Categories
Business

The Art of Negotiation


‘So much of life is a negotiation – so even if you’re not in business, you have opportunities to practice all around you’ – Kevin O’Leary


By Sabari Santosh

Management Student, IMT Ghaziabad

Kevin O’Leary once rightly said, ‘So much of life is a negotiation – so even if you’re not in business, you have opportunities to practice all around you’. Knowingly or unknowingly, we are all negotiating daily. As a child, I remember negotiating with my mom on how much milk to drink in the morning. And now, I usually find myself negotiating my leisure time with work hours every now and then. One thing that I have come to terms with is that it is a crucial skill to possess.

I happen to pursue an exceptional course on ‘the art of negotiation’ from Coursera, in affiliation with University of Michigan, recently. It highlights four stages of the negotiation process that can prove extremely useful in business and hone your skills as a negotiator.

  • The Preparation Before A Negotiation

Great negotiators often ensure that they collect as much detail about the negotiation and their counterpart. It is important for you to feel comfortable when negotiating, hence, ensure that you know whether you should negotiate or not. Convince yourself first.

Analyze the situation by knowing your objectives, constraints, and alternatives (BATNA – Best Alternative to a Negotiated Agreement). Identify the zone of the potential agreement and make sure to do a gap analysis (current state vs the desired future state) if it is a cross-cultural negotiation. Also, certify that you adhere to the law and ethical standards.

Also remember, “Don’t bargain yourself down before you get to the table.” – Carol Frohlinger

  • Key Tactics And Psychological Tools To Use

Use conversational intelligence to build a relationship with your counterpart. Here, the previously gathered information about the alternatives of your counterpart become extremely useful and powerful. Use psychological tools like anchoring, framing, reciprocity, and contrast principle to effect. Avoid psychological traps such as competitive arousal, overconfidence, and reactive devaluation. Always look for underlying mutual interests.

Also remember, “You must never try to make all the money that’s in a deal. Let the other fellow make some money too, because if you have a reputation for always making all the money, you won’t have many deals.” – J. Paul Getty

  • Close Your Negotiation With A Legally Enforceable Contract

Use contract laws to complete your negotiation. While creating contracts, make sure to ensure that both the parties reach an agreement, there is consideration that both parties are giving up something for the contract to be binding, the contract is legally enforceable and although agreements can be oral, it is taken in written.  

  • Contract Performance And Evaluation

What if there arises a dispute in performing the contract? While litigation is a way, always look for Alternate Dispute Resolution (ADR) techniques like arbitration and mediation that is cost-effective and doesn’t hamper business relationships. Evaluating your negotiation at every stage is one such way that can be done by a tool called ‘the six sigma process’. Here, you will need to define the negotiation process, measure the time frame for the negotiation, analyse how to optimize the negotiation, and finally look for ways to improve your negotiation process at each stage.

I strongly recommended you to do a personal performance review whenever you’re involved in any minor or major negotiation. Ask yourself what you did well and how you can improve. Introspect and move ahead! Finally, don’t forget to put your learnings and negotiation skills to practice!

To read the full article, visit: https://www.linkedin.com/pulse/art-negotiation-primer-sabari-santosh

To pursue the course, visit: https://www.coursera.org/learn/negotiation-skills

Subscribe to our website to get regular updates!

*Don’t forget to confirm your subscription through the mail received in your inbox

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s