Empowering Local Government Frontline Services - Mo Baines.pdf
Art of negotiation_2
1. THE ART OF NEGOTIATION II
By Dr. Robert Mudida,
Senior Lecturer,
Strathmore Business School
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2. SATISFY NEEDS THAT UNDERLIE WANTS
• Identify needs at individual, organisational or third
party level.
• Some needs are tangible and objective such as cost,
profit, timing, quality level and specifications.
• Some needs may be intangible and subjective such
as the relationship, the character of the negotiation
process, the precedent it sets, its fairness to both
parties and their constituencies, its sustainability, the
effect on your reputation and self-image, whether
trust is enhanced or eroded.
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3. SATISFY NEEDS THAT UNDERLIE WANTS
• Focus on the needs of the other party as much
as yours.
• In many cases the wants stated by the other
parties are only the tip of the iceberg.
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7. SATISFY NEEDS THAT UNDERLIE WANTS
• The first level of needs is related to the topic
under discussion.
• The second level of needs refers to the
personal needs of the individual negotiators.
• The third level reflects the needs of third
parties represented by the negotiator.
• Most of the time each party will have many
needs rather than a single one, and thus it is
an error to concentrate only on the stated
problem. 7
8. SATISFY NEEDS THAT UNDERLIE WANTS
• Needs provide the basis for joint gains and
creative solutions.
• Probe for underlying needs and positions.
• Watch for non-verbal cues.
• The process of identifying the needs of the
other party entails listening actively and
formulating appropriate questions.
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9. Examples of complementary interests
One party might care about: One party might care about
Form, appearance Substance
Economic considerations Political considerations
External considerations Internal cosiderations
Immediate future More distant future
Tangible results The relationship
Progress, Change Respect for tradition
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10. Some common interests we all have..
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Acceptance
Fulfilment
Accountability
Independence
Achievement
Knowledge
Acknowledgment
Love
Affection
Nurturance
Appreciation
Opportunity for
Input
Autonomy
Privacy
Belonging
Recognition
Clarity
Responsibility
Commitment
Respect
Competency
Relaxation
Consistency
Satisfaction
Efficiency
Safety
Fairness
Security
Freedom from Fear
Trust
Understanding
Validation
12. SATISFY NEEDS THAT UNDERLIE WANTS
• In many negotiations, the parties
have common underlying needs
which should be explored.
• Once they are discovered these
needs can be satisfied through a
number of alternative solutions.
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13. SATISFY NEEDS THAT UNDERLIE WANTS
• As it is true that several cooks can create
different dishes using the same ingredients,
negotiators can often develop several
different solutions to the same problem.
• Negotiators can often develop several
different solutions to the same problem.
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14. BE AWARE OF YOUR RELATIVE POWER AND USE IT
EFFECTIVELY
• Don’t underestimate your power base.
• Negotiators with little experience tend to assume
that each party’s power is an absolute and
unchangeable quantity. This often leads them to
suppose that they have less power than they actually
have, or at times to believe that they have more
power than they actually have.
• Remember that power is relative and depends on
who the parties are and also on the subject of
negotiation.
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15. BE AWARE OF YOUR RELATIVE POWER AND USE IT EFFECTIVELY
• Don’t forget about the other party’s power
base.
• Identify sources of power for you and the
other party.
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16. SOURCES OF POWER
• Organisational power: this arises from the
position of a negotiator within an organisation
or the influence a negotiator has within an
organisation.
• Personal power: this arises from a negotiator’s
commitment, persistence and belief in the
position held during the organisation.
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17. SOURCES OF POWER
• Situational power: for example if I have initiated the
contact or if the negotiation is carried out on my turf.
• Power to obstruct: refers to the capacity to block or
put obstacles in the other party’s path.
• Time power: time can work for or against us. The use
of time communicates information but norms about
time can vary among cultures. Knowing the deadline
for the opposing party can also give us an advantage.
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18. SOURCES OF POWER-BATNA
• Other alternatives to a negotiated agreement:
Having alternatives in case an agreement cannot be
reached is a vital source of power.
• The best of these alternatives is called the BATNA
(Best Alternative to a Negotiated Agreement).
• How much effort is put into a negotiation will
depend on how satisfactory the BATNA is.
• The BATNA can help negotiators avoid unfavourable
agreements and can prevent them from rejecting
those they should accept.
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19. BATNA
• When an agreement is reached that is worse
than the BATNA it is usually because errors
have been made during the negotiation
process or owing to inadequate preparation.
• As the value of the BATNA increases so too
does the capacity of the negotiator to improve
the terms of the agreement.
• It is easier to deal with a negotiation when the
alternative is clear.
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20. FRAME AND POSITION YOUR CASE ADVANTAGEOUSLY
• Advantageously positioning or defining the subject of
negotiation allows us to capitalise on the fact that
each party has a unique view of the situation.
• In most negotiations there is a certain ambiguity
about the problem subject to negotiation. Since
there is no single way of interpreting the facts, nor
any single way of defining the problem or a good
solution an expert negotiator should build strong
supporting arguments which direct the negotiation
towards a preferred solution.
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21. FRAME AND POSITION YOUR CASE ADVANTAGEOUSLY
• Framing the topic is a key aspect in a negotiating strategy and
can have an important influence of the expectations of the
other party.
• Do not frame the topic in a vacuum: Ensure that you identify
the needs and power of both parties and prepare a list of
options that satisfy as many of the needs as possible.
• Don’t assume there is only one reality: in a negotiation the
parties should expect the unexpected and prepare to have
more options than fewer options. Don’t expect that the other
party will always behave in a predictable manner.
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22. FRAME AND POSITION YOUR CASE ADVANTAGEOUSLY
• Care should be taken in choosing the words
used in presenting the topic and also remain
consistent.
