Negotiating Tips - Seven Basic Steps Before You Negotiate
Negotiation is far more than simply sitting at the table and exchanging proposals. It is the process of working through various phases while you learn enough about the other person or team to be able to engage the other person in a dialogue that makes the other person want or need to work with you. Remember, negotiating is about your getting the other person to do something that you want done. The other person has to eventually be motivated to act. Negotiation is the process of establishing that motivation.
The seven basic steps leading up to any negotiation include:
1. Identification of the problem. It is essential to establish what the issue is before you try to resolve it. Often arguments occur because you and the other person are discussing different issues or the crossover relationship is not apparent to one of you.
2. Researching the issues. Knowing what the issue is allows you to do the basic research into why you are in disagreement and how important the issue is to you.
3. Selecting the participants. Both you and the other person are entitled to add or object to a potential participant in any negotiation. How the two sides populate their teams usually will have an impact on the outcome. Among other things you should try to keep people out of the negotiation who tend to inflame the situation.
4. Researching the participants. Once you and the other person have established the people to be involved in the discussion/negotiation you need to assess who The other person has on his or her team, why they were added and what position they are likely to advocate. The other person's selection of co-negotiators will indicate the areas he feels are important to his position or the areas he feels he lacks expertise.
5. Preparing for the negotiation. Before you actually start any negotiation take a few moments or a few weeks, depending on the importance and complexity of the negotiation, to prepare for the negotiation session.
a. Separate facts from assumptions. Understand what you know about the situation and what you assume to be true.
b. Validate your facts. Sometimes facts change. Make sure your information is current. If you can't do this, consider the unverified facts to be assumptions.
c. Validate your assumptions. Assumptions should be validated by third party confirmation or simply asking the other person if they are valid.
d. Test your assumptions. Assumptions that can't be validated need to be tested or discarded. Erroneous assumptions can impair an otherwise sound negotiating strategy. Don't set yourself up for failure relying on an invalidated assumption because you like it or it helps your case.
e. Adjust your strategies. Using the newly acquired information, make sure your initial strategies, objectives and goals are still appropriate. The new information can often change strategies and on occasion can obviate the disagreement altogether.
6. Meeting the Participants. When the participants first get together to start the negotiation there is usually a short period of time when people meet each other and get settled. This is an excellent period during which you should take the measure of everyone about to take a seat at the table. Observe who are comfortable and who appear uneasy. Participate in casual conversations to determine the interests and backgrounds of the other person's co-negotiators. Make sure your advocates are comfortable and ready.
7. Establishing the parameters of the situation. Once seated at the table it is helpful to make sure everyone is aware of the issues to be discussed and uncover any new issue that needs to be addressed. If new information is provided or the issues changed feel free to take a break to reflect or regroup with your team if necessary.
You are now ready to enter into the negotiation. This is most typically done by asking or soliciting an initial offer. The early stage of any negotiation should be used to establish the parameters of the situation. That is, the bid/ask disparity between you and the other person.
Each step deserves to be mentally considered before it is undertaken. A negotiator should prepare, plan, and execute on the sub-task or individual step level to maximize the potential from the process. The skill is in the preparation and the art is in the execution. Obviously more complex negotiations will have added steps and a more detailed approach but even simple negotiations can be better resolved if these steps are fleetingly considered before you enter the fray with the other person.
How to Negotiate a Salary for a New Job
Asking a boss for a raise is typically very stressful. It need not be. Asking a potential boss for a salary higher than he or she is offering can be even more trying if you really need that job. Winning a negotiation over a starting salary does not mean the loser must feel that he or she has lost. The art in negotiating is the creation of mutual value. The true objective is an agreement in which both parties have a vested interest.
Here's how to negotiate a salary for a new job like a pro.
Establish the Offer Parameters
Once compensation discussions start the first thing to do is to see what the company is offering in terms of salary, benefits and other compensation. This will give you a complete picture of the potential offer. If there are additional items you expected to see in an offer package you can always ask if they were overlooked. At this point you are just compiling data. Depending on the job, the information may be provided as a range. One thing you should do is ask for the company's compensation range for the specific position. This will tell you a little about their flexibility in the offer and your upside income potential if you are hired.
Conflict is Not Part of a Negotiation for a Salary for a New Job.
Conflict occurs when two or more people compete over a commodity. This can be anything. Land, money, a woman, a man, the baseball bat or the last piece of cake are all commodities likely to cause conflict. But a salary negotiation for a new job is not a fight over a commodity. The company is looking to minimize its expense in the hire. You are looking to maximize your potential in taking a job. What you have to offer is time, talent and potential. They offer income, benefits and future potential. At this point both parties have agreed on the ultimate outcome provided the salary negotiations can be resolved. That is a significant aspect of any negotiation. Both parties now want the same thing!
