Tuesday, August 12, 2008
Bargaining for Advantage (Interests and Leverage)
My 2nd post on "Bargaining for Advantage."
3. Effective negotiators can see the world from the other party's point of view.
"It is not from the benevolence of the butcher, the brewer or the baker that we expect our dinner, but from their regard to their own interests." - Adam Smith
"If there is any one secret of success, it lies in the ability to get the other person's point of view and see things from that person's angle as well as from your own." - Henry Ford
To succeed, you must learn to ask how it might be in the other party's interest to help you achieve your goals. You must determine why the other party might say "no" so you can remove as many of his objections as possible.
Skilled negotiators focus on areas of shared or complementary interests during planning; less on conflicting positions on issues. By doing so, the skilled negotiators developed about twice the number of possible settlement options. The following steps will help you focus on what the other party wants and how these interests can be used to advance your own goals.
1. Identify the decision maker
2. Look for common ground. How might it serve other party's interests to help you achieve your goals? (Role reversal)
3. Identify interests that might interfere with agreement: Why might the other side say no?
4. Search for low-cost options that solve the other party's problems while advancing your goals.
4. Use leverage during negotiations.
"Every reason that the other side wants to needs an agreement is my leverage--provided that I know those reasons." - Bob Woolf
"You can get much further with a kind word and a gun than you can with a kind word alone." - Al Capone
Leverage is your power to reach an agreement on your terms.
1. Who controls the status quo, and who is seeking to change it? Leverage often flows to the party that exerts the greatest control over and appears most comfortable with the present situation.
2. For whom is time a factor?
3. Who has the most to lose from no deal? Create a vision that the other side has something to lose from no deal.
Positive leverage: needs-based. Every time the other party says, "I want," or "I need," your leverage has gone up. "Leverage is having omething the other guy wants. Or better yet needs. Or best of all, simply cannot do without." - Donald Trump
Negative leverage: threat-based