This reading covers all the questions frequently asked and related
answers needed in a negotiation. The content of the text is divided
in three kinds of tactics : tactics regarding price ;
tactics regarding process and tactics regarding people. We can
consider it as a manual for all aspiring negotiators.
I- Tactics regarding price
First question: Should I ever state my acceptable range ?
If you reveal clearly your acceptable range (for example if you say that you are willing to pay $40,000 to $45,000) then the other side is able to define reservation price. In this case, you will pay at least $45,000. The other side knows a decisive information about your strategy. This is a little bit risky but taking risks can be fruitful.
On the other hand, reveal your acceptable range can be a real benefit. Let's imagine a negotiation stagnating. The other person is at $40,000 and you are at $33,000. The other person push the deal to $38,000. Then you can avery that your range is from $30,000 to $33,000. Thereby, the other negotiator will probably accept to get less from you, as $35,000 for example, thinking that he has pushed you to the top while the reality is very different.
Second Question: Should I ever tell the other side my real bottom line ?
You can tell the otherside your real bottom line only in case we know it exactly or approximately. If you tell it in a excessive or inequitable way, you will lose credibility.
Third Question: Suppose that the other side opens with an incredibly unreasonable number. Should I counter with an equally unreasonable number or decline to counter at all ?
To answer this question, you can apply three strategies :
- Make a joke. By doing this, you will show to the other side that his offer is not enough serious for you. You can also add a sentence as : « Now, let’s get serious » at the end of your joke. It will allow you to relax the atmosphere and to reject the offer without being too aggressive
- You can declare clearly that the other side’s offer is unreasonable.
- You say that the offer is unreasonnable and that a deal is not possible. Thus you are closed to any negotiation. However, this option is to be avoided as far as possible. Indeed, the interest of a negotiation is to come to an agreement.
II- Tactics regarding process
First Question : Is it ever acceptable to bid against myself to make tho moves in a row
Second Question : Is it smart or fair to bluff ?
Third Question : In a complex deal, is it better to reach agreement issue by issue or wait until the end ?
Fourth Question : Is it better to deal with difficult or easy issues first ?
Fifth Question : What if there is an unexpected turn in the road-before or after an agreement ?
These issues are about commitment and the ways to come to an agreement. As David Churchman said « Negotiation is an integral and pragmatic tool. » The negotiations are not only technical, but is related to personal development. The most important skills you must have a good negotiator are: emotional intelligence, creativity, active listening, empathy, assertiveness, preparation and the ability to know how to manage time properly. Managing tactics related to process means managing trading strategies.
III- Tactics about people
First Question : What happens when you put a collaborative negotiator against a positional hard bargainer ?
Second Question : How should I respond if the other side seeks to change something in its offer after a deal has been reached ?
Third Question : What should I do when the negotiator on the other side has a temper tantrum ?
Fourth Question : I don’t believe what the other side is saying. What should I do ?
Fifth Question : When, if ever, is it appropriate to negotiate over the telephone or by e-mail ? Or it is essential to insist on a face-to-face meeting ?
Sixth Question : How should I react when the other side challenges my credentials status, or authority to make a deal ?
I- Tactics regarding price
First question: Should I ever state my acceptable range ?
If you reveal clearly your acceptable range (for example if you say that you are willing to pay $40,000 to $45,000) then the other side is able to define reservation price. In this case, you will pay at least $45,000. The other side knows a decisive information about your strategy. This is a little bit risky but taking risks can be fruitful.
On the other hand, reveal your acceptable range can be a real benefit. Let's imagine a negotiation stagnating. The other person is at $40,000 and you are at $33,000. The other person push the deal to $38,000. Then you can avery that your range is from $30,000 to $33,000. Thereby, the other negotiator will probably accept to get less from you, as $35,000 for example, thinking that he has pushed you to the top while the reality is very different.
Second Question: Should I ever tell the other side my real bottom line ?
You can tell the otherside your real bottom line only in case we know it exactly or approximately. If you tell it in a excessive or inequitable way, you will lose credibility.
Third Question: Suppose that the other side opens with an incredibly unreasonable number. Should I counter with an equally unreasonable number or decline to counter at all ?
To answer this question, you can apply three strategies :
- Make a joke. By doing this, you will show to the other side that his offer is not enough serious for you. You can also add a sentence as : « Now, let’s get serious » at the end of your joke. It will allow you to relax the atmosphere and to reject the offer without being too aggressive
- You can declare clearly that the other side’s offer is unreasonable.
- You say that the offer is unreasonnable and that a deal is not possible. Thus you are closed to any negotiation. However, this option is to be avoided as far as possible. Indeed, the interest of a negotiation is to come to an agreement.
II- Tactics regarding process
First Question : Is it ever acceptable to bid against myself to make tho moves in a row
Second Question : Is it smart or fair to bluff ?
Third Question : In a complex deal, is it better to reach agreement issue by issue or wait until the end ?
Fourth Question : Is it better to deal with difficult or easy issues first ?
Fifth Question : What if there is an unexpected turn in the road-before or after an agreement ?
These issues are about commitment and the ways to come to an agreement. As David Churchman said « Negotiation is an integral and pragmatic tool. » The negotiations are not only technical, but is related to personal development. The most important skills you must have a good negotiator are: emotional intelligence, creativity, active listening, empathy, assertiveness, preparation and the ability to know how to manage time properly. Managing tactics related to process means managing trading strategies.
III- Tactics about people
First Question : What happens when you put a collaborative negotiator against a positional hard bargainer ?
Second Question : How should I respond if the other side seeks to change something in its offer after a deal has been reached ?
Third Question : What should I do when the negotiator on the other side has a temper tantrum ?
Fourth Question : I don’t believe what the other side is saying. What should I do ?
Fifth Question : When, if ever, is it appropriate to negotiate over the telephone or by e-mail ? Or it is essential to insist on a face-to-face meeting ?
Sixth Question : How should I react when the other side challenges my credentials status, or authority to make a deal ?
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