Change the Negotiating Environment Strategically
Knowing at this point that you both want the same end result, you can relax and seek ways to make the other person more comfortable with the process, with you and with his or her decision to hire you. Instead of an antagonistic environment you want the discussions to become mutually supportive and respectful. Make an effort to recognize the pressures the company faces n its hiring practices and seek ways to assuage such impact my reselling your credentials or capacity to handle more than the specific job description. Suggest that they are hiring not only someone to do the job in question but to grow with the company and take on far great responsibilities. You are their investment in the future. This shift in mood exudes confidence on your part and may make your salary requests more palatable.
Establish Your Value
Job applicants are readily available. If you have made it to the stage where you are discussing salary you are doing very well. Now is the time when you slow down, take a few moments to resell your unique assets for the company. Note that I said the company and not just the job. Sure you can do the job. That is why you are talking salary. But you have more to offer. You are looking for a future with the company. Once they have trained you, you will be a valuable asset they won't want to lose. Your addressing why you are seeking a position with this particular company for long term reasons will enhance your potential value to them and improve your ability to seek a higher salary or more benefits.
Be Creative When Structuring a Compensation Package
Salary is important but it is only one portion of a compensation package. Seek benefits that are meaningful to you such as medical coverage, dental coverage, 401k matching contributions, stock option, a company car, and / or a company mobile phone. All these items add value to you and also become leverage when you go to another company. At that time you can indicate the total package you are getting and require it be improved upon to get your attention.
Be Patient When Negotiating
This is an important negotiation. You job will consume at least 30% of your waking hours. You need to like the job and you need to feel adequately compensated for doing it. That means at the onset you should be patient and make sure you do the best possible job getting the right package for you. That includes an opportunity for advancement either with our without the company. It is your career and each step should be carefully planned and executed.
Group Dynamics in Negotiations
People seldom act alone. Everyone has a group of associates or family members that need to be at the least informed of important decisions before a commitment is made. More often, prior approval is needed. This approval may be from a family member to keep the peace at home or from a corporate superior or oversight committee having the actual authority to bind the company.
When the group is involved in the negotiation process becomes much more challenging. The group has its own structure and objectives. Individual members of the group will typically have differing personal objectives and opinions. The negotiators challenge is to decipher the leaders in the group and the protagonists. Each will have to be dealt with to achieve an agreement that will survive the test of time.
The best way to find the decision makers or leaders within an opposing group is to discuss various aspects of the situation. Listening to each member's dialogue, content and, equally import, to whom they address their remarks no verbally. Look for glances or a change in their sitting position as an indication that they are watching how someone in their own group is reacting to their remarks. This differential habit will reveal where they stand on their team.
It is important to 'hear' the content and observe the delivery. A CFO can speak in deference to his CEO but the message can carry the import of the Board of Directors. Conversely, others speak to be heard and recognized by those in power. Differentiating those who want power and those who enjoy it will improve your ability to target the right person with whom to forge a consensus.
Group negotiations are most challenged when there are opposing views and power factions within the group. As an outsider and the 'opposition' it helps to ferret out such discord to decide if the group can reach an accord or if you are wasting your time and theirs.
When you run into a fractured opposing group dynamic you may be able to divide and conquer. But such power tactics have their limits:
• Pushing the primary negotiator to make a commitment contrary to the rest of his team may be successful during the meeting but fall apart as soon as the meeting ends and his or her associates speak up in private.
• Pressing too soon may cause the other team to postpone making any decision until they can agree among themselves thereby costing you the benefit of their fractionalization.
• Choosing the wrong negotiator to whom to play may back fire when the real power on the team emerges in opposition to the way you have lead the discussion.
The best advice when facing a dysfunctional team of negotiators is to go slow, increase your awareness of non-verbal signals and verbal intonations, and pace yourself not to be overcome by the varied and oblique affronts frequently used in group negotiations, and keep the discussion focused on where you want it to go. Don't let it become distracted or fragmented by allowing everyone on the other side to derail the process by talking just to be heard.
Strong negotiators must also be strong leaders. Controlling the content of the meeting and the direction of the discussion comes from the deft application of informal leadership skills. Sharpen these skills and you will improve your negotiating results.
The Power of Persuasion
If you want to win a negotiation you must expect to win. Attitude counts! Like any sport or other competitive venue, attitude has a direct bearing on the outcome of a negotiation.
