Negotiation isn’t a form of face-to-face combat. It’s an intricate dance.
To do it well you must know the steps, be able to sense the shift in tempo, recognise your partner's strengths and weaknesses and get to the end together.
The negotiation process moves through several phases.
Let’s think about them as steps.
1. Establish the relationship
In some cultures it’s inappropriate to do business without first establishing the relationship. Take time to greet, meet and respect your partner. Be interested in them. Disclose a little about yourself. In essence, build rapport.
If your negotiation is a simple one this ‘establishing the relationship’ step might take the form of a few minutes ‘small talk’. If it’s a conflicted negotiation, perhaps between your organisation and a community it might take weeks or months of face-to-face meetings and forums to get to know the people and their issues.
Expect that some of those meetings will be heated. You will need to be prepared to show empathy and acknowledge past issues. Don’t argue. The time for negotiating is not yet. This is just the ‘getting to know you’ stage. It’s a critical one though because the seeds of trust are sown here.
2. Clarify the issue, problem or opportunities
Discuss the reason you are meeting together but don’t get into solving mode yet.
Staying away from problem solving at this stage can be quite hard to do because the moment we hear something we think we can fix we want to propose a solution. But you will make a better option if you fully understand the issues first.
Tease out what other problems the situation has caused, get the backstory to why it matters, find out what is going on and what potential opportunities exist for both you and your negotiating partners.
Share your perspective of the issue, problems and opportunities too – remember it’s a dance, so we both move together. You will find that this type of dialogue promotes understanding and rapport. Make sure you use inclusive language – it sends the subtle message that we need to work together.
3. Identify and disclose needs and concerns
A need is a tangible ‘must-get’ – something you have to walk away with, such as a pay rise.
A concern is an intangible or a psychological driver, rarely acknowledged at the table, but often has the power to derail a negotiation if it’s not accounted for in the agreement. For example in a pay negotiation we want a raise, but that’s just a way to show that our work is valued, that we are important in some way. If the raise is given, but we still feel undervalued we may resign anyway. Feeling valued is the psychological driver.
Disclosure is a tricky business. The general rule is that you should go first (if you are leading the negotiation) but you have to be careful.
The only time that 'leader goes first' rule is invalid is for sales negotiations, in which case you should get your client to tell you about their needs and concerns first so that you can strengthen your options towards the end of the process. Otherwise, go ahead and disclose your needs, but in in general terms, for example, state that you would like a more competitive price but don’t give up what price or a range just yet.
Invite your partners to tell you about their needs and concerns. Make sure you get them all. Sometimes we are so happy we got an answer we forget to check if there is anything else on the list.
Once all the needs and concerns are out we can see what we have to work with. Now it’s time to go back and give and get more detail on the needs and concerns.
You have to be especially vigilant at this stage not to dissolve into bargaining. If you do well, you will reach the tipping-point’ where collaborative problem solving takes over and both parties create the synergy necessary to reach agreement.
4. Generate options together
Start thinking about what options exist to ensure that both parties get what they need.
Begin suggesting options, but remember you are still in a dance, so get them to suggest options too.
The options you finally decide on may be a mix of your suggestions and theirs or something else entirely that is sparked from the process of generating ideas. Be prepared to think outside the square. If you have a clear picture of the needs and concerns for both parties, you will be more likely to find some options that suit you both.
Evaluate and tweak the options. Decide whether any of them have merit.
5. Decide whether to agree or not
You may decide that there is not enough value in the options on offer, if that’s the case and they are the best you can both come up with, you can shake hands and walk away. You have left the relationship in good standing so the door is open for another deal in the future.
If you decide to agree, be clear about what you are agreeing to. Are you agreeing in principle (but need more information), agreeing to a proposal (after which a decision is implied) or agreeing to the options as they stand? It’s often helpful to ask your partner what they want to do next - to get them to commit to action.
6. Action and contract
Decide and record who will do what by when and how.
Be very specific in this stage. Ensure there is no ambiguity in the terms or language used. For example if you agree to a ‘reasonable time-frame’ what is that exactly - two weeks? Four weeks? It could mean different things to different people and that can cause disputes later.
Conduct your negotiation as a dance with two partners, but when it comes to the contract, you have to consider a third party. No matter how amicable your negotiation has been, always write the contract for the judge. Stipulate damages, costs etc so if your deal goes bad, the judge can award you what you are legally entitled to in the contract. If it’s not in the contract, you probably won’t get it.
As you weave your way through the process of negotiation always keep the big picture in mind. How does this action, this agreement, this admission help get a good sustainable agreement that will last past the implementation phase to completion?
Be smart. Consider all the variables but recognise that your negotiating partner is just that, a partner. You can help each other. Together, the sum of you is greater than either one of you. Join forces against the problem, instead of against each other for a robust agreement and an enhanced, healthier relationship.