negotiating skills notes

7/31/2019 Negotiating Skills Notes

1/25

Negotiation Skills

David White 1

Undergraduate Programme:

Management Communication Skills

Negotiation Skills

Course Notes

These are detailed notes. Much more than a copy of the lecture or workshop slides, they provide a

detailed review of the topic with additional concepts and exercises.

David White, Whitehorn Consulting Ltd


2/25

Negotiation Skills

David White 2

Contents

Objectives 4

Introduction 5

Defining Negotiation 5

Importance of Negotiations 5

Why do we need to negotiate? 6

The features of a negotiation 6

People involved 6

Formality 6

Contact 7

Conflict 7

Joint decision making 7

Persuasion vs. negotiation 8

1. OBJECTIVES 8

2. FLEXIBILITY 8

The 3 phase negotiating model 8

I. Planning Phase 8

Identify the issues 9

Research 9

Sources of information: 9

Setting Objectives 10

Smart objectives 10

Limits and choices 10

Researching the players 12

Using written documents 13

II Negotiating Phase 13

Stages in the process 13

Stage 1 Exploration 14

Atmosphere of a Negotiation 14

Environment 15

The need for an agenda 15

Timing 16

Stage 2 Bidding 16

Counter Bids 17


3/25

Negotiation Skills

David White 3

Time Out 17

Stage 3 Bargaining 18

Handling and communicating emotion 18

Maintaining control 18

Bullies 18

Two meetings in one 19

Dealing with argument 19

Body Language 19

Phrases to avoid 20

Unskilled behaviour 20

Skilled behaviour 20

Moving towards a deal 20

Trading Currencies 20

Stage 4 Settling 22

III Consolidation Phase 23

Conclusions 23

Review 23

Bibliography 24


4/25

Negotiation Skills

David White 4

Objectives

After studying this course you will be able to:

Identify negotiating occasions

Set negotiation objectives

Research the background to a negotiation

Select and use trading currencies

Present bids and offers

Bargain and settle

Consolidate agreements

Manage the stress and strains of a negotiations


5/25

Negotiation Skills

David White 5

Introduction

You cant always get

what you want...

But if you try some time,

You might just find -

Youll get what you need

Jagger/Richards

According to Henry Mintzberg, a Negotiator is a key decisional role for managers and anyone

involved in working with other people.

Defining Negotiation

A negotiation is a process of two or more people/parties coming together to reach an agreement

The agreement should be for mutual benefit and the aim is to find constructive and creative solutions

to problems

Negotiating is a delicate process that is frequently misunderstood. All parties involved will have

strong, sincere reasons for the position they take. However, the very act of coming to the negotiating

table is an admission that the other parties have something to offer, or requirements that they must gosome way towards accepting.

Any resolution of a negotiation therefore must be perceived as being of mutual benefit to all

concerned. A negotiation in which only one side can claim victory should be deemed to have failed.

The reason is simple if there is a long run, the losing party will either renege on the agreement or

seek ways to gain redress in the future.

The answer to what can seem insoluble at the beginning of the process is to create an environment in

which - for the sake of seeking solutions - everything can be regarded as open for discussion. By this

means unusual and creative solutions can be discovered.

Importance of Negotiations

Negotiation touches all aspects of a business: sales contracts, purchasing contracts, internal decision

making and resource allocation, labour relations, joint ventures, licences, etc.

Take place at all levels: from the individual contract to global agreements covering entire

organisations

The value and quality of agreements can have a critical impact on corporate performance


6/25

Negotiation Skills

David White 6

We tend to think of negotiation being confined to political and high-level management arenas.

However, away from the media spotlight, negotiations are going on all the time and for the

participants the issues can be just as critical.

Why do we need to negotiate?

Negotiation arises from our drive to achieve goals (personal, social, political, work-related) when there

will be always be obstacles involving the goals of others. This can stem from

conflict between achieving ones own differing goals (e.g. we want everything but also

want to pay the lowest price)

conflict between own goals and those of others (the normal source of conflict)

shortage of resources (e.g. negotiating over budgets/resources)

In a sales situation the need to negotiate is accepted by both sides as part of the

buying and selling game. As with any game, a full knowledge of the rules and the skill

to play well is essential to success.

