The Essential Negotiation Skill Of Setting Achieveable Objectives For Your Commercial Negotiations.
A critical negotiation skill in your business negotiations is how you go about deciding your objectives.
I would like to offer you 3 key points that we cover in our negotiation skills training programmes to consider when you are preparing for your negotiations.
1. What is the absolutely ideal outcome for you in this negotiation?
What would a great transaction (one that you would be very happy to agree to) look like?
We call this your aspiration base - in other words, the level at which you will aspire to close the agreement.
You should be aware that it is vital in your negotiation to always ask for a little more than you would like to get. This means that you must always have an aspiration base that is higher than your targeted outcome. By asking for a little more than you would like to achieve you allow yourself to make a concession to your counterpart in return for a counter concession.
On the upside, you may just get what you regard to be fantastic if you ask for it! Don't make the mistake of making decisions on behalf of your counterpart by saying to yourself they will never go for that .Take note that I am not proposing that you make extreme demands - extreme demands are highly risky and dependent on the cultural environment within which you are negotiating.
2. What is the absolutely minimum acceptable outcome for you in this negotiation?
At what point will you decide to stop or suspend your discussions?
If you do not decide on a specific point at which it will no longer be possible or attractive for you to reach agreement, then you may become susceptible to closing a deal that you will not be able to live with. This is important to do as you could easily become emotionally committed to closing a transaction at any cost because you may think that your individual credibility is at stake.
3. What do you think are the aspirations and minimum acceptable agreement levels for your counterpart?
It is also important that you consider the aspirations and minimum acceptable deal levels from your counterparts point of view. This will never be an exact science but through proper preparation and investigation of supporting information you may be able to get a good idea of what kind of transaction is the norm in your industry or kind of negotiation.
By considering the aspirations and minimum acceptable agreement levels from your counterparts point of view, you will be able to identify the bargaining range. Being aware of the agreement range or zone of possible agreement (ZOPA) will help you to see if a transaction is possible or not.
Most negotiation training programmes will teach you that the bargaining range is defined as the area of overlap between your minimum acceptable deal level and the minimum acceptable deal levels of your counterpart.
Remember that 99 percent of your success in negotiation is dependent on the quality of your preparation. You should spend at least as much time planning for negotiations as you expect to be busy negotiating. If you expect to be in negotiations for an hour, then you should spend at least the same time in preparations.
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