Media Coverage
Nice Negotiating-
An Interview with Ronald M. Shapiro, Chairman, Shapiro Negotiating Institute, Baltimore
Company Brief
Baltimore-based Shapiro Negotiations Institute is a negotiation, seminar, and consulting firm serving the needs of individuals and businesses in a broad range of industries. Since its founding in 1995, the company has delivered seminars to some of Americas leading corporations, including MBNA, BT Alex. Brown, Feld Entertainment, Ortho-McNeil Pharmaceutical, ARAMARK, Black & Decker, and Hearst Broadcasting.
Editor’s Note
It has been said that "nice guys finish last," but don’t tell that to Ronald Shapiro. On the contrary, the chairman of his own advisory and consulting institute contends, "You don’t have to be a tough, beat ‘em-up type of guy to succeed in the world of negotiation – and in fact, you shouldn’t be." With extensive corporate, political, and sports-sector experience, Shapiro can attest that "good negotiations" entail not only "getting what you want" but also "helping the other side get what it wants." And while his philosophy may seem simplistic and commonsensical, he insists that, by "being systematic" and emphasizing "The Three Ps" ("Prepare, Probe, and Propose"), people can change their media-conditioned "win-lose" attitude into a "win-win" one – which is precisely the message the Shapiro Negotiations Institute delivers to its impressive clientele. Vis-à-vis the business world specifically, the chairman notes that, already, "the paradigm has begun to shift," with companies increasingly "becoming less transactional and more relationship oriented." So within this context, his aim is to continue promoting his organization as "an institute of higher learning for corporate development in an array of fields."
After attending Haverford College and graduating cum laude from Harvard Law School in 1967, Shapiro served as a federal clerk, began teaching law school (at the universities of Maryland and Baltimore, as well as a legal-policies course at Johns Hopkins), and from 1972 to 1974 served as Maryland’s securities commissioner. He proceeded to found Shapiro and Olander, a Baltimore law firm, in 1972; the sports-management firm of Shapiro, Robinson & Associates in 1976; and the Shapiro Negotiations Institute in 1995. The co-author (with Mark A. Jankowski) of The Power of Nice: How to Negotiate So Everyone Wins – Especially You! (1998), he was named the 1996 Edward B. Shils Lecturer in Arbitration and Alternative Dispute Resolution at the University of Pennsylvania Law School. Shapiro also currently hosts, "Special Edition," a series of prime-time specials on Baltimore’s NBC affiliate, WBAL-TV.
You recently co-authored the book The Power of Nice, which is also a phrase you use frequently in your lectures. What does it mean?
First of all, it’s probably perceived as an oxymoron coming from someone like me, whose reputation has been built as a sports agent and corporate attorney. But what it means is that you don’t have to be a tough, beat ‘em-up type of guy to succeed in the world of negotiation – and in fact you shouldn’t be.
Good negotiations are all about making quality deals, getting what you want, and helping the other side get what it wants. They’re also about building relationships so you can make more good deals. This applies not only in sports, but also in the corporate world, and beyond. So the essence of the phrase "The Power of Nice®" is to practice negotiations in a constructive, rather than destructive, fashion.
That may sound like common sense, but it doesn’t usually happen in this world.
That’s so true. It is common sense, but we’re culturally conditioned – in part by the media – to view negotiations as a beat-‘em-up kind of endeavor. When we read about a budget negotiation, even if it’s bipartisan, it is depicted in the newspapers and on television as the "battle of the budget." Likewise, we read about sports negotiations, it’s always a fight between the two sides; if it’s union management, there’s always a conflict’ with international negotiations, they’re always fighting it out at the bargaining table. So that kind of conditioning, coupled with the media’s and others’ constant reinforcement of it, has resulted in a collective mindset that assumes negotiations have to be battles.
When I conduct seminars around the country, we play a simple $10 bill game that also appears in our book: People come up and negotiate over how to divide the $10. Predictably, one side will want more and to give the other side less. But in our game there’s also the rule that, if they don’t come to an agreement within a limited time period, I keep the money. Well 95 percent of the time I keep the money because of this cultural conditioning, and the people walk away with nothing, rather than something.
Are people really capable of changing that cultural conditioning?
Yes, there is a way to change. First of all, we have to change our win-lose attitude by thinking differently. At the same time, we have to be careful that win-win doesn’t become wimp-wimp, because our individual personalities control us too, and some people want to be too amiable.
Essentially, people must learn to recognize the value of being systematic. In our book I use the example of skydiving: If you’re not systematic when you skydive, you can die, so you have to overcome habits and instincts that may foul you up along the way. In the world of negotiation, the systematic approach is a simple system we call the The Three Ps: Prepare, Probe, and Propose. This approach emphasizes the process. After all, negotiation is a process, not an event. Most people view negotiation as diplomats, sports or corporate types going into a room and haggling over something. But to me, negotiation begins long before you enter that room. You prepare, which is the first "P." Then, when you get into the room, don’t haggle; instead, ask probing questions: the second "P." And finally, you make proposals, which is the third "P."