Task! We have to negotiate more often than we think. Identify the very last negotiation you

had to enter into however trivial. Assess how well prepared you were and whether this is

affected the end result.

The features of a negotiation

The features that define a negotiation are as follows:

People involved

A negotiation involves two or more people acting as individuals or representatives of their

organisations. The more people/organisations, the harder it is to achieve an outcome of equal

satisfaction to all parties.

Formality

Quite often, less skilled negotiators may find themselves in negotiation situations without even

realising it. Typical examples are to be found between parents and children over watching TV versus

doing homework, in the workplace between colleagues over lunch cover and between manager and

associate over doing extra duties. Not all negotiations are set up as such they just happen.


7/25

Negotiation Skills

David White 7

Contact

Negotiations are usually more successful if conducted face-to-face. This is because the interaction

involves verbal and non-verbal behaviour. Without the ability to see the whites of their eyes, to borrow

a term, it is difficult to target accurately. The political arena provides a useful term to illustrate how

unhelpful long distance negotiation can be megaphone diplomacy. This is used to describe the

conducting of negotiations through the media, rather than direct contact.

Conflict

However hard we try, we must accept that conflict is a likely component in the process. To this end, it

is important to plan for it and how it should be handled.

Joint decision making

By definition, a negotiation is an exercise in joint decision-making. Both parties have different

agendas and the process will involve appreciation of the other partys needs and how they can be

accommodated while also respecting our own.

Negotiation Outcomes

Outcome for B

Outcome

for A

WIN

WINLOSE

LOSE

WIN - LOSE WIN - WIN

LOSE - LOSE LOSE - WIN

As discussed in the first section, the best negotiations produce results of mutual benefit. As the above

four box matrix shows there are four possible outcomes:

Both sides lose: the negotiation produces no result. While both sides may retain their pride, they will

gain nothing more.


8/25

Negotiation Skills

David White 8

A wins and B loses or B wins and A loses: the likely result here is that the losing side will seek ways

out of an agreement, which is humiliating and unfair. While the winning side may take satisfaction

from the result initially, it is likely to rebound on them.

Both sides win: This demands that both sides focus on core objectives and are also willing to make

concessions.

Persuasion vs. negotiation

These factors point to the differences between persuasion, a standard sales tool, and negotiation. This

has two dimensions:

1. OBJECTIVES

The Persuader wants to get others to accept his point of view, while the Negotiator wants to reach a

compromise.

2. FLEXIBILITY

The Persuader is fairly inflexible, relies on coercion, adaptation, manipulation and communicating

information. The Negotiator involves compromise and change, based on information exchange.

The 3 phase negotiating model

To help us understand the negotiation process better, it is useful to define it as a process with three key

phases.

I Planning

II Negotiating

III Consolidation

Let us explore the phases in detail.

I. Planning Phase

This phase results in the identification of key issues by the negotiating team, likely obstacles to

reaching an agreement, and possible ways of overcoming obstacles. Thorough planning and a detailed

grasp of the relevant facts and details of the case are of vital importance.


9/25

Negotiation Skills

David White 9

Identify the issues

Adopt a `top down' approach: think over the issues very generally but actively, jotting down key

words and points

From the loosely assembled list of key words and points, identify the really important issues. Prioritise

these issues. Give consideration to the likely priorities and concerns of the other party to the

negotiation

Consider what you might `trade' and possible solutions to difficulties

Research

A key element in the planning phase is research. Knowledge is crucial and it would be true to say that

the side that gets nearer to achieving its objectives is usually the most knowledgeable.

Sources of information:

Competition (if you are competing for business, some mystery shopping amongst your

competitors will always be helpful in negotiating with the potential client)

Experts (dont be afraid to talk to people paid to know)

Online databases (the internet is a very valuable 24 hours source)

Libraries for Books and Directories (provides key dimensions in areas you are less

familiar with)

Colleagues (colleagues doing similar jobs will have come across similar situations.

Most people love to share their experience with you flatter them and learn from it)

As well as general research on the kind of business that the other party is in, it is particularly valuable

to research the person with whom you are negotiating in detail. Apart from the value of the

information, the closer you can get to them the better. Their motives will have a major impact on what

they are willing to accept. The greater the distress, the weaker the negotiating position. A person under

time pressures is particularly willing to make concessions.

