It would be easy (maybe even tempting) to define negotiation as a process of ‘getting what you want’. In fact, google for quotations about negotiation and you’ll find soundbites from business heads and politicians talking about winners and losers. But that’s a very limiting definition and not one that will help your business long-term.
In business negotiations, you may be seeking a deal favourable to yourself (of course) but the trample-your-opponent approach – while it might give you a momentary negotiation action hero ego-buzz – carries two major practical drawbacks:
- The person you just trampled is unlikely to want to work with you again (and presumably they have something you want otherwise you wouldn’t be negotiating in the first place);
- Your growing reputation as a trampler acts as a warning sign to people and businesses you want to work with in future.
So, if you work in negotiations with clients, suppliers, investors, etc. a broader, more faceted view of the subject is necessary.
…a bargaining process;
…knowing exactly what you want from the situation;
…understanding what the other person also wants;
…an agreement (though not necessarily a completely even, 50:50 deal).
Negotiation is also a multi-stage process, comprising preparation, exchange of information, bargaining, commitment/agreement, and then subsequent action. You can find models with more or less stages (for example, preparation could be sub-divided into several distinct steps) but they all fit this basic overall process.
Regardless of the exact process, negotiators tend to adopt one of five distinct negotiating styles, or attitudes, based on research into approaches to conflict conducted by Thomas and Kilmann in the 70s. These styles are defined according to the importance you attach to a) your own wants and needs, and b) the wants and needs of the other person; as follows:
- Competing – putting your wants and needs first.
- Accommodating – putting the other person’s wants and needs first.
- Avoiding – not interested in any needs, yours or theirs.
- Collaborating – seeking to meet both sets of needs.
- Compromising – accepting that some needs will be met, some won’t; for both sides.
Competing can be a very results-oriented approach in the short-term. However, unsurprisingly, the most effective negotiations (which also take into account future relationships and reputation) are conducted in either Collaborating or Compromising mode.
Key negotiation skills
As to what skills are essential to successful negotiation, the Chartered Institute of Procurement and Supply (CIPS), International Association for Contract & Commercial Management (IACCM) and Institute for Supply Management (ISM) all have relevant guiding competences and standards that are worth checking out. For a ‘starter list’ of core skills, the following is a good foundation:
- Analysis – to explore and understand the varying and/or conflicting interests of the parties involved.
- Rapport – to find common ground and build on it.
- Active listening – to correctly interpret what the other person is saying during the negotiation and how that affects their position and yours.
- Problem-solving – to clearly identify the sticking points and be able to propose and objectively discuss solutions.
Another area of competence that can greatly enhance any negotiation is emotional intelligence. The nature of a conflict situation (your needs are at least partly different to the other person’s, if not, you’d have nothing to negotiate about) often means frustration or worse; and the ability to control your emotional responses (and understand the other’s) can be critical.
Negotiation is often at the heart of business success. Whether it’s stakeholders, customers or suppliers, your needs and theirs will never be completely aligned because you have differing interests in a mutual situation. Yet, to move forward, you often need to find a mutually-acceptable (and agreed) middle ground. Sometimes you can find a balanced compromise, others it’s a genuinely win-win outcome. Either way, it’s negotiation that gets you there.
Naturally, this post can do no more than dip a toe in the water but if you’d like to explore the topic in greater detail, including how you can up your own negotiating game, check out our website for details or give us a call on 01582 714287, we’re here to help.