No business can be transacted without the presence of at least two parties. Negotiations precede all business transactions, whether they are the sale of a product, the formation of a joint venture, an acquisition or sale of a company or the hiring and firing of employees. Daily negotiations also take place internal to a company or organization. Therefore, solid negotiating skills are a critical asset all business executives regardless of their functional expertise.
Negotiation is a process whereby two or more parties interact in developing potential agreements to provide guidance and regulation of their future behavior. In any negotiation, the process and outcomes are influenced by strategy, tactics, context, leverage and of course by the skill of the negotiator.
There are three basic premises to understand about negotiations before sitting down at the table:
At the outset, everything is on the table.
There will be give and take on both sides.
The reason you are negotiating is to get the deal--not to "win"
When preparing for a negotiating session, start by defining the issue and gathering needed information. If possible, get relevant information from the other side. Organize it logically so you can refer to key points during the discussions as required.
Assess the strengths and weaknesses of your position and that of the other side. Think how you can use your strengths to increase your gains. Don't engage in preemptive surrender, even if the point is trivial to you. Save such points and use them as chips to get more of what you want from the other side.
Preliminary rounds are often conducted via phone, e-mail, fax or even snail mail. This will give you a chance to assess the skills of your opponent and to assess what is most important to the other side seeks. Pay attention to what the other side is saying. This is the time to think about what you can trade to get what you want.
Set the time, place and manner for face-to-face talks. Don't let the logistics of the meeting overwhelm you. Remember that opening offers are intended to set the bounds for continued negotiations and rarely appear in the final deal. Nevertheless, make a realistic opener. Asking for the moon and stars will get you nowhere, is a waste of time and may even tank the deal before you even begin.
Stay firm to your conviction but always remain cooperative. Never assume your opponent is less intelligent or less informed you. Think about the tactics you will use to reach an agreement and try to anticipate what the other side will throw at you. If it's still early in the game, there's no reason to become depressed or overly optimistic about the probable outcome. Maintain an even keeled approach throughout the discussions.
Outline what you can give up, and think about the price of such concessions. There will always be sticking points in protracted and detailed talks, and, if you're smart, there's always a way around a problem no matter how big it may seem at the time. Never box yourself in, and always make it possible for your opponent to concede gracefully while getting something, no matter how small, in return.
When you're close to wrapping things up, make a list of each point covered. When you've double-checked each point, get it in writing as soon as possible and have the other side sign-off on the points. This way you always have ongoing records of what was discussed and agreed upon.
Lastly, try to have fun. Even though there may be significant money or risk involved, at the end of the day negotiations are just a game. Whether you're negotiating a deal for your company, a raise from your boss, or whose turn it is to take out the garbage; sound negotiating skill are a life skill and those that master the art will have the best chance for success.
