Learn the key skills that make negotiating easy
Negotiations are a part of everyday business life, yet many people approach them with fear and apprehension – which can ultimately lead to a poor deal that’s bad for you and your company. Here are key hints on how to negotiate successfully.
Get Rid of the Fear
In developed first-world societies, in particular, negotiating is frequently viewed as somehow distasteful. This is understandable, given that most people shop in department stores and supermarkets where there’s a take-it-or-leave-it fixed price structure. But we do it unknowingly all the time – just watch two little girls playing dolls and you’ll probably see some negotiation as to whose doll gets to wear what, or who gets to be ‘Ken’ and who gets to be ‘Barbie’! Or, as an adult, imagine yourself haggling for a souvenir in a market somewhere up in Africa or in a souk in the Middle East.
As in any facet of business, taking a seat-of-the-pants approach is likely to see you coming off second best. Before you enter into a negotiation, be clear as to what it is you need from the product or service under discussion, what things you can concede on, and what elements are absolutely vital. Also know how much you can pay, and at what point it becomes unviable. Those who know how to negotiate will frequently also try to find out something about their opponents – their likes, dislikes, negotiating style and possible weakpoints.
If you’ve got rid of the fear and are properly prepared, this shouldn’t be a problem. In some foreign cultures, negotiating is a fact of daily life and has been elevated to an art form, so any perceived lack of confidence when dealing with them will be regarded as weakness and the proverbial sharks will begin to circle. In such circumstances, it’s difficult to get your opponents to concede any ground because they feel that they’ll ultimately win in the end, anyway. Rather be firm, polite and sell your case.
Strive for a Win-Win
Horacio Falcao, Affiliate Professor of Decision Sciences at Insead Business School in Singapore, stresses that negotiators should always be looking for win-win strategies that allow all parties to find value in the deal, or at least feel like they are being treated fairly. He says that if one party tries to use excessive power to obtain a one-sided agreement, the result will be resistance, time wasting and ‘blocking’ tactics from the other party. “We get into a battle,” Falcao explains, “when that happens, all the effort we have put in is destroyed in a split second.”
Deals that are not ethical may come back to haunt the parties involved and can even turn out to be illegal – particularly in the new world order of greater transparency and good corporate governance, in which South Africa’s own King III-inspired legislation is prominent. Before agreeing to a deal always ask yourself: “How would this look if it were reported in the media tomorrow?” Falcao says ethical dilemmas often arise as a result of the negotiating parties becoming consumed by a high pressure win-lose situation, and seeking to ‘win’ at any cost.
Be Cool and Calm
If you’re inexperienced, savvy negotiators may try to pressure you in all sorts of ways. New information or proposals could be unexpectedly introduced, for example. Or members of the negotiating team may be suddenly withdrawn and other (less friendly) negotiators introduced. New timelines (“we need to settle this by tonight”) could also unexpectedly become part of the equation. These are attempts to unsettle you and throw you off balance. Rather than say or do something you may regret later, simply sit back, assess and be aware of the reason for these actions.
Be Prepared to Walk Away
Unless you need a deal at any cost (unlikely in a business environment), be prepared to walk away once you reach your baseline negotiating point. Far better to seek a new deal with a new party, or to let the current parties have time to cool off before resuming negotiations at some point in the future.