We are constantly in the process of negotiation in many aspects of our everyday life, with family, friends, coworkers, or in business. Some instances in normal every day life include negotiating a price in a purchasing, negotiating a job offer or negotiating to settle conflicts. But when it comes to negotiating certain major business deals, resolving work conflicts or settling differences to maintain personal or professional relationships, one must be well-equipped with proper negotiating skills to arrive at a desired outcome without creating animosity. Sometimes negotiating in certain issues might lead to disappointment if you lack the ability to stand your ground. Effectively negotiating an outcome that will satisfy your personal needs and objectives will be hard if you are unable to position yourself stronger whilst involved in discussions with others.
Understanding different types of negotiation ?
Negotiations are often strategic discussions to resolve issues in a way that both teams find acceptable. The process generally involves a discussion, clarification, negotiating an outcome and an agreement. And apparently in negotiation, each side tries to persuade the other to agree with their point-of-view.
There are two types of negotiations, integrative and distributive. Both types are essential when it comes to dealing with businesses. Distributive often refers the fixed pie where there is limited amount of what’s being distributed or divided. In this, the approach is rather competitive as there is fixed amount to be gained and if one gains then the other loses. Such kind of negotiation usually involves no pre-existing relationship. Everyday examples include buying and selling products. The purchasing of products or certain business services where two teams enter discussions with the goal of claiming as much value as possible. For instance, a good old-fashioned haggling where the seller wants to go after the best price while as a buyer, you want to pay the lowest price possible to achieve the best bargain.
There is no real benefit involved in investing in the relationship in such situations as one is less concerned with how the other perceives and each side’s interests are usually self-serving. Moreover, any potential information each side gets to know might become a potential leverage against the other to get a better deal. The only information one should reveal when it comes to such negotiations is the fact that they have options. This can include why you want to purchase, your preferences, or point at which you decline the deal.
On the contrary, integrative negotiation refers to a pie that can be enlarged to work towards achieving something together and is cooperative and involves trust-based relationship. Such negotiations often end up with both sides walking away feeling they have achieved something that has value. They mostly involve mutual problem-solving and are future-focused with long-term relationships in mind. Such negotiations require that both sides understand each other’s situation, goals, interests or priorities for which, both sides need to share as much information as possible.
Such collaborative approach is often constructive, principled or interest-based. This approach involves treating the relationship involved as important and valuable element while seeking an equitable and fair or a win/win scenario. You can arrive at solutions that can benefit both parties involved thus, creating something of value. But this doesn’t mean that being collaborative is being weak and giving in. On the contrary, a collaborative approach seeks to gain the best possible solution.
Why is it important to build your negotiating skills
Successful negotiations create opportunity. Knowing how to negotiate skilfully can help you in your professional or personal decision-making, to solve problems, ease tensions, and to build a collaborative environment. By improving on your negotiating skill, you learn how to reinterpret an uncompromising demand or set of terms issued because of a dispute, or to work amicably towards maintaining a personal or professional relationship.
When it comes to skilful leadership, reaching agreements involving different opinions, dealing with disagreements or resolving conflicts requires right negotiating skills and strategies. With right negotiating techniques, you can be successful in resolving certain hard issues, or in settling a challenging situation by finding ways to satisfy as many shared problems and different interests to arrive at an amicable solution.
How to upgrade your negotiating potential
No matter what type of negotiation you are in, it is important to enter the dialogue with the intention of reaching a mutually beneficial outcome or to resolve a conflict. How successful you get in a negotiation always depends on not only what you do during the process, but also on what you refrain from doing. It requires managing in real-time, both your and other person’s wants and needs and involves controlling your intuition, understand the opponent and provide satisfaction by showing them the benefits if they accept your offer. Here are some do’s and don’ts that help you strengthen your position in any negotiation process.
If you step into negotiation without knowing what it is that you want, then you will walk away from the negotiation with an unfavourable outcome. On the contrary, having clarity about what it is that you would like to obtain from the negotiation will allow you to plan and prepare an effective strategy that will help you get closer to your desired outcome. Remind yourself that at times your motives may blind you from seeing the most important issues that you actually need in order to reach a favourable outcome. Differentiate between your wants from needs.