Task! For the typical negotiations in which you are involved, identify the best sources of data

for the information you need to be successful. Spend a few minutes investigating other

sources


10/25

Negotiation Skills

David White 10

Setting Objectives

In any negotiation you need to be very clear about what you want to achieve. This is not as simple as it

sounds. Objectives can be defined in a number of ways and it is important to apply all these definitions

to your own intended outcome.

Smart objectives

SMART is a useful acronym by which your objectives can be readily tested. This has already been

covered elsewhere in the knowledge packs, but is worth a quick revision at this point.

Simple

The objective should be capable of clear and simple definition. e.g. to pay 10 per ton for the supply

of a raw material, to establish that all PR activity should form part of the department's responsibility,

to pay overtime for all work carried out after 6pm...

Measurable

All of the above examples are capable of measurement. Too often an objective is vague and can mean

different things to different people. Insert such imprecise words as `a fair price', `communications' and

`after work', and the problem is easy to recognise.

Agreed

It is important to agree objectives with the team you are representing. This may mean having a full

understanding of what room you have for creative manoeuvre.

Realistic

Unrealistic objectives are provocative and can easily cause negotiations to break down. It is hard to

back down gracefully if it only serves to outline how ridiculous your initial position actually was.

Timed

The value of reaching an agreement is dependent on when the agreement can be implemented. Time

pressure can be useful as a catalyst to reaching an agreement. The Ulster peace talks have

demonstrated the strengths and weaknesses of this aspect of objective setting.

Limits and choices

SMART objectives are a very important starting point. But what do we do if the other party will not

accept them? In any negotiation there has to be flexibility but the approach to defining objectives as

outlined above can seem to create too rigid a framework for negotiation.


11/25

Negotiation Skills

David White 11

One solution is to set smart objectives at three levels. These are defined as what we would like to

achieve, intend to accept or must agree to, if the worst comes to the worst.

LIKE

This is the ideal resolution as far as we are concerned - and therefore our opening bid.

INTEND

This would be a thoroughly acceptable solution to us, but one that includes valuable concessions to the

other parties.

MUST

This is the poorest solution that we could accept, but which still represents a profitable/useful

outcome.

These three levels - whether articulated or not - will tend to underlie most negotiations. The like and

must levels also provide limits that you must not allow yourself to forget.

Too often, people forget their low (must) limit and accept a poor deal rather than walk away. Texas

oil billionaire Nelson Bunker if remembered for his phrase

There is always another deal around the corner

100% success rate in negotiation can mean only one thing you are not a good negotiator. The ability

to turn down a bad deal is even more important than the ability to close the deal. We will return to this

issue later in the knowledge pack.

You are more likely to succeed if you define the levels precisely and gain agreement from your own

side that these are the prizes you are playing for.

In many real life negotiations at the political level, there can be a tendency on the part of the public to

take the opening `LIKE' positions too seriously. If the negotiators then start to believe their own press

they become entrenched in a position that they had always been willing to step down from.

However, to step down you should expect to be able to extract a concession in return.

`If you'll do ____, we'll do___.'

Remember that the other parties will be starting from their 'LIKE' position, which if you have done

your research carefully should be comparable to your `MUST'.

The logical outcome is therefore acceptance of the intend position for both sides.

PRICE PARTY 1 PARTY 2


12/25

Negotiation Skills

David White 12

11 LIKE MUST

10 INTEND INTEND

9 MUST LIKE

This way of looking at objectives translates well into a negotiation model that takes into account both

sides goals and the range of features that may be issues involved in the negotiation.

Understanding the situation facing the other party is useful as it enables you to identify the areas of

strength and weakness in the counterparts negotiating position.

Task! Think of the next negotiating situation in which you are likely to be involved. Set out

your objectives in SMART and MIL terms

Areas of agreement

Your goalsYour push

zoneTheir goals

Their push

zone

Areas ofeasy

agreement

Researching the players

Just as you need to know the organisation with which you are negotiating, it is equally important to

know and understand the individual with whom you are negotiating. First of all we need to be sure that

we are negotiating with someone who has the authority (delegated or otherwise) to represent his or her

organisation.

