Saturday, 20 March 2010

How To Win Negotiations

We tend to consider negotiating as a skill used in business and exercised by a separate group of specialists who negotiate big commercial contracts. In fact negotiating is an important life skill that we all do more of than we think.  In a family setting agreeing lights off time with your children becomes more of a negotiation than an instruction as they get older not to mention pocket money, allowances. use of the car,  curfew hours or holidays without the parents.

At work, negotiating your first salary is not something that occurs to most young people starting their first job but research shows that the affect of  getting an extra few pounds on that first salary can have a huge knock on effect across your whole career.

In business negotiation is often seen as a highly charged game of combat where there are only winners and losers.  This is not the most productive way of building your business. John Paul Getty is reported as having learnt from his father how important it was  when negotiating a deal to not try to make all the money that was available but to allow the other party to made some money as well.  This pragmatic approach was based upon his fathers conviction that if you stopped the other party making any money then pretty soon you would have nobody to do business with. 

Is Win Win possible?
One big problem when negotiating is that we don't know what the other party will settle for and what their sticking points are. We tend to find these out by feeling our way around and sometimes a deal will fall through because of some relatively minor point. 
How can we increase our chances of making a deal without giving in?
Try to avoid a fixed "bottom line" position.  While this protects you from selling yourself short it does not give you any leeway to respond to new information that comes up during discussions.
Establish beforehand if you can afford to walk away from the negotiations and the deal.  Try to identify the risks and judge if you can afford to take them. Remember that if you need to make a deal at any cost then you cannot reasonably expect to negotiate the best possible terms.
Look for scope to expand the deal to cover other areas and increase the potential.
Most negotiations are started because there are two parties who do  want to make a deal. This will  give you more power in the process than you may think.
Listen to what the other side are saying and be open to changing your tack.  Don't offer concessions unless they are asked for.

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