Media Coverage
Negotiating at Home - Negotiating at Work
BY RONALD M. SHAPIRO
Negotiating is an activity few people enjoy. But – it is one of those functions that no one in business can avoid. Most of us negotiate every day. We negotiate with spouses and children over issues such as time, money and attention. With customers, the issues are quality products, services, value and price.
Suppliers want to make a profit. Employees want decent pay, fair treatment, top-of-the-line benefits and interesting work. The result of who gets what is the product of negotiation. That is a continuous process, not a one-time event.
NEGOTIATING FUNDAMENTALS
To negotiate more effectively, start thinking of negotiation as a process that begins long before you take a seat at the "bargaining table."
First, learn as much as you can about the opposition and the circumstances surrounding the negotiation. Then, set your sights on a WIN-win solution. One that benefits both you and the other side – but that is especially good for you.
The key to effective negotiation is preparation. Although you have no control over the other side’s actions, you have complete control over your own research and preparation.
Helpful: Use the system denoted by the acronym PAID to guide your preparation…
• P is for Precedents. Uncovering vital details – such as the market rate for a new product or service you need or the salary level of job candidates who have the background and skills you’re looking for – will give you confidence and power in negotiation.
Important, too: Use precedents to support your position. Know what precedents might be used against you.
• A is for Alternatives. Always enter a negotiation knowing the alternatives to the person, company or product on the other side of the table.
In other words, don’t put all your eggs in one basket. Find out if there are other prospective employees who might do the job just as well as the one who looks most promising now but is asking for too much compensation…other vendors who may provide equally good or better products or services, and so forth.
Alternatives keep you from making a negotiation mistake and from appearing desperate.
• I is for Interests. Interests are what you and the opposing side need most from the deal you’re trying to work out. Often, the true interests of both sides remain hidden throughout the negotiation. Your job as a shrewd negotiator is to make sure you understand what’s truly on the agenda of your opponent.
Example: An employee approaches you for a raise, saying he/she wants more money because he has demonstrated his value to the company and hasn’t had a raise in several years. However, you also know that the employee has just learned that his child has been accepted to Yale – and he’d previously expected the child to attend a much less expensive state university. Knowing his true interests enables you to come up with a creative ways to meet his needs without jeopardizing the company’s pay scale.
• D is for Deadlines. If you know the other side has to make a payment on a bank loan in two weeks, you know you’re under a certain amount of pressure — and that works to your advantage. Know your deadlines and theirs, and you’ll have a leg up in the negotiation process.
USING BOTH EARS
The best negotiators listen more than they talk. They enter the negotiation with a great deal of information about the people and circumstances involved. They use the information to probe the opposition for details they can use to clinch the deal. Probing the other side during negotiation is easy if you remember the acronym WHAT…
• W is for Why. Instead of engaging in a verbal battle about who wants what, find out the "whys" behind the other side’s demands. You may be able to use the information to design a deal that works for both of you.
Helpful questions: Why do you feel that way? Why is that important? Why do you want that?
• H is for Hypothesize. Good negotiators are cautious about disclosing information. Increase the other side’s comfort level by using hypothetical scenarios.
Start sentences with: "Let’s pretend…," "Just suppose…," and "What if…,"
Examples: Ask, "If the price weren’t the issue here what would be?" or, "If you weren’t feeling insulted by the offer, what might be standing in the way of our making a deal?"
• A is for Answer. In this case, it specifically means answering questions with questions. You can elicit more information from the other side by answering their questions with probing questions of your own.
Example: If a prospective employee asks about the salary being offered for the job, ask him, "What salary range were you looking for?"
If a vendor asks which other service provider you’re considering ask, "What does your company offer in terms of products and services that I can’t get elsewhere?"
• T is for Tell Me More. At this point, take a step back from the negotiating process and add up the facts as you know them. Then, use the information you have to probe even further.
Example: If you’re determined that price is an important issue, ask, "I’m not fully sure I understand the real issue. Can you tell me more about your concerns?" You might learn that speedy service – rather than price – is vital to the other side, and you may be able to use that information to negotiate around the issue of money.
Bottom Line: Finding out as much as you can before sitting down at the bargaining table will give you the confidence you need to negotiate the best deals possible and build strong relationships with the other side by being “nice” rather than hostile.
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