On the job and in our personal lives, solid negotiation strategies are key to our success. Negotiation is both an art and a strategic process that involves building trust and developing relationships, as well as influencing and shaping behaviours that result in mutually satisfying agreements for all.
Negotiating is a process of bargaining by gradually moving from opposing positions to conciliatory positions closer together. Unless both parties move and compromise there is no negotiation. Successful negotiation generally results in a contract. As a manager you will negotiate with other managers, customers, suppliers, employees, and trade unions.
Managers spend a significant proportion of their time negotiating with employees, other managers, customers, employees and trade unions. They thus need to know how to negotiate effectively and successfully. Some of the basic skills of negotiation include planning, knowing your opponent, and exploring options. There are numerous negotiation strategies for different situations.
If you are a poor negotiator, you will spend a fortune.
If you are a good negotiator, you will save a fortune.
If you are a great negotiator, you will make a fortune.
In today’s world we negotiate every day, with kids at home, boss in the office and in the shopping mall as well.
Now let us understand the theory and outcomes of negotiation:
The most difficult negotiation scenario is last one where some people want to make you lose.
The six stages of the negotiation process are:
1- Preparation and planning stage.
2- Building a rapport stage
3- Gathering of information and research phase
4- Bargaining and problem-solving stage
5- Closing and implementing the deal
6- Finalising or nailing down phases
The most important stage is Planning stage where you should know:
1- What’s your bottom line.
2- What’s your best scenario outcome
3- What If it fails
4- Review the time frame
DO NOT SAY IN A NEGOTIATION
1- I don’t agree
2- Should we meet in the Middle?
3- You will regret
4- I make the final call
5- This is my final offer
6- Lets work out the details later
7- Don’t use aggressive or accusatory language
The Principles of Negotiation
1- Everything is Possible
2- Be clear on your negotiation goals
3- Always have a Plan B
4- Play as a Reluctant Party
5- Negotiation is about Give and Take
6- Make the first Offer
7- Be a good listener as innocent
8- Watch out for Nibble
9- Get comfortable with silence and pause
10- Learn when to talk and be silent when required
11- Negotiation is not about defeating opponent
12- Negotiate with the decision maker
13- Keep your head cool
14- Agree on the big picture
15- Person with the greater power will get better deal
Sources of Power in a Negotiation
1- Attitude Power
2- Time Power
3- Information Power
4- Expert Power
5- Commitment Power
6- Strategy Power
7- Alternative Option Power
8- Walk- Away Power
9- Bravery Power
10- Location Power
11- Status Power
12- Popularity Power
13- Brain Power
The Bottom line
The basic skills of negotiation can be recalled by the acronym POCKET.
2- OPENING POSITION
4- KNOW OPPONENT
5- EXPLORE OPTIONS
There are numerous negotiating strategies that you can use in different situations. These are salami, limited authority, withdrawal, pretence, deadlines, good guy-bad guy, standard contract and fait accompli. Persuasion skills will help you get others to do what you want. Some of these include creating good relationships, making concessions, and summarising what has been agreed to date. A cooperative collaborative style is recommended.
Support your case by relying on precedent, quoting an impartial eminent source, or claiming that it has been conceded to others in the past in similar circumstances. The possible outcomes of negotiation are win-win, win-lose, compromise and failure to reach an agreement. The types of negotiating situations can be one-to-one and team based. There are many mistakes to avoid when negotiating including poor preparation and failure to compromise.
Source: HBR /Michael Yardney //Psychology/ Brian Tracy /Sameul Malone
Izhar Khan – Author is the FCA- CA ANZ, Business Consultant & Certified Marshall Goldsmith Executive Coach based in Melbourne Australia associated with ABN Finsights Academy & Business Consultancy Firm as a CEO & Founder having more than 25 years’ corporate experience including Blue Chip MNCs like 3M and Stanley Black & Decker& Ernst &Young globally.
Disclaimer: The contents of this article is for information only and is not offered as advice. Readers are encouraged to consult a suitably qualified professional adviser to obtain advice tailored to their specific requirements.