36 / IMPROVING YOUR SKILLS
Negotiating
Negotiating is all about bargaining to reach a mutually agreeable
outcome. It is a skill that will give you an enduring advantage, not just at
work, but in almost every aspect of your life. The keys to success in any
negotiation are having clear objectives and being thoroughly prepared.
Knowing your ideal
A negotiation involves two (or more) parties, who have
different needs, agreeing to compromise in order for
something to happen. Preparation is vital: start by
formulating a clear understanding of what you want
to achieve, what you are prepared to concede, and how
you will go about the process. Think about what you
want the outcome of the negotiation to be, discussing
and agreeing it with others where necessary.
Strategies for successful negotiation
of workers surveyed said they taught
themselves how to negotiate; 9%
learned from a mentor
55%
Start negotiating only
when you are ready to
do a deal. Don’t begin
the process on a
fact-finding trip,
for example.
TIME IT
RIGHT
01
NEGOTIATING / 37
Practice your
negotiating technique
in situations where the
outcome is not too
significant.
Propose trades with
the other party: “If
you could see your way
to do this, we might be
able to pay cash in
advance.”
Make a list of what you
think the other side
see as their must-
haves, ideals, and
give-aways.
At each stage, restate
what has been
discussed: “So,
we have agreed
that…”
Make sure that
everything is on the
table before you
decide to make
an offer.
When you have
reached a position,
make a clear offer
and wait for a clear
response.
If something looks
too good to be true, it
probably is—don’t be
taken in by slick
sales patter.
OFFER
TRADES
LOOK FROM
THE OTHER
SIDE
TEST OUT
YOUR
TECHNIQUE
SUMMARIZE
AS YOU GO
ALONG
MAKE YOUR
OFFER
DON’T BE
FOOLED
DON’T MOVE
TOO SOON
04
03
0708
06
05
02
38 / IMPROVING YOUR SKILLS
Being prepared
Before you start any negotiation, it is
crucial that you understand what else
is available. Before you attempt to buy a
car, for example, you need to have visited
other showrooms to see what is available
and for how much, and to have looked
at the road-test report, price guides, and
reviews. You also need to understand
what you are buying. When you buy a
cell phone, the price may seem very
reasonable, but you may be locked
into a 12- or 18-month contract. So,
unpack the product or service and
understand all the aspects.
“must-haves”
“ideals”
“give-aways”
of employees in one survey said
that they wanted to learn how
to negotiate a better salary
86%
Structuring your approach
Break down your thoughts into three areas:
•
The must-haves: these are the essential aspects of
the deal—if they are not available, you will walk away.
•
The ideal: this describes your perfect deal and defines
all the elements that contribute to it.
•
The give-aways: these are the aspects of the deal
that you would be prepared to trade for your your
“must-have” or ideal components.
NEGOTIATING / 39
Gaining power
Such analysis helps in two ways. First, it
helps you to identify your “must-haves,”
“ideals,” and “give-aways.” Second, it
gives you negotiating power. If you can
drop information about competitors
into the negotiation, it forces the other
party to respond in some way, giving
you an advantage.
BE CLEAR
Make sure that you clarify all
statements made by the other
party. Ambiguity is the enemy
of good negotiation.
Tip
NEGOTIATING YOURSELF A BETTER SALARY
The best time to negotiate your salary is before you accept a job. Your
prospective employer has invested money in recruitment advertising,
or consultants, and taken time selecting you. You are in a strong position
until you accept, especially if you have received other job offers too. In
these situations push for what you really think you’re worth. Remember
that every subsequent pay raise will be based on that initial agreement,
so getting it right will influence your salary for many years to come.
In focus
“must-haves”
“ideals”
“give-aways”
Analysis helps in two ways.
First, it helps you to identify
your “must-haves,” “ideals,”
and “give-aways.” Second, it
gives you negotiating power
40 / IMPROVING YOUR SKILLS
Doing the deal
Nearly every major negotiation requires
a meeting. When you enter a negotiation
meeting, you will have your objectives,
but be prepared to modify your stance
in the ebb and flow of the bargaining.
As the discussion progresses, the other
party will give you clues that indicate
their position. For example, if their
tone becomes more reflective, they
may be about to concede a point,
so ease off to give them the time
and space to make the step.
Understanding body language
Look out for body language that reveals
what the other person is thinking. If the
other person leans away from you, for
example, it may indicate disinterest, or
a demonstration of superiority: try to
engage your counterpart more, without
being confrontational. If more than one
negotiator is present, watch the person
who is not speaking. Directing some
of your questions to them may open
up other avenues.
Giving a reason
Most good negotiators know they
have to explain why they want
something, and that they have to
give the other person a reason to agree.
However, research has shown that
the logic behind the reason itself does
not necessarily have to be complex or
detailed. Basic as it may seem, if you
can back up your argument with even
a simple reason, you are much more
likely to convince your counterpart to
agree to your proposal.
CASE STUDY
RENEGOTIATING TERMS
The managing director of a window
manufacturer was introduced to
a potential new customer, a small
company wanting to buy window
frames. A deal was negotiated
based on payment with order,
so there was no credit risk. The
sales manager and MD had a good
feeling about the new customer.
They received the order for the
end of the week and put it into
manufacture early to make sure
it was ready for a Friday collection.
But on Thursday night, the sales
manager received a call from the
customer saying they had hit a
problem with their finance
company, which had delayed the
release of the money. Could they
put back the order a week?
The windows had already
been made, and could not be sold
elsewhere. There was little to
be lost and much to be gained
by allowing the customer to have
credit on this order. If they were
dishonest, it would be better to
find out sooner rather than later,
but if things were as they said,
the new relationship would be
strengthened. The customers
were as good as their word and
paid a week later. The trust created
by this one act resulted in a flow
of future orders.
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