Mastering the Art of Negotiation
Written by Bill Michels, Chief Commercial Officer, LavenirAI
How often have you heard someone say they’re a natural negotiator? I’m convinced that negotiation is a learned skill. It requires knowledge, experience, practice, communication and emotional intelligence Like any mastery, you must first understand the fundamental principles of negotiation.
True masters have strong ethical principles. The basis of LavenirAI’s ethical standards are Integrity, Cooperation, Respect, Leadership and Trust. You are representing not only your company’s core values, but also your own. Through respect and cooperation and the demonstration of integrity and leadership, you build trust with your stakeholders and the party you are negotiating with. Maintain high ethical standards in your negotiations. Trust and reputation are essential to maintaining your credibility. Once lost, credibility is difficult to get back. Say what you will do and do what you say.
2. Know the objective
Before entering any negotiation, knowing what you want to achieve is essential. What are the needs of your business and stakeholders? What is the current situation with the good or service you need? Through preparation by gathering data and conducting analyses, you can identify and clarify your business objectives, goals and priorities to understand your must-haves, wants and wishes. You should research the other parties’ interests, needs and negotiation style and identify the broader factors that can influence the negotiation. Prioritization of goals and objectives is critical to success.
You must have a plan, even if you don’t have a lot of time before the actual negotiation begins. Use the information from the preparation to determine if the negotiation is tactical or strategic. In a tactical situation, there are many suppliers and the item is not mission-critical to the organization. Planning options enables you to be confident in your BATNA (walk away position). In a Strategic situation, where there are few or one suppler based on the need for suppliers in the market or your restrictive specifications, relationship is key. Here, both parties should work collaboratively to achieve mutual benefit and value over the longer term. You must plan options to create value, establish guiding principles and gain alignment on mutual business and mutual gains. Understanding the type of negotiation, power, options, your needs, supplier needs and clear aims and objectives will keep you focused on the major deliverables.
4. Effective communication
Being a skilled communicator is vital. Learn to articulate your points clearly, listen actively, and interpret non-verbal cues. One of the skills to develop is listening skills. It is a fact that we think twice as fast as we speak. I have caught myself thinking how to counter-act to a statement rather than listen. Listening can reveal opportunities, so I make listening part of my plan. It is key to align, brief and communicate with stakeholders during the planning process. Part of my planning process includes communication by building agendas and presentations to make key points.
5. Psychology and emotional intelligence
Negotiation often involves an understanding of human behavior. Pre-conditioning to set or change the supplier’s expectations is a critical component to the success of your negotiation. I start the conditioning process long ahead of any negotiation through a planned series of messages sent to the supplier. You should develop your emotional intelligence to manage your own emotions and understand the feelings of others as well as to remain alert during the negotiation for any negative or positive changes in behavior. Emotions can influence decisions significantly. Learn to effectively frame your arguments and leverage social influence techniques without manipulation. Cultivate empathy to see the negotiation from the other party’s perspective to help build rapport and trust. There are various strategies and tactics you can employ to achieve favorable outcomes.
6. Never stop learning
Whether you’re new to negotiation or a seasoned veteran, always seek to enhance your negotiation skills further. Learn to navigate complex scenarios, such as multi-party negotiations or international deals, with finesse. Understand cultural differences and adapt your approach to negotiate successfully across cultures. After each negotiation, reflect on what went well and what could be improved. Learning from your experiences is invaluable. Ask for feedback from peers, mentors or even the other party involved. Constructive feedback can help you identify blind spots. Consider formal negotiation training or workshops to deepen your knowledge and refine your skills.
In today’s dynamic world, mastering the art of negotiation is a vital skill that can open doors to success in both personal and professional spheres. You can become a formidable negotiator by understanding the fundamentals, recognizing the role of psychology, employing effective strategies and tactics, embracing advanced techniques, and committing to continuous improvement. Remember that negotiation is not just about getting what you want; it’s about creating value and building lasting relationships. As you embark on your journey to mastery, approach each negotiation as an opportunity to grow and excel in this timeless art.