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 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.
F. Negotiators need to consider how these broad contextual factors
will influence the negotiation.
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 are 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
A. Negotiators
should recognize three types of coalitions and their potential effects:
1. Coalitions against you,
2. Coalitions that
support you, and
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 benefit 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 the 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 three-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.
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 did I learn?