Gain clarity about your personal motives, priorities, goals, needs and objectives. Also on what it is that your opponent wants, needs and hopes to gain from this negotiation. Determine what is driving and motivating you towards your goals and outcomes you would like to achieve as a result of the negotiation. Ask yourself, What is it that I want to gain from this? Is this my need or my want ?
Don’t think in absolutes
At times, others may need a change in direction to see other possibilities that they may not have considered. Assuming that there is only one solution or thinking in terms of absolutes does not lead to favourable outcomes. If you are focused on either your own position or of others’ – you often miss out on a whole range of possible solutions. When we think in absolutes, we tend to see only few options or see our approach or the situation as black or white, good or bad, right or wrong. We also limit our ability to think outside the box. Instead look at possible solutions that you could propose by thinking outside the box. Take time to think about the possible alternatives that you might be able to propose from your perspective, while at the same time looking at the potential solutions that the other side may be willing to bring to the negotiating table.
Preparation is the key to success and helps you determine the decisions you need to make during the process. Prepare to question the other side or your opponent from all possible angles and perspectives. Go into negotiations with as much knowledge as possible. For instance, if it is negotiating a job offer, research on what others are offering. If you are negotiating on a sale price, know the market for that particular product and how much others are selling it for. Likewise, know what you are bringing to the negotiation. Anticipate some of the more challenging issues that may arise and know how you are going to handle them. Ask yourself, What would they want to know? What concerns might they have?
Don’t come to a quick compromise to get things done
Most people measure their success by number of things they get done, you may have an aversion to conflict, or be willing to compromise that you later regret. Don’t sacrifice your values or integrity or allow biases, assumptions, emotions and ego overrule logic. Avoid being self-consumed, overly confident or overly optimistic. Prepare to walk-away if you are not able to reach an agreement amicably because there is always a possibility that some negotiations could break down or people at times can be unreliable. Such times, no agreement or a future agreement is the best alternative.
Don’t miss the bigger picture.
Sometimes we rush into negotiations so quickly that we simply do not focus on big picture and thereby do not identify potential opportunities for an agreement that could benefit everyone involved. Negotiations can at times get stuck when discussion focuses on small irrelevant issues that simply don’t need to be resolved. By getting lost in insignificant details, we simply lose track of bigger picture. It is important to realise that sometimes by sorting out the bigger picture, you can effectively resolve many smaller interconnected problems.
Prioritise ideas and, solutions, suggestions, variables and proposals made by you and your opponent to ensure that you don’t miss the bigger picture that is important of each negotiation. Provide them with a logical argument and break down your point-of-view into facts, stats and data that they cannot disprove. This way, you will effectively win them over to your way of thinking and work towards a long-term solution or a win/win scenario.
Choose an interest-based approach
Some people tend to engage in positional negotiation, especially if they are on opposite sides of an issue which is a win-lose scenario. However, using an interest-based approach increases the chance of success for both sides. The key is identifying the other side’s interest. Thinking logically provides you with a solid foundation of understanding. By simply asking why they want what they want, you can realise respective interests and whether or not they are conflicting.
Engage in dialogue, actively listen to what they are saying, and ask questions to truly understand their interests and concerns. Likewise, be transparent with yours. If the other side is competitive or positional and simply not willing to cooperate, or engaging in trickery, or being untrustworthy or not sharing any information, then it is better to walk-away. But it is important to remind yourself that the goal is always to reach an agreement and one should always try to avoid bringing the walk-away option too early into the discussion.
Avoid accepting positions & issue-fixation
Accepting positions taken by others as final or unmovable leads to missing the chance to move forward in a negotiating process. When the other person states their position assertively or forcefully, it is easy to assume that they are correct. This also leads to mistaking apparent conviction for evidence or feel intimidated by the way they make their point. Similarly, fixating on a single issue can lead to imbalance in negotiations and failure to realise all that you can. It can also lead to decision-making coming down to minor issues, as a result, you may reject bargains that don’t have a particular thing you want.
