This a summary of the article What HBO’s “Succession” Can Teach Us About Negotiating by Francesca Gino for HBR.
One of the most watched TV series of the decade, Succession, features a competition between the owner of a global media conglomerate Logan Roy and his children in the opener of season four. Here is a brief explanation of how to negotiate, based on the plot of the episode.
Logan is negotiating for digital media company Gojo to acquire his company Waystar. He wants to acquire Pierce Global Media, his long-living ambition. His own children, however, rise up to oppose him to get the PGM in exchange for their stakes in Waystar.
Logan Roy feels confident after his advisors telling him he is a most possible winner, although there are other bidders, and replaces the “soft” $7 billion he floated earlier with a $6 billion offer. Overconfidence can lead negotiators to final loss. Firstly, the counterparty can feel offended, and an unreasonably low bid has a very big possibility to insult them. Secondly, overconfident negotiators can be much too aggressive and oppressive. This is bad for the network and personal image, as well as the company's reputation. Aggressively low bids have to be justified in order to keep the connection and relationship.
When Roy’s children arrive to make a proposal to Nan Pierce, the PGM owner, she tells them that she had already got a solid proposal and they were very unlikely to win the negotiations. This way, she implied that Kendall, Roman and Shiv had to do their best to oppose Roy.
Framing is a tool used in negotiations that can increase the attractiveness of the proposal. It basically emphasizes the benefits and minimizes or hides disadvantages. It is used by customers as well as sellers.
After the Roy’s children telling Nan they are in, she answers: “I feel like I’m in a bidding war. Eight, nine, what’s next?” No one has mentioned those numbers, but she gives them an anchor and transmits the price she is most likely to agree to. Shiv makes an offer of $8 billion, but then switches to a final bid of $10 billion to decisively beat her father.
Anchors have a very powerful influence on a negotiation process, but their effectiveness depends on the range of the information we have about our counterpart and competitors.
There is a phenomena related directly to emotional arousal during the negotiating process. The counterparts in this state are more likely to make aggressive demands and to become overly defensive. This can escalate conflict instead of reaching the agreement. This leads to another tendency in negotiations: buyers often overbid and overpay. Aggression is as bad as extra enthusiasm.
The format of negotiations shown in the series is extremely dangerous, and the episode shows how fast did the siblings give in to their emotions. To avoid it, they should have negotiated the process of the competition before proposing a bid. For example, they could have asked to agree to a a single-round auction with no “funny” bids (such as bidding a dollar more than what the other bidder offered).
Timeline, the roles of the negotiation team, the responsibility of each party should be negotiated as well. Clean structure is one of the most powerful tools to achieve a good result.