This research can be completed via a friendly conversation with the person with whom you find

yourself dealing. Establish their length of time in the organisation, their job title and areas of

responsibility. The newer they are to the business, the less likely they are to be the sole source of

power. Then move the conversation towards the negotiation proper to establish whether there are

others involved in the decision making process.

If you find that your contact is not the decision-maker, then it is vital to seek the real decision-makers

involvement in the process. This is best achieved by encouraging the your existing contact to invite


13/25

Negotiation Skills

David White 13

them along to your next meeting. Do not simply go over the head of your contact. That will only earn

their enmity, which will then be used to influence the real decision-maker against you!

Finally, consider whether there may be any hidden agendas that should be allowed for. Questions you

might want to consider are

How important to the other individuals career is a successful outcome?

What are their options if the negotiation with you is unsuccessful?

Are there any personal needs related to the outcome, i.e. is this person very cautious? Would they

prefer a low risk simple solution?

What are the background reasons for this deal? (For example, if someone were selling you their car it

would be useful to know if this was because of an urgent need for cash, or because they are shortly

emigrating, or because they are trading up to a newer model. A different final price would probably

apply in each case!)

Using written documents

Depending on the appeal of the solution to the other parties you may wish to consider the degree to

which you make your position clear in advance. A radical and exciting new approach may need

careful selling and it would be a disadvantage to preview it in the relatively flat location of a

supporting paper distributed in advance. However, the other parties may demand more time to

consider the proposal and stall the negotiations until a further meeting. This is a matter of judgement.

Alternatively, a proposal likely to find favour can be presented in advance to speed up the process and

get the negotiation over more rapidly.

Either way, it is important to provide supporting materials when the negotiation is taking place over

more than one meeting. The materials will help clarify positions and are useful for your contact to

discuss with their colleagues.

II Negotiating Phase

Stages in the process

There are four key stages in the negotiating phase, which will tend to follow each other but may have

some degree of overlap.

1. Exploration - of general views & objectives

2. Bidding - opening bids


14/25

Negotiation Skills

David White 14

3. Bargaining - trading currencies

4. Settling - closing the deal

Stage 1 Exploration

Atmosphere of a Negotiation

Generate a hostile or negative atmosphere and the negotiation is sure to fail. It is critical to begin on

friendly terms, regardless of how you feel about the situation or the other party. Remember that

hostility breeds hostility while assertiveness tends to give you the initiative and allows you to set the

terms and agenda.

This is illustrated in the transaction analysis diagram below. Think of your own relationships with

others. If you are aggressive or hostile towards someone, nine times out of ten they will be hostile

back, whether they are in the wrong or not. However, if you friendly/affectionate they will also tend to

be that way in return. But if someone asks you your opinion on what should be done and you answer

assertively and precisely, they will be likely to focus on your proposal in a positive manner. In other

words, if you assert yourself and set the pace, the chances are you will have the greater power over the

outcome of the negotiation.

Transaction perspective

Hostility Affection

engenders passivity

Passivity

Assertiveness

provokes dominance

breeds

hostility

engenders

affection

The clichd perception of trade union negotiations in the 60s and 70s shows just how badly

negotiations can go wrong. It is vital that all parties retain a friendly and positive approach and talk

directly to each other rather than conduct the megaphone diplomacy that draws in the unhelpful

interest of media or other half-interested parties.


15/25

Negotiation Skills

David White 15

The message of the sales negotiation is a useful model to follow. The effective sales person will

always recognise that any argument with a customer can have only one winner - the customer. There

are almost no circumstances where the customer could not seek an alternative supplier. Create a bad

atmosphere and the other party may prefer almost any alternative to reaching an agreement.

Always look to the common goal of a positive solution rather than your own partisan objectives. By

this means both you and the other parties involved can act as if you are on the same side rather as

opponents.

To recap, the golden rules are:

Take time for ice-breaking

Be constructive not competitive

Be cordial and co-operative

Be brisk and professional

Sustain a positive approach

Environment

While you may not always have a choice in the matter, the environment is very important at a

psychological level. Think of the difference in confidence between the football team on their home

pitch versus away games.

Whatever happens, make sure it a private, quiet, low stress but business like environment with no

distractions.

