In my time working in the energy and technology industries, I have led negotiations in a number of mergers and acquisitions involving many millions of dollars. Before that I also found myself negotiating in conditions where the stakes were even higher, successfully securing the safety of a number of hostages when I was an SAS officer.
I didn’t realise at the time that this experience of negotiating in life-or-death situations would be applicable to the business world. But on reflection, all successful negotiations boil down to the same things and in this article I will outline how all of us can sharpen our negotiation skills and apply them effectively.
After all, when we think about it, we go through more negotiations in our lifetime than we may at first realise. A job interview is a negotiation, as is a request for a pay rise. Business partnerships require a degree of negotiation, as does conflict resolution - whether in the workplace or in the family home. There are negotiations we enter into willingly, and there are negotiations that are unpleasant but unavoidable. But they are undoubtedly everywhere.
There are some key principles that need to be followed in all of these settings. For a start, finding common ground is key to a successful negotiation. You can’t just wade straight into it and lay your demands on the table; you have to build a rapport first. To do so, each side must trust each other enough to establish this common ground.
A strong ethos is also vital for building trust. If you can show those you are negotiating with that you have a code of ethics that you will stick to no matter what, then you can earn their trust by delivering on what you said you were going to do.
However, you must also realise that the other party will have their own set of values and these may not be the same as yours. It is crucial not to let these differences develop into feelings of superiority.
To most people, taking hostages and threatening harm to them is considered taboo, for example. But while your moral code considers hostage taking to be unethical, this doesn’t give you any advantage. It’s a sad fact that good doesn’t always win out over evil, so you must remove the emotion from the situation. Retain your integrity even when the other side has compromised theirs.
You don’t have to like your adversary, necessarily, but the creation of a respectful, empathetic relationship will enable you will build rapport. These are key aspects of any negotiation. By creating this powerful dynamic, you will reap the benefits.
You must be prepared to work together and this can only happen if each party builds rapport. If you treat them as an equal, they will reciprocate the respect and trust that is essential for taking the negotiation forward.
A critical element of any negotiator’s armoury is his or her communication skills. To get the best deal out of any negotiation, you need to be an advanced communicator. Think about how you articulate your demands, areas where you are prepared to make concessions, and things on which you are not willing to compromise. Have a clear purpose and express it clearly.
Even more important than what you say, though, is what you hear. You absolutely must listen - and listen very carefully. An elite communicator should be able to not only define your own demands and red lines, but identify those of the other party too. Remember that these might not be directly or clearly stated, so you must be able to pick up on subtle clues for any implied meanings or subtext.
Once you have established what it is that everyone wants, every further step in the negotiation must be collaborative. The feeling that each side is working together will foster an environment where agreements can be reached.
For example, prospective clients may ask a service agency to lower their fees before entering into a contract. In reality, what they are asking for is to feel special, like they are a truly valued client. There are ways of achieving this without the service agency having to cross their own red line - reduced fees.
So rather than responding with a flat ‘no’, the agency can instead suggest some tweaks to the service-level agreement or key performance indicators. The client finds this agreeable and everyone walks away happy.
Often negotiations involve a degree of recognition that your current positions are mutually at odds. Only once you have made this admission can you move on to finding a path forward. And, of course, any commitments made in the course of negotiations should be honoured.
Not every negotiation is going to be a win-win but it is vital that everyone feels like they have been dealt with fairly. If there is a sense of unfairness then that relationship cannot go any further and conflict will arise again. But if you follow the key principles described above then you can truly master the art of negotiation.