Negotiation preparation made easy
This is a simple guide to negotiation preparation will assist negotiators develop a well organised pre-negotiation strategy, an essential element of confident and effective negotiation techniques.
Too often negotiators like to busk their way through their negotiations, trusting in their experience and savvy. The trouble is that if the other side has spent a little while preparing their negotiating strategy then they are always going to outperform the busking fraternity but the thing is….the buskers wont know! They’ll think that they’re doing well and so will continue to wing it. It’s an expensive mistake. So here’s a nifty way of making your negotiation preparation thorough, effective and surprisingly easy to do.
Here’s my nine point negotiation preparation checklist. As always, I’ve tried to make it all common sense and easy to do. Here goes.
Listen to the Negotiation Preparation Podcast
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1. Negotiation history & precedents
What prior negotiations have we had with this organisation/individual and what lessons can we learn from them? Remember that every negotiation you conduct sets precedents for the next one so be careful to exploit those precedents that suit you and be ready to refute those that don’t. A statement such as “we’ve always done it this way and there’s no need to change now” supports history whilst “because we’re entering a new year we need to develop a new way of doing business” gives you the opportunity to settle on more agreeable precedents.
2. Current market conditions
I think you need 20:20 understanding of the prevailing market conditions you are negotiating within because this will give you a clear grasp of the value of whatever it is you are discussing. For example, when house buying I reckon most people check the Land Registry, look at what other similar properties are going for in the area and generally sniff around so as to get a grip of the true value of the dream home they’ve just seen. If they don’t then the chances are they’ll end up paying over the odds. The better your understanding of true value, the greater the likelihood of you achieving great value for money.
3. Know your negotiation parameters
Because you have researched value, you’re now able to set your parameters. By this I mean the highs or lows of what you’re prepared to agree to. Here’s a negotiator’s acronym for you. Set your IQ point, (that’s not intelligence quota), but the point at which you can say “I quit”. Having an IQ point is essential. It means that you know exactly when the negotiation is no longer worth pursuing and you can walk away with nothing lost. IQ = confidence and if you keep to it you’ll never lose value.
4. Work out what you need & want from this negotiation
I define needs as absolute essentials and wants as strong desireables. Put it another way, I need water to survive but I want champagne to perk up my miserable existence. In our pampered, greedy Western lifestyles our wants tend to dominate. I don’t need an iPad but I really want one. Come to think of it, the entire Apple range is based on desires rather than essential needs. Maybe that’s the genius of the company. Anyhow, within a negotiation you shouldn’t reach any final agreement until all your needs are satisfied and as many of your wants are met as well. I prepare a list of each in separate columns. It sounds a bit nerdy, (hey, it is nerdy), but it works for me.
5. Know your opposite side
A strong relationship is an essential ingredient of the successful negotiation. The more you know about the person you are dealing with the better you will be able to anticipate their moves and gain a significant edge.
For instance, the approach you will take with a chatty negotiator versus the strong, silent type will be completely different. And if you know that he’s on a quarterly bonus scheme and it’s mid-March, how likely is he to be more flexible when you know he’s chasing his target?
It’s a good idea to check that the person you’re negotiating with has the necessary authority to reach an agreement, otherwise you’ve just wasted time and effort as well as revealing your hand to the other side.
6. Anticipate objections, problems & bear traps
This links in with knowing your opposite side. I’ve never been in a negotiation when the opposite side has not come up with reasons why my position is false and his/hers is not. Objections etc. are powerful ingredients in all negotiations, particularly in haggles, so it pays to try to anticipate those most likely to arise and work out credible responses. The best ways of doing this is to either know the other person inside out or to put yourself in the other guy’s shoes and try to imagine what questions you would raise.
7. Counter-punch with knock-out objections
The trouble with objections is that if you cant answer them properly then the temptation is to make a concession so as to keep in the other person’s good books. Experienced negotiators will quick-fire one objection after another so their victims are thrown off course and end up routed. So, it’s useful to have a bundle of powerful objections ready so you can go onto the counter-attack and divert attention away. Imagine your negotiating buddy raises a killer problem. You say something like’ “I’m glad you raised that because I have a major issue with XYZ,”……boom! With luck he’s now completely focused and trying to answer your question and his objection is forgotten. It’s a bit like tennis; if you can get the other person scurrying around the court then you can boss the game and win the match.
8. Proof of your position
If you think about it, negotiations are all about justifying, substantiating and proving your position whilst trying undermine the other side’s case. A great question to ask in a negotiation is “why?” and when people cant answer the “why” question properly then they have little choice but to give ground. Consequently, it’s really important to have solid proof at hand.
9. Understand Your alternatives a.k.a. BATNA
BATNA is another negotiating acronym and stands for Best (or Better) Alternative to This Negotiated Agreement. In other words, do you have alternatives? If I’m negotiating with Alan but know that I have Bertie and Charles beating down the door to provide the same service then I have plenty of BATNAs and I’m in a strong position. If, however, Alan is my only chance then I need to be well aware of that and adjust my strategy accordingly.
And finally… be prepared & ambush by phone
That’s it. If you spend some time in negotiation preparation you can cover off all these points so that when you start your negotiations you’ll be as confident and assertive as you need to be to succeed. And here’s a wicked tip. If possible, try to conduct the negotiation over the phone. If the other person is smart he’ll ask you about the issue and then say he’s too busy to talk right now which means he’s buying time to do his own preparation. But there’s a good chance that he’s a busker and, congratulations, you’ve just ambushed him. Either way, you’re now super prepared so you know you’re going to do well.