One of the most significant stages of a successful business is negotiation. As such, the process of negotiating is an essential skill of the modern business environment.
“We’re fascinated by the words, but where we meet is in the silence behind them.” – Ram Dass
What is Negotiation?
- General: Bargaining (give and take) process between two or more parties (each with its own aims, needs, and viewpoints) seeking to discover a common ground and reach an agreement to settle a matter of mutual concern or resolve a conflict.
- Banking: Accepting or trading a negotiable instrument.
- Contracting: Use of any method to award a contract other than sealed bidding.
- Trading: Process by which a negotiable instrument is transferred from one party (transferor) to another (transferee) by endorsement or delivery. The transferee takes the instrument in good faith, for value, and without notice of any defect in the title of the transferor, and obtains an indefeasible title.
In order to achieve a desirable outcome, think of the negotiation process as structure that can be broken down in the following major stages: planning/preparation, bargaining, clarification of your goals, agreement and implementation plan.
Having said that, don’t forget that having good options available before you start negotiating is best practice.
BATNA- a best alternative to a negotiated agreement
A best alternative to a negotiated agreement (BATNA) is the course of action that will be taken by a party engaged in negotiations if the talks fail and no agreement can be reached. This is your alternate plan when the talks start to wobble out of control. It can also be your trump card to make the deal happen to your advantage, or walk away from it altogether.
The term BATNA was coined by negotiation researchers Roger Fisher and William Ury in their 1981 bestseller „Getting to Yes: Negotiating Agreement Without Giving In.” A party’s BATNA refers to what they can fall back on if a negotiation proves unsuccessful.
Fisher and W. Ury have delineated a simple three-step process for helping you determining your BATNA: develop a list of actions to take if no agreement is reached; convert the more promising ideas into practical options; and tentatively select the option that seems best.
The strength of your BATNA (Best Alternative to a Negotiated Agreement): a mix between the negotiation skill and the negotiation strategy, identifying a negotiator’s BATNA is a necessary skill for developing the best strategies to use at the bargaining table.
“A negotiator should observe everything. You must be part Sherlock Holmes, part Sigmund Freud. “- Victor Kiam
Furthermore, for a successful negotiation, the two authors, Malhotra and Bazerman, of the book Negotiation Genius: How to Overcome Obstacles and Achieve Brilliant Results at the Bargaining Table and Beyond, observe that negotiation geniuses are made, not born. “What appears to be genius actually reflects careful preparation, an understanding of the conceptual framework of negotiation, insight into how one can avoid the errors and biases that plague even experienced negotiators and the ability to structure and execute negotiations strategically and systematically.”
That being said, bear in mind, the more options you have, the more effectively you will negotiate.