Each negotiation, no matter how insignificant, by definition is based in conflict. The people involved are each competing to protect their respective rights by depriving another of his or her expectations. It is a negotiation over conflicting interests.
The secret of winning lies in the passion one brings to the event. If you are convinced that you are right, if you think you deserve to win, if you know that you are in the right, then your passion will color each argument, strengthen each statement, and lead you to victory. If you have doubts, you will be less than effective. Get rid of your doubts before getting involved.
Positive Attitude Tips:
Plan to win. When you are considering strategies and tactics before a meeting envision using each tactic and prevailing with it. This mental exercise sets in your mind the feeling or the gestalt of deploying the strategy or tactic successfully. When the time comes to actually use it, your actions will be more natural and more effective.
Expect to win. When setting your objectives and goal, test them against what you know to be reality. If they are reasonable expectations, visualize achieving the objective. Do this repeatedly to set the image in your mind that the objective and goal is achieved. Don’t focus on the process of achieving it during this mental exercise but on actually achieving it. This is a form of programming yourself to not only want the objective but feel entitled to it. You are aligning your inner being to expecting to walk in and win. You are empowering yourself to prevail.
Act like a winner. When you enter a room, stand tall, make direct eye contact, offer a firm handshake, and be confident in why you are there. Take the time to get comfortable at the table, lay out material you may need, then settle back, ready to begin. Your statements should be brief, pithy and authoritative. Concise, targeted proposals convey clarity of purpose and conviction on your part. As you deliver them, assume they will be accepted. The power of a positive delivery is immeasurable. If the other person has doubts about their position, it may show in their reaction. Be alert for signs of their doubt. If they question you proposal, ask them why. Never accept on face value an objection. If you are confident of your position, the other person should be placed on the defensive unless they can prove you wrong.
The power of persuasion is based in your personal conviction of being right and entitled to prevail.
Learn to Communicate
Babies Must Forget to Communicate
Gorillas beat their chests and roar to establish their supremacy in the jungle. This simple approach to communicating can be very daunting if you happen to be cornered at the time!
For millions of sleep-deprived mothers around the world, the findings of a mom from Australia with a special gift could be a miracle! Priscilla Dunstan says she's unlocked the secret language of babies. When Priscilla was a toddler, her parents discovered she had a photographic memory for sound. At age 4, she could hear a Mozart concert on the piano and play it back note for note.
Priscilla says "Other people might hear a note but I sort of get the whole symphony," She goes on saying. "So when someone's speaking, I get all this information that other people might not pick up." That mysterious second language took on an astounding new meaning when Priscilla became a mother to her baby, Tom. "Because of my gift for sound, I was able to pick out certain patterns in his cries and then remember what those patterns were later on when he cried again," Priscilla says. "I realized that other babies were saying the same words."
After testing her baby language theory on more than 1,000 infants around the world, Priscilla says there are five words that all babies old utter regardless of race and culture. These are Neh="I'm hungry", Owh="I'm sleepy". Heh="I'm experiencing discomfort", Eair="I have lower gas", and Eh="I need to burp".
Evidently all babies have the same basic 'vocabulary' at birth. When parents don't respond to those reflexes, the baby learns to stop using them. When parents don't respond they must learn how to make their needs understood.
What are these babies doing? They are learning how to negotiate. The first rule of negotiation is that one must be able to -communicate and hear the wants and needs of the situation.
When we enter into a negotiation, any negotiation, we need to communicate. We need to learn how to do this in that specific situation. Each situation, because there are different personalities and issues involved, present differing communication challenges.
In a family dispute yelling or screaming is very likely going to block effective communications rather than make your point. The best way to resolve an emotionally charged discussion is to learn how to diffuse anger to allow both sides to be heard and to try work out their difficulties.
In the business environment negotiators who are demanding and use aggressive tactics often win small skirmishes but lose battles when the other person walks away from the table or declines to negotiate further. They may also miss opportunities to build the relationships that may later have been the bridge necessary to succeed.
Parents, struggling to communicate with their teenaged son will find that a ratio of calm logic may be far more effective that harsh criticism and grounding for sneaking out at night. Even though he is grounded there is little to do once you are asleep and he has your car keys. Rebellion is a strategy to test limits. By having their teenagers balance responsibility and performance in setting their own limits parents will fare far better than trying to enforce an autocratic approach.
By shutting down communication one loses the opportunity to learn from the exchange. As long as you possess absolute power this may work for you, Beware, typically power is fleeting and revenge is sweet!
