1. NEGOTIATION SKILLS Nico Decourt

2. Today When will you need to negotiate? What is negotiation? What is a good negotiation? Hard, soft and principled methods People, interests, options and criteria Power and Dirty tricks

3. When & what will you negotiate? Investors and financiers Customers Competitors and Collaborators Suppliers Staff Premises Regulators & Government

4. What is Negotiation? Definition:- – To confer with another or others in order to come to terms or reach an agreement – Latin,from negotium to transact business Most see themselves as having two ways to negotiate; HARD OR SOFT

5. Possible Outcomes  WIN- LOSE  LOSE-LOSE  WIN-WIN  WIN-PERCEIVED WIN

6. Good Negotiation Should produce a wise agreement which – meets legitimate interests of both sides – resolves conflicting interests fairly – will last Should be efficient Should improve or at least not damage the relationships between parties

7. HARD Negotiator Sees it as a contest of wills Takes extreme positions Holds out to the end Wants to win ‘at all costs’ BUT Often ends up producing an equally hard response and harms relationships

8. SOFT Negotiator Wants an amicable resolution Wants to avoid personal conflict Makes concessions BUT Often ends up feeling exploited and bitter

9. Hard Method - Positional bargaining Each side – Takes a position – Argues for it – Makes compromises – (Hopefully) Reaches a compromise This involves taking up and then giving up a series of positions

10. A Wise Agreement? The more you defend a position – the more committed you become to it – The more you become interested in “saving face” not agreement – The less concerned you are with underlying concerns of each party The more you argue that it is impossible to move, the more it becomes

11. Efficient? Time consuming Tendency to start with extreme positions and to defend them – The more extreme the position – The smaller the concessions – The longer the negotiation will take Requires lots of decisions by each party

12. The Ongoing Relationship Becomes a contest of wills It becomes a battle rather than a devising of jointly acceptable solutions Conflict words – ‘Can’t, won’t, not going to give in….’ Often leads to resentment & anger

13. Soft Method Many try to avoid the pitfalls of hard negotiation. They: – Prefer to see the other side as ‘friends’ – Focus on agreement not victory Method emphasises relationships & is often efficient Wise Agreements? - beware the hard negotiator

14. Negotiation levels Level 1 addressing the substance – Salary, terms of a lease or price to be paid Level 2 - the procedure for dealing with the substance - – The game about the game - the meta-game – How will we negotiate, hard, soft or some other way?

15. The Principled Negotiation Separate the people from the problem Focus on interests not positions Generate a variety of options before deciding on what to do Insist that the result be based on objective criteria

16. Human interaction is essentially negotiation. Intimidating, chiseling, and tricking are NOT negotiation. Defining Negotiation

17. Negotiation Is Personal  Emotions, temperament, and personality affect needs, interests, goals, and perspectives.  Ego, self-concept, and fears affect our needs.  Attitude affects our needs and our negotiation.  Knowledge of self is the starting point toward building effective negotiation skills.

18. Not Everything Is Negotiable  Every person has limits to what he/she will give and take.  Not everything SHOULD be negotiated:  Potential for MUTUAL BENEFIT is a prerequisite to negotiation.

19. Components of Negotiation  Personality  Approach  Style  Temperament  Perception  Interests  Goals Needs Needs Values Values Power Power Type of Conflict Type of Conflict Substantive Issues Substantive Issues Alternatives Alternatives

20. How Do You Know What You Know?  What do you know?  Beliefs may be confused with Assumptions.  Critical thinking includes asking: “Why?”

21. Fifteen-Step Plan  Practice critical thinking and empathy.  Study psychology, sociology, communication, and conflict.  Know yourself.  Know negotiation styles and temperaments.  Communicate effectively.  Acknowledge cultural and contextual differences and expectations.  Understand the dynamics of power.

22. Fifteen-Step Plan  Identify interests and goals before you negotiate.  Be assertive.  Be persuasive.  Be prepared and avoid common mistakes.  Use tactics that work for you and understand other tactics.  Know when to walk away.  Know how to evaluate your performance and improve.

23. The Negotiation Process Analysis – Gathering info, organise it and think about it – People, interests, options on the table, criteria? Planning – What to do on the four issues Discussion – Focus on the four elements

24. People Negotiators are human - emotions and communication are central issues Interested in substance and relationship Often get intermeshed Positional bargaining puts substance and relationship in conflict Try to separate relationship and substance

25. People Problems Inaccurate Perceptions – Put yourself in their shoes – Don’t deduce their intentions from your fears – Don’t blame them for your problem – Discuss each others perceptions – Make your proposals consistent with their views

26. People Problems Emotions – Try to recognise and understand them – Make them explicit – Allow the other side to let off steam – Don’t react to outbursts

27. People Problems Communication – Listen actively, question & acknowledge – Speak about yourself not them – Know what you want to communicate and what purpose the info will serve

28. Interests not Positions Interests define the problem Opposed positions often disguise compatible interests not just conflicting ones Everyone has multiple interests Human needs are the most powerful interests

29. Interest Issues Ask why? and why not? Make a list Acknowledge the other sides interests as part of the problem Put the problem before your answer Attack the problem not the people

30. Invent Options Avoid premature judgement - ‘just one solution’ Avoid the either/or position Don’t just focus on your own immediate interests Look through the eyes of different experts

31. Objective Criteria Fair standards to both sides – market value – precedent – costs – Professional standards Fair Procedures – ‘one cuts, the other chooses’, mediation etc

32. Objective Criteria Ask ‘what is your theory?’ Reason and be open to reason Don’t give in to pressure, shift from position to criteria

33. What if... They have a stronger bargaining position? – Any negotiation has realities that are hard to change Your objectives – To protect yourself against making an agreement you should reject – make the most of your assets

34. Know Your BATNA Best Alternative to a Negotiated Agreement – Your standard to measure against – Helps avoid over-optimism or summing your alternatives The better your BATNA the more powerful your position Disclosing your BATNA? What about theirs?

35. What if... They use dirty tricks, Try to: – recognise the tactic – raise it explicitly, question its legitimacy – negotiate over it

36. Dirty Tricks Are their facts correct? Ambiguous authority Stressful environment Personal attacks ‘Take it or leave it’ Don’t be a victim!!

37. Conclusions Hard, soft or principled? Wise, efficient and constructive? Separate the people Identify the interests Determine the options Use objective criteria Practice the skills!