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Negotiation Skills

Introduction
Definition Negotiation is a process of bargaining
in which two parties, each of whom has
something that the other wants, try to reach an
agreement, on mutually accepted terms.
Negotiation is any form of meeting or discussion
in which two parties who are in contact use
argument and persuasion to achieve an agreed
decision or action.
Negotiation is something we do all the time and
not merely for business purposes. It forms an
irremovable part of our social lives also.
Negotiation reaches agreement through
discussion and not through instruction, orders,
power, influence, authority

Need to negotiate
Negotiations in business context are used for selling,
purchasing, staff, borrowings, transactions, contracts
and other business matters.
If you negotiate to beat the opposition, it is known as
Distributive negotiation. Use of persuasive tactics
is made and you may end up not reaping the
maximum benefit. This is because you are not
looking for compromise and both parties are looking
for different outcomes.
In more friendly negotiations, both parties aim to
reach a common agreement and it is known as
Integrative negotiation. It usually leads to highly
beneficial outcomes.

Pre-negotiation
Tim Hindle in his book Negotiating Skills
bear in mind that it is almost impossible for a
negotiator to do too much preparation.
Preparation for negotiation involves assessing
the relative strength of the two parties
Setting of objectives which includes the real
issues and determining who would represent
the parties concerned.
Knowing your extremes including how much
can you afford to give in a settlement

The negotiating phase
Usually negotiations follow a fixed sequence
Parties begin by defining the issues and scope
for negotiations
Both parties, one by one, define their
individual positions
Initial positions are tested through argument
Move to a possible solution as an outcome of
argument
Firm proposals are made in more specific
terms, discussed and modified
An agreement is concluded

Behavioral strategy during negotiation
Prepare the agenda
Display confidence and power
Keep the negotiation under control and do not
compromise on quality, price, profit margins
which might hurt your business interest
Aiming high is a good tactic and then slowly
coming down to the other partys demands
Maintain flexibility
Implementation
Confirm in writing all that has been agreed
upon
Mention an implementation program in the
agreement including delegation of tasks to
various people
Ensure that every concerned person clearly
knows about the agreement, its implications
and the strategy of action

Types of negotiation

Hard
(1) participants are adversaries
(2) goal is victory
(3) demand concessions as a condition of the
relationship
(4) distrust others search for the single answer:
the one you will accept
(5) try to win a contest of wills
(6) apply pressure

Soft


(1) participants are friends
(2) goal is agreement
(3) make concessions to cultivate the relationship
(4) be soft on the people and the problem
(5) trust others
(6) change your position easily
(7) make offers
(8) search for the single answer: the one they will accept
(9) insist on agreement
(10) try to avoid contest of will
(11) yield to pressure



Tips for successful negotiating
Develop negotiation consciousness be assertive, realize that
everything is negotiable, be expressive without anxiety or
anger, be assertive not aggressive
Become a good listener negotiators are detectives, patient
and careful listening can solve many problems for you, a
successful negotiator listens more than he speaks
Go prepared- do your homework
Aim high sellers should ask for more than they hope to
achieve and buyers should offer less than they are prepared to
pay
Be patient
Focus on satisfaction
Dont accept the first offer
Dont make unilateral concessions- whenever you give
something away, get something in return
Ask open ended questions
Silence is Golden

When the other person is a talker and you
want to learn as much as you can without
making any type of commitment, saying
nothing and letting the other person do the
talking may be the best tactic. This is also a
good choice when someone says something
angry, attacking or outrageous. If you say
nothing, there isnt anything for the other
person to counter.
Facts and statistics
Anytime you can incorporate Facts and Statistics into
your negotiation, you have a tool that the other
person will find difficult to handle. Good data can add
a tremendous amount of power and credibility to your
side. But be careful if you quote statistics
incorrectly and the other person proves you wrong,
you lose credibility
Deflecting an answer with a great
question
This is one of the best tactics to keep the
door open in negotiations. If someone is
asking you to do something or accept
something that youre not immediately sure
is the best thing for you, say, Thats a great
question or Thats interesting Ill think
about it and get back to you later.
Put it in writing
Whenever you and the other person reach
agreement in a negotiation, you should be the one
to put the agreement in writing. This gives you the
opportunity to tie down any loose ends, such as
times, dates or wording that favors your interests.
Counter: If you dont agree with the loose ends
that someone else includes, you should
immediately email or write the person, explaining
how you think the issues should be handled
Negotiation by email-not
recommended
Remember email lacks the physical, social
and vocal cues which can be very valuable
during a negotiation. Also remember that
the small talk preceding negotiations (which
is not very effective via email) is very
important to building rapport
Also remember
The best time to make a request is BEFORE
you accept an offer, this is when you hold
the most power. Also, the way in which
you negotiate your starting offer
establishes an important impression and
lays the foundation for future interactions
and negotiations.

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