Negotiation (PowerPoint) - Lancaster University Law Society

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Negotiation Skills
Adam Hindle
[email protected]
a short history of me…
PhD Research - Modelling of Costliness of Rurality with
Dr. David Worthington at Lancaster
Teaching:
Project Management and Negotiation Skills
Mathematical Modelling and Optimisation
Excel Modelling Techniques for OR/MS
Public Sector Applications
Simulation - Flow Modelling, Queueing
Data Analysis and Statistical Modelling
Emphasis on case study work and the Process of OR
Consultancy:
Health Consultancy Services Ltd.
A range of public sector projects. Clients include:
Northern Ireland DHSS&PS, Countryside Agency, ODPM, Slovenian
Health Service, PSCU in Canberra
Why Negotiate?
There is no single, optimum solution
 Negotiation can reveal the true value
 It’s a creative dialogue process that
can generate a better “win-win”
 Every task that you don’t perform
alone is negotiated – it’s rational
thought, trust and relationships

and because …
…everything is negotiable!

Partner: managing free time, child care

Housemate: jobs around the house
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Friends: which pub/club to go to, favours
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Children: almost everything!
Signing a contract, agreeing a sale price,
deciding project scope, accepting a job,
determining your workload
The Main Stages
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Pre-Negotiation (Preparing the Ground)
Argument
(Getting the difficulties out into the open)
Signalling
(Indicating where movement might be possible)
Bargaining
(Proposal and Counter-proposal)
Closing
(Reaching a deal or contract)
Value

If you don't know what you want ...
you won’t get it

and if you don't ask for it ...
no-one's going to give it to you

Know what you want, how much you want
it and then ask/offer/propose it
“… it’s not the will to win, it’s the will to
prepare to win.”
Billy Bland, Bob Graham Round
Quoted by R Askwith in ‘Feet in the Clouds:
A Tale of Felling Running and Obsession’
“I take nothing for granted. I now have only
good days or great days”
Lance Armstrong
“Genius is one per cent inspiration and ninety-nine per cent
perspiration. Accordingly, a 'genius' is often merely a
talented person who has done all of his or her homework”
Thomas Edison
Preparing the Ground

The more each party is prepared for entering the
so-called Negotiating Arena the better for everyone
involved:

Informal Discussions
Workshops
Presentations
Prepared Position statements (inc. bids & tenders)
SWOT analysis
Brainstorm innovative options for mutual gain

Anything to better understand your situation

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Preparing a Position

(LIM)it the negotiation:
 Like to Get
(Would like)
 Intend to Get
(Want)
 Must Get
(Need)

Think big (the first number is the most dangerous,
don't limit yourselves)
Anchoring
Know your TRUE 'walk away' point

Tactical and Strategic gain


Preparing a Position

Try and anticipate the negotiation, e.g.

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


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what's going to be discussed?
how much movement is likely to be needed?
what's feasible?
what are the alternatives?
have a portfolio of equal value packages to offer
Anticipate likely threats and promises
Examine and list your own leverage & value
Prepare Decision Supporting Systems


paper based?
spreadsheet based?
Triple Think

What do we want?

What do they want?

What do they think we want?
No freebies!!



You want something they don't value
(maybe you can get it for free)
They want something you don't value (but
can concede for a high price)
They want something from you that you
want to do (and can sell it)
Do not offer any free gifts
Roles
Leader
 empowered to make unilateral decisions
 does most of the talking
Summariser
 buys thinking time by interviewing
 asks for clarifications or summarises
Recorder (often technical or legal expert)
 observes for visual and verbal clues
 writes terms of offers made
Analyst
 operates DSS model
 quickly assesses the implications of any offers and
 supports the leader by guiding the process
talk
listen
think
write
plan
Early Stages - Argument?

Be constructive by:
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being assertive (i.e. clear and unemotional),
looking for mutual advantage (win/win)
and being prepared to LISTEN - it is more like a problem
solving interview than a presentation
Seek to understand and satisfy their interests - not
necessarily their stated positions
Avoid: aggression, point scoring, blaming,
interrupting, speaking for long periods
Be non-committal, never say never, and caveat
everything with conditions. Nothing is black & white,
keep it grey.
Signalling

Signalling means indicating a possibility of movement towards another
parties wishes but without commitment (formal or informal)

“these are our standard contract terms”

“we never negotiate on price”

“we do not normally give discounts”

“as it stands, this wouldn’t be particularly attractive”

“we are looking to improve”
[direct signal]

Note that a signal often relies on the spoken emphasis given to a word or
phrase

Some signals are less direct than others (see above)

It is important to be able to formulate and send signals and hear them and
receive them

When hearing a signal, react quickly and question the meaning of the signal
Proposing

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Go first!
Use ‘if you .....then we’ rather than
‘if we ..... will you?’
Keep proposals and explanations separate
Avoid negative statements:
‘couldn’t you give us a bit more?’
Never reject out of hand - seek clarification - then reject if necessary
Incentivise not ‘negativise’ – focus on the positives
Once definite proposals have emerged, bargaining on the deal and
its details can commence.
Learn to shut up
Tactics
1.
2.
3.
4.
5.
6.
7.
8.
9.
‘Shot gun’: unless this, then …
‘Off-limits’: we can’t negotiate that
‘Goodcop/badcop’: nice guy negotiates
‘The Bully’: be prepared…
‘Russian front’: better of 2 alternatives
‘Salami’: slice by slice
‘Bluff’: pretend to walk
Collaborative, Principled
‘Out of time’ (careful)
Win-Win: Expanding the Pie
What win-win is not :

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intuitive
simply a compromise or even-split
how the pie is divided but how the pie is enlarged
feeling good/happy
simply about building a relationship (although this
is important)
Win-Win: Expanding the Pie
win-win is:
Exploiting and developing all creative opportunities,
where no resources are left on the table (integrative
negotiation)
signs:
 is there more than one issue?
 can other issues be brought in?
 can side deals be made?
 are there different preferences across issues?
 can we tie the deal to future performance?
Closing the Deal
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Normally aim for a ‘final concession’ close – have one final small
‘gift’ up your sleeve!
Try to avoid hitting your true bottom line – leave a little in the tank
Record all relevant outcomes and agreements
Ensure there is sufficient binding commitment (signatures etc.)
Do not allow the negotiations to unravel due to ‘dubious definitions’
(intentional or otherwise) “sorry, I thought you meant…”
Do not allow negotiations to be re-opened (assuming that you are
happy with the outcome)
If you have ‘lost’ try and link to other deals to be negotiated but, if
you have ‘won’, do not allow this to happen
A great deal is when both parties are still smiling

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