How to negotiate effectively

HOW TO NEGOTIATE EFFECTIVELY1. What is negotiation Negotiation is an essential part of the every-day business life. It cantake place at any time and in any place. Negotiation is a kind of meeting, butcontrary to the latter it may be held in some unexpected and uncomfortableplace such as the street or on the stairs. There are several definitions of negotiation.It is said to be theprocess for resolving conflict between two or more parties whereby both or allmodify their demands to achieve a mutually acceptable compromise . Thus, it is the process of changing both parties views of their ideal outcome into anattainable outcome . The need of negotiation arises when we are not fully in control ofevents.

Negotiations take place to handle mutual differences or conflict of interests wages,hours, work conditions, prices seller vs buyer rights differentinterpretations of an agreement The aim of a negotiation is to come to an agreement which is acceptableto both sides, and to preserve the overall relationships.

While specific issuesare to be negotiated, common interest are yet still to be maintained.Negotiations do not mean war . Negotiators can still be friends and partners. 2. The negotiation continuum OverlapThe situations of negotiation can be shown diagrammatically in terms of idealsand limits.Ideal Limit HIM Bargaining area Limit Ideal YOUThe limit may be the limit of negotiator s authority, such as a minimum e.g. price acceptable.

If there is overlap it is possible to settle. Thefinal position within the bargaining area, where settlement takes place,depends on the negotiators relative strength and skill.No overlapThe aim of the negotiator is to achieve a result, i.e. to find asolution, within the bargaining area. However, it is possible that both partiesset limits which do not provide overlap. In this case the negotiators have tomove their limits, otherwise the negotiation will be broken down. Ideal Limit HIM No deal YOU Limit Ideal Toomuch overlapThe opposite caseis also possible.

When one is careless and settles for less than he could. Inthis case the limit of the opposite side should be found and the ideal shouldbe revised.Ideal Limit HIIdeal3. The approachThere are fourmain stages of negotiation Preparingobjectives, information, strategy Discussing argue and signalling willingness to move Proposeand bargain Closeand agreeWhile preparing tothe negotiation it is important not only to prepare supporting arguments butalso to define objectives.

Objectives should be realistic and attainable andhave certain priorities. It is also necessary to investigate the opponent splans and priorities, which can be rather difficult.The objectivesshould be classified basically as follows Like Ideal but least importantIntend Achievable, a range of possibilitiesMust The real limit Ideal Limit AREA OF NO DEAL Like Intend MustThe generalstrategy for negotiation is to have a negotiating team of three people, whowill also be involved in the preparation.

Leader The person who will do thetalking and conduct the negotiations Summariser The person who will ask questions andsummarise for control Observer The person not involved in theactual negotiations, whose role is to watch, listen and record80 of thenegotiating time is spent arguing.If it equals 100 the negotiation willbreak down. There are two kinds of arguing Reasonableand constructive Debates,discussions Unreasonableand destructive Emotionalquarrels The opponent maytry to divert you by escaping into destructive behaviour.

In this case, yourbehaviour should be not to interrupt, but to listen and control your feelings.Even if the battle is won, the war can be lost.A negotiatorshould be constructive in arguments and try to get information by asking openquestions or even leading questions.One thing should be tackled at a time andthe opponent should be made justify his case item by item. It is important tobe non-committal and to state only ideals at first.

Later, the informationabout the negotiator s position can be given, and later alternative proposalscan be made. Sometimes it is necessary to challenge the opponent, so that hedemonstrates his strengths. Negotiation meansmovement. It may be that both parties move on one issue. It may be that eachmoves on different issue. The motive forces are twofold Sanctions The penalty of not agreeing Incentives The benefits of agreeing.In both cases, theparties seek to protect their self-interests.

They will show willingness tomove by sending signals.To signal is notto show weakness. But if both parties wait for the other to signal, the resultwill be deadlock.The opponent ssignals will show his willingness to move. So one should listen, recognise hissignals and interpret them, looking for the qualified words which are evidenceof willingness to move.Another veryimportant point of negotiations is proposing and bargaining.Proposals shouldbe realistic in order not to cause argument and deadlock.

The language of theproposal signals one s firmness. Weak language such as we hope , we like , weprefer should be avoided. Instead, a phrase we propose is appropriate. The final step ina negotiation is closing and agreeing. There are two aspects to it Whento close How tocloseThe first is themost difficult moment to recognise.There is a balance between Closingtoo early More concessionsfrom the opponent could have been squeezed Closingtoo late The opponentssqueezed excessive concessions.The aim of closing is to get the opposition to stop bargaining and tomake an agreement. The final thing to do is to write down the agreement andagree what is written down. It is necessary to do this before leaving thenegotiating table. 4. Characteristics of an effective negotiatorWhatcharacteristics should one have to be an effective negotiator. The first andthe most important characteristics, from the standpoint of many executives andmanagers of large corporations, is preparation and planning skills. The other veryimportant characteristics are Knowledgeof subject matter being negotiated Abilityto think clearly and rapidly under pressure and uncertainty Abilityto express thoughts verbally Listeningskills Judgementand general intelligence Integrity Abilityto persuade others Patience Decisiveness5. ConclusionIn spite of the existence of negotiating theories, it is frequentlydifficult to apply theoretical and conceptual knowledge in a practicalsituation.

In order to be a good negotiator, one should have negotiation skillsas well as a theoretical knowledge.

But without a practical experience it ishard to negotiate effectively.Interpersonalskills are very important in the negotiation, but what can help a negotiatingparty while thinking what to do is not an elaborated theory, but rather is it asimple analysis and intuition.

Bibliography1. Raiffa, Howard. 1982. The art and scienceof negotiation.

Harvard University Press. Pages 119-133. 2. Murcott, Owen. 1991. IBS ManagementTraining. Hanzehogeschool. Groningen.