How does one learn to communicate in a given situation? Much like the babies discussed above, we need to listen and observe the reactions to what we are saying. Verbal, non-verbal, overt, discreet responses need to be studiously considered during initial conversations the lead up to the actual negotiation so that you are prepared to understand what the other person is trying to say. Style, mannerisms, dialect, diction, education, background, knowledge, expertise are all exposed when one speaks. The question is if you are able to 'hear' the subtle messages that are being sent and aware that they will help you to learn how best to communicate with the individual once the discussion becomes serious and focused.
Negotiating is a natural process but by no means is being effect at negotiating easy. It takes hard work and discipline to be more than a casual negotiator. Take the time and make the investment to be come good. The efforts will return huge benefits throughout all aspects of your life.
When bartering with headhunters, make sure you have enough beads and trinkets to stay out of hot water.
When negotiating for services or products or even a repayment schedule don't be afraid to ask hard questions. You have the right and the need to assess the capacity of the other person to honor the terms of any agreement that might be reached.
Doing your due diligence is part of managing the process of negotiations.
Before sitting down to negotiate part of your homework is to research the other party. That research should include conducting formal and informal credit checks. Credit checks can be simple on-line reports reflecting past performance or more informative inquiries of others who have done business with the person in the past. One's reputation as a performer (or not) is typically readily available if you take the time to ask around. Remember, your reputation is also in the public domain. So take care to preserve it.
Credit and Reputation reflect the capacity and inclination of the other person to make good on his or her promises. In every walk of life there are those who try to bluff their way to greatness. They do not realize that if they fail to perform they are hurting the other person. You have the right and responsibility to determine with whom you are dealing and whether it is a person with whom you want to associate, work, or entrust your project or assets.
When finally seated across the table from the other person continue your due diligence of determining his or her capacity to perform. You are merely establishing that it is worth your time to even enter into discussions. Be prepared to be asked for your references or evidence of your ability to perform. Both parties are entitled to know who they are dealing with and that the others performance is viable if an agreement is reached. The more credit you bring to the table, the less risk there is for the other person to enter into an agreement. That lessened risk will often allow them to compromise more during the negotiation.
Don't be afraid that your questions may be considered impolite or intrusive. Credit checks are done daily. When we tender our credit cards or checks to a clerk in a store, they do not simply take our word that we can pay, they access a credit service and verify that we have the money to pay the bill. If someone is willing to be questioned by a total stranger over their ability to buy a steak dinner, surely they should not object to providing a financial statement when buying a million dollar parcel of land or home. If they are, caveat emptor or seller beware!
The Currency of Negotiations
Having a good supply of beads and mirrors is wise if you are venturing into the jungle. That is unless you don't mind staying to be dinner.
Negotiation is about currency. Currency can be far more than the money involved in a discussion. Understanding the currency of a negotiation is essential in knowing how best to negotiate the situation. Currency differs depending on the situation. Always identify and consider alternate or ancillary currencies in a negotiation.
Examples of alternate or ancillary currencies might be:
In All Situations:
- Time: To everyone time is important. A negotiation takes time. Time away from other activities. Second to money, time may be the next most important currency in a negotiation.
- Ego: From birth we have been taught that to win is good; to lose is bad. While everyone can't always win, no one likes to lose. If you can make the other person feel like a winner, his actual monetary loss might be come acceptable.
- Opportunity: There are only so many hours in the day. Other opportunities will always be pressing. Future opportunities, however, may become part of the currency of the current transaction if presented as potential benefits of working something out. This adds value to the terms for the other party and can make the difference between acceptance and rejection of your offer.
In Business Settings:
- Missed Opportunities by Meeting: Everyone is pressed for time in corporate life. Going to one meeting usually is at the cost of attending another. Both parties at a meeting have already made an investment of precious time. They have also foregone another opportunity to attend. You can strengthen the other person's impression of your sincerity in meeting and trying to work things out by revealing what you have given up to attend this meeting.
- Recognition: Everyone needs to be recognized. If you make it a point to acknowledge the other person's contribution to the process, to the outcome, you are providing an inexpensive incentive for the person to continue on and try to reach an accord.
- Power: Powerful people to be reminded that they are powerful. By seeming to acquiesce to a powerful person can often extract concessions other lose at a small cost, some of your ego. Effective negotiators understand their goals and objectives and strategically give up some personal satisfaction to make a deal work or to cement an agreement that is marginally acceptable to the other person.
- Prestige: If the arena within which you are negotiating has a special intrinsic value to those able to participate, use that attribute as collateral to be involved. Some tasks have great PR value in the corporate or public arenas. Don't miss the opportunity to parlay ancillary benefits of a deal into tangible returns.