In terms of seating, try not to find yourself sat across the boardroom table but across the corner,

alongside, or better still around a low table in comfortable lounge seating. If it is on your own

premises, make sure you are nearest to the phone to deal with interruptions or to chase up the coffee!

An important part of the background is your own appearance. There are at least two simple rules to

remember. Dress in a way that makes you feel confident and professional. Dress in a way that is going

to show empathy with the person with whom you are negotiating.

The need for an agenda

We all know that the best meetings are achieved when you have a clear, preferably written agenda.

You should think about this in advance by listing out the points to cover, prioritising them and making

enough copies for the group.


16/25

Negotiation Skills

David White 16

Jointly agreeing this with the person with whom you are negotiating is an excellent place to start, once

the ice breaking is over. It is a psychologically valuable device to find points of agreement as soon as

possible. Once you some yess, you are likely to get more.

When agreeing a plan for the meeting, it is important to set and have accepted a reasonably

challenging objective, i.e. to get an agreement within the meeting. Once this has been achieved, then

the other parties will share a sense of failure if the meeting breaks up without agreement. Following on

from this it is important to set the time at which the meeting must end. Negotiations that go on into the

small hours suffer from the fatigue and irritability that will result!

The setting of an agenda enables you to both recognise the joint benefits of achieving a single

overarching objective agreement.

Task! Write an agenda for a typical negotiation in which you are involved. How would youpace the main points for discussion?

Timing

Too much time can be as unhelpful as too little. A sense of urgency sharpens minds and creates a

productive atmosphere. However, it is vital to verify the timing contract at the beginning of the

meeting to remind everyone of the time available and to reconstruct the agenda if there is not enough

time after all.

remember the golden rules are

Agree a plan/agenda for the meeting at the start; identify key issues and take these in a

logical order

Agree a pace for the meeting (i.e. how long on key items)

Be aware of time and keep control

Avoid deviation from key issues

Explore what matters to the other party

Put forward constructive proposals

Be willing to trade concessions

Stage 2 Bidding

The bidding stage involves putting forward suggestions (for example on price, quality standards, pay

rates, conditions of service, appraisal procedures).


17/25

Negotiation Skills

David White 17

In putting forward your proposals, you only have one chance to make the right first impression.

Careful structuring of your argument is vital. Any attempt to rush your proposal (or allowing yourself

to be rushed) will be counterproductive. Just as the good salesman communicates the benefits before

stating the price, so must you.

Which level should you open your bidding with must, intend or like. You should aim to make the

highest defensible bid, because the only way to go from there will always be down. Negotiators

lacking confidence will start from intend out of embarrassment that their like position will cause

offence or not be taken seriously. This may be because the level has been set wrongly, as a result of

poor planning. More often, it is just a function of confidence.

Bids should be made firmly, without justification or apology. You have to look like you mean it.

Remember the poker player who aims to give the minimum away as to the quality (or otherwise) ofhis/her hand.

Counter Bids

Generally speaking, after hearing out the bid of the other person, you are more likely to succeed if you

table your bid, rather than simply respond to theirs. For this reason you must respond to bids with

counter offers, rather than criticisms of their position. Criticism is perceived as aggressive and will not

be received well.

If you do not make a counter bid, then your opponent will have set the negotiating benchmark, which

is probably their like position, and therefore right at the least favourable limit you have set yourself.

By tabling your like position, you have placed a second benchmark and effectively marked out the

field of play.

Time Out

However, if a counterparts bid takes you by surprise, you may have difficulty coming back

immediately with your own position. For this reason, dont be afraid to assert your right to take time

out to consider their offer or your position.

Most people are afraid that taking time out could be seen as a sign of weakness. This is a small price to

pay for the time it gives you to:

Evaluate the bid

Consult with others

Consider counter bids


18/25

Negotiation Skills

David White 18

And remember while you are taking time out, the counterpart can only sit and wonder

what you are going to do.

Stage 3 Bargaining

This is the point at which the proverbial gloves come off. The ice has been broken, the objectives set

and the initial positions established.

Even if you are unhappy with their opening bid, avoid lapsing into confrontation. Instead be calm,

positive, patient and persistent. If the gap is substantial you will have to consider the need to shift your

ground as long as they shift theirs too. It takes two to tango.