I can’t emphasize enough how vital it is to understand the importance of these principles. I’ll go into a room with upper management and ask, "How many of you take a systematic approach to preparation in your negotiations?" And I may get two or three hands. In The Power of Nice, we have a preparation planner that outlines precedents, alternatives, interests, and deadlines [PAID], as well as strengths and weaknesses, goals and walkways, and strategies for team building. When people look at it, they usually ask, "Why didn’t I think of that?" Then, just having it down on paper and using it in a negotiation makes them realize that preparation is power.
Preparation is also the only aspect of a negotiation in which you have complete control. You can’t totally control the other side, and outside events are beyond your control, but you alone control your preparation. Being prepared also means you’re going to have more time. As far as practice, the American philosopher William James believed that everyone had to do at least two things each day that he or she hates, just for practice. So you have to be willing to make that commitment. You have to put this system in place and practice it, instilling the philosophy that, in order to get what you want, you also have to help the other side get what it wants.
Do you believe that almost any negotiation can result in a win-win situation?
It’s important to remember that win-win isn’t necessarily 50-50. There’s nothing wrong with saying, "Look, I want to come away with more then you, but I also want you to feel satisfied." That’s a win-win to me. In fact, when we depict win-win in the book, we present the win that you want to get in bold type and the win that the other side will get in not-as-bold type.
Having engaged in very difficult corporate, sports, and political negotiations, I believe that people can achieve a win-win about 90 percent of the time. They’re not going to achieve it all the time, and in some cases the mentality of the other side or a specific set of circumstances will make it impossible. Nevertheless, when two parties are drawn to the negotiating table and are relatively equal in terms of bargaining power, there is a 90 percent likelihood that they achieve a win-win.
You founded the Shapiro Negotiations Institute four years ago. What led you to create the company?
I discovered that, while it may seem like common sense for people to create win-wins, they are often so conflict-oriented that they engage in only counter-productive negotiations. I’ve even seen it in the sales context. Having been blessed with tremendous success in my previous professions, I took the opportunity to go out and do something different during this next phase of my life.
The truth is that I’ve always enjoyed teaching, and I wanted to teach the corporate world how to benefit from my vast array of experiences. After starting the Institute, one of our first clients was MBNA America. Their sales and banking culture is relationship-oriented, and our message had an incredible impact. They asked that we return to teach seminars and encouraged me to reach out to other corporations – and everywhere we went, people requested that we return and do more.
Isn’t the win-lose mindset embedded in corporate America? Do you think that companies’ philosophies need to change in the future?
I think they already have. In the corporate cultures I see today, there’s the realization that what goes around, comes around. The paradigm has begun to shift, and now people are looking for relationships and ways to do more deals. We’re becoming less transactional and more relationship-oriented, which again means that, to get what you want you have to help them get what they want.
In the 1996 movie "Jerry Maguire," which was about the sports agents’ world, there’s a famous line, "Show me the money!" But in my mind, the best line in the movie was spoken during the locker-room scene, when the agent said to the player, "Help me help you." That really epitomizes the paradigm shift we’re seeing in business.
Are most top-level executives willing to accept your approach, or are they usually resistant to change?
Based on a sampling of nearly 100 firms, about 30 of which I’ve worked with intensely, most corporate executives are desirous of having their people practice this philosophy. Their primary concern is usually that the people who work for them – negotiating out in the market – also need reshaping.
Not only haven’t I encountered much resistance among chairmen and CEOs, but they are usually the ones who bring us in. The greater challenges usually come at the lower levels, but I find that my background as a sports agent helps. When I talk about sports heroes – Kirby Puckett, Cal Ripken, Brooks Robinson, and others – people tend to perk up, listen, and suddenly there’s a buy in. By telling them my stories, I’m usually able to get them to relate their own.
All of us are born with strengths in some areas and weaknesses in others. Along those lines, some people may be born with a natural ability to negotiate, while that may require a more concerted effort for others. How important is the preparation you mentioned, and can it really level the playing field?
I believe it can. When negotiating, I believe that, in addition to using the preparation-planner checklist I mentioned, you can scope out people and their intentions pretty well, particularly with the flow of information that exists today. The question is how to find out what their characteristics are.
From the standpoint of preparedness about people and business, one thing I use is my network; mine is fairly extensive now, and I can acquire information about other people relatively easily. But even with all that information, I still probe in the next negotiation phase: I ask questions and listen. I then use that information to try to put myself in the other person’s shoes. Once I can judge what the other side is thinking, I can figure out the best way to deal with them.
You have extensive negotiation experience in the corporate, political, and sports worlds. Is the process different or more difficult in one arena than in the others?
I have found them to be much more similar than people would believe. The corporate executives for whom I conduct negotiation trainings often say: "Ron, use these sports stories and metaphors. They’re relevant to what goes on in corporate-sales and corporate acquisition situations, and they get people’s attention." So the areas are all very similar.
