My entire career has involved negotiating and observing the negotiating styles and skills of others. As a result, I have learned what it takes to become an effective negotiator, and that is what I plan to share with you throughout this course.
Let's start out with a simple definition of the negotiating process. Negotiating is an attempt by two people to achieve a mutually acceptable solution without there being an obvious winner or loser. When you effectively negotiate, there is a satisfactory conclusion for both parties. To achieve those results, you must have a clear understanding of what represents a good result for you as well as the other party.
Effective negotiators enter the negotiation process well prepared, alert, and flexible. They understand the eight basic principles of negotiating, which we will delve into deeper throughout this course. They include:
Principle 1: Clearly Understand Goals. Determine what you are trying to accomplish by negotiating. If you do not know where you are going, you probably will not get there. In addition, have a Plan B or even a Plan C in mind. You must have a clear picture of your goals but also the minimum outcome you are willing to accept.
Principle 2: Develop a Game Plan. Determine upfront if you are dealing from a position of strength or weakness. Do you need this deal more than the other party, or do they need it more than you? If you make short-term concessions, is that in the best interest of your long-term goal?
Identify the issues that are deal-breakers for you. Whenever possible, anticipate deal-breakers for the other side and determine upfront if you can agree to them.
Principle 3: Assess the Opposition. Research the negotiating style of the person on the other side of the table. What are their reputation and past track record when negotiating with you or your company? Conduct a gap analysis to determine where your goals overlap and where concessions might be necessary to close gaps.
Principle 4: Select a Strategy. A strategy is an overall policy designed to achieve specific objectives. They should not be confused with tactics, which are the detailed methods used to carry out a strategy.
Your strategy and the negotiators involved should be based on the issue being negotiated, circumstances, and personality. Choose individuals to negotiate who have the strength and skills to best achieve your objectives.
Principle 5: Work toward a Satisfactory Conclusion for Both Parties. You cannot always walk away with a win/win situation when negotiating. However, if one party feels they were treated unfairly, it can jeopardize your relationship. Negotiating is a process to identify value for both parties. I have been involved in negotiations, however, where I have taken a "hit" because I looked at the long-term value of a specific client.
Principle 6: Refrain from Negotiating with Yourself. In Lesson #1, we talked about negotiating with yourself, which can sabotage your ability to negotiate effectively. Once you have made an offer, you need to wait for a response before you propose a counteroffer. If you prematurely lower your prices or offer additional concessions, it will be perceived as a weakness, and the other party could take advantage of the situation.
Principle 7: Utilize an Agenda. Try to set the agenda because it influences the meeting. Items should be listed with an allocated timeframe. Every involved should be sent the agenda in advance. Do not be surprised if the other party wants to negotiate the agenda items.
Principle 8: Create the Right Atmosphere. The environment can influence the outcome of a negotiating meeting. Consider convenience, neutrality, and facilities available. Write out requirements and then select a location that can fulfill your requirements.
Understanding and implementing these basic principles will help you fine-tune your ability to negotiate and obtain the results you desire.