When the other side says that there is no alternative, and something is not negotiable, rather than accepting their position as unchangeable and giving into their demands, find the interest behind their position, real purpose or what is particularly important to them. Chunk up or down and seek areas of common ground that you can agree upon. You may not see the same solution, however, there may be certain aspects that you both can agree upon.
Listen, understand & Communicate
No matter how much you like to argue and fight your personal point-of-view, the purpose of negotiation is to reach a favourable resolution that is most ideal for everyone concerned. The ability to speak, listen and persuade helps you develop a rapport to find a common ground and on tackling shared problems. Everyone comes into negotiation with specific set of goals, objectives, and outcomes that they would like to obtain. Knowing other side’s personal drivers, their emotional tendencies or habitual emotional reactions, you can better understand what drives their decisions and actions.
Ensure that you are listening, questioning and clarifying what the other side has brought forth. It is equally important to communicate what you are looking for. Understanding others side’s expectations will determine their strategy, approach and willingness to make concessions. In order to show your opponent that what you are offering them is valuable, you too must satisfy the opposite side by finding benefits in accepting your offer. This is only possible when you listen to their needs, understand their concerns and communicate clearly as to what you are offering is aligned with their needs and also can highlight other benefits, so they understand your point-of-view to reach a favourable outcome.
Anchoring bias is relying too heavily on the first piece of information that is offered. So, it is important to differentiate between when you are being given information and when the other side is using it as their leverage. For instance, when negotiating a job offer, how much they are willing to offer can be an anchor for you if you want to negotiate for more. But if there is additional information about how reputed they are or how many others they are considering for the same position can be a leverage. Once, you hear how reputed the company is and how many others they are considering, you are swayed to relax on negotiating the amount you want to ask.
Instead of relying heavily on information that is available right away, take time to reflect on the information that is being provided, look for any point of references and see them as what they are, as anchors. When you realise you are being anchored, pause to understand it’s true value and commit to resume the conversation later. You can always reject an anchor if you do not comply. Instead of saying no, you can cite reasons as to why and propose to start over with more realistic and acceptable alternatives.
Think in solution-oriented terms
When you enter into a negotiation, it is very easy to get carried away with the problems and obstacles. Sometimes these problems grow so large that it gets difficult to see the opportunities and solutions that would help both sides to reach a favourable outcome. When solution seems to be too few and far, then simply focus on common problems that both of you share. Work together to identify possible solutions that will help everyone concerned to reach a favourable outcome.
Sometimes common problems bring forth the greatest insights and ideas. Seeking solution-oriented outcomes requires that you minimise making statements and rather focus on asking solution-based questions that will expand your thinking and reflective ideas. By learning to ask more effective questions you can gather information you need from your opponent to successfully move towards an amicable solution.
Questions for self-reflection
How do you rate your negotiating abilities in your daily life?
Are you competitive, assertive and aggressive in your approach ? Or are you collaborative, open and honest?
Do you prefer to avoid or participate in negotiating situations?
Do you compromise quickly in a negotiation to satisfy others?
How often do you try to find creative solutions in a negotiation?
How focused are you in understanding the concerns and interests of the other side?
Do you work towards what is fair to find a middle ground?
How accommodating do you get in building and maintaining relationship with the other side?
*Reflect on above questions to improve your negotiating potential *
Negotiating is an important skill to develop and requires patience, flexibility to adopt to changes or information presented during the process and requires proper awareness of the circumstances and subject involved. Successful negotiation is understanding opposite side’s needs and communicating to make your position clear on the issues involved, and provide logical arguments or strong evidence to support your claims. While the above steps and details provide a framework which can be used in real situations to strengthen your position, learning, participating quite often in negotiating situations can help you further in improving your skills. While doing so, focus on your strengths, have facts, information and data that support your stance, and develop an ability to understand yours and the other side‘s needs, priorities and goals in order to gain advantage in a negotiating process.