Art of Negotiations
Negotiation is an art that you learn at every stage of life. You negotiate people every day on various personal and professional issues. Professionally, the focus of your negotiation could be: Resolving employee issues, effective teamwork, improving business relationships, etc. Young children also negotiate with their parents to get things of their choice.they may put conditions like ‘ if I study well will you get me an Xbox ‘ and most of the parents and end up responding positively to this condition. Some people term negotiations as bargaining or even haggling. However, negotiations are a means through which you can resolve your differences with people at the workplace or with your family without getting into a dispute or by resorting to heated arguments. At the workplace, you negotiate because there is a disagreement between you and your colleagues regarding the solution to a problem or goals of a project. If two parties conduct negotiations by keeping their respective ego aside, it can be beneficial for both sides. They also need to follow the principle of fairness to safeguard their mutual benefits and relationships. Good communication skills and good interpersonal skills are essential and critical to conduct effective and efficient negotiations. For successful negotiations, two parties sit across the table ( not literally ) and discuss all possible ways to resolve some issues or finalize a business agreement or come to a mutual understanding. They accept the way that is most suitable to both parties.
For conducting a fruitful and effective negotiation you must take care of the following points:-
Preparation: Before sitting across the negotiation table, skilled and experienced negotiators do proper preparations, like determining the goal of negotiation and possible alternatives to be discussed for reaching the goal. Negotiators must look up at the earlier situations or deals where they or their colleagues had concluded an agreement to reach organizational goals. Past deals can give clues about how to initiate and move forward in negotiations.
Problem analysis: Analyse the problems which are the focus of negotiation and see the benefits accruing to the negotiating parties from the resolution of the problems. All the issues – main and periphery- associated with the problems should be identified and the possible outcomes listed. Thorough preparation for all the essential elements makes you a perfect negotiator. A better agreement to a well-defined problem leads to an amicable promising solution thana great solution to an ill-conceived problem.
Emotional balance: It is very important to maintain composure during negotiations to arrive at correct decisions. Emotions have no room in negotiation. They can lead to wrong decisions out of frustration caused by emotional imbalance. If an employee has become adamant to go on leave and in the prevailing office situation, the leave cannot be allowed. But the boss because of emotional considerations allows the employee to take leave, and the office work suffers. In another example, if to keep the employees in good humor, the boss takes the irrational decision of granting them pay hikes, though the company does not have enough resources to bear this hike, it will again not be a right approach to handle the situation. It is better not to negotiate and walk away from the deal with your papers than losing one’s trust, patience and temperament.
Effective Listening: During negotiations, it is very important that both the parties should not talk excessively. They must pay full attention to non-verbal cues and interpret them properly. Non-verbal cues speak volumes about the real intention of the negotiator. If you are a good listener then this will enable you to identify those points of compromise where you are not going to lose much. So do not waste your energy by indulging in unnecessary talk or distractions.
Teamwork: negotiation is not always one- to- one. It can be many- to -many or one -to – many. If the group works according to the team plan with good relations and understanding, the outcome can be favorable. Both sides should think about working together so as to reach a win-win situation.
Communication with words: articulate negotiators have an advantage over others as they can communicate with absolute clarity and effectiveness. Good communicators leave less scope of creating misunderstanding and therefore can come out with several permutations and combinations of the problem. You can choose a passive, aggressive or assertive style while negotiating but the assertive style has proved to be the best choice to get mutually beneficial outcomes from negotiations.
Interpersonal skills: interpersonal skills are a key factor in maintaining good relationships with the people involved in negotiations. The negotiators must maintain composure and patience and should be able to persuade his/her counterparts without manipulations. This helps in maintaining a cordial relationship between negotiators.
Decision-making ability: leaders must be quick in taking the right decisions during negotiations. Indecisiveness on their part can let a bargaining or beneficial opportunity slip from their hands. If decisions are not made then the deadlock will remain as it was before the start of negotiations.
Ethics: trust is one of the most key factors while negotiating. Trust between the parties involved in negotiations can be built only if both parties Conduct themselves in an ethical way. They must fulfill the promise made to each other after reaching a certain decision during negotiations. Whatever be the decision, both parties should respect what has been agreed upon.
There are three basic negotiation styles a negotiator can adopt. These styles are explained below.
Red Style the red Style
The red style negotiators’ are highly competitive and therefore considered intensely competitive/ distributive bargainers. They follow the ideology that one side’s gain is the other sides’ loss ( also called the zero-sum or value claiming). They are self- centered, hard negotiators who do not trust the other party and therefore focus on gaining the maximum share of the pie.
The blue style negotiators adopt a cooperative style and believe in looking for a wide range of interests to be addressed and served. They focus on building long term relationships for mutual and personal benefits of the parties involved in the negotiations and create value for them ( also called the non- zero-sum or value creation).
The purple Style negotiators represent a fusion of Red Style and Blue Style negotiators. They believe in giving or get the principle, that is having a trading behavior where they gain something of their choice and give something of others’ choice. They are called principled negotiators as they use a strict tit- for – tat strategy. They are open, learnable, cautious and decent.
Major negotiation concept
The following concepts help both sides make informed decisions about possible options for a deal. With these concepts, they explore what are their ‘ best’ and ‘ worst’ points and how are they going to negotiate them along with any alternative deal.
- BATNA( Best Alternative to a Negotiated Agreement)
While preparing for negotiations, you investigate which resources you control or influence that can serve your interests. This establishes the baseline of your walking- is BATNA. This helps you create a benchmark against which you can measure whether the negotiation process is strengthening, weakening, or changing BATNA. The term BATNA was coined by Roger Fisher and William Ury in 1981. It means the best you can do if your counterpart refuses to negotiate on the terms acceptable to you. BATNA provides you a clear picture of what is in your piggy bank if you decide to walk away from the negotiation table without an agreement. For instance, you go to buy a watch. One shopkeeper offers you a watch for Rs 2500. You move to the next shopkeeper who offers the same watch at RS 2550 /-. You start negotiating for a price reduction. You already have a BATNA of RS 2500 and want the shopkeeper to settle for a price below RS 2500.
BATNA is crucial for negotiations as no decision can be made without knowing what alternatives are available. Before starting negotiations put all the possible choices on your side. Having a good BATNA enhances your negotiation power because if you are aware of good alternatives then you need not concede much. You can also force the other side harder. You will not even care much whether you achieved the target or not. If you do not have a good BATNA, then you will give in to the other person’s demand. To improve your BATNA as much as possible to be a good negotiator.
- WATNA ( Worst Alternative to a Negotiated Agreement)
The term WATNA defines the leverage the other party has over you in the negotiating process. It works positively for your counterpart in negotiations than you.
- ZOPA ( Zone of Possible Agreement)
It refers to the overlapping of the aspiration and expectation ranges of the two negotiating parties. In other words,it represents a range of prices within which the negotiating parties may reach an agreement. Before every negotiation, one should be prepared to handle the following questions:
- What are the objectives of the negotiation?
- Are we going to address critical factors like time, cost, performance, techniques, and technology?
- What is the scope of our negotiation plan?
- What can we surrender or compromise with?
- Are we planning to take a greater risk for greater margins of return?
- Are we prepared to face the consequences if the negotiation breaks down?
Be clear about your negotiation style. Know and chalk out your list of goals and decide which issues you can complete, compromise or avoid to cut a deal.
Nair, Aswathy | SevenMentor
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