Getting what you want does not always come easily. You have to work for it. But, if you are properly prepared, you can conquer almost any business dilemma. Things do not always go as planned, and it can be tough trying to negotiate with someone who just will not budge. There is a myriad of information out there that deals with ways to properly negotiate.
A lot of this information is made up of misleading myths, and when it comes down to it, you can win a business negotiation in three easy steps. Before you rush out right away and start trying to make deals, read a little bit more about some common truths and myths and the three steps to take to ensure that you’ll come out of a business transaction with the arrangement you want.
Step 1: Pick a strategy and stick to it
One of the biggest myths out there is that negotiations should be a win-lose situation in which one clear winner will rise to the top. People who are more competitive tend to take this viewpoint, but where does that leave the rest of us? Of course the win-lose strategy is always available for you to choose, and if that’s your prerogative then go ahead. But what you should strive to do is create a win-win situation.
Imagine this: you and a client are negotiating a deal with three key elements. Your firm resolve about not budging on any of the three points is beginning to intimidate your counterpart, and eventually he caves. Is that what you want? Instead, try to look at it from his perspective.
You are facing a cutthroat negotiator with whom you really need to strike a deal, but you’re starting to feel like you are never going to get the sale price you want out of the negotiation. You feel your grasp on the situation slipping away, and he comes out victoriously. Would this make you feel good? Would you want to do business with him again? Doubtful on both counts.
As you can see from the example, a win-lose situation really isn’t that great unless you’re the winner. Creating a win-win situation can open you both up to new opportunities because there is no resentment and you both walk away from the situation feeling satisfied. So, when you pick a strategy and stick to it, try to go for the win-win option. You’ll consolidate time and keep everyone open to future projects.
Step 2: Understand the other side
One huge myth that ties in with this step is that people think negotiations are always daunting, critical tasks. In reality, they don’t have to be as long as you research and plan. Understanding the other side can let you prepare yourself in advance and figure out how to counter offers that you’ll anticipate the other side will be making. Knowing a little extra information about the other side can help assist your negotiations favorably.
For example, let’s pretend you are entering into negotiations with a company that is facing bankruptcy. Without this critical piece of information, you would enter into the transaction with certain assumptions about the company’s performance and maybe even assume they were doing relatively well.
This could leave you at a loss, because if they need something from you, you actually would have much more leveraging power, and you’d know how to use it if you’d done your research.
This is just one easy example to illustrate how a lack of information and understanding can detract from your ability to obtain a favorable outcome. Of course, you should never be subversive, but you should always try to research what points and counters the other side is likely to bring up so you can then formulate ways to discredit those points.
Understanding the other side can make your job of negotiating much, much easier. You wouldn’t make a speech to the President without rehearsing what you’re going to say or anticipating what questions he might ask, would you?
Step 3: Know your objective; don’t be afraid to walk
One of the most pervasive myths in the negotiating realm is that if you walk away from something, that’s the end. In reality, deals and opportunities will often come back around. Walking away from something won’t preclude you from striking a deal in the future. You can’t predict what position the other side (or your side) will be in next time around you’re negotiating with each other. They may end up needing something from you and be willing to concede more in favor what you want.
Knowing your ultimate goal is important in this situation.
When you have a clearly defined objective ingrained into your mind before you begin to negotiate, you’ll be less likely to be influenced by your emotions and may end up agreeing to a deal just because you didn’t want to pass one up. It’s okay to say “no” and it’ll be easier for you to do so when you know exactly what you can and can’t budge with.
Remember that negotiators are made, not born, and you can always learn how to improve your negotiating skills. These three simple steps can help guide you to the winner’s circle each and every time.
Originally published August 2013.