Negotiation Preparation & Success – Part 1

One of my colleagues recently said they found it very useful to attend the Dynamiq Consultants U.K. negotiating skills training. They especially appreciated the concept of putting yourself in the shoes of the other party!

When any of us are negotiating we often go in with a pre-set frame of mind when all we tend to think about is “I want this – I want that – I want the next thing”, rather than the other way round, by which I mean thinking about what’s important to the other side, and why is that important to them?

Conceding reluctantly

They may want things which you can give them quite easily, but you should generally try to make sure that you get something back in return. The way to do this is to avoid making it obvious when what they want is not a problem for you! In this way you might get an ideal outcome from your angle when they might think that you’ve had to compromise more than in fact is the case.

They may want flexibility of design in the event or process you are offering to them. They might ask you to modify your designs and plans, having no real idea if this will be easy or difficult for you, though it is really important to them.

It may be very important to one of my clients that I be willing to restructure and modify the design of a training programme which I know I can modify pretty easily, in fact. But if I am a shrewd negotiator, I don’t give that fact away for nothing. I do a little reluctant conceding In other words, I give the impression that I will be in some difficulties providing what they are asking for, but in reality it’s not a problem, or only a little one, for me. They get something they value a lot from me, and my willingness to concede ground may increase their willingness to do so when I am seeking a concession of some kind from them.

Developing Leverage

This is all about developing increased leverage; some things I can give away relatively or very easily that the other side value a lot. In all negotiations, they want lots of things as, of course, I do!

Getting paid more quickly

In the case of one of my current clients, I reckon they could pay me a lot quicker than they do! I could renegotiate my invoicing and payment arrangements with them. I could suggest that, in exchange for a modest discount, they could pay me more quickly or on a monthly or on some other ‘preferred supplier’ basis reducing my running costs and business overdraft charges. This may be really easy for them and not an important issue, as they are a cash rich organisation to which my fees are a mere drop in their fiscal ocean! I must be aware, however, that they may – in turn – do some reluctant conceding before agreeing to this. They don’t want it all to seem too easy, any more than I do!

As in all negotiating situations, you must try not to give the impression that many of the things being asked for or demanded are of little or no importance or difficulty to you. If an issue is very tricky or you think it could consume more time than is needed or available right now, then saying “Can we come back to that later, as it’s really important and will need careful consideration?” can be a very useful expression if not overused!

If I am a relatively small enterprise, It may be extremely helpful to me to be paid very regularly, on a retainer or standing order basis for example, but I need not let on to them about that as a ‘needy’ issue – better to stress that it would simplify the project’s cash flow and facilitate future programme planning, resourcing and co-ordination – to the benefit of both sides.

Mirroring

Another term for this is mirroring! Example …. “If you could pay us on a monthly standing order basis, representing 1/12th of our contracted business with you over the year ahead, then we could accommodate your requirement for a high degree of flexibility in our event and programme planning, which is a time and resource intensive issue for us!”

One key skill to be imparted in training people to negotiate successfully is to stress the importance of aiming for a WIN WIN outcome for all, or as perceived by all. Even the most skilled and successful negotiators need to keep remembering to use this skill in all their business negotiations.

Issues of importance to clients…

Some issues are especially important to clients including the flexibility of design, price, quality and standard of delivery. As you can see from our negotiating video and the accompanying articles on this website, good negotiators prepare in advance and give thought to all of the issues that you want to cover and how important those issues are to you. Then you think about your ideal outcome and compare it with the least that you might accept.

In my fee structure I might for example want to charge £12,000 ideally. Then I think about what concessions I might need to be willing to make, so I might be prepared to do the deal at £10,000 but not go lower than that. In this way I develop a realistic set of parameters for the piece of business in hand.

Unless anything radically changed! They might suddenly say they want twenty programmes, so I might modify my target fee structure.
The most important thing is to think about these possibilities in advance, so that you are prepared when they occur. Sometimes you will be working in a negotiating team when this is even more critical.

In our video on negotiation skills I talk about a colleague who worked in the Health Service as a Director of Procurement. He used to go with the Chief Executive of a PCT (a body that funds hospitals) to meet the Chief Executive of a Hospital Trust to negotiate. He told me that the only preparation he did was in the lift on his way to the conference room.

Does that mean that he was a highly skilled negotiator or just a lucky one?

He was unlucky I thought because he’d have been a lot luckier if he’d prepared. It’s like the golfer, Arnold Palmer, who famously said “The more I practice the luckier I get!”

In part 2 of our series ‘Negotiation Preparation and Success’ we look at preparation in more detail, and what makes a negotiator successful.  If you would like more help and guidance on negotiation skills, please contact us or call on 0114 2363781.

Article by Ian Flemming and Peter Collett .

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