How can you become a successful negotiator? (Part 1 - Types of negotiation)

Never cut what you can untie.
— Joseph Joubert

To be a successful negotiator you need to understand that a negotiation can only take place when everyone involved thinks they will get some benefit from the transaction. Both sides want to be in on the deal and all will influence the outcome.

To be successful you must:

  • Analyse the negotiation and choose the best approach
  • Be well prepared 
  • Pay careful attention to detail
  • Be creative

In essence - be a TOP negotiator. This process revolves around analysing the negotiation and choosing the best approach, based on the following three things.

  1. Choose the Type of negotiation
  2. Determine the Outcomes from the negotiation
  3. Remember the Principles of negotiation

Let's look at the type of negotiation in more detail in this blog.

Type of Negotiation

First you need to decide which type of negotiation you wish to have.

 TYPES OF NEGOTIATION

TYPES OF NEGOTIATION

The Quick Type

This type occurs during rushed negotiations, when issues are of low importance, or when neither party intends to do business together again. It's a fairly competitive style, where parties see their interests as opposite. This style is useful when buying something like a house, car of furniture etc. This style is not as appropriate when long-term business relationships are at stake.

The Compromise Type

This type of negotiation is often seen as effective because each side walks away with some form of deal. Relationships continue with outcomes achieved, often quickly. This style works when it is obvious both parties want to reach an agreement,  but just need to resolve a couple of issues.

However, for compromise to work you need to ask, "How can the pie be divided?" Rather than "How can we make the pie bigger?" With pressure on budgets, forecasts and incentives, this type of negotiation is becoming very popular - but often sub-optimal.

The Deliberate Type

This approach comes into its own when there is an ongoing business commitment and you want to develop or maintain the relationship. During these negotiations true partnerships happen, where the negotiation is based on value and not price. You need to maintain a good balance between relationships and substantive issues. To use this approach you must accept that:

  • The deliberate type requires cooperation and relationship building to reach an agreement
  • You need a real ability to quantify value
  • It does not develop without time and effort
  • It means moving forward, sideways, backward and forward again

We have seen many deliberate negotiations turn into quick negotiations and then back again in a number of hours. Continually switching until both sides agree. Just because you decided to adopt a deliberate type does not mean that the other side will see it the same way.

Most people have no idea how important it is to understand what type of negotiation is occurring. They enter into each and every negotiation in the same way, which is both time-consuming and counterproductive.

So, take the time to decide which type of negotiation you want to use. Choosing the best approach for each negotiation is part of the Negotiation Leadership course at ACU.