Negotiation is one of the most pleasing career skills you can develop! Here are some tips to prepare you for an effective negotiation process.
Negotiation skills apply to nearly every aspect of our lives, personally and professionally. To some, the skill comes naturally. However, it is a learned skill that most of us take practice to perform effectively. Considerations for Business Negotiations will be discussed in this post. Prepare for the negotiation by asking yourself these questions:
When is negotiating required?
It is necessary to negotiate when two parties wish to do business together, and decisions must be made about how the transaction(s) should occur. An example of this is when two companies enter into a long-term commitment that requires consideration to details such as cost estimation, purchasing changes, or set-up time, to name a few.
What is the role of communication?
The negotiating process relies heavily on communication. Most negotiations start with a verbal connection and eventually escalate to a written contract. Before you meet with the other party, practice reciting the details of your proposal. Be sure to prepare to answer questions concerning your submission. If you seek to do business cross-culturally, it is necessary to evaluate the negotiation customs of the other party. Time and resources are preserved when both parties understand the typical strategies inherent in various cultures. Sometimes something as simple as misinterpreting a hand-shake can make or break an important business deal.
What are your goals and objectives?
Before attempting to find out the other party’s intentions, you must clearly understand your purpose. So make sure your objectives are written down. Also, you should identify your key objectives for reaching the goals that you have set. Please review this information several times, adding to it as needed. You will want to be well prepared to stand your ground and remember your intentions. New ideas will be introduced during the negotiation, so you need your notes to stay focused.
What are your minimum standards?
Every negotiator has a minimum standard that they refuse to go below. Although it is not recommended that you disclose this minimum at the start of the negotiation process, you must remain personally aware of your limits. Think through what you have to offer and what you’d like to achieve. Know the lowest price or standard you’re willing to agree to meet your objectives and accomplish your goal. Even the savviest negotiators have minimums that they will not budge on.
Are you willing to walk away?
Some business deals may not be ethically, financially, or strategically sound. The other party may even change their views along the way. Examples of this include sudden erratic behaviour, or their finances may prove to be less than you were led to believe. If situations seem unfavourable for you, be willing to walk away. Good negotiation is not a deal where your losses will be more significant than your wins. All negotiations are about compromise. Yet, no one should leave the table feeling like their needs have not been served.
These questions can help you measure your negotiation preparedness. You should be prepared with solid research and knowledge before entering any negotiation. Be very clear about your needs and what you are willing to compromise.