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Fundamentals of negotiation
Resourceful Equitable Sensitive Patience Endurance Character & integrity Tolerance
Types of negotiating
1. Positional a. Each party tries to maintain their position while a give-and-take compromise effort ensues. b. Neither party wants to budge from their original position. c. Not effective because: i. Parties are focused on their positions not on mutual benefits. The maintenance of the position is more important than negotiating. ii. Takes a long time as each party will hide their needs & concerns. iii. Hinders long-term relationships. 2. Win-win a. Effective because: i. Satisfactory results to both sides. ii. Promotes decisions more quickly. iii. Encourages long-term relationships. b. Guidelines: i. Listen to the other party ii. Keep your own demands flexible iii. Make fair requests iv. Look for a trade-off of concessions
• • • • Brainstorming Putting yourself in the other party’s position Accepting a variety of answers Involving others and asking for fresh opinions
Preparing for negotiation
The Importance of preparation
• Most critical element in successful negotiation o Research the issue Gain firsthand knowledge Consult written and on-line resources Ask the other party questions o Research the other party’s background Other party’s handling of previous negotiations The other party’s chain of command The other party’s goals When not prepared to negotiate: o If not ready tell the other party you are not ready and take time to become fully prepared. o Let the other party know how much time you will need. o Ask the other party for specific information. If they balk, find out why they are uneasy.
Set your goals and limits
1. 2. 3. 4. • Make sure your goals are supported by the appropriate individuals in your group. Do not set more goals than can be realistically met in the time available. Balance optimism and realism. Identify which goals hold the greatest importance. Set written limits o Allow one to know what offers to accept and which ones to reject
Guidelines to limit sessions
1. You have other choices. 2. Know your other choices and the options available to the other party to gauge the value of your concessions. 3. Enforce your limits.
• • Find a location where you feel comfortable Have a negotiation agenda o Purpose Create purpose and direction Make it difficult to avoid hard issues Encourage focus Encourage individuals to take notes
o PLAN your agenda Prioritize according to goals Limit the number of issues necessary to attaining your goals Allocate time to cover each issue Note emotional issues and schedule them last to prevent individuals from being caught up in them
Mutually beneficial negotiating
People & Negotiating
• • Focus on the people If the people are the problem o Analyze the other’s party’s behavior and discuss the possibility that they are not viewing the situation as you do. o Discuss how the other party’s behavior differs from yours. Reach understanding: o Consider the other party’s point of view. o Do not place blame on the other party even if justified. Counteracting strong emotions: o Examine your own emotions. o Openly acknowledge the emotions. o Let the other party vent their frustrations. o Maintain self-control. Identify needs: o Put yourself in the other party’s position. o Consider what request you have made and examine why the other party has not been able to comply. o Recognize that varieties of sources create needs and the other party may have to juggle several interests during the negotiation. o Understand basic human needs. Offer rationale Do not dwell on the past Be firm in your needs Strongly support your needs
Communication and negotiation
• • Be clear Be an active listener o Make eye contact o Wait before responding o Repeat what the other party has said Watch body language o Posture
o Limb positions o Facial expressions o Tone and inflection
Finding mutual benefit
• • Break tough issues into smaller components Explore different options o Identify the problem generally to determine the major points of difference. o Identify the details specifically so you can address individual parts of the issue. o Suggest specific actions to address the details individually. o Suggest options to expand the results of the detailed actions to the general problem. o Create secondary options. Find common interests o May require searching out. o Make use of common interest. o Common interests provide positive negotiation atmospheres. How can I use differing interests? o Show where one party sees value in something that the other party does not. Value the solution to make sure that one party is not benefiting at the expense of the other. Persuade the other party that using objective criteria is of beneficial to both parties. o Approach as an opportunity to establish criteria for reaching a fair solution. o Consider criteria that the other party supports and see if you can support them as well. If not, one may need 3rd party arbitration. o Do not be pressured into using unsound methods.
Working the negotiation
• Making successful concessions: o Make a concession before the other party can ask for one. o Make the least important concession first. o Show considerable reluctance with every concession. o Ask for a concession each time you make one. What should I do if I begin losing concessions? o Request a break / recess to review / plan next steps. o Take the rest of the day to regroup. o Shift the conversation to a stronger topic when the other party is dwelling on one of your weaker issues. How can I protect myself against a more powerful negotiator? o Set goals and limits before entering the negotiation.
o Determine your alternatives. How can I level the playing field? o Power depends on your alternatives. o Take the time to develop your alternatives. o Consider the other party’s alternatives if you both have solid choices.
Closing the deal
• • • Once you have achieved an acceptable agreement, try to close the deal. If the other party is not satisfied with the final agreement you will need to step back from the current agreement and discover how to meet their needs. Take a break to review the agreement before considering it officially closed.
Positional Negotiating Tactics
• Types o Deception tactics Deception of an issue (bluff) Deception of the other party’s authority Deception of the other party’s intention o Mind games Stonewalling • Counter by maintaining your composure • Openly review your position • Question the other party’s willingness to negotiate • Stand behind your offer Walking out - Only use when dealing with critical issues. • Take time to review the situation. • Explain your reasons for walking out to the other party. • Do not look back when walking out. • Possible outcomes: o Other party may try to stop you. o Other party may contact you later. o Other party may do nothing. Good guy-bad guy • Counter: o Request to talk to the good guy alone to render the plan useless. o Play along with the tactic and act intimidated. Announce an end to all further negotiations. Turns approach into, “come back and we’ll talk.” o Use the good guy by telling him in confidence that you are about to walk away from negotiation due to the ‘bad guy’s’ approach.
Surprise advantage • Counter: o Remain calm. o Ask for specifics. o Ask for a recess. Splitting the difference – only if within your limits & goals Debate techniques • Prioritization • Straw man arguments o Pressure tactics Common tactics • “Take it or leave it” o Counter Ignore the proposal Countering with a similar offer Give in if the offer is acceptable to your goals. Exercise the leave it. • Bad tempers o Counter: Listen to the other party and allow them to finish their complaining. Let them know you are concerned and surprise them with your sympathetic tone. Take a quick break. • Extreme demands o Counter: Examine the demands and decide what compensation you can fairly give the other party. Offer a fair settlement and let the other party know why the offer is fair and meets their complaint. Determine the rationale for compensation by asking the other party to justify their demand. • Escalating demands o Counter: Bring the tactic to attention. Consider a break. • Refusal to negotiate • Lock-in tactics
o Counter avoid focusing on the position taken by the other party. Invisible partner o Counter by asking to meet with them. o If the other party does have to pass everything to someone else, ask to deal with that person. Calculated delay o Counter by bringing attention to the tactic. Intimidation and treats o Threats to dismiss all negotiations. If it is not a bluff, try to appease them with a concession that will not compromise your overall goals. o Threats to higher management. Welcome the inquiry.
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