Patience and listening get you information. Information leads to knowledge when the context is understood. Knowledge properly conveyed leads to credibility. In negotiations, the more you understand about the other party and their requirements, the more credible you will be when you have something to say.

Credibility is the cornerstone of communication. You build credibility in order to get others to listen to you, otherwise your voice is just noise. It works like this:

negotiations credibility

Credible speakers:

  • Listen carefully and patiently
  • Listen to obtain the facts, not to argue
  • Treat people as individuals based on those facts, not as general stereotypes
  • Agree or disagree based on information and logic
  • Don’t promise more than they can deliver
  • Anticipate the effects of their speech
  • Accept responsibility for what they say and do

In this sense, credibility is a combination of knowledge, integrity and capability. Often, we admire those whom we find credible, they may even become personal heroes. When you have credibility, you have the ability to inspire trust and belief.

Credibility is the power to inspire belief.

Fortunately, most people in business (like you) don’t have trouble being credible. Maybe that’s because you can point to what you know or what you have done. And when you are credible, people tend to listen to you. This is critical in negotiations. Think about what happens when you are speaking with someone who has no credibility — someone you consider a “bs” artist. What do you do? You usually turn off; you stop listening. Well, if you are not listening to someone, what chance do they have of persuading you? However, just because you are credible does not mean you will be persuasive.

For example, if you are credible, you can present a believable business case showing why the price you’re charging is competitive in your industry and is consistent with reasonable cost structures. However, to show the other side why they should pay that price — that it will make them more competitive in their business — you must know something about their business, which circles back to information and knowledge. Of course, that’s more difficult, because you don’t know as much about their business as you do about your own.

So, we see that credibility, the belief of the other side, is an essential step for the other side to listen to the other step in your message – the value to them. Of course a pre-requisite to both of these steps is clarity of your communication. Thus, we can say that truly effective persuasive communication has three main attributes. It must be:

  1. Understood
  2. Believed
  3. Valued

Let’s look at these three qualities more closely:

  1. Communication that is clear has a message that is understood.
  2. Communication that is credible is believed.
  3. Communication that conveys an awareness of your counterpart’s business and needs is valued. It shows the benefit of what you do for them.

People don’t make decisions because they understand or believe what you are saying. While these first two attributes are critical, the main reason someone decides in your favor is the value you provide to them. Dealing with you makes them “better,” however “better” is defined by them or their business. Your value argument will usually have more impact if you can quantify “better.”

The following chart shows the communication and negotiation process the K & R way.

This is the K&R Leverage Cycle!

Consider the following negotiations example:

M4 Software had a poor relationship with the Sentinel Account. The problem involved $4 million in previously purchased software that Sentinel had not yet installed. This “shelfware” had seriously strained the relationship. M4 appointed a new account manager to sell additional solutions to Sentinel but she was unsuccessful. M4 had a credibility problem, and no matter how valuable the new solution was, Sentinel would not listen. How did the M4 team deal with the trust issue? They used effective communication. They asked lots and lots of questions; they listened carefully. Sure enough, they uncovered the real problem.

The M4 team found an education gap. Sentinel had so much shelfware because they did not know how to use what they had already purchased. M4 solved the problem by educating the people at Sentinel. In this situation, M4 elected to absorb training costs to help the customer use the software they had already purchased. Credibility and trust were regained and a relationship was reestablished. Shortly after, M4 closed a sizable new contract with Sentinel.

The M4 team found an education gap. Sentinel had so much shelfware because they did not know how to use what they had already purchased. M4 solved the problem by educating the people at Sentinel. In this situation, M4 elected to absorb training costs to help the customer use the software they had already purchased. Credibility and trust were regained and a relationship was reestablished. Shortly after, M4 closed a sizable new contract with Sentinel.

Read More: