Not a confident negotiator? Practice your negotiation skills using this easy 3-step framework.
You are constantly negotiating, even when you don’t think you are. You’re negotiating with employees, with prospects, with clients, with your suppliers/vendors, even with your family!
As a business owner or leader, your negotiations can carry serious consequences and it’s important to become skilled at it.
I constantly meet business owners and leaders who do not enjoy the process or aren’t confident about their skills. They tend to have an “it’s a necessary fact of business” vibe about the whole thing.
When I dig deeper into this with some clients in our business coaching sessions, I inevitably highlight to them that their aversion is less about the actual negotiations and more about the feelings they experience when negotiating. Who likes to feel anxious, uncertain, stressed, like their back is against a wall?
Josh Freedman, CEO of Six Seconds, under whom I studied emotional intelligence states in his book that “people drive performance, emotions drive people”. So, if you have been falling down in your negotiations, it’s in your best interest to increase your self-awareness about your triggers and barriers and improve your skills in this area.
There is a long list of negotiation skills you can master. I’ve narrowed down the top 3 you can apply simply to see an immediate difference in your business dealings.
1. Identify your best possible alternatives beforehand.
This is the internal work you should do to prepare for the negotiation. The other party doesn’t need to know the answers to any of the questions below, but you must. Don’t wait till you’re in the room and looking and feeling like a deer in headlights.
- Consider what would be the best outcome of the negotiation.
- Work out what you can give up, to get what you want most.
- Decide your floor – the point past which you will not go. For instance, if you’re the seller, what is the best price you will offer and still feel like your work/product is being valued?
- What happens if you can’t reach an agreement? Do you have a Plan B?
- Make sure you have all the information you need to make a sound counter-offer. And if you don’t, be prepared to ask for it.
- Finally, understand your patterns around negotiations. Who do you become in negotiations? Do you cave at the slightest pushback? Do you get overly magnanimous and give away value with no reciprocal fee? If so, perhaps you should attend with a colleague who will keep you on script.
2. Communicate more.
You can be completely prepared before you step into the room, but what you do when you meet will determine your outcome. How you communicate and your flexibility are important.
- Manage the physical space. The best way to negotiate is in person. The world being what it is now we can’t always meet face-to-face, but where possible, aim to get together around a table. Sit side by side, instead of across from each other. Professor Guhan Subramanian, from the Harvard Negotiation Project, advises that the less adversarial the meeting, the more successful the negotiations are likely to be.
- Build Rapport. Break the ice and look for some common ground with the other party. Foster some connection that will put you on level footing and help everyone feel more comfortable. Contrary to popular belief, negotiations are less about one party winning and another party losing. Great negotiations are where both parties feel they won. Start off your negotiations by showing that you want that for each of you.
- Listen intently. Don’t go into the negotiation with a fixed mindset. Listen to what the other party is saying with interest and ask questions where you’re unclear. The more you can hear what the real drivers are behind a request for a change in price or location, or whatever is causing the difficulty in getting a yes, the easier it will be to offer a viable solution.
3. Take a Strategic Approach.
Go into your negotiations with a planned strategy.
- Decide the key negotiating strategy you will use. The parties will all have decided beforehand what they want to push back on. It’s important that you know the ‘why’ of your argument which positively affects them all. That ‘why’ may be value, competition, business in the future, risk and liability, whatever, so long as it moves you towards the best outcome.
- Make multiple offers. If during negotiations, things come to a standstill, consider making more than one offer at a time. Make three offers and see which they respond to. Then work on coming to an agreement on that.
- Propose contingencies. Perhaps you can’t get any movement in one area. Suggest a contingency instead. For instance, let’s say you’re buying in a service to deliver an e-commerce website. You could the deal contingent on the site being delivered in a certain time frame. Failure to deliver would result in some sort of penalty.
- Beware of focalism, also called the anchoring bias. This is the tendency to make quick judgments based on information gained early in the decision-making process. For example, think of a number between 12 and 100.
Now, imagine I’m offering to sell you a bottle of wine. How much would you pay? If the number you thought of initially was 18, you might offer to pay 22 for the wine. If the number you settled on was 56, you may offer to pay 70 for the wine. You’re biased by the information you received earlier.
You overcome the anchoring bias by taking the time to gather all the relevant information you need about the offer, such as true value and available alternatives, and by not rushing the decision-making process.
That’s it, the three negotiation skills you should start to learn to apply today. This framework will increase your confidence, improve your decision-making, and deliver the best return on your time and effort.
by Uzo Ijewere, Augment Results.
It has never been more important for organisations to be seen to be human. At Augment Results, we power performance in companies, teams, and individuals by helping you adopt better management strategies, improve leadership skills, and achieve overall better results through more engaged, empowered and productive people. We offer seminars, workshops, consulting, and one on one coaching.
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