- Advancement: To many corporate negotiators success brings advancement. When casually discussing each other's background seek to find out if this particular discussion has special meaning to the other person. It may be that a successful session is as important as the primary terms to the other person. If you know this, you can extract value on other fronts in exchange for reaching a final agreement.
In Personal Relationships:
- Love: This currency in a relationship should not be put on the table cavalierly. It is the basis for the couple being together. Threaten the love in a relationship may destroy it.
- Respect: While sex is important, respect trumps sex every time. Men, women, parents, children all deserve and require the respect of those they love. It is a powerful currency in a conflict.
- Affection: This is far different than sex and can be just as powerful. Either the man or woman can use affection to shape behavior.
- Sex: Women have used this commodity since the first bite of the apple.
- Privileges/Responsibility: Children are eager to gain freedom and personal responsibility. These are valuable commodities the parents hand out in exchange for good behavior, specific performance (grades or chores), or as other rewards for the desired responses.
Opening the discussion up to these alternate or ancillary currencies gives the everyone involved the chance to come together on a myriad of terms rather than focusing on one point of disagreement. This makes the primary term less important and may convert a troubled situation into a mutually beneficial accord.
Ancillary currencies may seem to have little or no value to you but may be vitally important to the other person. Converting idle currencies in to valued commodities in a transaction is how negotiators create value. mediators are adept at bringing out the importance of public apologies, admissions of guilt, and mere recognition of another person's situation as a means of diminishing the importance of the primary matter being mediated. The process of mediation is based on the very human process of interaction. Typically the parties to a mediation have squared off and stopped communicating a long time before the mediation. The mediator brings them together and forces communication. This, in and of itself, facilitates the ultimate resolution.
By incorporating ancillary currencies, you will increase the opportunity to craft an agreement that yields a greater return on your investment than merely bartering dollars. Often it enables you to extract value from the other person for something that you intended to provide anyway.
What is Negotiating
When to Accept an Offer
Six Basic Negotiating Tips
What to Avoid When Negotiating
How We Negotiate
The Difference Between Bartering and Negotiating
Learn to Communicate
The Art of Persuasion
Ten Persuasion Techniques
How to Negotiate
Brainstorming as Part of the Negotiation Process
Man's ability to dream, to think beyond the obvious sets him apart from the animal kingdom. This unique characteristic has resulted in bows, arrows, slings, knives, spears, black powder, guns, bombs, nuclear warheads and other tools needed to advance civilization!
Brainstorming how to solve a challenge is the crux of advanced negotiations. Until the parties at the table begin to work together to resolve their issues the confrontation is merely a brawl or barter. It does not create value.
Negotiations should yield incremental value in that both parties should be able to leave the table thinking they gained more than the other person.
Brainstorming goes hand and glove with the whole-pie theory of negotiations. Before focusing on the base terms of a negotiation take the time to get as many issues as possible on the table. Expanding the scope of the discussion should reveal areas of agreement that help to offset the compromises that will eventually be required to settle the primary point of dissension.
The globalization of the discussion, the brainstorming to add incremental issues, and the process of reaching ancillary agreements creates the groundwork for the final, major negotiation. The incentives provided to assuage the ancillary needs can help to justify the required concessions on the major issue.
It is the capacity to look beyond the issues at hand to come up with viable solutions that make negotiating an art form rather than mere bartering or brawling. Before you actually sit down to negotiate, seek to uncover the ancillary issues that may have a bearing on the discussions. Brainstorming prior to a negotiation or settlement conference could include:
-Other related or unrelated areas of opportunity to work together.
-Issues related to the specific topic at hand that have yet to be raised.
-Common goals and objectives the parties might have.
-Common acquaintances the parties might have that may add credibility to either's arguments.
-Common challenges the parties may be facing on a micro, macro and global level.
You won't know where the brainstorming might lead. The time it takes to discover related issues typically pays dividends once the final negotiations commence. Be patient. Be diligent. Be thorough. Doing something right makes it worth doing.
Assume and Fail!
The difference between man and beast is that man assumes he is better than the beast. In the wild a man is only a match if he has the right equipment, is well trained, and knows the jungle. A camera on safari is no defense against a charging rhino!
In every dispute resolution one must assume certain things about the other person in order to make progress. As an example, you may be trying to measure when the other person has reached his limit in the discussion before you make your final concession. How you come to this conclusion must be based in part on an assumption on your part.
To assume is to presume or presuppose. Assume also means to imagine. This is dangerous territory in a negotiation. You need to limit your imagination as much as possible by turning to your communication skills and validating your assumptions. But, better still, you need to minimize your assumptions.
