How to Negotiate Like Bill Gates

Don't let your anxiety incite uncontrolled emotions at the bargaining table.

Entering a negotiation is a journey into the unknown--you have no idea how it will turn out. The uncertainty of bargaining can make even the most seasoned negotiator nervous. But you don't have to let the tension control your thoughts and actions.

In his research, Michael Wheeler, the author of The Art of Negotiation: How to Improvise Agreement in a Chaotic World, found a tremendous amount of tension among the parties at the bargaining table.

"Every person we interviewed expressed some degree of anxiety about negotiation," Wheeler writes in Harvard Business Review. "With a few subjects, it was only a minor concern, but with most it was the dominant emotion."

Wheeler explains that the "unpredictability of the process," worries about the other party's intentions, and self-doubt all contribute to anxiety.

"Such feelings hamper effective negotiation," he writes. "If anxiety isn't properly managed, it can make you defensive--and lots of other bad things will follow. You may be reluctant to reveal your interests, for example, fearful of being exploited. And if you're wary of others, you may be too quick to interpret an innocent question as a ploy. Most important, if you are tense and closed yourself, others may misread your defensiveness as hostility and prompt them to be defensive themselves. Tensions may escalate as a result."

Wheeler says being successful in a negotiation is not about repressing your emotions--you need to be passionate--but it does require maintaining poise. "Instead of ignoring these important feelings, you have to be aware of them and not let them take over," he writes. As an example of how to conduct yourself, he points to Bill Gates. Read below for details on the Microsoft co-founder's effective negotiating techniques.

Listen, then give your perspective.

Gates is known for his negotiation skills, which years ago he showed off during a tense encounter with Apple founder Steve Jobs. Just before launching Windows, Jobs and Gates were butting heads, according to Jobs's biographer Walter Isaacson. Jobs claimed Windows was a copy of Apple's operating system. The wrinkle, though, was that Apple had "liberally borrowed" programming from Xerox.

The two founders needed to come to an understanding about the provenance of their competing operating systems. Isaacson wrote that Gates went to Apple's headquarters and Jobs lambasted him in front of Apple executives. In one of his infamous emotional outbursts, Jobs yelled, "You're ripping us off. I trusted you, and now you're stealing from us!"

That's when Gates grabbed the upper hand, Wheeler notes. Instead of screaming back at Jobs, Gates gave his perspective in a tranquil manner: "I think it's more like we both had this rich neighbor named Xerox, and I broke into his house to steal the TV set and found out you had already stolen it," he said.

Gates tapped into a key tenet of emotional intelligence: He stayed poised in a high-pressure situation. His calm demeanor helped to placate Jobs, and the two men hashed things out.

Be 'less emotional.'

Looking back years later, Gates said he is successful in negotiations when the other party is emotional because he is "kind of less emotional." The fact that Gates said he is less emotional rather than unemotional reveals an important distinction. "He obviously knows that feelings are important when dealing with other people, especially in a negotiation," Wheeler writes.

"The heart of [emotional intelligence] is self-awareness, the capacity to sense the first stirrings of anger or anxiety," Wheeler writes. "That awareness, in turn, must be coupled with an understanding of what kindled that particular response. Depending on the situation, it might be something that another person has said or done. But if we dig deep enough, we sometimes see that our own attitudes are the real source of our visceral response."

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