Negotiation Skills – Session 3
1
Positional Negotiation
The more you clarify your position and defend it
against attack, the more committed you become to
it
The more you try to convince the other side of the
impossibility of changing your opening position, the
more difficult it is to do so
The result is frequently an agreement that is far
less satisfactory to each side than what it could
have been
2
Negotiation Style Activity
Assertive
Co-operative
Competing
√
*
Accommodating
*
√
Avoiding
*
*
Collaborating
√
√
Compromising
√
√
3
Negotiation Tactics



No Deal Tactic

Force you to accept the worst deal

Can do better by walking away

Cherry Picking
Anchoring Tactic

Customer makes an extreme offer

Compromise is higher than seller expects

Hard bargaining
Concealing Information

Customers keep changing their stance
4
Negotiation Tactics Contd…

Making Last Minute Demands



Vulnerable to accept
The Krunch

You’ve got to do better than that

Mostly used by buyers
Boulwarism

Named after Lemuel Boulware

Ultimate offer with no revisions

Refers to “Take-it or Leave-it”
5
Negotiation Tactics

Preconditioning – Bothering customers with tele-calling

Monkey on the Back – Only Rs. 1000 in my pocket

Use of Higher Authority – Introducing an unseen third party

Nibbling – Vulnerable (kept secret till the last moment)

Good Cop Bad Cop – Walking away tactic

Maintain Low Key – Silent tactic
ISMS
© Stratecent Consulting 2005
6
Do’s while Negotiating

Analyzing the Issues

Specifying the goals

Ask open ended questions

Use closed ended questions to confirm

Focus on objectives

State the facts

Use right level of muscle
7
Don'ts while Negotiating

Don’t say things like “That’s not fair” or “It’s my turn”

Don’t raise minor issues that are irrelevant

Don’t get into an argument, it’s a discussion

Don’t be scared to ask

Don’t pressurize

Don’t take it personally

Don’t assume anything
8
Bargaining

Get the other side to commit first.

B: “I’m willing to reach some sort of deal, but I want a 10% discount.”

S: “I’ll agree a 10% discount, but we have to look at a longer term
agreement.”

B: “Well, thanks for the 10% but the 1 year contract we have already
agreed will have to stand.”

S: “Okay, we may be able to look at our discount structure, but to do
that we will need to agree a 2 year contract.”

B: “Okay, 2 year may be possible. Can we get the full 10%?”
9
Business Negotiations: Closing
Closing Signals
Depends on the effort put at the earlier stages.

Closing signals include:

The difference in the position of the parties narrows significantly.

The objections have faded out.

Other side indicates that they would like to see a draft agreement.

Closing will only occur when both parties have a feeling of Win Win

Remember the Salesman’s Golden Rule, “Once you close…. Shut
Up.”
10
Americans Approach to Negotiation



Focusing on results vs. relationships

Getting results is topmost priority

Success is directly proportional to results
Viewing negotiating as a competitive process

Tend to be self focused

Deal is a deal
Wanting to get down to business quickly

Move quickly from issue to issue

Push for a quick closure
11
ABSURD Negotiating Behavior

Argue – Contrary view to every point

Block – Resist and block the progress

Sideline – Distracted conversations

Upset – Complaining

Ramble – Off beat

Dominate – Controlling
12
Removing the Emotional Element

Identify the points you have in common to establish an atmosphere
of agreement

Identify the points you differ on, and re–evaluate your position in
light of information obtained about your opponent's view

Work on resolving the differences without taking sides
13
The 4 Key Concepts

BATNA

Reservation Price

ZOPA

Value creation through trades
14
BATNA

Is the only standard which can protect you both from accepting
terms that are too unfavorable and from rejecting terms it would be
in your interest to accept.

In the simplest terms, if the proposed agreement is better than your
BATNA, then you should accept it. If the agreement is not better
than your BATNA, then you should reopen negotiations.
15
Thank You!!!