Assume less, listen more:
-Identify what you are assuming before a meeting, and when the meeting starts, ask questions to validate your assumptions.
-Seek third party input to validate an assumption. Don't make an assumption about something that can be researched.
-If you don't know, ask. You may be surprised at how open the other person is.
If the assumption is about a significant issue, don't rely on your gut. Investigate, question, brainstorm, network and research until you can assess the approximate accurateness of your assumption. No one said negotiating is easy.
Running into a angry grizzly requires swift, deliberate action. It is often best to aim and shoot rather than think and plan how to react.
Flash Negotiations is a tactic used to quickly resolve an issue. The proper use of this tactic relies on the sixth sense a negotiator gets that a resolution is at hand. This can happen when meeting the other person for the first time. Usually such meetings are tactical opportunities to gather and validate information upon which future strategies are developed. But the experienced negotiator will, on occasion, get a flash opportunity to open resolution discussions while the other person is off guard. Take advantage of these situations to save time and money. Flash Negotiations often yield the best possible deal available.
How does flash negotiating work?
To be able to deploy Flash Negotiations one must be able to draw upon his or her experience reading people, understanding the specific situation, knowing the background facts and understanding what they are prepared to do to make the deal. Armed with a strong base of experience and people skills, an aware negotiator commences the research interview. As the discussion develops, the other person may signal that he or she is receptive to an offer, is caught off guard, wants quick resolution, or is up to speed and prepared to discuss the matter.
Any of these signals presents an opportunity for Flash Negotiations.
If you are prepared to open negotiations, take the initiative and make a low but realistic offer. Tender as low an offer as you think will be received without shutting off the dialogue.
If the other person counters the offer or asks for more information you will know that the opportunity exists for a Flash Negotiation. His counter will set the parameter of the bid / ask and you can typically assume that the negotiation will end up at the median of the bid and ask. In a flash negotiation I often move quickly to that median point and use the swift pace of the negotiation as a reason to acknowledge the other person's professionalism, insight and forthrightness.
If you are ready to deploy Flash Negotiations as a tactic you will typically find that you will secure better terms and save time by doing so. As you have initiated the dialogue, you should be in control of the facts, be better prepared, and have the negotiating advantage while the other person has had little time to assess the situation.
When to use Flash Negotiations:
-When more time benefits the other person.
-When time is critical to your cause.
-When you know what you are willing to spend.
When Flash Negotiations may not be appropriate:
-When you aren't sure what your initial offer should be.
-When you do not know what you are willing to spend.
-When time is critical to the other person.
-When you are not prepared.
-When you do not have the authority to commit to the terms.
Develop the discipline to be alert and ready to deploy Flash Negotiations and you will be more effective as a negotiator or mediator.
Overcoming Barriers to Negotiations
When embarking on a hike in the woods don't expect it to be a walk in the park. Anticipating challenges and obstacles is the best insurance to winning a negotiation. Barriers to a settlement are the reasons negotiating is necessary in human interaction. Without them life really would be walk in the park!
It is not if, but where, barriers exist. I say where rather than when. If you view the negotiation process as a journey, you will find your path littered with obstacles challenging your progress. Seeking each out and resolving them is the only way to make it to the end of your journey.
Understanding that they exist is the first step. Uncovering them is the second. Resolving them is the third.
To better understand where the another person is coming from in a negotiation, take time to get to learn about the person. Visit his or her office. Get a feel for the person's personal life including family, interests and hobbies. Talk with mutual friends. In short, learn what you can before settling into the actual negotiation. Football coaches video the competition and then review the tapes with their players to identify and anticipate likely offensive and defensive barriers they will face. Negotiations should be no different. It is an adversarial sport.
When you are stymied by a barrier, find a way around it. If it is a personal prejudice, you may want to call in a co-negotiator to counter-act the image you represent. If it is a technical matter, you may want to enlist the help of an expert. Your role as a negotiator or mediator is to identify and resolve barriers.
In family situations the barrier can be generational. A father often filters the statements of his thirty-something son as though he was still an adolescent. And the son still looks at his father as a stern, judging parent. Changing this engrained perception is difficult because both are relying on years of first hand observation.
Barriers are the crux of human interaction. Rather than trying to avoid them, embrace them as natural challenges to be overcome. A positive attitude toward resolution is ninety percent of the battle.
Assumptions Lead to Negotiating Pitfalls
Seldom does a lion make a faulty assumption about its prey. They take the time to carefully stalk their prey until they know the time is right to strike. Man, on the other hand, eagerly rushes in only to find he forgot to pack his big-game gun!
