|Pre-Negotiation Strategy Check List (Part 1)|
|This check list will help you prepare a successful negotiation strategy for any potential conflict and attain the best possible agreement.|
Many naturally talented people abound on this orb of ours. They seem to float effortlessly through life, like a boat slices neatly across a crystal mountain lake. Other people have to scrape and claw their way competing against many other rivals, who vie for the rarefied air of the elite. To perform well, we must learn to prepare before we can expect to succeed. Ask any athlete who spends countless and tedious hours preparing for a competition, or a lawyer about to step into a court room. As negotiators, we also must learn the basics, and above all else, we have to follow some regimen to prepare for our negotiations. Simply ask yourself how well you did when you decided to skip the preparations and just 'wing it.' Your response might be that you didn't fare too badly, but have you ever thought about how well you might have done, had you really prepared?
Let's look at a negotiators check list to see how we might better prepare for our negotiations.
Here is Part 1.
Negotiators Check List
1) Assess the situation
Each negotiation is going to be different, no matter how often we've addressed similar situations. We will always be negotiating with people who have different styles, goals and objectives, and who are coming from different circumstances and have different standards. So, always take stock and gauge each negotiation as something unique.
2) What Kind of Negotiation?
There are basically 3 circumstances to consider.
- Is it a one time negotiation, where we will unlikely interact with the person or company again?
- Is it a negotiation that we are going to be repeating again?
- Is it a negotiation where we are going to form some kind of long term relationship?
Most of our business negotiations are likely going to fall in the last two categories. We will be handling a lot of repeat negotiations, where we negotiate with regular suppliers, or engage in labour negotiations with the same union reps for example. Or, we will be seeking a long term negotiated agreement such as a joint venture, where we will be mutually entwined over a long period of time.
3) What Type of Conflict Will We Face?
There are basically two types of conflict situations we may encounter in a negotiation. Conflicts can present themselves singularly, or may be a mixture of the two. It is vital that the negotiator carefully analyze the conflict issues, both individually and collectively, to fully appreciate the unique challenges they present.
The first form of conflict might simply be called agreement conflict, where one persons views or position are in conflict with another individual, or members of a group. This is a situation that takes into account their conflicting views relating to opinions, beliefs, values and ideology.
For example, two executives may have different views about whether a policy should be implemented. Another example may consist of a trade dispute between two countries, and entail ideological or religious based differences. Or, the conservative viewpoints of management might conflict with the more left wing approach of union leaders.
The second form of conflict entails the allocation of resources like money, quantity, production or simply put - things. Any physical commodity will fall into this category of conflict. Other issues might entail the allocation of resources, as a separate segment of the trade dispute. Resource issues though, are more tangible as they comprise knowable items, or particular products.
One blaring example occurs when subsidized farmers of one country, 'dump' cheaper products onto the market of another country, at the expense of the indigenous farmers of that country.
By analyzing the types of conflict into categories, negotiators can have a better understanding of the real measure of the disputes, and frame or focus their strategies more effectively.
4) What Does This Negotiation Mean to Us?
There are only two reasons why we enter into a negotiation.
The first reason occurs when out of necessity, we have to. This could be due to either some immediate need, such as urgency to find a particular supplier, or it could be that we face severe cutbacks in personnel, if we can't increase our business.
The second reason occurs when we are seeking out an opportunity. This situation may arise simply because an opportunity has sprung up, where we can increase our overall business at an opportune time,
5) The Ripple Effect
We also need to ask ourselves whether the results of the negotiation we are conducting, will affect other negotiations or agreements later. Many companies today have international interests. An agreement with a company in one country, may affect how talks will impact or be influenced, with negotiations that will transpire later. with other countries. It's vital that we, as negotiators, consider the impact or consequences of an agreement in developing our strategy.
6) Do We Need to Make an Agreement?
We either enter into negotiations because we have to, or because we want to. Part of our strategy will involve a careful analysis of our BATNA (Best Alternative to a Negotiated Agreement). If an agreement is absolutely essential, and we have few alternative options, in the event of talks collapsing, this will affect our strategy. Or, if the negotiated agreement is not essential because we have a strong option, and can walk away with confidence, this also influences the approach to our strategy.
7) Do Other Parties Need to Formally Approve the Agreement?
Many agreements made during the negotiated process require formal approval, or ratification before an agreement is official. Union members may vote before they accept a tentative labour agreement, that was previously negotiated between management and the union. A Board of Directors, CEO, stakeholders, or other outside constituents, may need to review and ratify an agreement, before it comes into effect.
8) Is the Clock Ticking?
Time has an impact on the course of negotiations from two perspectives. First there are deadlines that might be imposed, to either make or break an agreement. Offers with expiry dates may be tendered.
Secondly, we all know that 'Time is money'. Negotiations use up time, and if a plant is shut down while the clock is ticking because of a strike, then this is costing money. Or, it could be due to some other resource issue, such as waiting for badly needed components, in order to resume production. The point to remember is that the longer the negotiations drag out, time will negatively affect the bottom line.
Take a break because there's more to come in PART 2!
- Harvard Business Essentials 'Negotiation' Harvard Business School Press, (2003).
- Leigh Thompson, 'The Heart and Mind of the Negotiator-2nd Edition', Prentice Hall Business Publishing, (2001).
- J. Lewicki, A. Litterer, W.Minton, M. Sauders, 'Negotiation', 2nd Edition, Irwin,(1994).
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