Kevin Spacey made it seem like very serious business in "The Negotiator" and we agree with him! It is important that budding entrepreneurs equip themselves with a strategy for effective negotiation. Why, you ask? Its simple... every one thinks about their own selves, avers Dale Carnegie of "How to Win Friends and Influence People" fame. Doing smart business is often a question of striking deals that are attractive to others while serving one's own interests. This is where good negotiating skills come in handy.
Negotiating skills are needed during all business interactions, be it acquiring a new client, striking deals with suppliers, hiring new employees or even keeping the ones you have. Bear a couple of things in mind to negotiate well:
The personal touch: Whatever be the deal you are trying to negotiate, keeping in contact with the other party is essential. By this we do not mean fixing appointments over the answering machine! Ideally, one should make an effort to meet the client or vendor in person. This will not only secure the other parties' attention but also give you a chance to assess them closely.
Understand the terrain: The strategy you employ during negotiations will depend upon the other party as well. For instance, if you have common interests, collaboration is the most likely outcome. Compromise is yet another outcome, wherein both parties settle for something a little short of their individual targets. But if your groundwork is strong, you could be calling the shots. Be a patient listener and try to get as much as possible out of the other person; this will put you in the driver's seat. Prepare and play your cards well, else you could find yourself accommodating more and more concessions.
Aim high: While the idea is to make the deal as beneficial as possible, that's probably what the other person is going for as well. So, define your targets and keep them high enough to ensure that you do not lose out in the bargain. Ensure a fairly large margin to play with. While setting goals, stick to what is best for your company, (reputation included) rather than that which merely enhances profits. Remember to be discreet about your own goals while negotiating; keep the opponent guessing about what's on your mind!
Keep the ball rolling: Good negotiating skills require adopting an active stance. For every problem the other party comes up with, discuss possible solutions. Be enthusiastic and persuasive; emphasize common ground and stress on the benefits of the deal to the other person. Unexpected opportunities might emerge during the dialog; hence be prepared to request for more time, if you need to consult with others. Likewise, if dispensable clauses seem to be getting in the way, compromising on them is probably the best thing to do.
See which way the wind blows: Don't hesitate to make or seek clarifications as this will avoid confusion later. Think twice before you agree to anything new on the spot; there might be more to it than what is obvious. Keep your ears and eyes open for any changes that might not be in the best interest of your business. Calling off a deal that is a no deal is just as important as negotiating well.
Face roadblocks head on: While conflicts are common to all negotiations, they need to be handled with caution. Suggest temporary solutions to problems until they can be discussed at length later. This way you could buy more time to tackle those difficulties efficiently. If there are more than two people on either side then call for a vote to resolve the setback.
The devil is in the details: Once you see the deal through, take care to outline the terms and conditions carefully. Specify the validity of the contract and clauses addressing compensation if the deal falls out among other things. Do this meticulously to avoid loopholes. Attention to minute details will help save precious time and money, should the tide turn against you. Look before you leap; don't make any commitments before the deal is down in black and white.
There might come a time when it seems like the discussion is headed nowhere; stay patient and focused through it. "Getting to Yes: Negotiating Agreement without Giving In" by Roger Fisher, William L. Ury and Bruce Patton , could be a good start for those of you wanting to nail the deal at top speed . "Interviewing, Counseling, and Negotiating: Skills for Effective Representation" by Robert M. Bastress and Joseph D. Harbaugh, could improve your negotiating skills a great deal. If poor communication has been getting in the way of your negotiating skills, solve your problem .
Finally, be confident about yourself and your offer; most importantly, end the discussion on a good note, whether you decide for or against the arrangement. With our tips to guide you, "The Negotiator" could well be your second name!