Assumptions are at the same time necessary and dangerous. It is not likely you will have all of the information you need to make a decision. So you must fill in the blanks, so to speak. How you do this will determine if you are successful or not in whatever you do.
The best defense against a poor assumption is good preparation. Thorough knowledge of your topic, your goal, your strategies and objectives, your company, yourself, your opponent, his company, and the issues relating to the task at hand is the best way to insure your assumptions are reliable.
Few have the luxury of such preparation in their daily routine. So prepare as much as possible before the meeting and then add to your knowledge by measuring the reactions to your questions and comments. During a casual question and answer session you can refine what you know or think with reasonable accuracy if you listen effectively and watch the person's body language.
The problem with bad assumptions is that they can lead to bad conclusions. During your preparation separate what you know and what you assume to be the case. Then focus your conversation on validating your assumptions. In addition to using the preliminary casual discussion period to build a good working relationship or to create a healthy environment within which to negotiate, do not miss the opportunity to uncover false assumptions.
Negotiators use Agendas, Hidden and Apparent
There are two types of agendas. Those that are public and set the course of a meeting and those that are hidden and guide the actual progress of the session. Uncovering hidden agendas is an important aspect in any negotiation or mediation.
It is the hidden agendas that truly impact how a settlement conference will proceed.
Controlling a meeting is key to controlling a negotiation. Managing the agenda establishes this control. Mediators garner their power as they control what happens, when it happens and where it happens during a settlement conference. They have the ability to call for caucus sessions, quiz both sides, and dictate certain rules. This often gives them the cloak of authority to get the parties to move toward reconciliation.
Hidden agendas, on the other hand, are what skilled negotiators use to manage the process as the informal group leader.
There are likely many hidden agendas at play during any negotiating session. Those of the primary negotiators and those of the other participants in the room. Each person is likely to have a personal agenda that differs slightly from their own teammates. Uncovering and capitalizing on the disparity of these agendas can be useful to a negotiator.
How does one uncover another's hidden agenda? By being a good detective:
1. Ask questions soliciting the other person's needs and wants.
2. Ask follow-up questions designed to cross check previous answers.
3. Seek similar responses from other members of the other negotiating team.
4. Feel free to question the responses.
5. Press to discover why the individual sitting across from you feels that way; as opposed to why his company or client may feel a certain way.
6. Identify if there are personal needs that are in conflict or amplify the stated objectives of the otherside.
7. Seek to discover if the real decision maker is at the table or available to be reached for input or decisions.
8. Gather and digest the responses to create the 'fabric' of the other side's basic needs and stated wants regarding the situation.
9. Observe non-verbal reaction that may indicate responses are less than forthright.
Negotiation is far more than simply sitting at the table and exchanging proposals. It is the art form of learning enough about the other person to be able to engage him or her in a dialogue that makes them want to work with you. Without absolute power, your primary agenda is to uncover enough about the other person to be able to manage the discussion toward satisfying your needs.
A Negotiator Values Good Advice
Advice is cheap. No matter the cost, it can be extremely valuable to a negotiator!
Before sitting down to negotiate anything of substance it is worthwhile to conduct a little research about the person with whom you will be meeting. Seeking the advice of others is part of the due diligence aspect of negotiation preparation. How you handle that advice marks the difference between an impressionable novice and a veteran negotiator.
The negotiator's job is to qualify and verify the advice received. Often information is biased or flawed and can be misleading. Remember, the information passed along has been filtered by the other person and may be biased based on their experience. The task is to validate input garnered from numerous sources. If this information is deemed pertinent to the task at hand, mentally file it away to use when appropriate. If something is learned that is disturbing, seek collaborative input. Never trust a single source even if that person is respected. If they lost a fight or were embarrassed by the outcome, they are more likely to 'bend' reality to their liking than to relay the facts of the situation dispassionately.
Seek out advice by asking peers about their past experiences with the person or company, asking other people who have negotiated with them, or even asking their assistants or co-workers about them. Often one's hobbies reflect on the type of negotiator they are apt to be. A sailor, as contrasted to a power boat owner, is likely to be much more process oriented while the power boater will be focused on the end result.
Solicit input from as many sources as possible and distill it to salient impressions. Then, when actually meeting the other person, during the initial getting-acquainted conversation, observe and validate if the impressions seem to fit.
Train yourself to be observant and reflective to fully develop your negotiating skills.
When to Accept an Offer
Crossing a rushing stream is easier if you take the time to locate the stones creating a path across the stream before wading into the water.
The art of negotiating is most required when you are presented with an offer that is acceptable; but you don't know if it is the best you can do!
