NegotiatingA Practical Approach

Alternatives

• Let us never negotiate out of fear, but let us never fear to negotiate.– JFK

• BATNA: Best Alternative to a Negotiated Agreement.

What is it?• Negotiation is a

continuing problem solving process. It’s getting people with both common and conflicting interest to come together to arrange or adjust their future relationship by making a joint decision.

Value Add

• Successful negotiations allow for beneficial exchanges and agreements to be made that give added value to relationships or situations.

Communication

• “The problemwith communication is theillusion that it has occurred.” – George Bernard

Shaw

Communication

• Listening• Being Explicit, candid,

honest and forthcoming.

• Understanding• Repeat what you think

you heard and understood.

• Get confirmation

To be an effective negotiator

• Develop and use people skills.

• Effective negotiation involves 20% Technical skills and 80% people skills.

Stereotype

• Tough• Super skillful• Secret techniques• Ruthless• Winner take all mindset

Rapport

• Effective negotiators learn to build rapport and trust

• They are able to connect with others.

Empathy

• Understand that the other person does not really care how the outcome of the negotiation affects you.

• The other person only cares about how it affects him or her and their side.

Be Kind

• Be kind to people and hard on issues. Separate people from the problems and solutions.

• There’s only one rule I know of: you have to be kind.– Kurt Vonegut

• Ad Hominum

Signaling

• Demeanor can get you more than substance.

It is a Small World

• Negotiate with integrity. Your career will depend on it.

Make Bridges

• Don’t burn bridges. This is especially true if there is a chance you’ll be negotiating with this same person or company again in the future.

What is your bottom line?

Before starting, know…•your ultimate goal•what you can waive or modify•what you can give away without any issues.

Preparation Refocus

Before starting…•craft a simple statement you can use to explain the goal of the negotiations. Something you can use over and over during the negotiations to refocus the players.

Example

• Something like, “My client is interested in buying the house and your clients are interested in selling the house. What can we do to get this deal done?”

Process

Start• Start your

negotiation with a point on which you both agree:

• Mutual benefit of a successful negotiation (both want a resolution) and

• Things or issues you each have in common.

Show interest

• Get Involved- Take your time and Take notes. The other side will appreciate you taking the time to write things down (even if you really don’t need to).

Emotional Distance

• Treat negotiations like a game. Come across as caring about the outcome, but not that much.

• (We will talk about applications of Game Theory too.)

Don’t be Reactionary

• Deflect, reflect and then select.

• Before responding, learn how to take time and let something bounce off you, reflect and think about it, and then select your response.

Empathy and Understanding

• Tap into the other person’s belief system. In all negotiations there are generally three truths: your truth, the other person’s truth, and the actual truth.

Listen

• Listen 70% of the time and talk 30% of the time.

• Two ears and one mouth. 2 to 1 ratio. : )

• Acknowledge the other person’s ego.

Authenticity

• Set the proper frame. Smile and make a good first impression. Be honest and real.

• Don’t be cynical in applying these suggestions. You really need to care about the other party.

Keep talking

• Communicate with tact and empathy.

• Keep the other side talking. Ask open-ended questions. “What do you mean by that?”

Reflect on this

• Two of the best negotiators are dogs and babies. – Relentless– Sustained– Persistent– Constant

SWOT

• Understand your strengths and weaknesses and also the other side’s strengths and weaknesses.

Sell

• Share you position via story telling. Remember, facts tell but stories sell.

Options and Alternatives

• Don’t fall in to the trap of the either/or dichotomy. It’s never only A or B. There’s always C, D and E.

• Open it up and be creative, don’t think binary.

Relationships and Outcomes

Preparation

Dress and groom yourself appropriately. Be on time, prepared and remember the 6 ps:

prior preparation prevents piss poor performance!

Eye to Eye• Negotiate in person

when possible. Over the phone is OK. In most instances, Avoid negotiating by email.

• 70% of all communication comes from body language, expressions and eye contact.

Avoid getting Boxed In

• On major issues, never negotiate for yourself. Use a third party.

• Do not include person with authority directly in the negotiations. Keep option open, “I need to run that by my partner…”

Authority to make a Decision

• along the same lines, do not agree to negotiate with the other person unless he or she has full authority.

Acknowledge, Empathize, Redirect

• Never tell the other side they are wrong. Instead use this, “I know how you feel. I use to feel the same way. But then I found out about AAA and now I feel BBB.”

Create a sense of Urgency

• When making offers, use time sensitive deadlines and mean it.

• Credibility not threats.

Strategic Respect

• Always leave a “back door” or “exit strategy” for the other person. Allow him or her to save face and avoid embarrassment (especially in front of a client).

Close the Deal

• When the time is right, never be afraid to Close the deal. Ask for the sale or ultimate desired outcome.

Signed, Sealed, Delivered

• Avoid buyer remorse. If documents are necessary, have them ready to go and don’t leave until they are signed and all terms are properly confirmed.

Success

• Both parties relatively satisfied.

• Leave some on the table.

• Don’t crush the other side. You may need information or a follow on favor.