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What is a Black Swan in negotiation? What kind of information does it contain?
A Black Swan in negotiation is some hidden piece of information that, if it were known, would completely transform the dynamic of the negotiation and the final outcome. Finding the Black Swan is the last piece of the puzzle to succeed in a negotiation.
Keep reading to learn how to find a Black Swan in every negotiation.
Types of Information in Every Negotiation
There are three types of information. There are known knowns. This is what we know for sure. Things like your counterpart’s name, their offer, and your experience from past negotiations are known knowns. Unfortunately, you can be tunnel-visioned by them and wrongly assume that this is the only kind of information.
Then, there are known unknowns. This is information that we know exists but that we don’t possess ourselves. In a poker game, for example, you know that there are wild cards: you just don’t know who has them.
Negotiation Black Swan: The Last Piece of the Puzzle
Lastly, there are unknown unknowns. This is the information that we lack— and don’t know that we lack. These are Black Swans.
Your counterpart might not know how important their Black Swan is. Your task is to uncover it by asking the right questions. In a negotiation, those who can best identify and exploit the unknown unknowns come out on top.
(Shortform example: let’s say you were looking to buy a house from someone. If, in the course of your negotiation with the seller, you discovered that they were facing some sort of external financial pressures (from a lawsuit or a job loss), you would have great leverage over them. This information would tell you that your counterpart was a highly motivated seller who would likely accept a heavily discounted offer from you. This is a Black Swan: something you didn’t know before, didn’t know that you didn’t know, and that completely reshapes the negotiating environment.)
Finding the Black Swan in a Negotiation
So how do you find the Black Swan in every negotiation?
- Get face-time to pick up verbal and body language cues. You miss too much with impersonal media like email. You won’t hear their tone of voice, and you won’t see the unplanned, non-verbal signals that they might be sending you. Remember the 7-38-55 Rule. If you’re just getting the words, you’re only getting 7 percent of the message. Likewise, email gives your counterpart too much time to rehearse their responses and stall for time. You’ll miss the little, unguarded, spontaneous moments that can tell you so much.
- Pay attention to the unguarded moments. The first few minutes of a meeting and the last few present particularly rich opportunities for information-gathering. Look for interruptions, odd exchanges, and signs of division between team members if you’re dealing with a group.
- Exploit the Similarity Principle. Look for what you have in common. Build a rapport with your counterpart and create a conversational, even confidential atmosphere. By doing this, you take your counterpart out of their “negotiation” mindset. They don’t think that they’re negotiating with an adversary, they think they’re just having a conversation with a like-minded and empathetic individual. In doing so, they’ll start to reveal key bits of valuable information to you that they otherwise wouldn’t. They’ll be more comfortable with you and more willing to divulge information to you if they think you share an affinity.
Speaking Your Counterpart’s Language
Black Swans give you key insight into how your counterpart sees the world. Once you know this, you’ve cracked the code: you can speak to them fluently in a language they understand.
You access their hidden area, their deeper desires. This gives you great insight into their behavior and will enable you to predict what they’ll do next. When you don’t understand your counterpart’s behavior, avoid the trap of thinking that they’re “crazy.” They have a different worldview and their actions most likely make sense to them in the context of that worldview.
Think back to the earlier example of the Filipino terrorist and kidnapper Abu Sabaya.To outside observers, his actions were insane, reckless, and morally indefensible. But they made perfect sense to Sabaya: in his worldview, he was a freedom fighter for the Muslim minority, fighting the good fight against powerful oppressors. Any action would defensible in order to combat the evil forces that Sabaya believed he was up against. Still, the hostage negotiators needed to become fully immersed in Sabaya’s understanding of the world, as irrational and morally repugnant as it may have seemed to them. It was the only way they would be able to have any kind of dialogue with him.
What looks like crazy behavior by your counterpart may really be rational, because:
- They have bad or incomplete information.
- They face external constraints that prevent them from making a deal and are too embarrassed to admit it.
- They have other wants, needs, incentives, agendas.
Finding Negotiation Black Swan: Example 1
In 1981, an armed man named William Griffin took hostages at a Rochester bank. Police expected it to be a straightforward hostage negotiation where nobody ended up getting killed. Based on prior experience, this was the most likely outcome. However, Griffin shocked police and onlookers by executing one of his hostages whom he had instructed to walk out of the bank’s front doors. Griffin then proceeded to calmly walk out of the bank, where he was immediately killed by police sniper fire.
This baffled police and the FBI. Why would anyone kill a hostage? A kidnapper needs hostages, otherwise they don’t have any leverage. The whole point is to threaten to harm them.
But in this case, the authorities made the tragic mistake of not understanding Griffin’s real motivations. Griffin wasn’t after money, or recognition, nor was he pursuing some sort of political agenda. His real motivation was to die: and he knew that executing a hostage would provoke the police into shooting him (the case was one of the first of what’s now called suicide-by-cop).
The tragic killing of the hostage happened because the authorities failed to recognize Griffin’s true wants, needs, and incentives. This was a classic Black Swan: something that the authorities didn’t know, didn’t even consider (because it had never happened before), and would have completely changed their response had they known it.
Finding Negotiation Black Swan: Example 2
The story of Dwight Watson presents the opposite case. This was an instance where the authorities successfully identified a Black Swan and used it to de-escalate what could have been a dangerous situation.
In 2003, a North Carolina tobacco farmer named Dwight Watson drove a tractor full of (what he claimed were) explosives to Washington, D.C. He said he was doing this to bring attention to the economic woes of the country’s tobacco farmers and to protest what he believed to be the government’s complicity in the farmers’ plight.
In their discussions with him, the FBI learned that he was a devout Christian. They discovered this through close observation and analysis of references Watson made as he was speaking to the negotiators. This Black Swan gave the authorities valuable insight into Watson’s state of mind, his motivations, and how to craft appeals to his religious ideals that would let him surrender without losing face.
One of the days during this standoff happened to be the Dawn of the Third Day, when Christians believe that Jesus rose up out of the tomb and ascended to heaven. The FBI used the Black Swan of Watson’s devout Christianity to speak to him in his native language. They said, “If Jesus could come out on this day, so can you.” He surrendered immediately after.
This worked because the authorities put in the hard work to gain a holistic understanding of Watson’s view of the world. They were thorough: double-checking, comparing notes, and using back-up listeners. Above all, they were willing to listen.
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Here's what you'll find in our full Never Split the Difference summary :
- Lessons learned from years as an FBI hostage negotiator
- Why negotiation is about emotional appeals, not rational ones
- The 5 methods for tactical empathy, which gets you what you want by focusing on the other person's feelings