You must therefore be prepared to accept concessions and to require counter-concessions.

Handling and communicating emotion

Some schools of thought suggest that your emotions should remain a completely closed book.

However, careful communication of emotions can help your cause. People like to sell products to

people who are enthusiastic to buy them and are more willing to be generous in their terms. (Think

back to when you last sold your car. If the buyer compliments you on it and says how much they like

it, you are keen for it to go to such a good home.)

Maintaining control

Keeping control of the negotiation is important to achieving your objectives. The control problems

may be more related to the personalities involved than the actual negotiation, but there are some

typical problem people you will encounter. They can be addressed as follows:

Bullies

Some people will try to dominate the meeting, trying to stop you putting your position forward. The

techniques you can use for dealing with them include:

Flattering them on their knowledge and contributions

Pointing out the importance of hearing from other participants (including you)

Asking others for their views (or stating your own)

Deflecting personal attacks by paraphrasing them as objective information

Taking time out to massage your own ego and recover your temper

Keeping people to the point


19/25

Negotiation Skills

David White 19

Others have the ability to slip off on tangents or get lost in detail. They are frequently fairly thick

skinned and can be herded back on course. Good techniques to use include:

Confirming that you understand their point

Remind the meeting of time constraints in relation to the agenda

Refocus on the next agenda point

Two meetings in one

During team negotiations, there is a danger that the meeting may splinter with individuals starting up

their own sub groups. This is a problem that will only get worse if you do not act rapidly. A useful

sequence of interventions include:

Pausing and making eye contact with the sub group members

Asking them to share their ideas with the meeting

Restate the importance of the objectives and point out that more will be achieved if

only one person speaks at a time.

Using the threat of running out of time can rein in pointless deviation from the subject in hand.

However, in a heavy meeting, the occasional moment of lightness can help to refresh the mood.

Dealing with argument

A negotiation will often involve a certain amount of heat and this may translate into prolonged

argument. Once again, it is important to act fast to prevent this souring the atmosphere and wasting

time. A strategy for dealing with someone who is arguing unnecessarily is to:

Address the person who is making the argument. Restate the gist of their position in your own, less

inflammatory words.

You may need to repeat this for each person involved in the argument.

Return the meeting to the agenda while noting that the points made are valuable and may benefit fromairing again later.

Body Language

During this key period of the negotiation, it is useful to tune yourself into the body language of those

involved. If someones body language is expressing a different view to what they are actually saying,

the gap between the two can be very instructive. For example, a look of anxiety while turning down

your bid would indicate that their position is softer than it might appear.

Try to control your own body language too!


20/25

Negotiation Skills

David White 20

Phrases to avoid

There are few statements you must never make. And if other people say them to you, just remember

they are all lies.

The include Trust me; Ill be honest with you or Take it or leave it

Do not allow yourself to be put off by these clichs.

Unskilled behaviour

irritators

immediate counter-proposals

defence/attack spirals

diluting the argument

signalling immediate disagreement

Skilled behaviour

stating reasons for disagreement prior to disagreeing

testing & summarising

implementation concerns

seeking information

statements about feelings

pausing for reflection

Moving towards a deal

Remember that you do have room for manoeuvre (Must, Intend, Like) so do not be afraid to trade

concessions. But do not start doing so too soon. This is dealt with in more depth in the next section.

At all times remember that you must give the other party room to manoeuvre and not create a situation

in which they feel retreat means humiliation. The price to be paid in personal or departmental prestige

may then become so high that the common good is an insufficient reason for agreement.

Trading Currencies

The solution to any negotiation often lies in giving away something that you do not value, but that the

other party does. Negotiations can often seem to founder on price, but trading currencies are seldom

money.

What do we mean by a trading currency?


21/25

Negotiation Skills

David White 21

A classic example in the buying and selling of houses are curtains and carpets. To the vendor they are

of doubtful value as they are unlikely to fit the house they are moving to. But to the purchaser they are

very valuable - to replace them would be very expensive and they are already fitted.

So any gap between the price the vendor is seeking for the house and the purchaser is hoping to pay

can be filled with the notional value of the carpets. The vendors are happy as they have not given real

money away, and the purchasers are happy as they are getting a house full of carpets and curtains for a

relatively modest sum.

