Negotiation skills

1. Negotiation skills NicoDecourt

2. Today • When will you need to negotiate? • What is negotiation? • What is a good negotiation? • Hard, soft and principled methods • People, interests, options and criteria • Power and Dirty tricks

3. When & what will you negotiate? • Investors and financiers • Customers • Competitors and Collaborators • Suppliers • Staff • Premises • Regulators & Government

4. What is Negotiation? • Definition:- – To confer with another or others in order to come to terms or reach an agreement – Latin,fromnegotium to transact business • Most see themselves as having two ways to negotiate; HARD OR SOFT

5. Possible Outcomes • WIN- LOSE • LOSE-LOSE • WIN-WIN • WIN-PERCEIVED WIN

6. Good Negotiation • Should produce a wise agreement which – meets legitimate interests of both sides – resolves conflicting interests fairly – will last • Should be efficient • Should improve or at least not damage the relationships between parties

7. HARD Negotiator • Sees it as a contest of wills • Takes extreme positions • Holds out to the end • Wants to win ‘at all costs’ BUT Often ends up producing an equally hard response and harms relationships

8. SOFT Negotiator • Wants an amicable resolution • Wants to avoid personal conflict • Makes concessions BUT Often ends up feeling exploited and bitter

9. Hard Method - Positional bargaining • Each side – Takes a position – Argues for it – Makes compromises – (Hopefully) Reaches a compromise • This involves taking up and then giving up a series of positions

10. A Wise Agreement? • The more you defend a position – the more committed you become to it – The more you become interested in “saving face” not agreement – The less concerned you are with underlying concerns of each party • The more you argue that it is impossible to move, the more it becomes

11. Efficient? • Time consuming • Tendency to start with extreme positions and to defend them – The more extreme the position – The smaller the concessions – The longer the negotiation will take • Requires lots of decisions by each party

12. The Ongoing Relationship • Becomes a contest of wills • It becomes a battle rather than a devising of jointly acceptable solutions • Conflict words – ‘Can’t, won’t, not going to give in….’ • Often leads to resentment & anger

13. Soft Method • Many try to avoid the pitfalls of hard negotiation. They: – Prefer to see the other side as ‘friends’ – Focus on agreement not victory • Method emphasises relationships & is often efficient • Wise Agreements? - beware the hard negotiator

14. The Principled Negotiation • Separate the people from the problem • Focus on interests not positions • Generate a variety of options before deciding on what to do • Insist that the result be based on objective criteria

15. Defining Negotiation Human interaction is essentially negotiation. Intimidating, chiseling, and tricking are NOT negotiation.

16. Negotiation Is Personal • Emotions, temperament, and personality affect needs, interests, goals, and perspectives. • Ego, self-concept, and fears affect our needs. • Attitude affects our needs and our negotiation. • Knowledge of self is the starting point toward building effective negotiation skills.

17. Not Everything Is Negotiable • Every person has limits to what he/she will give and take. • Not everything SHOULD be negotiated: • Potential for MUTUAL BENEFIT is a prerequisite to negotiation.

18. Components of Negotiation • Personality • Approach • Style • Temperament • Perception • Interests • Goals • Needs • Values • Power • Type of Conflict • Substantive Issues • Alternatives

19. How Do You Know What You Know? • What do you know? • Beliefs may be confused with Assumptions. • Critical thinking includes asking: “Why?”

20. Fifteen-Step Plan • Practice critical thinking and empathy. • Study psychology, sociology, communication, and conflict. • Know yourself. • Know negotiation styles and temperaments. • Communicate effectively. • Acknowledge cultural and contextual differences and expectations. • Understand the dynamics of power.

21. Fifteen-Step Plan • Identify interests and goals before you negotiate. • Be assertive. • Be persuasive. • Be prepared and avoid common mistakes. • Use tactics that work for you and understand other tactics. • Know when to walk away. • Know how to evaluate your performance and improve.

22. The Negotiation Process • Analysis – Gathering info, organise it and think about it – People, interests, options on the table, criteria? • Planning – What to do on the four issues • Discussion – Focus on the four elements

23. People • Negotiators are human - emotions and communication are central issues • Interested in substance and relationship • Often get intermeshed • Positional bargaining puts substance and relationship in conflict • Try to separate relationship and substance

24. People Problems • Inaccurate Perceptions – Put yourself in their shoes – Don’t deduce their intentions from your fears – Don’t blame them for your problem – Discuss each others perceptions – Make your proposals consistent with their views

25. People Problems • Emotions – Try to recognise and understand them – Make them explicit – Allow the other side to let off steam – Don’t react to outbursts

26. People Problems • Communication – Listen actively, question & acknowledge – Speak about yourself not them – Know what you want to communicate and what purpose the info will serve

27. Interests not Positions • Interests define the problem • Opposed positions often disguise compatible interests not just conflicting ones • Everyone has multiple interests • Human needs are the most powerful interests

28. Interest Issues • Ask why? and why not? • Make a list • Acknowledge the other sides interests as part of the problem • Put the problem before your answer • Attack the problem not the people

29. Invent Options • Avoid premature judgement - ‘just one solution’ • Avoid the either/or position • Don’t just focus on your own immediate interests • Look through the eyes of different experts

30. Objective Criteria • Fair standards to both sides – market value – precedent – costs – Professional standards • Fair Procedures – ‘one cuts, the other chooses’, mediation etc

31. Objective Criteria • Ask ‘what is your theory?’ • Reason and be open to reason • Don’t give in to pressure, shift from position to criteria

32. What if... • They have a stronger bargaining position? – Any negotiation has realities that are hard to change • Your objectives – To protect yourself against making an agreement you should reject – make the most of your assets

33. Know Your BATNA • Best Alternative to a Negotiated Agreement – Your standard to measure against – Helps avoid over-optimism or summing your alternatives • The better your BATNA the more powerful your position • Disclosing your BATNA? What about theirs?

34. What if... • They use dirty tricks, • Try to: – recognise the tactic – raise it explicitly, question its legitimacy – negotiate over it

35. Dirty Tricks • Are their facts correct? • Ambiguous authority • Stressful environment • Personal attacks • ‘Take it or leave it’ • Don’t be a victim!!

36. Conclusions • Hard, soft or principled? • Wise, efficient and constructive? • Separate the people • Identify the interests • Determine the options • Use objective criteria • Practice the skills!