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Your Insufficiently Developed Commercial Negotiation Skills Capability Could Cause Critical Negotiation Interventions To Collapse Due To Poor Preparation
Two parties are engaged in a negotiation - one succeeds in achieving his/her objective(s) and is satisfied, whilst the other walks away disappointed with the result. Does this situation sound familiar?
How often have you felt disappointed with a settlement that you have reached? Have you sometimes entered into an agreement only to feel remorse soon after reaching agreement?
SUCCESS VS FAILURE
What differentiates success vs failure in commercial negotiations?
Most of us recognise the significance of preparation to achieve positive results and it is therefore remarkable to note that the majority of business negotiators do not spend adequate time planning for negotiations, often due to insufficient negotiation training. Professional sports people spend significantly more time preparing for competition than they spend in competition; should it not be the same for business negotiators?
THE EVIDENCE
Commercial negotiators only spend around 1/3 as much time preparing for negotiation as they actually spend in negotiation. If you were a professional sports person, this would mean that you spent only 1/3 as much time training & planning as you do competing. The main contributor to successful commercial negotiation results is the quality of your preparation for the negotiation.
As a matter of negotiation strategy, consider the following main 5 components of preparation and at the same time you will also develop your negotiation skills:
1. Understand Yourself
Before we even employ best- and leading practice negotiation, it is key that we first understand our own strengths & weaknesses and it is vital that we make use of personal profiling tools to emphasise our areas of preference within the context of business negotiations, which enables us to have a reference point from which to plot our skills development.
2. Vision
What is the fundamental aim behind the negotiation? Is the negotiation about price or is it about the value that can be added? What are the main motivating issues behind your counterparty's position? What common ground, if any, exists between your and your counterparty's vision? It is key to comprehend the interests or silent motivations behind the positions of all parties to the negotiation and it is only by asking questions that we will uncover these motivations.
3. Value
What are the most important deal goals being pursued in this negotiation? What are the facts and figures contributing to the negotiation environment? What alternatives does each party have, if any? Once again we should try to identify, rank & weigh the goals of all parties to the negotiation and only then are we in a position to highlight those objectives that are shared and at the same time deal with those objectives that are likely to produce conflict.
4. Process
Have you spent time preparing an agenda for your forthcoming negotiation? Have you noted all the trades that you will give & receive? Do you have tools/templates at your disposal to support the efficiency of the negotiation process.?
5. Relationship
It is easy to forget that we deal with people who have goals & aspirations not unlike our own and it is not always just about the money. The research is clear that people are more likely to agree with those whom they trust & like, than with those with whom they little in common. Try to focus on those things that you share with your negotiation counterparts, and do not forget to focus on the human elements.
Key Aspects To Look At When Applying Your Negotiation Skills In Cross Cultural Transactions
We could easily make the mistake of stereotyping people according to their national culture whilst ignoring the other elements of culture that will contribute to the success in your negotiation.
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Make Sure To Look At These 2 Elements When Seeking A Business Negotiation Initiative, It Will Be A Mistake Otherwise
Developing a strong negotiation capability is contingent on critical factors: The negotiation strategy, process, the individual's skills and the supporting network. Relying on the negotiation abilities of people is a familiar oversight businesses make.
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