Trading currencies can be almost anything that can be turned into a variable within the terms of the

negotiation.

Examples can include:

TIME

For one party a rapid conclusion may be more valuable than it is to the other.

EXTRAS

Optional frills are worth much less to the supplier (who sees the actual cost of them) than they are to

the purchaser (who sees the retail price of them). Giving away extras can be much cheaper than

discounting.

STATUS

In pay negotiation, status is a currency that can make a staff member appear to have gained a lot from

their negotiation with management. In the trade-off between more money and more status, many

people will give a lot of ground in return for more status.

In all cases, the negotiating strength lies with the party for whom the trading currency is of lower

value. Once you have identified those currencies the trick is to tie a concession in that area with one

that involves a currency of higher value to you.

`I would be able to begin the project on the date you would prefer if you can sanction the additional

staff needed'

The value of trading currencies is their ability to mean different things to different people. This is part

of the key to providing for a `WIN-WIN' outcome.

In summary the key principles are:

Always seek clarification

Maintain priorities

Trade concessions


22/25

Negotiation Skills

David White 22

Proceed in a measured way

Task! What are the key trading currencies available to you in your normal negotiations

either internally or with external customers and suppliers?

Stage 4 Settling

Dont be afraid to say yes to aspects of counterparts bid, even if you cannot accept the whole thing.

Reach preliminary agreement on individual issues as you proceed, gradually building a workable

solution.

Pull things together in a short but critical phase near the end. Go briskly through the all the points of

agreement.

Hold your nerve to extract final concessions. Then confirm points of agreement and agree follow-up

actions.


23/25

Negotiation Skills

David White 23

III Consolidation Phase

Agreements are generally translated into formal documents (letters of agreement, contracts, etc.)

They may have to be ratified by authorities higher than the negotiating team (e.g. Board of Directors).

You need to ensure that agreed follow-up actions are taken on time.

You also may need to explain the outcomes of the negotiation to all those affected by it.

Finally, as a professional negotiator, you need to monitor the agreement and learn from the experience.

Conclusions

Negotiation is a professional game; it is not simply about force of personality or nerve. It is a gamewith rules.

The key points to remember from this knowledge pack are that you must prepare thoroughly and be

clear about your objectives, their levels and the limits they impose.

Open the negotiation positively and stay flexible. Remember, both sides must win for the negotiation

to be a success.

Finally, as many political negotiations show, it isnt over til its over. Never give up.

1.

Review

This chapter focuses on a key communication skill which combines a number of areas of behavioural

competence. We begin by defining negotiating and why it is such an important part of life from

personal life through to global politics. We explore the reasons why we need to negotiate and the

features of a negotiation itself. We also draw out the differences between negotiating and persuasion.

The key concerns of the chapter are what actually takes place in and around a negotiation and we

employ a three phase model for this. In the planning phase, we look at how to identify the key issues

and the need for background research. Based on this knowledge, we can then set appropriate

objectives and begin to understand those of our counterparty. Once the planning phase is complete we

are able to move into the negotiating phase which involves stages of exploration, bidding, bargaining

and settling. Finally we explore the consolidation phase which ensures that the negotiated agreement is

fulfilled and used positively.


24/25

Negotiation Skills

David White 24

Bibliography

Swim with sharks without being eaten alive, Harvey Mackay

Selling for Dummies, Tom Hopkins, IDG

Negotiating for Dummies, Michael D Donaldson and Mimi Donaldson, IDG

Getting ready to negotiate: the getting to yes workbook, Roger Fisher and Danny Ertel

Barbarians at the gate: the fall of RJR Nabisco, Brian Burroughs and John Helyar

The Negotiator, Frederick Forsyth - a novel, but full of useful principles.

The Program on Negotiation at Harvard Law School. A website to investigate at:

www.harvard.edu/vine/providers/program_on-_negotiation/.

Writing and Speaking at Work, Bailey, E. (1999) Prentice Hall, Paramun, NJ

Business Communications, Nickson, D. and Siddons, S. (1996) Butterworth Heinemann, Oxford

Business Communications A cultural and strategic approach. Rouse MJ and Rouse S, Thomson

Learning (2002)


25/25

Negotiation Skills

negotiating skills notes

Documents