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Negotiation happens every day in almost any situation, however, the real challenge occurs when one person goes into a negotiation totally unprepared while the other has amassed a wealth of experience negotiating. To the less experienced and unprepared party, cues that negotiation is needed or even ongoing may be ambiguous. Unlike what you’d expect from an overexaggerated Hollywood showdown with a master and a fool, this imbalance in skill is more subtle, and it happens in daily interactions to formal business negotiations. It is only with the right skills and execution that you’ll be able to gain greater satisfaction from these exchanges. Therefore, here are a few steps on how to negotiate better simply and successfully achieve your objectives:
The single largest barrier to negotiating is the prospect of embarrassment. The fact that you’re reading a how to negotiate article is a bit of a give away.
The fear of losing face is a dominant reason for avoiding a negotiation. No one wants to look like a fool, hence we take the ‘high road’ that saves us any humiliation. However, doing so takes away the opportunity for you to obtain a more favourable outcome for yourself or your business. According to Harvard Business Review, overcoming this barrier requires self-reflection and a willingness to reframe our perception of negotiation. By removing the focus from how bad you’ll feel from rejection and shifting it to how good you’ll feel when you reach a positive resolution.
It may come as a surprise that much of the outcome of a negotiation depends on the preparation, rather than the process itself. The best thing to have in a negotiation is control, and to do so requires the relevant information: getting to know who you are negotiating with.
Understanding their goals and objectives, their current situation, interests and motivations of the people you are to negotiate with, and knowing who makes the decisions, can go a long way to help you craft meaningful dialogue and make more valuable offers.
When preparing for a negotiation, the most important thing to do is to set a limit, a ‘walkaway point’, and make a concerted effort not to go beyond it. This is what we consider the ‘Least Acceptable Agreement’ –– the point where you decide that you will no longer follow through with the deal. Chris Croft, one of UK’s leading trainers, says that this limit is the “root of your strength”. Similar to having your back up against a wall, having a limit gives you something to push back from. If the person you are engaging with senses that you do not have a limit, you render yourself powerless in the negotiation.
And of course, just as important as setting a limit is sticking to it. The principle of setting a limit relies firmly on the promise of sticking to it. By bending or giving in to a term that falls outside of the pre-determined range renders the objective of setting a limit completely pointless!
Just as important as developing the ‘Least Acceptable Agreement’ is identifying the “Most Desirable Outcome. This is the result or outcome that you want to achieve and are willing to defend. Once the target achieved, it is crucial to accept the deal and walk away, do not go rogue or off-script and jeopardize the results achieved!
To achieve a win-win outcome, both parties must be motivated to create value. Viewing negotiations as a competition rather than a trade-off and relying heavily on persuasion to achieve your goal are one of the many reasons why most deals disappoint.
Negotiation consultancy Scotwork surveyed nearly 5,000 untrained negotiators in 31 countries about their experience doing business deals. It was reported that fewer than a quarter of their negotiations ended in stronger relationships and higher long-term value. Among other weaknesses, inexperienced dealmakers attributed it to the lack of preparation and ethical lapses.
Another barrier to achieving a win-win is assuming that your counterpart wants the same as you – the ‘fixed pie perception’. However, by widening the scope of the negotiation, you are more likely to reach a mutually favourable outcome.
As you can probably tell, negotiating requires many different elements (preparation, execution, follow-up) to determine the success of the outcome. Hence, adopting a team approach will not only lighten the burden on each member of the group but also drive home the agenda with precision and impact. Having expertise in different subject matters help you to stay on course and nullify unprecedented curveballs in negotiation. For example, a procurement expert can keep track with cost considerations while a secretary can be assigned to take minutes and ensure follow-up. Garnering the strength of a well-equipped team can do wonders in achieving your target goals!
Negotiation, like many other skills, requires knowledge, effort and repeated practise to hone rather than just a quick “how to negotiate” google search. Applying strategies and concepts to real-world problems both at work and home will allow you to move from the understanding phase into the intuitive phase. According to Bazerman, “If you consciously use your new strategies in multiple applications, they will slowly become second nature, taking the place of old patterns.”
However, day-to-day interaction often lacks the intensity and context for good negotiation. A good way to practice is through hands-on learning with a group of like-minded individuals. And there’s no better way to solidify your knowledge than with kinesthetic learning.
We hope you enjoyed our quick tips on how to negotiate! Auston offers courses from that cover basic negotiation to advanced negotiation condensed into 1-2 day courses, giving you the best insights and practice to hone your negotiating skills!
The basic course is designed to help beginners overcome initial barriers by building greater confidence with practice and preparation. While the advance course equips participants with the preparation and follow-up techniques adopted by the best negotiators. Best of all, these courses are funded by SkillsFuture bringing you quality and affordable sales training. Don’t miss out on this opportunity!