How to succeed in negotiations

4 Nov 11
Almost everything at work requires negotiation. Learning how to bat points back and forth will not only improve internal and external relations but ensure you get what you need from meetings
 By Ann McFadyen | 1 November 2011

Almost everything at work requires negotiation. Learning how to bat points back and forth will not only improve internal and external relations but ensure you get what you need from meetings

Illustration: Mark Smith

As the US negotiation expert Chester Karrass says: ‘ In business, you don’t get what you deserve, you get what you negotiate.’

Almost every aspect of your working life is negotiable, whether it is suppliers looking to hike prices, services that need to be changed or staff requesting pay rises or promotion opportunities. In recessionary times, this can work in your favour, as the pressure is higher than ever to get the most out of relationships and realise value from deals.

Understanding the art of negotiation and communication will considerably increase your chances of a positive and sustainable outcome in such a range of circumstances.

And there’s a lot more to it than well-known tricks of the trade such as open-ended questioning and keeping your powder dry. Here are a few key principles that will stand you in good stead whatever you’re negotiating. These tried and tested techniques have been distilled into ten top tips to help you perfect this crucial, and all too often undervalued, art.

1.  Preparation and planning
You can’t wing negotiations. You’ve got to know your audience, what’s in it for them, what do they want and what questions you need to ask. The first step is to understand what’s driving the other party and where their priorities really lie. It is not always about price. Think about relationships, added value items, ‘tasters’ and even introductions to other senior personnel in the organisation. Find someone who has had a similar encounter – where were the weak spots or the push buttons?

2. Tailor your response
Figure out what type of individuals you are dealing with and talk to them in a language they recognise. Make an initial assessment of a person: are they formal, precise and analytical? If so, they will need a lot of data before they feel comfortable making a decision. Are they purposeful, demanding and competitive – could winning be more important than the outcome? If so, you might have to have some ‘giveaways’ to coax them. Some people are caring, relaxed and patient. They don’t like to rush things and they want to know more about you. So ensure there is some social interaction beforehand. Are they warm, expressive, sociable and often persuasive? They might try to take you off point and lull you into a comfort zone before going for the kill, taking you off guard.

3. Listen carefully – don’t just hear
Remember you learn more and put yourself in a better position if you talk less and really listen more. This is the best way to understand who you are up against. Always start by asking the other party what they want to get out of the negotiation. If possible, have an initial face-to-face meeting to discuss agendas before getting into the specifics at the final meeting. Remember: the more you say, the more you give away. Exercise control, be quiet. Ask lots of open questions. Let them talk while you listen and take notes.

4. Careful, your attitude is showing
We give away 55% of what’s going on in our head through our body, and face-to-face is usually the preferred medium for negotiation. So you need to take the right mental approach to control your body language. If you feel weak or intimidated, it will be hard to cover this up and will set the wrong tone from the outset. Even the most experienced negotiator should be reminded and encouraged to think of negotiation as a factual discussion. Don’t lapse into emotional language or personal circumstances. Those entering into negotiations should think: ‘We all need each other.’ Know the value of what you’re offering, and how it helps the other party. Once your head is clear, you will feel in control and can take the lead through questioning.

5. Discuss, don’t sell
Negotiation should be a discussion of how to achieve a mutually agreeable outcome, not a selling exercise. ‘This is what we do and what we can offer. How can it help you?’ is a starting point. Don’t be the ‘know it all’, no matter how much background digging and research you have done. ‘This is the best thing for you’ approach is never received well unless it has been asked for.

6. Take time out
Don’t be afraid to ask for a break in negotiations to collect your thoughts. If you need time to go away and reconsider or to call another party then do so. Unless you’re up against a fixed deadline, be prepared to ask for time out, and use this to recalibrate your thought processes, get help or seek permission for a different deal.

7. Understand your bargaining positions…
Before you enter negotiations, form three positions in your head: what you could get away with – which is usually your opening bid; what you expect to get, based on a knowledge of your market; and your deal breakers. When you feel you are losing, it’s easy to give more away than you wanted or intended just to get out of the conversation and walk away with something. So it is vital to work out these positions in advance. Remember to create a tough opening bid and move from this position to give them the satisfaction of winning. Unrealistic positions damage relationships.

8. …and get to know theirs
One of the biggest mistakes negotiators make is failing to uncover their opponent’s position. When selling, for example, if a potential customer does not want to pay your asking price, ask them what they do want to pay. Once they have told you what they are willing to pay, you have two positions and you have opened up more scope for negotiation.

9. Collaboration not compromise
If you’re going to have an ongoing relationship with the other party, negotiation needs to be
win-win. Negotiation should always be about understanding how and why we are solving people’s problems, and what pain we are taking away. Use empathy, not sympathy. Emotions are usually involved, whether you are talking to an employee asking for more pay or you’re agreeing the price for a product or service. So, you can go a stage further than simply finding out about who you’re negotiating with – and a step closer to success – by carefully assessing how sensitive the subject is and how it will affect them personally.

10. Objection handling
There is always a reason why someone is saying ‘no’, so do not assume that it is the end of the negotiations. People often make decisions on things that haven’t been covered in the meetings. So find out what would make the difference. Sometimes you will be surprised at what you find. Efficient objection handling often leads to a better relationship in future. You might not always be able to solve the issue. But the fact that you showed you cared and didn’t walk away without going the extra mile will create a loyalty that will help in the future.

Ann McFadyen is head of business and product development at CIPFA Business Services

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