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Art of Negotiation and Its Role in Your Business

Negotiations: Methods and Opportunities

Negotiation is a process aimed at reaching understanding through working out a mutually acceptable solution. It is a specific form of interaction between people during the performance of their business activities. We negotiate, exchange commitments and make promises all our lives. Whenever two people need to agree, they must negotiate. In business, negotiations take on the form of a conversation during which both parties discuss points of mutual interest and attempt to forge partnership ties.

As far as their objectives are concerned, negotiations differ significantly. They can be conducted for the purpose of concluding a trading contract, doing research or design work, signing an agreement on cooperation or coordination of activity, etc. In the course of negotiations, the parties involved should identify common interests and ensure effective exchange of information. The main goal of holding negotiations lies in reaching a mutually acceptable agreement and achieving a result that would satisfy the participants. Hopefully, these professional writing services will suit all your expectations about academic papers.

Main Stages of Negotiations

There is no strictly defined model of conducting negotiations. That said, they are generally divided into the following main stages:

  • Preparation;
  • Introduction;
  • Outlining the subject of negotiation, suggesting negotiation modes, exchanging positions, and working out a mutually acceptable solution;
  • Conclusion.

Preparation for Negotiations

Conducting negotiations requires careful preparation. The more intensively they are conducted (using analysis, calculating economic effect, providing expert assessment, etc.), the greater the chances of achieving success are. A quite contrary effect is achieved when different objectives and psychological aspects were not taken into account.

To be ready for negations, one should define a subject and analyze an issue. Also, information about your partner should be collected. Your interests, the likely goals of another party, and the availability of alternative solutions should be clearly understood. Planning negotiations also involves developing a negotiation concept, defining goals and strategies, doing economic calculations, coming up with basic positions, and preparing the necessary technical and reference documentation.

Negotiation Process

In the course of negotiations, people usually have two main goals; 1) to avoid confrontation that inevitably arises due to the clash of interests 2) to achieve understanding about a matter of common interest. For that, ensuring an effective interaction and finding a way to solve a problem is absolutely important.

People with totally different communication skills can meet at the negotiating table. They may also have different tempers and educational backgrounds. You should, therefore, take any opinion expressed by another party very seriously . Your behavior should correspond to the situation during the negotiations. Speak calmly and convincingly, control your speech, and avoid any verbal insults. The cooperative principle, formulated by Paul Grice, is applicable to various types of business negotiations.

For negotiations to be a success, parties should strive to achieve common ground immediately after their beginning. First, you should outline non-controversial aspects of the subject. Do not focus on the divergence of views, if they are not fundamental. After that, discuss the points that can be solved relatively easily. Only after that can you proceed to the items on the agenda that require thorough discussion. When you inform your partner about a problem, be sure to mention the reasons for its emergence and possible consequences if it is not resolved.

Sometimes, reaching an agreement is only possible through thorough discussion. During negotiations, various interests can be revealed, and participants usually perceive them through the prism of their own needs. It is critically important to know what positive or negative expectations the parties have at the beginning of the negotiations, especially if they evaluate new solutions suggested in their process.

Negotiations consist of questions and answers. They can proceed smoothly or tensely — the parties can agree easily, have difficulty agreeing or fail to agree at all. Therefore, successful and productive negotiations require you to know the rules of conducting negotiations and different negotiating techniques.

Completing and Debriefing

Completion of negotiations is a critical stage. If the negotiators did not reach a solution, negotiations could be postponed to a later date. Regardless of whether the negotiations were successful or unsuccessful, their results should be discussed. What have you achieved in the course of the talks and what have you not done? What were the main reasons for such outcomes? What conclusions can be drawn to ensure more effective results in the future?

The primary attention should be given to the drafting of final papers. It is necessary to remember all the details discussed so as not to miss the essential ones in the draft agreement. It should be taken into account that all terms discussed verbally have no legal force unless they are included in the final text of the contract.

Main Mistakes During Negotiations

  • Cold Start
  • Your partner enters negotiations without knowing their needs and purposes. They have also failed to take into account difficulties that may emerge in the course of negotiations. In this case, they will be reactive, and not proactive.
  • Lack of Plan
  • A businessman should have a clear-cut plan listing maximum and minimum requirements. It is much easier to negotiate having several options in mind or on paper.
  • It Must Suit Me, Period!

A negotiating party refuses to make any concessions. Narrow-mindedness and selfishness are often to blame for that. They prevent any further progress and discourage the other party from continuing discussion.

Letting Things Slide

A negotiator does not have any clear idea about a subject under discussion. They have nothing to offer and, therefore, the effectiveness of negotiations is reduced to zero.

Wrong Ways of Communication

Incorrect behavior of one of the partners adversely affects the atmosphere of the negotiations and hinders the achievement of goals. A negotiating party is not able to listen to others and doesn’t strive to reach common ground. It becomes a one-way street.

Methods of Successful Negotiations

Variational Method

To have room for maneuver, it is necessary to understand what could be an ideal solution to the problem, what arguments are needed to respond to objections, and what approaches can be used. Such reasoning requires an in-depth review of the entire problem, quick thinking, and realistic assessment.

Integration Method

This method is intended to convince the partner to assess the subject of negotiations in relation to the social ties and the need to develop further cooperation. The use of this method does not guarantee reaching an agreement and should be used in cases when a partner takes an overly individualistic stance.

Compromise Method

All negotiating parties should be ready to compromise. As far as the divergence of interests is concerned, they should seek agreement step by step. A compromise solution is typically reached when negotiators make some concessions after failing to reach an agreement. When they cede in something, they can get something in return.

Roger Fisher and William Ury, professors of Harvard University, believe that none of the above methods is perfect. Therefore, they have come up with four methodological recommendations:

  • Avoiding disputes between negotiators;
  • Focusing on the benefits;
  • Considering several options that may be beneficial to both parties;
  • Insisting on the use of objective criteria.

To sum up, conducting successful negotiations is a skill any senior manager should possess. Like any other skill, it comes with experience, practice, and the ability to learn from mistakes, both others’ and your own. The most important prerequisites for having successful negotiations include proper preparation, focus on the main subject, problem-solving skills, aspiration to reach common ground, realistic approach, consideration of interests, and flexibility.

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