When it's time to stop negotiating and accept the terms is an art of timing.
While you do not want to needlessly leave anything on the table, you do not want to over negotiate a point and risk losing the whole transaction. Understanding your business model enables you to know when you have acceptable terms. Knowing the other person enables you to know when you have pushed him as far as possible.
How do you get to 'know' the other person in the time span of a negotiation?
You do it by observing how he or she reacts/responds to various aspects of the negotiation. As you discuss terms, make offers, and react to offers made to you, carefully observe the non-verbal reactions of the other person. These reactions become the benchmarks you will need to evaluate how hard you have pressed them when the final offers and counter offers are being made.
No conversation should be treated as idle conversation. If you are not studiously learning something about the other side you should assume they are learning a lot about you. Learn to mask or vary your reactions, especially the non-verbal reactions, to keep them off balance. Negotiating is in no small part bluffing.
Knowledge Improves Ability as a Negotiator
In negotiations, one's areas of expertise are not only defined by his mastery of the art of the process but his mastery of the issues being negotiated. You cannot expect to negotiate an outstanding real estate transaction unless you are well versed in the economic, cyclical nature, demographic, and geographic aspects of the specific real estate segment you are considering.
Negotiating is not just the process of bartering. It involves creating value from ideas and altering wants and needs to achieve an accord that is compelling enough to get both of the parties to agree. A negotiator cannot achieve this without being well informed of the subject matter.
A mediator, on the other hand, needs a working knowledge of the subject matter but need not be an expert in the field. His or her role is to bring structure to the settlement discussions and help forge a viable solution. Mediators are not creating value for their own accounts. They are seeking to introduce enough avoidance value so the parties can agree to settle for less than they feel they are entitled to in order to avoid the risk of losing more before a judge or jury.
A negotiator's ability stems from his or her knowledge of the collateral being discussed. The ability to negotiate is a hidden asset skilled negotiators possess. Frequently, they hide this attribute by feigning limited experience or lack of knowledge in "handling" such matters to put the other person at ease. This also may give the other person a false sense of superiority.
When a skilled negotiators meets the other negotiator for the first time, he or she will take the time to learn whether the other person is knowledgeable about the underlying subject matter. Many landlords are able to outwit and out negotiate corporate representatives from very large, powerful companies simply because they know more about the subject matter. Corporate employees handling real estate acquisitions for restaurant and retail companies often know a lot about real estate and very little about their industry. Landlords, on the other hand, are extremely well versed in the shopping center business, the economics of leasing and the dynamics of their tenancies. If you are a corporate negotiator, it is wise to learn the basics of how your business is run, what it takes to make a location profitable, how the occupancy costs impact cash flow, and what the drivers are that generate a strong top line. Being armed with this knowledge will enable you to meet the challenge of a well-prepared landlord and seek viable lease terms for your company.
It is not about how cheap you can get a property. It is about getting a property at a price that allows your company to make money.
Similarly, when negotiating to buy a home, you need to focus less on the cost than the affordability of the purchase price and mortgage terms.
Data Can Impact a Negotiation
Identification of edible plants in a survival situation can be the difference between living and dying. Knowing the poisonous plants is essential!
Data is any information available about a given topic, person, commodity or situation. Having the discipline to gather, assess and use this data makes the difference between negotiating and begging. Preparedness is the key to a successful negotiation.
Typically information is readily available if you know how to seek it out.
If the information you are seeking is fact-based and in the public domain, the information may be available at the library, newspaper archives, from a title company, or off the Internet. If it concerns a payment that is in question, records from your accounting group or a copy of your personal check from your bank may be what you need. It may be troublesome to get the hard data, but it is difficult to refute and worth the extra effort.
Knowing the facts that help you is a good thing. Knowing those that hurt your cause is much better. When you conduct your fact-based research, don't narrow your search to the specific item. Be on the alert for related information that may be used against you or undermine your position. The search for data should be broad-based and inclusive to allow you to properly prepare for the moment of confrontation.
If your research is about the personality of the person you are confronting, seek the counsel of others who know the person, study previous negotiation results with the person or his company, casually discuss the person with his or her secretary, or read up on the person's activities. With a little sleuthing, there are usually some valuable insights available. As with data-based research, cast a wide net and collect as much information about the other person's interests, nature, and reputation as possible. You can use this collective pool of data to talk about his hobbies and interests to build a relationship or use it to be on the alert for his known stylistic tactics.
Take the time to fully prepare. If you do this, often as not you will be better prepared than the other person. As a result, you may be able to control the conversation and impact the outcome of the negotiation.