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Negotiation Strategy
Summary
   Negotiation is getting what we want from people who
    want something from us
   Preparation on all the issues is everything
   All negotiations should revolve around the word 'IF'
   It's about movement from both sides to a common
    acceptable agreement
   Be firm but flexible; polite and clear; cool and rational
   Nothing is agreed till everything is agreed
   Avoid changing the price. Change the
    proposal/package
Negotiation Tips
   Spot tactics as tactics: don't react emotionally
   Final often does not mean it. Finalish : Forever-for-
    now
   AII negotiations can be renegotiated
   Price is one aspect: there are other satisfiers
   It’s not how much you concede but how you concede
   Leave the other person thinking they got a bargain
   Beware "funny money" (odd promises/offers)
   Remember long term relationships
   Watch out for last minute problems
   Get written contracts
Phase 1: Preparation - What Do We
Want?
   Decide which crucial issues need addressing
   Define your wants for each issue
   Rate how important each want is
   Assign ranges of possible values to each issue/want
    (entry and exit position). Know your BATNAs
   Record preparation details
   Start thinking about the other party's wants and
    priorities
   Try the same strategy for their wants
Phase 2: Debate - What do they want?
   Use debate/discussion to gauge the other party's
    views/wants
   Use open questions, clarification, active listening to
    discover their 'entry' position and all subsequent
    positions. Be curious, listen carefully
   Avoid saying no. Ask a question rather
   Regularly summarize what you here the other party
    proposes before responding. Precis your understanding
    of their position
   Avoid discussions around beliefs, values, principles,
    opinions communicate your wants and find out their
    wants. Concrete not abstract
   Look for signals of 'movement'-qualifications attached to
    a statement-get the other party to expand on their
    tentative hints
4 Key Questions in Every Conversation

   What are they asking for?
       Goal
   What do they want?
       Need
   What will they accept?
       Resistance Point
   At what point will they walk away?
       BATNA
Phase 3: Propose - What Wants Could We
Trade?
   Analyse your competing wants
   Make your proposal conditional - the condition and
    the offer
   Be flexible-but always conditionally
   State your proposal-then shut up! Listen
   If responding to a proposal - summarize, clarify, ask
    open questions-don't instantly reject
   Offer a considered, alternative, perhaps
    compromise, proposal
   Between two converging considered proposals is a
    potential settlement and agreement
Phase 4: Bargaining
   The precise terms on which both parties would settle
   All bargains should be expressed as a condition and
    an offer. If you ... then we ....
   Different from 'Proposal' as it is precise and you are
    seeking a 'yes'
   If offer rejected, require other party to propose
    reasonable alternatives
   If responding, make a conditional counter-offer
    bargain (you may return to debate phase)
   Keep whole deal together-all issues linked in the one
    package
   Remember nothing is agreed till everything is agreed
Agreement
   Closing techniques
   When: Greedy is worse than needy-have you got
    what you want?
   How:
       Conditional traded movement close to clinch
       Summary close
       Adjournment close
       Either/or-useful if within budget constraints
   Agree what you have agreed:
       Each issue which has been subject to negotiation should
        be summarized and the summary agreed between the
        two parties, Follow up in writing. Check sensitive
        phraseology at this point
Pricing Issues
   Never change the price - change what is offered
   Identify all the negotiable tradeables in your
    business
   Money always involves numerous issues and
    emotions
   Stress the value of ownership versus the cost of
    purchasing
   Stress the value of the service versus the cost of the
    service
   Stress the value of long-term benefits versus the
    upfront costs
   Stress benefits rather than features
   Listen to how they talk and think about money
False Assumptions
   The buyer is usually all powerful
   The buyer knows what he/she wants
   The price is always the central issue
   Competitors dictate your limits
   More authority is better in sales
   Price cutting is the most powerful weapon
The Real-World Law of Time Pressure
   90% of all concession making is done in the last
    10% of time spent negotiating
   Furthermore, one of the two parties is ALWAYS
    under greater time pressure ...

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Negotiation Strategy

  • 2. Summary  Negotiation is getting what we want from people who want something from us  Preparation on all the issues is everything  All negotiations should revolve around the word 'IF'  It's about movement from both sides to a common acceptable agreement  Be firm but flexible; polite and clear; cool and rational  Nothing is agreed till everything is agreed  Avoid changing the price. Change the proposal/package
  • 3. Negotiation Tips  Spot tactics as tactics: don't react emotionally  Final often does not mean it. Finalish : Forever-for- now  AII negotiations can be renegotiated  Price is one aspect: there are other satisfiers  It’s not how much you concede but how you concede  Leave the other person thinking they got a bargain  Beware "funny money" (odd promises/offers)  Remember long term relationships  Watch out for last minute problems  Get written contracts
  • 4. Phase 1: Preparation - What Do We Want?  Decide which crucial issues need addressing  Define your wants for each issue  Rate how important each want is  Assign ranges of possible values to each issue/want (entry and exit position). Know your BATNAs  Record preparation details  Start thinking about the other party's wants and priorities  Try the same strategy for their wants
  • 5. Phase 2: Debate - What do they want?  Use debate/discussion to gauge the other party's views/wants  Use open questions, clarification, active listening to discover their 'entry' position and all subsequent positions. Be curious, listen carefully  Avoid saying no. Ask a question rather  Regularly summarize what you here the other party proposes before responding. Precis your understanding of their position  Avoid discussions around beliefs, values, principles, opinions communicate your wants and find out their wants. Concrete not abstract  Look for signals of 'movement'-qualifications attached to a statement-get the other party to expand on their tentative hints
  • 6. 4 Key Questions in Every Conversation  What are they asking for?  Goal  What do they want?  Need  What will they accept?  Resistance Point  At what point will they walk away?  BATNA
  • 7. Phase 3: Propose - What Wants Could We Trade?  Analyse your competing wants  Make your proposal conditional - the condition and the offer  Be flexible-but always conditionally  State your proposal-then shut up! Listen  If responding to a proposal - summarize, clarify, ask open questions-don't instantly reject  Offer a considered, alternative, perhaps compromise, proposal  Between two converging considered proposals is a potential settlement and agreement
  • 8. Phase 4: Bargaining  The precise terms on which both parties would settle  All bargains should be expressed as a condition and an offer. If you ... then we ....  Different from 'Proposal' as it is precise and you are seeking a 'yes'  If offer rejected, require other party to propose reasonable alternatives  If responding, make a conditional counter-offer bargain (you may return to debate phase)  Keep whole deal together-all issues linked in the one package  Remember nothing is agreed till everything is agreed
  • 9. Agreement  Closing techniques  When: Greedy is worse than needy-have you got what you want?  How:  Conditional traded movement close to clinch  Summary close  Adjournment close  Either/or-useful if within budget constraints  Agree what you have agreed:  Each issue which has been subject to negotiation should be summarized and the summary agreed between the two parties, Follow up in writing. Check sensitive phraseology at this point
  • 10. Pricing Issues  Never change the price - change what is offered  Identify all the negotiable tradeables in your business  Money always involves numerous issues and emotions  Stress the value of ownership versus the cost of purchasing  Stress the value of the service versus the cost of the service  Stress the value of long-term benefits versus the upfront costs  Stress benefits rather than features  Listen to how they talk and think about money
  • 11. False Assumptions  The buyer is usually all powerful  The buyer knows what he/she wants  The price is always the central issue  Competitors dictate your limits  More authority is better in sales  Price cutting is the most powerful weapon
  • 12. The Real-World Law of Time Pressure  90% of all concession making is done in the last 10% of time spent negotiating  Furthermore, one of the two parties is ALWAYS under greater time pressure ...