and flossing your teeth. You may not get a big kick out of them, but the results are undeniable.

Propose

When you finally propose a deal, your proposal will only be as good as your preparation and probing.

Propose. Try not to make the first offer. When you do make an offer, aim high—make it strong, solid, and reasonable. And be open to change it as the process unfolds.

As it is usually better not to make the first offer, there are a number of ways to draw a proposal from the other party (covered in Chapter 7). But even if the other side leads, you will have to respond to their proposal, which is a proposal in itself. So remember, a proposal is a starting point: Smart, revealing, but not final. Never forget, there's another side opposite you. Give them something to think about. Don't just give them something to accept or reject, to take it or leave it. (That would be a sure way to turn a potentially tough negotiator into a truly tough one.) A good proposal should lead to conversation: Exchange, swapping of needs and wants. The process allows both sides to formulate and prioritize. Where do you go from here? What is most important?

Don't start by asking for the moon, and don't start by asking for the least you can live with. Always know, before you propose, where you're willing to go next. Plan to make concessions. If you know in advance where and what you can concede, they won't be losses, they will be part of your plan. You gave and it didn't hurt. And the other side has gotten something.

Brooks Robinson's Final Contract or One “P” Out of Three May Be a .333 Batting Average, but It's Lousy if You're a Negotiator

One day in 1976, not long after I had left my job as Maryland's Securities Commissioner to go into private law practice, I got a call from Jerold “Chuck” Hoffberger, owner of the Baltimore Orioles. He asked if I could help one of his ballplayers straighten out some financial troubles. While I wasn't salivating at the prospect of sifting through shoe-boxes of old receipts, trying to balance hopelessly screwed-up checking accounts, and, with luck, undoing some fly-by-night deals, I had two problems with declining. First, I just like to help people. It's hard for me to say “no.” Second, it was especially hard for me to say “no” to Chuck. My total hesitation got as far as, “Uh, Chu…” when he interrupted, “Ron, it's Brooks Robinson.” I said, “When do I start?”

Brooks Robinson wasn't just a ballplayer; he was a legend with one foot already in Cooperstown. He couldn't be in financial trouble. He had to keep his mind on third base and the Orioles' pennant hopes. To skip to the happy ending, we managed to turn Brooks's ink from red to black.

So when Brooks called after the 1976 season and asked if I'd negotiate his final contract with the Orioles, I said the same thing: “When do I start?”

Brooks was paid $100,000 in 1976, but the Orioles were trying to impose the maximum allowable reduction of 20 percent and take him down to $80,000.

(Imagine walking into work tomorrow and being told your salary is being cut 20 percent!) They said Brooks was a former superstar, with declining statistics in his declining years. Legend or not, they said, Brooks's best days were behind him.

I attacked my job with a fervor that would make some of today's agents seem comatose. I was a combination pit bull–grad student–evangelist, staying up day and night to formulate a thesis that would forever change the sports world. Straining at the leash, I was hungry and unstoppable—a man on a mission and a marathon. Brooks Robinson didn't deserve a 20 percent cut, or even 10 percent. He deserved a raise! He should get $105,000 at the very least. And I was going to get it for him!

I was a glutton for information. I read. I dug. I scoured. I researched. I referenced. I cross-referenced. My aim was to learn everything there was to know about the Orioles, their organization, and their financial condition. Did they make money? How much? Who called the shots? What did they pay other players? How did the Orioles compare with other clubs?

Fortunately, the Orioles were a public company so they filed their financial data with the Securities and Exchange Commission. Yes, they were profitable. Modestly. Though they were among the winningest teams in baseball, wins didn't equal dollars. They ran on a tight budget—really tight—and they had every intention of staying that way.

They made money but didn't part with it easily. How did they feel about the value of past glories?

I talked to everyone I could who was in any way connected directly or indirectly with the club or anyone in it. The Orioles did want to keep their ties with the past greats alive and well; they knew that name players brought fans and also helped the transition to the next stars. Frank Robinson, Boog Powell, Dave McNally, and Paul Blair had all recently retired. Management wanted these past greats to lead the way to the new generation of fans and players.

How much was that transition worth?

