How To Create Value While Negotiating

How To Create Value While Negotiating

Using integrative negotiation strategies you can create value during a negotiation
Using integrative negotiation strategies you can create value during a negotiation
Image Credit: Tom Anderson

If you sit back and think about it, what are you really trying to accomplish during a negotiation with all of your fancy negotiation styles and negotiating techniques? If you are like most of us, what you would like to be able to do is to discover additional value that nobody realized was there, perhaps make some useful trades with the other side, and finally come up with a deal that will exceed both sides initial expectations. All of this sounds wonderful; however, how can a negotiator actually make this happen?

Before The Negotiation Starts

Before you next negotiation starts, you are going to want to sit down and spend some time thinking about three critical questions. These questions are as follows:

  1. What’s my BATNA (best alternative to a negotiated agreement). This is what you would end up living with if you walk away from the negotiation.
  2. What are my most important interests, in order?
  3. What is the other side’s BATNA, and what are their interests in negotiating with me?

Coming up with answers to these questions is not as hard as it may seem from the start. You can can take the time to perform some careful estimation, analysis, and hold some conversations with your colleagues in order to answer the first two questions. Next, spend time thinking about the other side’s BATNA and interests. You probably won’t be able to reach a deal with the other side if you haven’t taken the time to consider their needs and wants.

How To Add Issues

Your job as a negotiator is to collect as much information as you possibly can. What this means is that as the negotiation starts, take the time to ask questions of the other side and find out what their real interests are. No matter if you have already planned out what offers you are going to make and alternatives you can use, you need to start things off by taking the time to listen to what the other side has to say.

Asking questions is not necessarily an easy thing to do. In order to find out the information that you will need, you are going to have to ask the other side a lot of questions. Only by doing this are you going to be able to draw out of them a clear understanding of exactly what they are interested in. Keep in mind that in order to show them what kind of responses you are going to want from them, you are going to have to be willing to reveal your interests to them. Don’t worry about exposing too much to the other side, this is something that rarely happens.

Using “What If”

As a negotiator, your job is to look for ways to create value while negotiating with the other side. In order to make this happen, one of the best ways is to play a game of “what if” with the other side. Your goal here is going to be to see if the trade that is being proposed is really going to create value by trying it out on the other side.

In order to use the what if technique with the other side, you can ask them questions in order to find out what their current situation is. Once you have a good grasp of this, you’ll discover what they really want to get out of the negotiations. When you have this information, you can then present them with a what if scenario in order to gauge their level of interest in what you are proposing. If you’ve agreed to brainstorm ideas before putting together a final deal, you can feel comfortable testing a variety of packages with them. Additionally, you can further reduce the risk that the other side will assume a premature commitment by offering more than one ‘What if?’ proposal at the same time. Each package is designed to create more value by taking advantage of mutually beneficial trade-offs.

What All Of This Means For You

The goal of any principled negotiation is to find ways to create a deal that both sides will be willing to live with. What this means for you as a negotiator is that you are going to have to be able to find ways to add value to what you are proposing to the other side. Value exists, it’s just going to take some effort on your part to find ways to add it to the current negotiations.

Before your next negotiation starts, you are going to want to take the time to answer three key questions. It’s only by going into the negotiation with the answers to these questions that you’ll be able to reach the deal that you want. In order to add issues to the negotiation, you are going to have to be willing to ask the other side a lot of questions. You’ll also have to be willing to share information with them in order to show them how to answer your questions. A powerful technique that will allow multiple proposals to be considered is to use what if questions. Present them with trade-offs and see which ones they respond to.

In order to be able to reach a deal with the other side, value has to be created at the negotiating table. It is your job as a negotiator to make this happen. Taking the time to focus on how you can make what is being negotiated more valuable to the other side is your key to being able to reach a deal that both sides will be able to live with.

– Dr. Jim Anderson
Blue Elephant Consulting –
Your Source For Real World Negotiating Skills™

Question For You: When you use “what if” to present multiple negotiating scenarios, how many different scenarios do you think that you should present?

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What We’ll Be Talking About Next Time

As negotiators, what we would all like to be able to do during each of our negotiations is to find a way to create a “win-win” situation. These are the negotiations in which both sides emerge feeling that they got a good deal in the end no matter what negotiation styles or negotiating techniques were used. However, finding this kind of solution to a negotiation can be a real challenge. What we need are ways to make this happen even in even the trickiest negotiations.

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