Why You Need a Killer Negotiating Plan.
Part 1: How do I prepare for a business negotiation?
Preparation is key to negotiating success. Just about every guide or coach will bang the same drum, but they are often less helpful about what you should prepare. Here’s the answer:
Every successful negotiator has three plans for the deal, whether he is aware of them or not.
1) Strategic plans set your negotiating range.
You need to decide on: Goals and walk-away limit. Ceiling and floor.
2) Your tactical plan is your roadmap for moving towards your goals – and away from your bottom line. Decide: Who makes the first offer? How do you maximize your results?
3) The style guide tells how you will manage the relationship with your counter-party. Decide: Partnership, transaction – or string of transactions.
The benefits of neogotiation planning:
Does good planning help you predict what is going to happen in your upcoming negotiation? Oh, Lord no. As the great Mike “The Professor” Tyson once said, “everyone’s got a plan until they get punched in the face.” But the process of making plans – and rejecting bad ideas or inferior options – prepares you to better manage the unpredictable, the unforeseen, and the unexpected.
An even more important reason for your negotiating plan is to seize and defend the agenda. If you show up empty handed and unprepared, then you hand the other side a significant advantage. A big part of your tactical plan is injecting YOUR agenda and deal points into the negotiation.
What if I want to wing it?
Great – as long as you are just doing research and listening. Just remember:
- No commitments
- No over-sharing
- No numbers.
Make sure he is selling you on his ideas – because every time you talk you are giving him potentially useful information.
Unexpected negotiation happens. There will be plenty of times when you find yourself discussing business deals that you have not had a chance to prepare for – but maybe he has. You get cold-called/ambushed, and now you’re knee-deep in a high-pressure negotiation.
The 3 Plans
Step one is strategy. Negotiating strategy is pretty straightforward: Where do you want to be in X time? What is your best alternative if you can’t reach that goal? Once you know that range – your optimistic business goal and your no-deal option – then you are in a position to consider the mechanics of how you will use the counter-party to reach that goal.
Once you know your goals and your walk-away point, the next job is coming up with a tactical roadmap for getting where you want to be. Tactical planning includes setting your variables or deal-points, deciding on process issues (who is negotiation, where you are negotiating, how long it will take, face-to-face or email, etc.). Tactics are more responsive than strategy, but you still do better if you plot out how you want your discussions to go.
The final plan is one that many Americans and Europeans don’t do, but is second nature in Asia and the Middle East – relationship planning. Do you want a one-off transaction or a strategic partnership? Are you a cutthroat competitor, or a win-win collaborator? You either decide about the relationship or the decision will be made for you.
Your Killer Negotiating Plan: