There is 1 central idea, one key factor that is critical to comprehend.
If you have this right, you will be rewarded with profitable, gratifying and long term relationships in which price is not the only factor. If you fail to get this right, you will battle with sub optimal relationships and you will most likely end up haggling about price in almost all of your negotiations.
The key element is understanding the interests of your counterpart in your negotiations; this is an important element taught in negotiation training.
Most of us have a good understanding of our own objectives, needs and desires. When we negotiate with others, we usually set about attempting to convince them of our opinion. We think it makes sense to us, surely it must make sense to anyone that is reasonable. The problem with this approach is that it completely ignores the objectives, needs and desires of our counterparts.
What good is it trying to convince another person to do something that they don't believe would be in alignment with their objectives, beliefs and desires?
You will never convince anybody to agree with you by arguing with them, quite the contrary will happen. Because you tell someone that they are wrong and you are the one that is correct, you will compel them to defend their position rather than listen to yours. Nobody likes to be told that they are wrong and if you tell someone that they are incorrect it will become key for them to defend their stance because their personal credibility is on the line.
It is rare to achieve agreement with someone after you have told them that they are wrong, you have also managed to paint yourself into a corner. If it was important for you to reach consensus and you do not manage to win the argument, then you will have to compromise your own credibility by departing from your 'correct' stance to adopt the argument of the other side.
If you want to reach agreement the easy way rather than have your negotiations spiral into a positional argument, here's what I suggest that you should do:
Start by asking some questions, the best of which you can ask will be questions designed to uncover the interests behind the positions that your counterparts have assumed in the negotiation. Open questions are the best kind of questions to show the interest or motivators that support your counterpart's positions.
A good question to can ask and at the same time endorsing your negotiation skills: Why are you negotiating with me / my organisation?
This is quite possibly the best question to ask at the beginning of a negotiation. Follow this question by asking the other side to elaborate on and to prioritise the reasons offered in response to your questions. This will give you a prioritised list of their key interests.
Sample Interests:
- Individual: Security, Acknowledgment and Control
- Organisation: Profit, Risk Avoidance and Strategic Fit (Some important elements you would have learned in purchasing training)
Once you have an understanding of your counterparts' key interests it is a good idea to share your own interests. Once all the parties to the negotiation have revealed their interests it will be much easier to identify the areas of common ground and then it is useful to present your case in the context of how it would serve their interests. This way, you will not have to convince the other side that your argument is correct; you will only have to demonstrate that your suggested course of action would satisfy their interests.
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