Wing your Tough Negotiation? 9 Steps to Preparation Success
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Have you ever left a negotiation feeling battered and bruised like you never had a chance from the word go? Too often I’ve seen smart yet unprepared sales professionals torn apart in a negotiation. Admittedly, I suffered similarly early in my career. I notched this up to being part of my hard knocks sales negotiation training journey. Does it need to be?
I’m a big believer in practicing before the game, not in it. Charm and charisma only goes so far when you’re up against a tough as nails competitive negotiator whose upcoming performance review is dependent upon ensuring that you get a less than satisfactory deal!
Here are 9 steps to prepare for your next negotiation.
1. Know Your Strategy
If your negotiation strategy isn’t clear to you, how can you expect to enjoy results that benefit your company the most? If Senior Management hasn’t made clear your strategy, which is sadly too often the case, make sure you ask.
2. Negotiating Style
Will you ? Will you lose the battle to win the war? Will you compromise and meet in the middle or compete to the bitter end? Make sure to choose a style that best fits the circumstances. (For more on this See: ‘5 Negotiating Styles to Consider When Closing a Deal’)
3. Identify Goals
Do you want to maximize the short term value or work to establish a longer term collaboration that will grow value over time? Is your goal to steal market share at the expense of profit? Make sure to know what you want going in, instead of settling for what you end up with.
4. Prepare a SWOT Analysis
A simple but often overlooked tool. Think of the real external opportunities and threats as the walk away positions on both sides. True power in any negotiation is having developed a good walk away alternative. Understanding this may not get you the deal you want, but it will prevent you from agreeing to a lousy deal.
5. Pre-Meeting Questions
I was once told while being trained by a mentor that once you understand someone’s motivation, you are in control. In negotiations, information is power! If you hope to get creative and stack the cards in your favor, you’re going to need to know everything you can about your counterparty’s decision makers, underlying interests and walk away position.
6. Options / Deal design
This is your opportunity to get creative. Work with your team and put together a comprehensive list of options to consider in designing your deal. If you’re not comfortable with numbers, make sure someone on you team is. Make sure to leverage your SWOT’s ‘Opportunities’.
7. Trading Plan
Armed with information from your pre-meeting questions, you are ready to start prioritizing your interests. What can you trade? What can you get in return? Start with your most important interests or goals first. Our Trading Plan is too complex to explain in this article.
8. Set the Agenda
If you don’t set the negotiation agenda and take control early, your counterparty will. Email your agenda before, and print a copy for your meeting.
9. Build a Team
Avoid negotiating alone. Anyone who has ever been ganged up on knows the feeling. Same goes for preparation, co-opt a colleague or two. Ensure that your negotiation team are clear on your negotiating strategy and roles. Without it, you run the risk of contradicting each other at the negotiating table and losing the upper hand.
Now that you have a clear process for preparation, how long should you invest into preparation? My rule of thumb is to invest at least three times the amount of time you expect to negotiate. So a two hour face to face meeting needs about six hours of preparation. This doesn’t mean that you need to spend six straight hours locked up in a room preparing. Pace your team and yourself in the days and weeks leading up to the meeting.
Our veteran negotiating clients are quick to train their more junior colleagues that success in negotiating is determined by what you do before you sit at the table. Tactics and behavior won’t deliver consistent outsized results. For strength and confidence, look to your negotiation preparation process. It’ll come as no surprise to you that our negotiation training courses cast the lens right from the start on …preparation.