Reflections of Expert Negotiations workshop, 17 Sep 2014, Jakarta
September 19, 2014
17 June 2014, Jakarta. So today we are in Jakarta to deliver our Level 5 program for our long-time Japanese client company. This post is written for participants to reflect on some of the salient learning points, but I am sure anyone reading this can also take away something…
1. Negotiation is not selling
We began by defining negotiation by drawing this picture:
And basically this means that negotiation is a process where parties who have interest for what the other has to offer come together to work out the best way to achieve that. Hence, negotiation is really about meeting interests, objectives and goals; it is not about selling.
2. Preparation is key to negotiation success
Of the four steps of negotiation – preparation, information sharing, bargaining, finalizing – preparation is the most important. If you fail to prepare, you prepare to fail. So use the Expert Negotiation Planning Guide to get prepared.
3. Seeing from all sides
One of the unique features of our planning guide is “seeing from all sides”. While you fill in the six categories for your side, you should also look at what the other party (or parties) might fill in for theirs. By having an understanding of their objectives, interests and their BATNA, you would be in a better place to create a positive zone of possible agreement (ZOPA). So make sure you fill all the columns of the planning guide, not just the first one.
4. Never get into a negotiation without a BATNA
BATNA refers to the “Best Alternative to a Negotiated Agreement”. It is what you will do if the negotiation fails. It therefore lies OUTSIDE the negotiation. The stronger your BATNA, the better your bargaining position, and the easier for you to walk away if the negotiation stalls. It is the key to overcome position and power, the traditional drivers for negotiation success.
To increase your BATNA power, try to negotiate an agreement for it before going into your primary negotiation. We talked about purchasing an apartment in a particular block for a particular price. If you can secure an in-principle agreement for purchase of another similar property but with somewhat less desirable terms, then you can go into negotiations for your primary target more confident , knowing that whatever the outcome, you will come out on top.
6. Your agreed-upon value cannot be lower than your BATNA
We worked on BATNA quite a bit and for those of you who don’t like numbers, well, I tried to keep it to a minimum. But it is difficult for us to go into a numerical negotiation (salaries or price) without knowing your numbers. Hence, you need to at least know how to calculate expected value. You may not like it, but that does not absolve you from having to do it. So if you don’t like it, get someone to help because you don’t want to end up agreeing to a position that has lower expected value than your BATNA.
7. Get agreement from all your stakeholders for your BATNA
Make sure that you get your bosses, and your bosses’ bosses, to agree to your BATNA. The last thing you want is to be vilified for capitulating on too low a value.
8. Seek win-win
While we identified 5 different negotiating styles, we also agreed that the win-win strategy is most effective; especially if you need to maintain a relationship with your counterpart. And if this is the case, then you should not start the negotiation on numbers. Start instead by understanding what they want to achieve, what their interests are, and how both of you can achieve that together. That is key to win-win negotiations.
Lastly, we talked about tactics, especially what to avoid. These are:
The Winners’ Curse
Positions and persons
10. Negotiation is a process
Remember, negotiation is a process and both parties need to be assuaged by it. So even if the opening offer was more than your expectations, you need to complete the process to make it win-win. This will avoid the Winners’ Curse and make everyone leave with a smile.
I hope this summary of our lessons learnt will help you reflect on your personal learning and make you a better negotiator.