On numerous occasions I have participated in negotiations as a technical consultant on behalf of clients. In order to save time and money, the client often prepares for these negotiations himself. Through many previous bad experiences, I have learned to ask clients ahead of time what their idea of ​​preparation and trading strategies really is. However, their answers often show that they are not yet ready to start an effective trading session.

Inexperienced, lazy or naïve negotiators believe that being prepared means ‘knowing what they want’ from the negotiations, which usually implies that they have decided on terms they would be happy with. They may have even thought of the worst case scenario, but that is usually the extent of their negotiating strategies and preparations.

Knowing what you want from a negotiation is only a small part of what it takes to be prepared. The key to success is knowing how you are going to get what you want. Success comes from having effective negotiation strategies that convince the other party that what you want is indeed fair and reasonable, or at least unavoidable.

ill-prepared negotiators

Most negotiators do not prepare properly. Even when it comes to large sums of money, people often rely on past or similar situations to determine trading strategies. They hope to use their wits and develop a strategy on the fly. At best, planning for an effective trading session is one-sided and incomplete.

Skilled negotiators love ill-prepared opponents because their negotiating strategies are easier to manipulate. The lack of effective negotiation preparation on the part of your opponent makes their job much easier and allows them to overwhelm the other side with a greater degree of knowledge, preparation, research, and forceful demands.

Being prepared requires that you have some idea of ​​the results desired by the other party. A plan is only realistic if you know what the other party wants and have figured out a way to give it to them (while getting what you want) or figured out a way to change their minds to agree to your demands. The more you know about what the other team wants, the less there is to negotiate and the easier it is to reach an equitable agreement through an efficient and streamlined negotiation session.

Determining failure or success

Success is determined when a mutual agreement is fulfilled and both parties are satisfied without hard feelings. To accomplish this, you will need to consider the other party’s needs as well as your own.

After all, effective negotiation should not be a winner-takes-all type of contest. The vast majority of negotiations take place with people you will need to work with after the negotiations have come to an end. If they feel cheated or resentful of a deal that was struck, the employment relationship will suffer.

Failure is judged in terms of potentially damaged relationships or a deal you are dissatisfied with. A failed negotiation could very well be one where he got everything he wanted (or thought he had) but ended up damaging his working relationship with a colleague, supplier, or competitor.

It is not uncommon for the purchasing department of large companies to squeeze small suppliers and contractors to the point that there are no profits (or incentives) in the contract that is finally signed. The result is a contractor that provides substandard or poor quality services and products. In this context, who is the winner of the negotiations? Nobody is. Everyone loses.

Successful setup tactics

When planning effective negotiation strategies, it is best to develop a list of goals for ourselves and imagine what the position would be for the other party. Are they likely to accept our terms or not? If not, why not? What would they agree to? Taking a win-win approach to effective negotiation strategies creates allies, not enemies.

For an effective trading session, strategize with the big picture in mind: focus on long-term goals, not short-term ones. Preserve relationships even at the cost of short-term victories. And remember that the next negotiation starts the moment the last one ended. Being prepared means knowing how you will get the other party to agree and be happy with the deal you want or need. Being prepared requires planning, strategy and tactics.

The strategy is developed from your analysis of what are reasonable goals and objectives. Your negotiation strategies are your approach to how you are going to convince the other party to accept what you want. Tactics are specific and identifiable maneuvers that implement trading strategies.

Consider this example: A car salesman wants to sell cars at the highest possible price. He wants to pay the minimum. But does the car dealer also want you as a long-term customer? Do they want a car swap from you? Do they want to provide financing and maintenance? Is there more than a low price that can be negotiated with a car dealer?

If the seller just wants the highest possible selling price, their only bargaining chip is knowledge of prices at other dealerships. However, if the seller is interested in other aspects of the deal, then there are more details that can be negotiated to get the lowest possible price.

Knowing what the seller is interested in other than price allows you to develop more sophisticated and effective negotiating strategies and related tactics.

Preparation Checklist

• Your Goals: Identify goals and justifications along with their relative priorities.
• Your Goals: Identify what you expect the other party’s goals, justifications, and priorities to be.
• Strategy: Create an effective negotiation plan to convince the other party to accept the terms you want, keeping in mind a long-term overview.
• Tactics: Specific approaches to how you will present your arguments (i.e. negotiating strategies) convincingly.
• Tactics Response: Predict the other side’s tactics and plan your reactions and counter-tactics.
• Room to move: Be prepared with some default options to give you flexibility in what is asked of you and offered.

To be prepared

Negotiating is the art of convincing the other party that they should get what they want. Being prepared for an effective negotiation involves much more than simply knowing what you want. Effective negotiation strategies mean knowing what you would settle for and how you are going to convince the other party to give it to you.

Comprehensive negotiation strategies include prepared reactions to the other party’s strategy and tactics. When you take the time to predict what the other party is likely to want and do and then integrate these predictions into your negotiation strategy, you are among those rare people who are truly prepared for negotiations.

Negotiation is a contest. Fortune favors the prepared (and negotiating) mind. If you want to be a winner, prepare yourself properly.