I kept digging, kept preparing. I studied the negotiating personality of the man I would face, Hank Peters, the Orioles' general manager. Was he a hardball player, out for an I Win–You Lose negotiation? Or was he a WIN–win type? Did he negotiate in confidence, behind closed doors, quietly and subtly? Or did he use the press as a tool to float offers and preempt counteroffers? Was he stubborn? Was his ego on the line? What effect would this negotiation have on his career? Did he and Brooks have a past and was it a plus or a minus? Did he have a sentimental bone in his body? Was he a soft touch for a legend getting ready to hang up his number, or was he a numbers cruncher who delivered budgets as if they were RBIs?

I went back to my network. I talked to reporters. I read sports stories. I read what the Orioles' media guide said about Peters, talked to employees and former employees in Baltimore and in other big league cities. I listened to what people who liked Hank said and what people who didn't said. I learned that he was a tough negotiator, but a fair one. He valued marquee players, but he never forgot that he was part of an organization that ran on and believed in really tight budgets. He hadn't kept his job by throwing money around.

Hank looked like a guy who couldn't be swayed by an emotional pitch. But what if emotional value could be translated into bottom-line numbers?

Next I went looking for precedents. How did Brooks' numbers compare with those of other ballplayers? More research, more digging. I pored over Major League Baseball statistics. I put Brooks up against every third baseman; every player making $100,000; superstars in their prime; superstars in the twilight of their careers—Willie Mays, Joe DiMaggio, Ernie Banks, Yogi Berra, Ted Williams, Stan Musial, Mickey Mantle; other Orioles of the past and other Orioles last season. I was searching for anything and everything that would justify $100,000 (and negate a salary reduction) for a player of the caliber and stature of Brooks Robinson.

I didn't find it.

The hard fact was that before 1975 and the beginning of free agency, lots of Hall of Famers–to-be were underpaid and they took pay cuts as their careers faded. Even players with stats comparable to Brooks's weren't earning six figures. Existing precedents weren't supporting the $100,000 goal.

Was the research wasted? Hardly. It was all the more valuable. Now I knew what Hank Peters might know. I would have to be prepared for it and be prepared to counter it.

Now it was time to determine my client's real goals. What was it worth to Brooks, not just to the Orioles, for him to finish his career in Baltimore? If we got another $10,000 from New York, was it worth it to move? Did it take $20,000 or $30,000 more to live there as well as he lived in Baltimore? Even if he got more from one of the expansion clubs like Toronto or Seattle, was it worth it for probably only one more season? What about life after he left the field? Would he want to be back in Baltimore anyway?

The answer was pretty clear: Brooks was tied to Baltimore. After turning his finances around, he had good business prospects here and he was part of the community. He hoped to expand on his relationship with the Orioles—maybe in the front office, maybe behind a microphone. Going to another club to finish his career might dull the luster on Mr. Oriole as it had, for a short time, when Mr. Colt, Johnny Unitas, left Baltimore for San Diego. And that might lessen Brooks's future earnings.

It was time to explore alternatives. True, the precedents weren't in our favor. And Brooks wanted to stay in Baltimore. I knew it, and probably Hank Peters knew it. But Peters didn't know if Brooks was willing to leave. I evaluated the option of going to other clubs. Only the expansion clubs would meet or exceed the $100,000. Established clubs didn't care about his intangible value—Mr. Oriole didn't mean anything at Fenway Park or Tiger Stadium.

He wasn't a hometown hero. (They had their own Carl Yastrzemskis and Al Kalines.) To them, he was an aging third baseman who might not be able to spear a scorcher up the line anymore. Our option was new clubs where an “old star” might be a draw and have an impact on developing younger players.

Time to take inventory. Where did all this preparation leave me? The Orioles weren't going to overpay—Peters would be persuaded with numbers, not nostalgia. The precedents of comparable players spelled a pay cut. Established teams wouldn't pay a premium for Brooks, though expansion teams might. Brooks wanted $100,000, but would take less to stay in town.

Would I have been better off not knowing all this? Absolutely not. What if Peters knew it all and I didn't? What if I pursued avenues that were blind alleys? It's as important to know your weaknesses going in as it is to know your strengths: Maybe more important.

