Monday, October 1, 2007

Are You a Good Negotiator?


We can tell that you're one of life's persuaders. We're not saying that you could sell ice to Eskimos, but you could probably spin a good story about the designer status of your ice. Perhaps you would stress that it makes the perfect accompaniment to a G&T, as this would allow you to offer a deal on the gin as well! We can tell that you're a sociable person and, whether you've noticed it or not, you probably have a well developed understanding of human nature, not to mention body language. If you want people to follow your lead you need to give them a good reason. "We should do this because…" could be your opening line, but you're not afraid of using your imagination to find ways to draw people into the rest of the sentence. However, be careful not to overdo it, as this approach can appear to be manipulative or deceptive, especially if presenting data that is biased to your cause. The good thing about your negotiating style is that you always make sure that the other side sees the full picture and feels positive about the deal.


Always focus on the other side's goals:

Typically people focus only on what they want to get out of a negotiation for themselves and about their own benefit. Try to focus only on why the other party is negotiating with you. What are they trying to achieve? What are their constraints? What would make them agree to your terms? What pressure are they exposed to? Let's say you're negotiating a new lease for your office space or apartment. Don't focus too much on what you're willing to spend. Find out if the landlord has lots of un-rented space, how much it will cost him to get a new tenant, how much it will cost him if the building is empty for a couple months while he's looking for new tenants. What's his risk that another tenant may not pay the rent on time while you are very good with your payments? Make a list of all those items before you start negotiating. Use them during the negotiation by asking probing questions if the situation allows for it.


Higher Authorities:

The higher authority approach is often used, especially when you are negotiating with bigger companies. Let's say you want to get a discount on a brand new designer jacket. The salesperson will probably say that he/she is not authorised to give that to you. Or they will tell you that it's the company's policy never to give a discount. Always question higher authorities and policies. People created those policies and all it takes is to find the person within an organisation that can change the policy for you. Ask to speak to that authority or to talk to someone who can change a policy. On most occasions a manager will come to speak to you. That manager will probably not want to waste much time and will also try to play out his power position and thus give you a discount – if only to show the poor salesperson how it's done by the big boss. Be persistent in your requests to speak to the so called authority or policymaker. On the other hand, you can use the "that's our company policy" approach yourself in a number of different situations, as it stops most people arguing. To pick up on the apartment lease example, you might say something like "I always get the first month free of charge when renting a new flat."


Never split the difference:

A very common and often used technique in negotiations is to split the difference. There is no reason why you should do this. If the other side suggests splitting the difference, use the authority approach to say that you never split the difference. The other party has already given up half way; there is no reason that should keep you from pushing them a little farther. Just make it your own policy to never split the difference. If the other party moves a big step towards you, give up a little space yourself, but not as much as they did. Always move towards the other person in little steps. It's important to give up a little to avoid a stalemate. But never give up more than you need to at once.


Be creative:

People often get stuck in a stalemate. You might need a better price while the other party cannot give up any more. Move away from the price entirely and focus on other areas. Let's say, you're buying a house but simply can't agree on a price with the vendor. Find out if there are other areas where both sides can give up a little that might benefit the other party a great deal. If you weren't under pressure to move within a certain time, you could allow the current owner to stay in his house for one or two extra months after you've paid your deposit. This might be very valuable if the other party needs to get some cash for a deposit on their new house, or if they need time to organise the move. Try to really understand the other party's situation and come up with creative ideas which create a win – win scenario.

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