Few people ever learn negotiating skills, although these are business fundamentals. To succeed in any business, you’re going to need to develop this skill set. Let’s take a look at basic components of a negotiation and problems that the inexperienced invariably run into in trying to navigate a negotiation to try to help their businesses get the best, or even a minimally fair deal in a business transaction. Even savvy negotiators may be surprised at picking up a tip or two from reviewing some essentials here.
What is the Real Aim of Negotiation
You’ll be ahead of the game if you don’t think of a negotiation as a means to get what you want, or to get ahead of the other guy. A negotiation is really a meeting to attempt to find the middle ground on which both parties can be as satisfied as possible that their own interests are aligned well enough with the other party’s that a deal can actually be made.
You’re not negotiating to give away what you want, but to get as much of it as possible. And, the other party is doing the same thing. But, the point is to find that sweet spot in which both parties are satisfied that they’re getting enough of what they want to make a deal possible. Give to get. That’s the very plain and simple basic principle of negotiation.
Elements of Negotiation
There are three basic components in negotiation:
- Mutual desire — Both parties have to want what it is that an agreement can render for them, in order for a negotiation to occur.
- Investment in the outcome — Both parties have to want a successful outcome (meaning both must want to achieve a meeting of interests that ends in a deal). But, it’s a disadvantage for you to be too invested in that outcome. Over-investment in the outcome can cause you to lose your balance and potentially subconsciously undermine your own interests.
- No set rules — Of course, there are a few rules, like not setting things on fire during the meeting. But, when it comes to price ranges, contract terms, or any expectations, the rules are not set in stone. Everything is negotiable.
What’s Going On in a Negotiation?
Above all, negotiating is about problem solving. It’s not a debate or an argument. Yes, it’s about adding as much more as is realistic to your own end of the deal, and not subtracting from your expectations of the outcome. But, it’s got to be primarily about seeing the other person’s point of view and rethinking possibilities as necessary to help him or her get as much as possible of what they want—for the purpose of getting as much of what you want.
Many people find the whole proposition too challenging, and do not even attempt to negotiate. Such people are typically not long in business. One common stumbling block to successful negotiating is failure to grasp the distinction between your interests and your bargaining position. Once two parties start arguing their positions and drift away from focusing on their respective interests, a negotiation has a way of unnecessarily exploding into an overheated argument and ending in failure and mutual frustration.
Focus on your interests, the desire that has motivated you to bother with entering into the negotiation. Think only in terms of that interest as you present your counterpoints. If the other party starts drifting into an argument to defend his or her position, keep in mind that that party’s real interests are likely not to be as fixed as his/her position appears to be. Help your counterpart appreciate your will to work in good faith toward a solution that satisfies you both.
But, don’t let the need to operate in good faith be confused with the need to protect your real interests in the negotiation. To succeed, you still need to come away knowing you’ve gotten as much of what you want as possible, and to be sufficiently satisfied with the outcome.