Two parties are engaged in a negotiation - one accomplishes his/her objective(s) and is satisfied, whilst the other walks away unhappy with the result. Does this scenario sound familiar?
How often have you felt unhappy with a settlement that you have reached? Have you ever entered into an agreement only to feel remorse soon after sealing the deal?
SUCCESS VS FAILURE
What distinguishes success vs failure in commercial negotiations?
Most of us recognise the significance of preparation to deliver success and it is therefore remarkable to note that most business negotiators do not spend enough time preparing for negotiations, often due to not enough negotiation training. Professional sports people spend significantly more time preparing for competition than they spend in competition; should it not be the same for commercial negotiators?
THE EVIDENCE
Commercial negotiators only spend around 1/3 as much time preparing for negotiation as they actually spend in negotiation. If you were a professional sports person, this would mean that you applied only 1/3 as much time training & planning as you do in competition. The main factor to profitable commercial negotiation results is the quality of your preparation for the negotiation.
As a matter of negotiation strategy, consider the following main 5 factors of preparation and at the same time you will also enhance your negotiation skills:
1. Understand Yourself
Before we even put into operation best- and leading practice negotiation, it is imperative that we first invest in understanding our own strengths & weaknesses and it is important that we make use of personal profiling tools to underline our areas of preference within the framework of business negotiations, which enables us to have a reference point from which to plot our skills development.
2. Vision
What is the fundamental objective behind the negotiation? Is the negotiation about price or is it about the value that can be added? What are the key motivating issues behind your counterparty's position? What mutual ground, if any, exists between your and your counterparty's vision? It is important to comprehend the drivers or silent motivations behind the positions of all parties to the negotiation and it is only by asking questions that we will expose these interests.
3. Value
What are the main deal objectives being pursued in this negotiation? What are the facts and figures strengthening the negotiation environment? What options does each party have, if any? Once again we should try to identify, rank & weigh the objectives of all parties to the negotiation and only then are we in a position to highlight those objectives that are shared and at the same time deal with those objectives that are likely to cause conflict.
4. Process
Have you spent time thinking about an agenda for your forthcoming negotiation? Have you listed all the concessions that you will make & receive? Do you have tools/templates at your disposal to support the efficiency of the negotiation process.?
5. Relationship
It is easy to forget that we deal with people who have goals & aspirations not unlike our own and it is not always just about the contractual terms. The research is clear that people are more likely to deal with those whom they trust & like, than with those with whom they little in common. Try to focus on those elements that you share with your negotiation counterparts, and do not forget to focus on the people.