Yet my role-model negotiator isn’t a sports type at all; it’s former President Jimmy Carter. In The Power of Nice, I discuss how he epitomizes effective mediation negotiation by practicing "The Three Ps." The fact is, President Carter prepares well, knows how to probe, ask questions, and listens. While he may not be viewed as a particularly eloquent speaker, he truly understands the process of negotiation. In the book I cite the Camp David Accords – as well as my own 300-day negotiation of Cal Ripken’s contract with the Baltimore Orioles –as textbook examples of how to practice those principles President Carter exemplifies.
When you negotiate personally don’t you find it’s also important to relate well to your clients? Is it really possible to negotiate a win-win without having common ground?
You certainly have to have a common understanding of where negotiation is going to take you. Let’s put it this way: If Cal Ripken Jr. wanted to chew up and spit out everybody in sight, I’m not sure we could have accomplished all that we have together through the years. Of course, he’s a great player who has achieved great things, and he has great value in the market place. In fact, he’s a brand now. But Cal would be the first to tell you that the mutual approach we’ve used in his negotiations and business relationships has only helped to build more relationships and firm up the brand. So there certainly has to be some degree of foresight and a common understanding for negotiations to work.
People have said to me, "Don’t let anyone see that book you wrote because they’ll shy away from you." But on the contrary, there’s actually a great willingness among many athletes to embrace this approach. Many of them find my philosophy appealing, so the book is the greatest marketing tool in the world. Once they read what this approach has accomplished for the athletes I’ve represented through the years, they often end up as clients. So this satisfies the athletes' needs as well as my own, creating a win-win for both of us.
Sports agents have often been portrayed in the media as dishonest, and to some degree there is a general perception that the business is shady. But you’ve been called one of the most respected agent-attorneys in baseball. What initially attracted you to this line of work, and is there any truth to this perception?
I got into this business way back in the 70s. I had just completed services as Maryland’s securities commissioner. Regulating all of the investment in the state, I achieved a reputation as one of the leading fraud busters in the country. It was the age of tax shelters: The wealthiest people in America in terms of earned income – celebrities, doctors, professional athletes, and others – were earning a lot of money and going into these crazy tax shelters. So I busted them up and made a reputation for myself in the process. Then I went into a securities practice, and while it’s a pinstriped sort of profession, it actually gave me the opportunity to be an agent.
I had my first encounter with the stereotype almost immediately. Because Brooks Robinson was having financial problems, he asked me to represent him and I agreed. People said: "Ron, you’re crazy! You’re making a big mistake. People are going to think of you as a sleazeball because of what agents are all about." But my response was, "I know who I am, and I don’t believe that has to happen." And it didn't.
Twenty-five years later, I think that some of my colleagues and I have proven that you can maintain your dignity and integrity and be respected in the business. Occasionally, someone will say that agents are no good, but that’s a stereotype we all have to live with. On the whole, who you are, along with what you have accomplished and represent, really speaks for itself.
The sports world is notorious for short-lived careers, and there’s always the risk of injury short-circuiting a career even sooner. Does it bother you that players may achieve all of this fame and fortune and then, a few years later, never be heard from again?
It worries me greatly because I’ve seen firsthand the tremendous impacts that can have on people’s lives. With my very first client, Brooks Robinson, I saw a man who played major-league sports for 22 years yet was on the verge of bankruptcy. So way back when I got my start in this profession, I decided that I would be a financial adviser first, an agent second, and a life advisor third.
My job is not only negotiating great contracts; it’s also convincing my clients that, because their earning spans are short, they must prepare for the future. The truth is, athletes can’t live the dream of continually earning and raising their standard of living. Instead, they have to moderate their standards of living, so that when their earnings fall off – and they will – they can continue to live comfortably. This has been difficult over the years, but it’s a challenge I’ve undertaken, and I’m happy to say that my clients have not fallen into the bankruptcy trap.
The other piece of this is the price of celebrity. I once started a book to be called, "The High Price of Celebrity," about the terrible price that comes with being a hero and celebrity. You think everything is always going to go your way, then suddenly the music stops. So another part of being and agent is getting your client to accept the fact that the dream will end, and preparing him or her for that eventually. I’ve always worked very hard to do that.
What are your plans for the institute? Do you foresee it expanding into other areas in the future?
My partner, Mark Jankowski, is a brilliant young teacher and very technology-oriented. He has some wonderful ideas about the ways in which we can apply technology to learning, particularly long-distance learning. So we’ll be exploring that area and related areas aggressively in the hopes of reaching as many people as possible.
In addition, while we’re a small company with only six employees, we just hired a COO because we’re gearing up for growth in advanced negotiations and other products and services that will serve the learning needs of businesses in various contexts. We’re looking at the best leadership and organizational-structure teachers because we truly want to become an institute of higher learning for corporate development in an array of fields. Some might call our plans grandiose, but I believe there are tremendous opportunities for doing what I love to do most: going into corporations and teaching people how to be more effective in making satisfying deals and building relationships.
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