Mastering Negotiation: 5 Keys to Achieve Successful Outcomes
Control of the Negotiation Process
A common error in negotiation is the lack of a clear definition of success. This can lead to manipulation and an ineffective negotiation strategy. A well-defined goal is crucial for a win-win outcome. A good result in a negotiation typically exhibits the following characteristics:
1. Best Alternative to a Negotiated Agreement (BATNA)
In a successful negotiation, the agreed-upon outcome should be better than what each party could achieve independently. This ensures that the agreement is mutually beneficial and resolves the conflict more effectively than alternative options.
2. Satisfied Interests
It’s important to distinguish between interests and positions. For example, two siblings might both want an orange (position), but one wants the juice and the other wants the peel (interests). Focusing on interests rather than positions allows for creative solutions where both parties can potentially win.
Example: A finance manager wants to minimize borrowing but might also be interested in staying informed about new products and economic projections. By incorporating these additional interests, the negotiation gains value.
A negotiation process that focuses solely on positions or demands often leaves parties unsatisfied with both the process and the outcome.
To ensure a successful deal, it’s crucial to:
- Secure your own interests.
- Ensure the other party’s interests are acceptable.
- Ensure that third parties involved in the negotiation can tolerate the process to avoid sabotaging the agreement.
3. Optimal Choice Among Multiple Options
Exploring a wide range of possible solutions is key to finding the best outcome. In the example of the siblings wanting an orange, perhaps they could sell the juice and use the money to buy two oranges.
Example: A supplier and customer might have differing price expectations. However, considering other interests could lead to alternative options. If refrigerated transport is difficult for the supplier, perhaps smaller, more frequent deliveries could be a solution that benefits both parties.
By incorporating creative options, both parties can potentially achieve a win-win scenario.
4. Legitimate Result
A legitimate agreement is based on objective criteria. For example, if employees request a raise, the employer could present salary statistics from comparable companies to justify their decision.
Using objective criteria offers several benefits:
- Prevents positional bargaining and protects against coercion.
- Leads to a lasting agreement and strengthens the relationship.
The legitimacy of an agreement is often demonstrated through reciprocity. For example, a factory negotiating with a contractor might agree on a penalty for late delivery but also offer a bonus for early completion. This ensures that neither party feels cheated.
5. Clear, Realistic, and Sufficient Commitments
A successful negotiation results in clear commitments that outline what each party will do, how they will do it, and when. These commitments should be:
- Clear and Operational: Each party understands their responsibilities.
- Realistic: Both parties can fulfill their commitments without jeopardizing their interests.
- Adequate: The commitments cover all necessary aspects to achieve the desired outcome without requiring further negotiation.
By adhering to these five key principles, you can significantly increase your chances of achieving successful negotiation outcomes.