Chapter 12
Best Practices
in Negotiation
Overview
In this final
chapter we reflect on negotiation at a broad level by providing 10 “best
practices” for negotiators who wish to continue to improve their negotiation
skills.
Learning Objectives
1.
Ten best practices to improve
negotiation skills.
I.
Be Prepared
A. Negotiators
who are better prepared have numerous advantages, including
the ability to analyze the other party’s offers more effectively and
efficiently, to understand the
nuances of the concession-making process, and to achieve their negotiation goals.
B. Preparation
should occur before the negotiation begins so that the time spent negotiating is more productive.
C. Good
preparation means understanding one’s own goals
and interests as well as possible and being able to articulate them to the
other party skillfully.
D. Good
preparation includes being ready to understand the other party’s communication
in order to find an agreement that meets
the needs of both parties.
E. Good
preparation also means setting aspirations for negotiation outcomes that are
high but achievable. Negotiators
should prepare by understanding their own strengths and weaknesses, their needs and interests, the situation,
and the other party as well as possible so that
they can adjust promptly and effectively as the negotiation proceeds.
II.
Diagnose the Fundamental Structure of the Negotiation
A. Negotiators
should make a conscious decision about whether they are facing a fundamentally distributive negotiation, an integrative negotiation,
or a blend of the two and choose their strategies
and tactics accordingly.
B. Negotiators
also need to remember that many negotiations will consist of a blend of integrative and distributive elements and that there
will be distributive and integrative phases to
these negotiations.
C. There
are also times when accommodation, avoidance, and compromise may be appropriate strategies.
III. Identify and Work the BATNA
A. The
best alternative to a negotiated agreement (BATNA)
is especially important because this is the option that likely will be chosen should an agreement not be reached.
B. Negotiators
need to be vigilant about their BATNA. They need to know what their BATNA is relative to a
possible agreement and consciously work
to improve the BATNA so as to improve the deal.
C. Negotiators
also need to be aware of the other negotiator’s BATNA and to identify how it compares to what you are offering.
D. There
are three things negotiators should do with respect to the other negotiator’s BATNA:
1. Monitor
it carefully in order to understand and retain your competitive advantage over the other negotiator’s alternatives;
2. Remind
the other negotiator of the advantages your
offer has relative to her BATNA; and
3. In a
subtle way, suggest that the other
negotiator’s BATNA may not be as strong as he or she thinks it is.
IV. Be Willing to Walk Away
A. Strong
negotiators remember this and are willing to walk away from a negotiation when no agreement is better than a poor agreement or
when the process is so offensive that the
deal isn’t worth the work.
B. It is
important to continue to compare progress in the current negotiation with the target, walkaway, and BATNA and to be willing
to walk away from the current
negotiation if their walkaway or BATNA becomes the truly better choice.
V.
Master
the Key Paradoxes of Negotiation
Five
common paradoxes that negotiators face.
A. Claiming
value versus creating value.
1. Typically,
the value creation stage will precede the value claiming stage, and a challenge
for negotiators is to balance the emphasis on the two stages and the transition
from creating to claiming value.
2. Negotiators
need to manage the transition tactfully to avoid undermining the open
brainstorming and option-inventing relationship that has developed during value
creation.
B. Sticking by your principles versus being resilient to the flow.
1. Effective negotiators are thoughtful about the distinction between issues of
principle, where firmness is essential, and other issues
where compromise or accommodation is the best route to a mutually acceptable
outcome.
C. Sticking with strategy versus opportunistic pursuit of new options.
1. The
challenge for negotiators is to distinguish phantom opportunities from real ones;
developing the capacity to recognize the distinction is another hallmark of the
experienced negotiator.
2. Strong
preparation is critical to being able to manage the “strategy versus
opportunism” paradox.
D. Honest and open versus closed and opaque.
1. Negotiators
face the dilemma of honesty: how open and
honest should I be with the other party?
2. The
challenge of this paradox is deciding how much information to reveal and
how
much to conceal, both for pragmatic and ethical reasons.
E. Trust versus distrust.
1. Negotiators
face the dilemma of trust: how much to trust
what the other party tells them.
2. Negotiators
should remember that negotiation is a process that evolves over time. Trust can
be built by being honest and sharing information with the other side, which hopefully
will lead to reciprocal trust and credible disclosure by the other side.
VI. Remember the Intangibles
A. Intangibles
frequently affect negotiation in a negative way,
and they often operate out of the negotiator’s awareness.
B. The
best way to identify the
existence of intangible factors is to try to “see what is not there.”
C. Often
negotiators do not learn what
intangible factors are influencing the other negotiator unless the other
chooses to disclose them.
Negotiators can “see” their existence, however, by looking for changes in the other negotiator’s behavior from one negotiation
to another, as well as by gathering information about
the other party before negotiation begins.
D. There
are at least two more ways to discover intangibles that might be affecting the other.
1. One
way to surface the other party’s intangibles is to ask questions.
2. A
second way is to take an observer or listener with you
to the negotiation.
E. Negotiators
also need to remember that intangible factors influence their own behavior.
VII.
Actively Manage Coalitions – Those
Against You, For You, and Unknown
A. Negotiators
should recognize three types of coalitions and their potential effects.
1. Coalitions against you.
2. Coalitions
that support you.
3. Loose,
undefined coalitions that may materialize
either for or against you.
B. It is
important to recognize when coalitions are aligned against
you and to work consciously to counter their influence.
C. Strong negotiators need to monitor and manage coalitions
proactively, and while this may take
considerable
time throughout the negotiation process it will likely lead to large payoffs at the implementation stage.
VIII.
Savor and Protect Your
Reputation
A. Starting
negotiations with a positive reputation is essential, and negotiators should be vigilant in protecting their reputations.
B. Rather
than leaving reputation to chance, negotiators can work to shape and enhance their reputation by acting in a consistent and fair
manner.
C. Strong
negotiators also periodically
seek feedback from others about the way they are perceived and use that information to strengthen their credibility and
trustworthiness in the marketplace.
IX.
Remember That Rationality and
Fairness Are Relative
A. People
tend to view the world in a self-serving manner and define the “rational” thing
to do or a “fair” outcome or process in a way that benefits themselves.
B. Negotiators
can do three things to manage these perceptions proactively.
1. First,
they can question their own perceptions of fairness
and ground them in clear principles.
2. Second,
they can find external benchmarks
and
examples that suggest fair outcomes.
3. Finally,
negotiators can illuminate definitions of fairness
held by the other party and engage in a dialogue to reach consensus on which standards of fairness apply in a given situation.
X.
Continue to Learn from Your Experience
A. The
best negotiators take a moment to analyze each negotiation after it has
concluded, to review what
happened and what they learned.
We recommend a four-step process.
1. Planning
a personal reflection time after each negotiation.
2. Periodically
“taking a lesson” from a trainer or coach.
3. Keeping
a personal diary on strengths and weaknesses and developing a plan to work on weaknesses.
4. Maintaining a record of how the negotiation evolved, notes about
the other negotiator, etc. especially if you are negotiating with the same
person or group on a regular basis.
B. This
analysis should happen after every
negotiation,
however, and it should focus on what and why questions:
1. What
happened during this
negotiation?
2. Why
did it occur?
3. What can
or did I learn?
