Negotiation Skills. Scottish Investment Bank

Negotiation Skills Scottish Investment Bank

Negotiation Skills If you give me one of your doggy treats, I ll give you two ham bones. Ok Bernie. I m happy if you re happy.

Nobody ever saw a dog make a fair and deliberate exchange of one bone for another with another dog. Adam Smith Economist (1776)

Welcome

Outcome Improve your confidence to negotiate effectively Through your actions

Our objectives At the end of the session you will be able to: 1. State the four ingredients of Ury and Fisher s principled negotiation 2. Commit to one important action for each ingredient 3. Describe BATNA (Best Alternative to a Negotiated Agreement) and its link to success 4. Recognise four tips to supercharge your confidence

Agenda 1. Principled negotiation 2. The negotiation Preparation Conversion the dance Afterward 3. Supercharging our confidence 4. Summary

1 Principled negotiation

Principled negotiation 1. People: Separate the people from the problem 2. Interests: Focus on interests, not positions 3. Options: Generate a variety of possibilities before deciding 4. Criteria: Use objective standard

People from problem It s tough... but Negotiators are people first Discuss perceptions Face saving and ego Speak about yourself not about them

Interests not positions

Options: 14 April 1912

Options: 14 April 1912 Time Log 23:40 Lookouts telephone the bridge about seeing iceberg 23:41 Titanic hits the iceberg despite reversing and turning 23:47 Titanic officially stops 00:05 Captain Smith orders lifeboats uncovered 00:10 Wireless distress signals begin 00:45 First lifeboat launched 02:05 Last lifeboat lowered 02:18 Titanic snaps 02:20 Titanic fully sunk 03:30 Rescue ship Carpathian seen by survivors 04:10 First survivor picked up

Criteria 1. You want a pay rise 2. You want to sell your house 3. You want a full time (37.5 hr a week) colleague on a project 4. You d like a rent holiday of three months on your new office 5. You d like 300 off the quoted price of the three piece suite in the shop 6. You would like a 1000 a day consultancy fee 7. You would like to achieve 12 500 as a settlement for your car, written off in a recent accident

2 The negotiation

The negotiation 1. Preparations 2. The conversation 3. Afterward

Preparations

Planning Aim and objectives Substantive Relationship Strategy Questions Concessions Each element Ideal Good Live with (resistance) The people Preferences History My case Helps and hurts Me/My team Mentally/Physically Strengths/Red Rags Roles

The leader The sweeper The recorder In teams

Teams Leader Sweeper Recorder Makes the demands Talks the most Chairs adjournments Gives concessions Breaks off negotiations Asks the questions Makes the offers Presents the decisions Looks for concessions Looks for weaknesses Protects the leader Focuses the negotiation Looks for verbal and non verbal signals Takes notes Summarises Clarifies understanding Keeps team informed on bargaining range Feedbacks exact words where disagreement occurs

BATNA Best Alternative To a Negotiated Agreement Well defined. Time spent increases with the significance of the negotiation.

Uneven game? Tourists/James Bond Formal education Better dressed Cash rich Urchin Cost price Tourists buying signals Average sale price How long to get a sale

The conversation

Package Conclude No Exchange Yes Signal No No Explore Q & A Response Prepare

First seek to understand then to be understood. Stephen Covey Statements generate resistance: questions generate answers. Bill Ury

Irritators Behaviour Comments Measured Difference Counter proposals Defend/Attack spirals Excessive use of arguments Emotional control Testing for understanding Summarising Seeking information Stating feelings Complimentary statements that favour one s own position or offer, such as, This is an excellent deal. Immediately countering with one s own proposal, which the other party interprets as a blocking tactic and as being unreceptive to their suggestions, offers, propositions etc. Taking an adversarial position and defending your actions by attacking the other party i.e. You can t blame us. It s not our fault ; You should have planned for this. Using too many arguments or giving too many reasons when trying to support a weak case. Using emotionally charged statements rather than employing an element of formality. For example, rather than saying I m telling you we might say Can I make a suggestion. Checking if the recipient has understood the previous statement. Summarising the main course covered so far The unskilled negotiator asks significantly fewer questions than the skilled negotiator Rather than simply state their opinion It will not work the skilled negotiator will say how they feel I am worried. Average Skilled Use per hour 10.8 2.3 Frequency per hour 3.1 1.7 Percentage of comments 6.3 1.9 Average number of reasons given to support their case 3.0 1.8 Percentage of all behaviour preceded by an emotional statement 1.2 6.4 Test Understanding 4.1 9.7 Summarising 4.2 7.5 Seeking information as a percentage of all behaviour 9.6 21.3 Giving internal information as a percentage of all behaviour 7.8 12.1

Talk the same language Tune in to VHF

VHF in action What might a Say?

In action I see now That feels doesn t right ring any bells with me I That have looks a firm right grip to on me the Suddenly it clicked subject I Just get listen the picture to me It s an intense problem I hear what you say I need to get it in I perspective Something need a concrete tells me example that s the answer I I m find That s in it the difficult music dark to about to handle my ears this

Signalling Gestures Statements Questions

Signalling Gestures Statements Questions We have never had a ten year pay back

Signalling Gestures Statements Questions Why should we accept your valuation?

Signalling As you keep them engaged Body movements Voice tone Words and phrases Suppose Perhaps Willing to consider If Maybe

The signalling game What is the response or meaning? Activity

Signal Response/meaning "We don't normally give a discount." "When might you give one?"

Signal Response/meaning "We never give a discount as big as 15%." "Could you give us a discount of 14.999999%?"

Signal Response/meaning "I am not looking for a figure below 100,000." This is the opening position (a dance move) What might you be looking for?

Signal Response/meaning "These are our standard terms." This implies there are other terms. Find out the non-standard terms. What circumstances would allow you to offer special ones?

Signal Response/meaning "At this stage we are not prepared to sell that item." Find out when and under what circumstances they would sell. What would you and I need to do together so that you would sell that item?

Signal Response/meaning "We would find it difficult to buy at that price." There isn't a "No" here. It suggests you are close to their figure "At what price would you be prepared to buy? What would make it easier for you?

Signal Response/meaning "No. We couldn't produce that amount in such a short time." "When could you do it for then?"

Signals and proposals Become master of: If... then... Even trial proposals If perhaps... then we might

Exchange I will give you X if you give me Y Always conditional on a final agreement.

Afterward

Afterward Negotiate Take action Review Conclude for next time

3 Supercharge your confidence

Confidence 1. Forensic planning 2. Agreement on scope to act 3. Effective BATNA 4. Everyone knows their role 5. Great questioning and responding 6. Active listening 7. Presence to take a break 8. Politeness Personified 9. Follow PIOC

4 Summary

Summary Forensic preparation Strong BATNA Team plan The dance Stay resourceful Take your time Questions Take action Negotiate Conclude for next time Use summaries and breaks (adjournments) Review

People said I was lucky. It s funny, cos the more I practised the luckier I got. Gary Player Champion Golfer 60

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