How CEOs negotiate – with a hug

Today’s Wall Street Journal had a thought-provoking article about “How Steve Ballmer Became a Rookie Basketball Mogul” in which we learn that even CEOs get nervous when they are preparing to meet NBA superstar players for dinner. (And they binge-watch to relieve stress just like the rest of us.)

More interesting is how he negotiated the purchase of the Los Angeles Clippers from Shelly Sterling after her odious estranged husband was forced to sell the team. Rather than have his people call her people, he arranged for mutual friend and former Walt Disney CEO Michael Eisner to call Ms. Sterling to vouch for him. During their meeting a couple of days later, Ballmer dropped his prepared pitch and instead focused on reassuring Sterling that he wouldn’t move the team to Seattle and that he was committed to seeing the Clippers win a championship. Ballmer knew that this negotiation was between two people, not two faceless corporations. He was competing against Oprah Winfrey, David Geffen and Larry Ellison, so clearly Shelly Sterling’s decision would come down to more than just money.

And the best part of the story is how he handled Ms. Sterling’s counterproposal to his $1.75 billion offer for the team. She raised the price to $2 billion, and asked for courtside seats, parking spaces and the title of “owner emeritus.” Mr. Ballmer agreed and threw in the title of “Clippers #1 Fan.” This man is brilliant. He understood what the other party wanted and valued, and he knew how important it was to respect, address and meet the other party’s underlying concerns. And when they signed the deal, Steve Ballmer and Shelly Sterling hugged.

You may not actually hug the person you’re negotiating with, but can you find where you can add a “Clippers #1 Fan” title?

Leave a Reply