Making Credibility Your Strongest Asset

Dealmakers often forget the power of a good reputation. In this article from Negotiation, HBS professor Michael Wheeler tells why having a storehouse of credibility will put you head and shoulders above the competition.

Negotiation is a breeze if you’re selling a unique product or service that others desperately need: Just sit back and let the bidding begin. Likewise, if you’re a buyer in a buyer’s market, getting a bargain is a snap.

But what happens when lots of other people are selling what you’ve got, or many others are bidding for what you want? One solution to distinguishing yourself in competitive environments is to build your bargaining endowment—storing up credibility and resources by developing relationships, burnishing your reputation, and controlling key assets.

When you’re trying to prevail amid fierce business competition, your bargaining endowment can spell the difference between closing the deal and being shut out. A healthy bargaining endowment explains how Darren Rovell won a job on national television while other journalism graduates were lucky to be doing programs on cable access. It’s also how Tony Lucci got box seats for the World Series when thousands of others were shut out. And it explains how Bob Kraft positioned himself to buy a professional football team.

Although Rovell, Lucci, and Kraft operated in very different contexts, they all met their goals by enhancing their own credibility and discerning the interests of other key players. Their three stories illustrate different elements of the process of building your bargaining endowment: (1) grab someone’s coattails, (2) foster a reputation for generosity, and (3) plan several moves ahead.

by Michael Wheeler

Full Story: http://hbswk.hbs.edu/item.jhtml?id=5104&t=negotiation&iss=y