Last week I was at a cocktail party and was asked about what I do. As a negotiation consultant, it's a common question. The next question was the question most people think but don't ask. "What's the one thing about negotiation?" she asked. I asked for clarification, and she continued, "You know that one thing that's a game changer."
I thought about it for a moment and a few things came to mind. Asking questions and listening was an obvious place to go. Use of silence was something I considered. I even thought about discussing some of the parlor tricks used by so many negotiation consultants. Then, I settled on what I think is the number one game-changer in negotiations. And it's so simple! Planning.
It's easy to do and easy to say, but so many negotiators prefer to wing it rather than set aside the time to do the appropriate planning. I've worked with buyers from some of the world's largest retailers who tell me that their day is spent negotiating with suppliers. They don't have time to plan, they say. I've been at the table with countless salespeople from the largest sales organizations in the world. They say much the same thing. Their goals and objectives are so high, they just don't have the time.
The result is that these buyers and sellers leave tremendous amounts of money on the table. Because they didn't plan, they (and their leaders) may never know how much they lost or what to do about it.
3 KEYS TO PLANNING FOR A NEGOTIATION
When it comes to planning for a negotiation there is a lot of ground to cover. In fact, when we give workshops on deal craft, a significant portion of the time is spent on planning. While I can't cover everything in a blog post, I can share three things that will help you plan for your next negotiations:
1. Know your counterparty! This seems simple, right? The question is whether you have taken the time to do it.
a. Have you read their annual report?
b. What are their drivers and objectives?
c. What is most important to them and why?
d. How have they negotiated in the past?
e. What patterns have they exhibited in past negotiations?
f. How do they value all the variables? How is that different from how you value them?
g. What are they going to do if this deal doesn't work out?
2. Know yourself (and your values)! Most negotiators I talk to say they know the value of what they have and want. Seldom have they assessed the value of all the things they have to trade.
a. What are your drivers and objectives?
b. What is most important to you and why?
c. What expectations have you sent (or can send)?
d. How can you precondition them to change their expectations?
e. How do you value all the variables? How is that different from how they value them?
f. Have you included all the things that can be traded (even things that don't normally get negotiated)?
g. What are you going to do if this deal doesn't work out?
3. Plan your moves! This is another simple concept. However, many negotiators wait until the negotiation. Then they make moves on the fly. These moves are often unplanned and when they make them, they give away a lot of money and value.
a. What does your opening proposal look like? What message will it send?
b. What do you think their opening proposal will look like? How will you respond to it?
c. Which variables will you move and when? How much will you move them?
d. How many moves will you take to concede or exchange value?
e. What concessions will you demand in return for any you make?
f. Where are the opportunities to build value for each party?
g. Which negotiation style will you adopt?
h. What are the triggers for you to walk away from the deal?
There is so much that can be said for planning in negotiation. The lion's share of the time spent on a negotiation should be in the preparation for it. These questions in these three areas are a great place to start your planning!
Sib Law, Founder & Chief Consultant
DealCraftTM Advisors
Copyright 2023, by DealCraftTM Advisors