Being an entrepreneur can be challenging because you need to wear multiple hats all the time. A lot of this is stuff you’ve never been taught, and you need to learn “just in time” and on the job. There is no safety net, and you need to learn many different skills: how to interpret a cash flow statement; how to sell; how to hire and fire people. These are complex tasks, and while you may never be able to master all of them, you definitely need to become a jack of all trades if you want to continue growing your company.
I think there is one key skill which entrepreneurs often don’t appreciate the value of – and this is the art and science of negotiation. The reason it’s so important is because you need to negotiate all the time as a founder. Negotiation is the heart of human interaction and you need to do this on a daily basis. You need to convince your family members that it makes sense for you to leave your cushy job with a corporate with a fat salary and start off on your own, your co-founders that they should join you in your madcap journey; your employees that they should come work for you even though they will have to take a cut in their salary, and work their butts off if they want to shine.
You will need to negotiate with customers and explain to them why your product is better than what’s available in the market, even though you are untried, unproven and untested, vendors when you can’t afford to pay them on time as to why they should be patient and give you a discount because this will be good for them in the long run. You have to negotiate with everyone you meet to back you, and this means they need to take a major leap of faith in your abilities to pull this off, because no one is ever sure how a startup will fare.
Because you have to do this day in and day out, successful entrepreneurs have mastered the techniques of negotiation. While some people are naturally good at it, you can learn this invaluable skill once you understand the key role it plays in your success.
The problem is that it’s an unappreciated asset because often people don’t even realise that what they’re doing is negotiating. This is why it’s important to have a theoretical framework so that you can follow a process and do it intelligently. If you don’t, you will find that you’re on the losing end multiple times, and this can be an expensive proposition!!
You may not even realise that the reason you are hitting barriers all the time is because you’re not being able to negotiate properly. As an entrepreneur, you are going to have to deal with conflict all the time, because you are always going to be shackled by constraints. The definition of a great negotiator is one who can resolve conflict in such a way that both parties end up thinking of themselves as being winners at the end of the negotiation. This requires a lot of maturity and the good news is it’s a skill which can be learned, but you do need to invest time and energy to do so.
You can learn from the master negotiators you will meet on your journey – and every time you lose, treat this as an opportunity to learn from the person who out-negotiated you! It’s very helpful to have a partner with you, so that you can go over the process in a thoughtful fashion, and analyse what went right and what went wrong. This will help you hone your skills.
There are also lots of great books which can help you do a better job. And if you are lucky and have a small child at home, you will find they are the best teachers of this skill – they have learned how to get adults to do what they want, which means they can wield influence without having any apparent power!
[This post by Dr. Aniruddha Malpani first appeared on LinkedIn and has been reproduced with permission.]
