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Your Underdeveloped Business Negotiation Skills Capability Could Cause Critical Negotiations To Fail Due To Insufficient Preparation
Two parties are engrossed in a negotiation - one succeeds in achieving his/her objective(s) and is very pleased, whilst the other walks away disappointed with the outcome. Does this situation sound familiar?
Do you often feel dissatisfied with a settlement that you have reached? Have you sometimes entered into a settlement only to feel remorse soon after sealing the deal?
SUCCESS VS FAILURE
What distinguishes success vs failure in business negotiations?
Most of us recognise the importance of preparation to deliver positive results and it is therefore remarkable to note that most business negotiators do not spend enough time preparing for negotiations, often due to poor negotiation training. Professional sports people spend significantly more time preparing for a championship than they spend in competition; should it be any different for business negotiators?
THE EVIDENCE
Commercial negotiators only spend approximately 1/3 as much time preparing for negotiation as they in reality spend in negotiation. If you were a professional sports person, this would mean that you spent only 1/3 as much time training & preparing as you do competing. The leading factor to successful commercial negotiation outcomes is the quality of your preparation for the negotiation.
As a matter of negotiation strategy, consider the following key 5 components of preparation and at the same time you will simultaneously develop your negotiation skills:
1. Understand Yourself
Before we even put into operation best- and leading practice negotiation, it is imperative that we first understand our own strengths & weaknesses and it is vital that we make use of personal profiling tools to underline our areas of preference within the context of commercial negotiations, which enables us to have a reference point from which to plot our skills development.
2. Vision
What is the fundamental objective behind the negotiation? Is the negotiation about price or is it about the value that can be added? What are the main motivating factors behind your counterparty's position? What mutual ground, if any, exists between your and your counterparty's vision? It is important to comprehend the drivers or silent motivations behind the positions of all parties to the negotiation and it is only by asking questions that we will uncover these interests.
3. Value
What are the most important deal objectives being pursued in this negotiation? What are the facts and figures strengthening the negotiation environment? What options does each party have, if any? Once again we should try to identify, rank & weigh the objectives 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 cause conflict.
4. Process
Have you spent time thinking about an agenda for your upcoming negotiation? Have you noted all the concessions that you will make & 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 individuals who have goals & aspirations not unlike our own and it is not always just about the contractual terms. The research is clear that people are more likely to deal with those whom they trust & like, than with those with whom they little in common. Try to focus on those elements that you share with your negotiation counterparts, and do not forget to focus on the human elements.
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