It was going to be a tough battle, but we had one route open, the intangible called “economic impact”: the money Brooks generated by being there. Economic impact is a commonly used term today in financing major civic projects like stadiums and convention centers. Back then it wasn't. Even now, it is never an exact calculation—more the art of fiscal conjecture. So I created my own guesstimate of Brooks's impact. I looked up newspaper and magazine articles. I gleaned every fact, trend, and anecdote that indicated how his presence in an Orioles uniform, on the field, and in the line-up might boost attendance, sell souvenirs, and line people up for beer and hot dogs. I estimated the value of Brooks at every home game. I calculated the return, in dollars and cents, of a “Thanks Brooks Day.” I looked at Brooks as a one-man public relations office for the Orioles and tried to assess the positive community impact of the Orioles keeping Brooks and the potential negative impact of not keeping him.

Tough battle or not, I was ready. I knew where the mines were planted. I knew every number, every fact, every stat for and against us. I could make the case for $100,000 without stepping into a trap. I could make the case, in dollars and cents, and I could back it up. And because of what I had learned, we weren't stuck on getting $100,000 in straight salary. We were willing to accept creative ways to get there.

Bring on Hank Peters. Let him ask me anything, let him challenge me, let him put me on the spot. I was prepared, prepared, prepared.

I went into Hank's office. I looked over at him and I didn't see a general manager. I saw the jury. My case would win them over. I spread notebooks out and laid newspaper articles across the tables. I propped pictures up. I circled figures and percentages. I unfurled my spreadsheets. It was impressive, to say the least, and it took almost an hour. From fact to fact, from figure to figure, and finally to the finale: I made my closing argument to the jury. “Hank, clearly, undeniably, absolutely you can see this evidence demonstrates beyond any doubt that Brooks Robinson is worth at least $100,000.”

I rested. I looked at Hank Peters, my jury. I waited. Confidently. It was time for an impressed Hank to furrow his brow, scratch his head, stick out his hand, and agree with me.

There was one problem. Hank hadn't read the script. He just looked across the table and said, “Thanks Ron, I'll get back to you.”

What? “I'll get back to you?” He didn't say “yes.” He didn't even say “no.” After my brilliant performance! “I'll get back to you?” Had I not made an ironclad case? Was he just not listening? Oh, he was listening, all right. He heard everything. Because I told him everything I knew, all at once.

I was prepared, but I didn't probe. I didn't ask one question. I didn't get one insight from Hank Peters. I didn't even ask how the traffic was that morning.

I was prepared, but I didn't properly propose. I said, this is what we'll take. I didn't try to get him to go first, or give me an idea of where or how or even if he'd make an offer.

I didn't negotiate. I orated, I speechified, I pontificated. But I didn't engage in “the commerce of information for ultimate gain.” I revealed our entire position without getting one shred of information from him. He could take his time, mull over our position, respond to every argument, and defuse, disarm, and negate my points, one by one.

Most of all, I didn't listen. Listening is a critical link in probing and throughout the process. I wasn't open to input that might have changed the outcome. I wasn't attuned to the cues from the other side. I heard only what I already knew, not new information that might have changed the outcome of the negotiation.

Hank said, “I'll get back to you” because he knew how to negotiate. And he did get back to us with an offer of $80,000. And he gave us his reasons, which by now were honed to perfection. Brooks accepted.

There is a P.S., though. We never burned our bridges. And that paid off down the road. Late in the season, in anticipation of getting into the World Series, the Orioles wanted to make a roster move, that is, make room for a younger player by moving an older player off the roster. Hank Peters called and asked if Brooks would be willing to move off. I took the opportunity to remind Hank that Brooks had acted and played like a true professional throughout the season, despite never feeling quite comfortable with the outcome of our contract negotiations. Hank knew that was true and said he was going to make up the salary difference retroactively so Brooks would, in fact, make $100,000 for the year. The team even held their “Thanks Brooks Day” to recognize his career contributions to the Orioles. It was an early lesson in the value of building relationships. There's much more about that as you read on.

So, unlike me with Hank Peters, don't fail to put all 3 Ps in play. In the next three chapters, we go into detail on each of them—Prepare, Probe, and Propose. We'll provide you a systematic approach to insure that you understand them, refine them, practice them, and employ them and empower you to…yes, maximize your win.

Chapter 4
The Three Ps

A Systematic Approach

Prepare, Probe, and Propose

Prepare

Probe

Propose

Refresher

Chapter 4: The Three Ps—A Systematic Approach