Eight Steps of Negotiations

Prepare Argue Signal Propose Package Bargain Close Agree

PREPARE

Prepare carefully well in advance

Prepare for negotiations and not defending

Be ready for opportunities

Reconsider your preparation items

Five key areas of preparation

Objectives Information Concessions Strategy/Style Tasks

Preparation- objectives

Define what outcome you want to achieve from the negotiation- ISSUES

The realistic expectation against each issues- INTEND

Minimum acceptable position on intends- MUST ACHIEVE or AVOID

What is the ideal outcome you want – WISH LIST

Step 1-Preparation- Objectives

Do the same for your opponent – ISSUES, INTEND, MUST ACHIEVE & WISH LIST

As negotiations progress keep your objectives under constant review: are they still realistic? Should your INTEND be boosted by a few WISH LIST items? Should you move on an INTEND to protect a MUST?

Elements of Negotiations

VALUES POSTION NEEDS NEEDS SATISFIERS NEEDS BLOCKERS

VALUES

Deeply held preferences that shape our goals and means to fulfill them. Transmitted through socialization and enduring. Values are shared and often culture specific . Values create needs that we want to fulfill.

POSITIONS

An opening demand that the negotiator believes will satisfy need.

Positions can be changed in skillful negotiations

NEEDS

Needs are specific in a negotiation , but are derived from the values we hold. They have to be dug out by skillful questioning and then a suitable need satisfiers can be used to move the negotiation forward .

If we are not clear about our needs we may bargain away some thing we value

NEED SATISFIERS

These bring focus to the negotiation and create a positive environment , which can then be used to change positions

NEED BLOCKERS

They are threatening and do not lead to collaborative negotiations

Tactics of Negotiation

ATTACK- creates negative energy EVADE- can be used meaningfully INFORM- clears the environment OPEN- helps in understanding needs UNITE- build rapport – Emphasize common

ground- reframe – propose solutions

PREPARATION- Information

Research both parties Analyze the basis of power for both Do SWOT for both Prepare questions in advance What is the BATNA of the opponent What is their awareness in regard to your

issues and needs Brutally admit to assumptions and biases

BATNA- Best Alternatives in a Negotiation Agreement

Ideal----------------------------------A

Intend---------------------------------B

Must avoid--------------------------- C

Negotiations Zone

PREPARATION- Concessions

Where can we be flexible? What concessions can we make? What can we give in order to what we want –

TRADE What value the concessions have to the other

party? What will you ask in return?

PREPARATION-Strategy

Keep it SIMPLE and FLEXIBLE Avoid confusing strategy ( means) with

objectives ( objectives) E.g. Take the train ( strategy ) to London

(objectives ). If you meet a “ gate “ adjourn or reconsider .

Understand the preferred styles of each other

DEFERENTIAL- Respect and Hierarchy

SUBSTANTIVE- Material issues

RELATIONAL- Trust and good faith

PROCEDURAL- Agenda and rules

Understand your personal style

IMAGINATIVE- creative , intuitive, integrative and inspiring

FACTUAL- clear, focused, informed , verify RELATIONAL- solve conflict,listen,

encourage, listen and maintain relations , constructive

ANALYTICAL- logical and process oriented EVALUATIVE- weigh , measure and moniter

PREPARATION- Tasks Leader- conducts the negotiation, gives information, expresses

opinions, makes proposals, trades concessions.

Summarizer- asks questions to test understanding, draws attention to , clarifies , summarizes to buy thinking time, confirms areas of disagreement and agreement . Does NOT give personal opinions, information's, and concessions,

Observer- watches, listens, records and tries to understand the motivation , concerns, priorities, & inhibitions,

STEP 2- ARGUE

It is an opportunity to – Exchange information Review issues Structure expectations Test assumptions Probe motives Explore opportunities Identify inhibitions, & chinks Influence, persuade & inform Review sanctions & concessions

STEP 4- Signal

Signals indicate change in stance They are verbal or non verbal When opponent moves from absolute to

qualified statements it is a signal Listen , reward, expand and confirm signal Signals indicate when to make a proposal

What are qualified statements

Can you explain the reasons? Suppose I agree to that what can you offer? Which aspects are you unhappy with? Why is it important?

STEP 5- PROPOSE- ENTRY OFFER

Open realistically- entry offer A realistic proposal is based on facts that

support the proposal Address the key issues & your intend list Matches the other parties BATNA

Making proposals

Propose – Explain – Summarize Invite response If you have to modify the proposal the

secondary proposal is tentative If there is a grievance suggest a solution

RECIEVING PROPOPSALS

Never interrupt Question – clarify – summarize Response could be No- this gives the other party the

initiative. If Yes- Are you missing an opportunity to add some

thing from your wish list? Instant counter proposal- leads to haggling and

arguments Adjourn- gives time to consult and think Detailed response – encourages repackaging, to

make the proposal more acceptable Considered counter proposal- best response TRY TO GIVE THEM WHAT THEY WANT ON YOUR

TERMS

More about proposals

If you are asked to concede something from your intend list then add something from your wish list

Remember the strengths of your proposal Proposal set the agenda A proposal beats arguments

STEP 6 - Package Packaging adjust the variable without increasing the offer in

order to make the proposal more acceptable If you have opened realistically then you may reach a deal

without making any adjustment or concessions. In order to do get more out of the other identify inhibitions and

interests and address the package to them. If you use a competitive stance likelihood of identifying needs

about inhibitions are low , so use a cooperative stance Proposals are solutions to needs Think creatively about all the variables or services while

packaging

Styles of Negotiations

Co operative Long term relationship Voluntary relationship Trust Private and informal Tolerance of others views Emotional detachment Skilled negotiations Win - win

Competitive on recurring transactions Mandatory relations hip Suspicion Public and formal Intolerance of others Emotional involvement Poor negotiators Win lose

Step 7- Bargain Bargain is any trading activity , You can bargain at any

stage of the negotiation:For informationFor concessionsFor signalsFor time’ for the deal

The fundamental rule in bargain is TRADE. You should always have an answer to the question “ What did you get in return?

Be prepared to concede in areas of lesser importance to gain in areas of greater importance

Put an unreasonable price to an unreasonable demand

Step 8- CLOSE Trial closure is useful device for drawing out issues.

Ask “ Are you saying if I agree to both of those items you will be satisfied?” - this insures if there are hidden issues they will emerge

What is the most important closing opportunity – a minor question that the other party asks about your proposal e.g. – “does that include delivery ?” or “ Would that be back dated?”

If both parties are happy

Closing concessions should be :Conditional ( on the deal)SpecificSmall

Don’t get greedy

Agree

Agree to what is agreed- any ambiguity gets cleared up easily

When to go for adjournment

When you feel you need to reconsider your objectives

New critical information emerges Your strategy is over taken Stuck in circular argument When you need time to repackage

How to make adjournments

Summarize the position the negotiation has reached

Withdraw to a private place and discuss with your team before breaking away

Agree on a new meeting date Give home work to the other party