How is emotion best used in negotiation?
- Must be in control of them
- Sincerity is key
- Use early in the negotiation
- Use to increase perceived value of your bargaining
- Use to counter logic
- During negotiations, the decision as to whether or not to settle, rests on emotional factors
How is logic best used in negotiation?
- Don’t be too quick to ask why
- Get your own logic in first
- Keep to one powerful argument, don’t dilute
- Be credible
- If others can’t see it, change tack
- Counter logic with emotion
How is threat best used in negotiation?
- Be slow to threaten
- Threaten at the business, not the person
- Use a discreet or veiled threat
- Never make a threat you can’t keep
- Be credible
- Add if to to transfer threat to bargaining
How is bargaining best used in negotiation?
- Don’t expose your position early
- Don’t put a marker down
- Don’t seem to eager to move
- Move in small steps
- Get a return for any concession you make
How is compromise best used in negotiation?
- Last resort
- 50/50 is not the only compromise
- Let the other party suggest compromise
- Compromise favours the more extreme party
- …the one suggesting compromise probably accepts or moves towards a position of the other
What are some other tactics?
- Cherry picking: pick what you want and exclude what you don’t want in the deal
- Salami - don’t ask for everything at once, ask for things in slices to mitigate risk of losing the deal
- Good cop/bad cop - 2 negotiations: 1 aggressive who often leaves and 1 friendly who softens edges - encourages other party to compromise but can be spotted easily
What is win lose: fixed pie mindset?
- Creation of an us and them
- Energy directed towards victory only
- Own point of view only
- Strong emphasis on immediate solutions regardless of whether the long-term objectives are met
- Too many personalised conflicts
- Emphasis on short-term concerns - long term relationship forgotten: negatively impacts buyer-supplier relationship
- Works if it is a one time deal
What is a lose-lose mindset?
- Neither party achieves its objectives
- Disillusionment with the negotiating process
- Frustration
- Loss of respect/trust from followers
- Long-term relationship soured
- Negotiators may be different to those who are affected by the deal
What is a win-win mindset?
- Meets the needs of both parties
- Decision is not unacceptable to anyone
- Requires two-way communication
- Emphasis on flexible approaches
- Concentrates on objectives
- Long-term relationship is maintained
- Expand the pie
- Both parties comfortable with the outcome
What are the 9 rules for good negotiation?
1) Design the process and ensure it is transparent and fair
2) Gather intelligence and adjust the terrain
3) Invest in personal relationships
4) Make no concessions until the end (not the fixed-pie view)
5) Use techniques to drive creative outcomes (e.g brainstorming)
6) Ask lots of questions to understand the other party
7) Long term contracts and risk sharing wherever appropriate
8) Continue creativity after negotiation
9) Understand cultures, especially your own
How does culture effect negotiation?
- National culture does not determine negotiation behaviour, but it is an important influencing factor
- Language - different body languages mean different things
- Non-verbal behaviours e.g Indian nod - subtle cultural difference
- Values thinking
- Decision making process
- Stereotypes are dangerous and international negotiators must get to know the people they are working with
