How to proceed in negotiations: How to enhance your negotiation

Identify your interest, issues and positions effectiveness even from a position of
Prioritize your interests weakness:
Establish a ranking order of priorities. Mitigate your weak spots by:
Different priorities invite trades. Systematic preparation.
Careful strategy design.
Common negotiator’s mistakes: Those who think weak, act weak.
Neglecting the other party’s problem Avoid myopic look at own weaknesses.
Letting price bulldoze other interests
Letting positions drive out interests Listening like a Negotiator.
Search too hard for common ground Learn active listening:
Neglecting BATNAs Develop the desire to listen.
Failing to correct for Skewed Vision Always let the other person do most of the talking
(30/70).
Stages of international negotiations: Ask a question –then be quiet –don’t interrupt.
Preparation phase Always ask the other person to clarify what he or
Establishing rapport she just said.
Exchange of information Learn to “listen” for nonverbal messages–body
Persuasion language.
Post negotiations
How should you respond to your
Preparing to negotiate: counterpart’s initial offer?
The 5-Step-Prenegotiation Framework: Ignore anchor, shift conversation to different topic.
Step1: Assess your BATNA
Separate information from influence.
Step2: Calculate your Reservation Value Avoid dwelling on their anchor.
Step3: Assess other Party’s BATNA. Make an aggressive counteroffer, then propose
Step4: Calculate other party’s Reservation Value. moderation.
Step5: Evaluate the ZOPA. Give them time to moderate their offer without
losing face.
Negotiating from a weak BATNA
Negotiating from an inferior power position: Designing your first offer.
Don’t reveal that you have a weak BATNA. Four factors to consider when establishing your
Overcome your weakness by leveraging the other first offer
party’s weakness 1. Keep the entire ZOPA in play
Identify and leverage your distinct value proposition 2. Provide justification for your offer
(DVP) 3. Set high but realistic aspirations
 How to overcome ‘price only’ negotiations? 4. Consider the context of the negotiations and
1. Submit multiple proposals simultaneously. the relationship with the other side
2. Lower your bid just enough to get into the
second round’. How to obtain information to better estimate
3. Take the agent out of the game. the other party’s reservation value (exit point)
4. Educate your customer between deals. Identify your assumptions prior to negotiations.
If your position is extremely weak, consider giving it Exhaust all pre-negotiation sources of information.
up entirely and simply ask the other side to help you. What are the benefits of gaining more information
Strategize on the basis of your entire negotiation prior to negotiation?
portfolio.  Gives clearer concept of ZOPA.
 Reveals the other party’s interests.
Shifting the balance of power in your favour:  Avoids being manipulated or lied to.
 Commands greater respect.
Increase your strength by building coalitions with
 Decreases willingness of the other party to deceive you
other weak parties.
Ask questions that challenge your assumptions.
Leverage the power of your own (extreme)
Ask indirect questions.
weakness.
Protect yourself from lies and uncertainties with
Understand and attack the source of your
contingency contracts.
opponent’s power.
The 7 principles of investigative negotiations: 5 strategies for eliciting information from
Don’t just ask WHAT => ask WHY. reticent negotiators :
Seek to reconcile interests not demands. Build trust to create willingness to share
Create common ground with uncommon allies. information.
Interpret demands as opportunities. Ask questions (especially when you are surprised or
Don’t dismiss anything as ‘their problem’. sceptical) and know HOW to ask them.
Don’t let negotiations end with a rejection of your Give away some information.
offer. Negotiate multiple issues simultaneously.
Understand the difference between ‘selling’ and Make multiple offers simultaneously.
‘negotiating’.
Creating Value Contingency contracts:
Effective haggling strategies: Create value by allowing negotiators to stop arguing
about their different beliefs, and leverage their
Focus on the other party’s BATNA and reservation
differences through bets that both sides believe to
value.
win.
Avoid making unilateral concessions. Create expected value
Make clear that you expect concessions of similar Can rescue deals if the expectations of both parties
size. are extremely different.
Make contingent concessions. Can protect parties from dishonest negotiators.
Be aware of the effects of diminishing rates of
concessions. Where contingency contracts do not work:
What are the effects of a contingency contract
Strategies for value creation: on the other party’s incentives?
Preparation : Make sure, contingency contracts are incentive
Identify your multiple interests compatible.
Create a scoring system If the other party is more knowledgeable than you
Calculate an overall package reservation value (has access to more reliable information sources)
Identify the other party’s multiple interests. ‘If you argue about who won the bet, it is not worth
Execution : betting.
Negotiate multiple issues simultaneously
Make package offers STRATEGIES OF INFLUENCE
Leverage differences of all types to create value. How to influence and persuade your
Post-negotiation : counterparts:
Seek out Pareto improvements even after the deal is Highlight potential losses rather than potential
signed. gains.
Disaggregate your counterpart’s gains and
aggregate their losses.
Getting to YES.
Employ the ‘door-in-the-face’ technique.
 Employ the ‘foot-in-the-door’ technique
 Leverage the power of justification.
 Leverage the power of social proof.
 Make token unilateral concessions.
 Use reference points to make your offers and
demands seem reasonable
 Pre-empting lies and deception:
Defence Strategies:
Look prepared.

How to signal your preparedness to your counterpart:

 Arrive on time for all negotiation meetings.

 Be well prepared to discuss details regarding the
myriad of issues that are involved.
 Be well organized and efficient.
 Remember the finer details of prior discussions
with the other party, be able to refer explicitly to
notes you made during earlier meetings.
 Speak intelligently on issues related to their
Defending yourself against STRATEGIES OF business and industry – including issues that are
INFLUENCE: not directly relevant to the current negotiation.
Prepare systematically.  Respond expeditiously to requests for information
Create a scoring system. or to the other party’s offers.
Explicitly separate information from influence. Signal your ability to obtain information.
Do not negotiate under time pressure.
Rephrase your counterpart’s offer in other terms. Ask indirect questions.

When Negotiations get NASTY: Take the first step – don’t lie.

How to Deal with Anger: How to Detect Lies:

Detection Strategies:
Gather information from multiple sources.

Set a trap, test the honesty of your counterpart.

Zero-in on the truth.

Look out for responses that do not answer the

question you asked.
Seek to understand why your counterpart is angry.
Establish a contingency contract.
Give voice to your counterpart’s anger.

Sidestep an emotional attack and maintain control

of your own emotions.

Help the other party focus on their true underlying

interests

Dealing with threats and ultimatums:

Ignore the ultimatum.

Anticipate and pre-empt any additional threats that

your counterpart might be tempted to make.

If you don’t find the threat to be credible, let them

know.

Consider the impact of face when dealing with

threats and ultimatums.