• Be subtle and avoid excessive repetition
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23. FRAME AND POSITION YOUR CASE ADVANTAGEOUSLY
• Prepare supporting data and arguments.
• Anticipate the arguments the other side will
make.
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24. FRAME AND POSITION YOUR CASE ADVANTAGEOUSLY
• A reasoned argument supporting your position is an
admission ticket that establishes one’s request as
legitimate and get’s the other side to pay attention.
• However, argument alone is not sufficient to achieve
negotiating success.
• Your request must be within the zone of the other
party’s capability and interests, and your manner of
communicating the standard you wish to apply must
be persuasive.
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25. SET HIGH BUT REASONABLE EXPECTATIONS
• Those who ask for more tend to get more if
aspirations are within the range of reason.
• It is easy to lower aspirations but hard to raise
once known.
• Not leaving room to negotiate may be risky.
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26. SET HIGH BUT REASONABLE EXPECTATIONS
• Making the first offer is risky since it may be
lower than what the other party may be
willing to offer.
• On the other hand, a well presented initial
offer within the limits of what is reasonable
could make the other party re-evaluate their
position and make them willing to agree to a
higher offer than originally expected.
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27. SET HIGH BUT REASONABLE EXPECTATIONS
• Identify all conceivable options and
concessions by each party.
• Prioritise by value to you and the other party.
• Concede only if the other party has worked for
it and deserves it (slowly and reluctantly).
• Don’t panic as the deadline nears.
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28. SET HIGH BUT REASONABLE EXPECTATIONS
• You’ll never hit the target if you don’t aim.
• Find out where you want to go and why.
• Goals set the upper limit of what you will ask
for. What you aim for in negotiations
determines what you will get.
• A goal is the highest legitimate expectation of
what you should get.
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29. SET HIGH BUT REASONABLE EXPECTATIONS
• The bottom line should not be your dominant
reference point in negotiations.
• Parties with higher but still realistic goals
outperform those with modest goals.
• Be aware of your absolute limits but do not
dwell on them.
• Prepare your bottom line then set it aside
while you energetically work on formulating
your goals.
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30. SET HIGH BUT REASONABLE EXPECTATIONS
• Keep both the goal and the bottom line in
focus.
• Don’t have modest or “I’ll do my best” goals in
negotiation.
• Be especially wary of goals such as “I’ll do the
best I can” or “I’ll just go in and see what I can
get.”
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31. Be realistic
• Optimistic goals are effective only if they are
feasible; that is, only if you believe in them
and they can be justified according to some
standard or norm.
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32. WHY DO WE SET MODEST GOALS?
• Firstly, many people set modest goals to protect their
self-esteem. We are less likely to fail if our goals are
low.
• Secondly, we may not have enough information
about the negotiation because we have not prepared
well.
• Thirdly, we may not have the same sense of desire as
the other party. If the other party wants money,
control or power more urgently than we do, we are
unlikely to set a high goal for ourselves.
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33. MANAGE INFORMATION SKILFULLY
• Seek information that strengthens your case.
• Before disclosing information consider its
impact.
• Discount information that weakens your case.
• Be prepared to discuss information in depth.
• Present information at appropriate times and
in a powerful way.
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34. MANAGE THE INTERPERSONAL RELATIONSHIP
• Separate people from the problem.
• Take into account if it is a one time or a
continuous relationship.
• Generate trust so as to facilitate the process of
exploring, listening, persuading and
confronting.
• Communicate effectively being flexible and
emphatic.
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35. MANAGE THE INTERPERSONAL RELATIONSHIP
• Negotiation is about people-their goals,
needs, and interests.
• The ability to form and manage personal
associations at the negotiating table is a
critical element of effective negotiation.
• Personal relationships create a level of trust
and confidence between people that eases
anxiety and facilitates communication.
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36. MANAGE THE INTERPERSONAL RELATIONSHIP
• People are complex and unpredictable.
• No matter how stable your relationship with
the other party may be, one must grapple
with the problem of trust each and every time
you negotiate.
• This implies that one must get into the habit
of reviewing the relationship factor as a
routine part of effective negotiation planning.
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37. Personal relationships versus working relationships
• There is a subtle difference between working
relationships and personal friendships that
can make a major difference in the way
negotiations work.
• The closer the personal relationship between
the two negotiators, the more likely it is that
they will seek to minimise conflict and close
the deal based on some simple, roughly equal
compromise.
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38. Personal relationships versus working relationships
• Individuals who have a close personal
relationship start the negotiation with more
modest goals, make bigger concessions; argue
with each other less; and tell each other the
truth about their bargaining positions more
often.
• In short, they are nicer to each other than
strangers are and reach agreements by
straight, simple compromises.
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39. Personal relationships versus working relationships
• This “soft” style, however, has a cost.
• Personal friends are sometimes less successful
than strangers at uncovering hidden, mutually
rewarding trade-offs since they focused on
simple, equal compromises on all issues and
engaged in less problem solving and probing
of priorities than do competitive-minded
strangers.
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40. The middle ground
• The middle ground for relationships between friends
and strangers is so-called working relationships.
• These are the exchange of relationships of everyday
business life. They are based on a degree of trust
and reciprocity and on the prudent assumption that
both parties are looking after their own best
interests.
• Working relationships can be built across the table
with small steps such as gifts, favours, disclosures or
concessions.
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41. The relationship factor
• Avoid reciprocity and relationship traps like
trusting too quickly, letting others make you
feel guilty, and mixing big business with
personal friendships.
• Take your time and build trust step by step.
• Use your relationship network to check the
other party out.
• If this is not possible take a small risk before
you take a large one.
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