NEGOTIATION

NEGOTIATION

Negotiation is conferring with another person or group to

arrive at a settlement of some conflict.
It typically utilizes a zero-base mentality.
Negotiation is a fact of life in sales organizations (all
organizations) and should be mastered rather than feared
and avoided.
Negotiation is useful for resolving conflict when the two sides:
– share an important goal
– have some differences
– are in a position to trade things that they value with one another
 WHY STUDY NEGOTIATION?

Executives have identified negotiation as one of the skills that business students
should possess in order to function effectively as managers.

Effective negotiation techniques are useful for self-defense and for improving
one’s own position.

Skilled negotiators will take advantage if they sense fear or incompetence.

Once skills are mastered, prospects of sustaining productive relationships when

conflict arises will improve.

Putting the proper negotiation techniques into practice increases the probability
that each party will achieve more rewards than would otherwise be the case.
SUCCESSFUL NEGOTIATIONS

The mark of a successful negotiation is a contract, written or verbal, that

signifies that a mutually agreeable solution to conflict has been reached.
What is necessary to be a good negotiator?
– Most important: prepare thoroughly for the negotiation.
– Never enter negotiation when you are tired, hungry or angry.
– Allow for the possibility of not reaching agreement.
Always remember that nearly everything is negotiable. The other party’s
“last offer” may also be negotiable.
NEGOTIATION PREPARATION

Homework is the most important aspect of any negotiation process.

Preparation endows negotiators with confidence in their ability and a

stronger, factually based belief in the correctness of their positions.

Good negotiators understand the implications of each item on the table, the
consequences associated with various concessions, and where the absolute
bottom line of the negotiation lies.
 PREPARING FOR A NEGOTIATION

Define your goals, the other party’s goals, and the conflict.

Identify the goals you share with the other party.

Define the things you are willing to trade and their value to the other party.
Do the same for the other side: what they might offer you and how much it is
worth to you.

Anticipate alternative scenarios and prepare your tactics.

Define your BATNA (best alternative to negotiated agreement) to determine

how important it is for you to reach a settlement.

Realize that you are no weaker or stronger than the other party. The two sides
share goals and both sides are willing to trade to attain their objectives.
WHAT TO DO DURING A NEGOTIATION

Volunteer to do the paperwork, to keep notes on what is being agreed upon.

Open by stating the goals you share.
State your demands: high if selling, low if buying.
If the other side makes an unreasonable demand, be prepared to flinch!
If need be, walk out.
If you yield from your demands, yield in small amounts, infrequently.
Never give something for nothing. Trade what is cheap to you but
valuable to them for what is valuable to you but cheap to them.
Talk less and listen more: remember you will never give anything away while you
are silent. Use the silent period to think over what has been said.
Find alternatives.
Take breaks.
If you are going to attack, attack hard and without warning.
Reach for an agreement, but do not insist upon it unless necessary. End results
may be agreement, agreement to continue later, or end of the negotiation.
If you feel pressure to settle, be aware that the other side is probably feeling
similar pressure.
DURING A NEGOTIATION
What to Emphasize During a Negotiation:
– Repeat the goals you share with the other party from time to time.
– State your position clearly and repeatedly.
– Clarify positions. Repeat what they said. Ask questions.

What to Avoid During a Negotiation:

– Do not make concessions early.
– When you make concessions, avoid large concessions.

Make the other side earn the concessions they get.

– Avoid irritating the other side or making them angry.
– Do not accept a deadline for reaching a settlement.
NEGOTIATION AND RELATIONSHIPS
Though people often enter negotiations driven by self-centered motives, the
negotiation should also be influenced by the relationship outcome the person
desires after the negotiation process is over.

If the negotiating parties must continue to work with each other, for a
negotiation to be deemed successful, the contract should be such that both sides
“can live with it.”

If the negotiation is between parties who will not interact with each other after
the completion of the deal, each side may simply try to get all they can while
reaching an agreement, without concern about the long term happiness of the
other party.

The type of negotiation strategy one chooses will directly affect the relationship
they currently share or hope to develop with the other party.
PREDATORY NEGOTIATION STRATEGY

Predatory Negotiation tries to gain as much as possible by giving the other as

little as possible. The nature of the solution depends on who:
– concedes slowest
– exaggerates the value of its concessions most while understating
the value of the other’s
– argues most forcefully

The most aggressive “hardballers” often make inflexible demands, while

threatening to walk away or retaliate if their demands are not met.
SYMBIOTIC NEGOTIATION STRATEGY

Symbiotic Negotiation features attempts to create mutual value

through trade-offs and bargaining.

It assumes that resolution is best achieved by being cooperative,

imaginative, and persistent in the pursuit of mutual gains.

Symbiotic negotiators stress the value of sharing information and

open lines of communication.

Two types of symbiotic negotiation strategies are an open

submission strategy and a win-win strategy.
“JERK” NEGOTIATOR TYPES

The Tank: confrontational, pointed, and angry. Some apparently strive to

achieve the ultimate in pushy and aggressive behavior.

The Think-They-Know-It-All: don’t really know much, but they are big
enough to not let their ignorance get in the way of their opinions. They can be
exaggerating, bragging, misleading and distancing.

The Yes Person: quick to agree, but slow to deliver. They leave a trail of un
kept commitments and broken promises in an attempt to please.

The No Person: deadly to morale and able to defeat big ideas with a single
syllable. Doleful and discouraging, they lead others to despair.
STRATEGIES FOR DEALING WITH “JERKS”

The Tank: Command respect. Stand your ground, blunt their attack, quickly
backtrack from their issues, and state your point in a non-threatening way.

The Think-They-Know-It-All: Give their bad ideas and suggestions the

hook. Give them a little attention and ask them to clarify, then you can give
an account of the real solution.

The Yes Person: Make it safe for them to talk honestly, help them plan,
and ensure your commitment to them. Try to strengthen your relationship
with them.

The No Person: “No people” should be used as a resource by leaving the

door open and acknowledging their good intentions when you can.