Negotiations are formal discussions between people who have different aims or intentions, especially in business or politics, during which they try to reach an agreement. They try to reach a common ground eliminating their differences.
Negotiation in business has become one of the most important skills and abilities. While negotiation will happen between two parties for reaching an agreement, it is said that the most effective negotiator will be both competing as well as collaborating. An effective negotiator is one who creates value for the other while claiming value for the self. There must be meaningful give and take that should happen in negotiation.
Negotiation should always be win-win, where agreements are created by taking care of the interests of both the sides. Negotiation requires interpersonal skills, communication skills as well as problem solving skills. To get good at your negotiation skills make sure you choose the best PMP prep course.
There are broadly two types of negotiation namely distributive negotiation and integrative negotiation.
In distributive negotiation, the parties area only looking for their gain. It leads to a win-lose kind of outcome. In distributive negotiation, negotiation is carried out more as an one time transaction, not keeping in mind any kind of long term relationship.
While in integrative negotiation, the negotiators look for long term relationships and they try to ensure value for both sides. It leads to a win-win outcome.
Negotiation can always be sensitive and should be carries out in a planned manner keeping in mind the end goals to be achieved. We should take care to ensure that negotiation does not get into an argumentative situation.
The negotiations process is made up of five stages:
In order to achieve the desired outcomes from negotiation, it will be extremely important to do the initial homework. We must identify what we are looking at achieving from the negotiation. What are our best alternatives to a negotiated agreement (BATNA). It is also important for us to understand about the expectations of the other party and more information about their BATNA.
It is important to lay down the procedures for carrying out the negotiation, such as who will be part of negotiation, where the negotiation will happen and some basic ground rules to be followed.
Then the actual information and offers must be exchanged between the parties. Arguments and confrontations must be avoided in the process. At this stage the required bargaining should be done keeping good faith. Negotiation should always be done as a win-win outcome for both sides.
Once agreement is reached, the same should be implemented.
An effective negotiator will be using some of the below skills during the process of negotiation.
Negotiation skill is one of the most important skills. It is through effective negotiation we are able to eliminate differences and we arrive at common agreements. While we can adopt a structured approach for negotiation, negotiation is an art that one can master only with time and experience.
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