© 2011 AACE International Inc. “AACE” and the AACE logo are registered marks of AACE International (06-10) Essential Negotiating Skills for Cost Engineers * And a little bit about AACE International

Agenda Why Negotiating is an important skill Types of Negotiations The 7 Steps Cultural Considerations Update on AACE International 2

My Background Global association management professional for 15+ years including tenure with ASME MBA, Certified Internal Auditor, Certified Government Auditing Professional and Certified in Control Self- Assessment Recognized as a Distinguished Faculty member by the Institute of Internal Auditors for conference presentations, facilitations and seminar instruction Topics include: communication skills, hostile negotiations, conflict resolution, audit skills, generational differences, creative problem solving and risk management AACE International Executive Director for 109 days 3

Meaning The word “negotiation” stems from the Roman word negotiari meaning “to carry on business” and is derived from the Latin root word neg (not) and otium (ease or leisure). That’s the central point: It’s not easy!

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Negotiating: A Critical Skill It is a part of everyday life It makes you valuable to your company, supervisor and department It gives you confidence and builds your skill set It makes the team stronger It can save your company time, money and resources Bottom line it can earn you more money, a promotion and more clout 6

Types of Negotiations Informal – the kind you do every day Formal: –Budget Issues –Trade offs between scope, time, costs, quality –Change management –Contract Overruns –Workspace and Equipment –Vendor Selection –Risk Management Strategies –Pay scales & Bonuses 7

The 7 Steps to Successful Negotiations Why we exist!

The 7 Steps to Successful Negotiations 1.Prepare 2.Set the Tone 3.Listen and get the issues on the table 4.Look for Common Ground 5.Shoot for Collaboration 6.Spell out Decisions 7.Close with a final Summary 9

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Preparation is Key Do a DUMP Sheet What Outcomes do you want out of the meeting? What is your BATNA? What is your bottom line?

Set the Tone Clarify Purpose Physical environment Collaborative mindset Ready and willing to listen Keep a sense of humor 12

Actively Listen Focus on what is being said; maintain good eye contact, lean in; head nodding Ask Questions Paraphrase Don’t tune out!

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Common Ground A summarizing tactic Transitioning tool 15 Areas of AgreementAreas of Concern

Agreements/Disagreements Worksheet – Why it Works Listening in Stressful Situations Bearer of Bad News More Analytical/Objective Perspective 16

“By fighting you never get enough, but by yielding you get more than you expected” – Dale Carnegie, How to Win Friends and Influence People 17

Strive for Collaboration 1.Willingness to listen with objectivity to all sides of the story 2.Listening to peoples’ different perspectives to the situation 3.Willingness to brainstorm solutions that will be of mutual benefit 4.Stay focused on the problem and not the people 18

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Spell Out Decisions Put detailed decisions on paper Express expectations Close meeting with final summary, expectations, next actions to take, and deadlines Always reconfirm deadlines 20 Closing

A Word on Salary Negotiation –Research –Strike first –Make them sweat –The complete package 21

The Golden Rule of Resolving Conflict

Myth Busting Most literature on negotiation and conflict management espouse the collaborative Win- Win approach as the only style to use. That is not exactly true Collaboration yields the best success. In truth it depends on the person and the situation. You must think strategically in terms of your approach

Don’ts of Negotiation Don’t negotiate via . It leads to the escalation of issues. Pick up the phone or even better meet in person. You can always get the documentation later. Don’t Allow emotion to escalate Don’t negotiate with the unempowered

25 “Let us never negotiate out of fear. But let us never fear to negotiate” – John F. Kennedy Inaugural address January 20, 1961

Cultural Considerations Most people in most cultures hate conflict Common issues: –Language barriers –Reference issues –All filter through their individual values, beliefs, cultural bias – this leads us to interpret through our own lense –People rely on stereotypes According to the Harvard Business School “Deal making across cultures tends to lead to worse outcomes compared to negotiations within the same culture” Take time to study the person on the other side of the bargaining table, including the country in which he/she is from, his/her company, etc.

Richard D. Lewis Model 27

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© 2011 AACE International Inc. “AACE” and the AACE logo are registered marks of AACE International (06-10) AACE

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Federal Agency Roundtable District Architecture Center (Washington Chapter AIA) 421 7th St. NW Washington, DC - October 17, 2014 from 8:30 am to 12:30 pm The focus of the roundtable discussion, which will be facilitated by officers of the Association, will be “The Benefit of Professional Certifications within Government Contracting:” 34

The Second ITCM Conference will be held in Bangkok Thailand 35

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© 2011 AACE International Inc. “AACE” and the AACE logo are registered marks of AACE International (06-10) Questions? Contact Information Charity Golden, MBA, CIA, CCSA, CGAP