Two people are engrossed in a negotiation - one succeeds in achieving his/her objective(s) and is delighted, whilst the other walks away unhappy with the result. Does this scenario sound familiar?
How often have you felt unhappy with an agreement that you have reached? Have you ever entered into a settlement only to feel remorse soon after reaching a settlement?
SUCCESS VS FAILURE
What differentiates success vs failure in commercial negotiations?
Most of us understand the significance of preparation to deliver success and it is therefore interesting to note that most business negotiators do not spend sufficient time planning for negotiations, often due to insufficient negotiation training. Professional sports people spend considerably more time preparing for competition than they spend in competition; should it be any different for commercial negotiators?
THE EVIDENCE
Business negotiators only spend approximately 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 devoted only 1/3 as much time training & planning as you do in competition. The number 1 factor to profitable business negotiation outcomes is the quality of your preparation for the negotiation.
As a matter of negotiation strategy, consider the following top 5 factors of preparation and at the same time you will also improve your negotiation skills:
1. Understand Yourself
Before we even employ best- and leading practice negotiation, it is vital 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 context of business negotiations, which enables us to have a reference point from which to plot our skills development.
2. Vision
What is the main aim 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 vital to understand the drivers or silent motivations behind the positions of all parties to the negotiation and it is only by asking questions that we will uncover these motivations.
3. Value
What are the main deal goals being targeted in this negotiation? What are the facts and figures contributing to the negotiation environment? What options does each party have, if any? Once again we should try to recognise, prioritise & 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 initiate conflict.
4. Process
Have you spent time preparing an agenda for your forthcoming negotiation? Have you listed all the trades that you will make & receive? Do you have tools/templates at your disposal to support the effectiveness of the negotiation cycle.?
5. Relationship
It is easy to forget that we deal with individuals who have goals & aspirations not unlike our own and it is not always just about the facts & figures. The research is clear that people are more likely to agree with those whom they trust & like, than with those with whom they little in common. Try to focus on those things that you share with your negotiation counterparts, and do not forget to focus on the people.
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