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Fazal Majid

This is called the "tit for tat" strategy in game theory. It only works if there is repeat business or a long-term relationship. Not everyone cares about the long-term, unfortunately.

robertinseattle

Finally catching up on some of your older posts, Andy. I learned a lot about negotiating many years ago when one of my companies did a deal with a Japanese multinational in the 80's. Being Chinese myself, I focused my team on understanding Japanese culture and business so that we'd have better understanding in our discussions.

The best lesson we learned had to do with the importance of saving face. In other words, wiggle room. And not just for your side but for the other guys as well. Back the other guys into a corner with no room to save face and your deal goes down the drain. Too often, our approach in Western business is that John Wayne win-at-all-costs-take-no-prisoners mentality and it results in that win-lose taste that can linger long after the contract is signed.

A wise VC (yes, there are a few) once told me, "A perfect deal is when the two parties walk out with a deal and they're both a little unhappy."

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