Whether we like it or not, aware or unaware – negotiation is an integral part of everyday life.

From finalising a deal with a client, discussing a job offer to deciding on a vacation destination with friends, the ability to negotiate effectively can significantly impact outcomes as well as relationships – and, as a result, our salaries, wealth, professional network or in the setting of a romantic relationship whether we have to sleep on the couch or not.

I think we all can agree that it is very helpful to know the fundamental tactics that effective negotiators use to succeed in negotiations without compromising the underlying professional or personal relationship with the involved parties.

Our image of good negotiators is strongly characterised by what Hollywood and co tell us about how tough and ruthless men like Gordon Gekko (”Wall Street”) or Harvey Specter (”SUITS”) play their power to force the other side to give in to their position. In a nutshell, the narrative typically goes like this: The strongest party wins by using its power to get what it wants, while the other side loses out.

According to the world’s top negotiation experts, good negotiating is actually quite different and very far from the hard-bargaining that movies and societies tell us about it. Sounds interesting? Then read on to find out more.

In this article, I’d like to talk about one of the most famous and well-liked pieces of advice on the topic of negotiation.

In their famous book, „Getting to Yes,“ Roger Fisher and William Ury present a framework for principled negotiation that aims to reach mutually beneficial agreements while preserving relationships. This framework is based on a few key principles that successful negotiators (or the ones of us that want to become successful negoatiators) should use.

Let’s take a look at some of the key ideas from this influential book.

Separate People from the Problem:

Fisher and Ury emphasise the importance of distinguishing between people and issues. By focusing on interests rather than positions, negotiators can address underlying concerns without resorting to personal attacks or becoming entrenched in fixed positions. This approach helps to minimise conflict and maintain constructive dialogue. A best practice is simply to spend some time building rapport with the various participants. This can be done, for example, before the actual meeting, during breaks or in the evenings (in the case of multi-day negotiations).

It is also helpful to introduce the meeting(s) in a way that addresses the overall objective and the challenges/issues to be discussed in a positive way. For example, you could introduce the negotiation by saying something like „The purpose of today’s meeting is to work out the details of the agreement so that we can begin what I hope will be a long and mutually beneficial partnership. A particular challenge seems to be agreeing on payment terms that work for both parties.“

Focus on Interests, Not Positions:

Rather than sticking rigidly to specific demands or positions, negotiators should seek to understand the underlying interests and motivations of each party – that is, to ask „WHY“ the other party wants what they want. Whenever a person or party states a position (e.g. a certain price, payment terms, holiday destination), they have a deeper reason for WHY they want to achieve that position.

In a practical example, a potential client might ask for a lower price of an offered solution (their position). An open exchange as to why they want the reduced price might reveal, for example, that there is a limited budget available this financial year. Or it could be that the potential customer does not want to pay a certain amount up front before the solution is delivered – thus their concern is less about price and more about the risk of „sunk costs“ if the solution does not meet their expectations.

Identifying common interests (e.g. successful delivery of the solution that meets the customer’s expectations) allows creative solutions to be developed and explored. Using this approach, effective negotiators can often find mutually beneficial agreements that meet the needs of all parties.

Generate Options for Mutual Gain:

Fisher and Ury advocate generating multiple options to increase the likelihood of finding a solution that satisfies the key interests of all parties involved. A good understanding of the parties‘ motivations behind their positions allows creative solutions to be brainstormed and alternative possibilities to be explored. As a result, effective negotiators can expand the pie and create value beyond what initially seemed possible. This collaborative approach fosters a sense of ownership and buy-in from all parties.

In the example of the sale above, a deal could be struck for an up-front partial payment and a ’success-based‘ second payment once the solution has been delivered as promised. In return for this concession on the side of the supplier, the client might also agree to further expand/scale the solution (upsell) once the first stage/phase has been delivered successfully. This solution addresses the customer’s concern (risk of unsuccessful delivery) and creates a win-win situation for both the customer (extending the benefits of the solution to other areas) and the supplier (increasing revenue from the customer).

Insist on Using Objective Criteria:

While negotiations can often get sidetracked by subjective opinions or power dynamics, negotiators should try to base their decisions on objective criteria whenever possible. By using fair standards and benchmarks, negotiators can ensure that agreements are based on merit rather than arbitrary factors. This approach increases transparency and builds trust between parties.

Let’s consider a scenario where two business partners are negotiating the terms of a new joint venture. One party proposes that the profits should be split 60-40 in its favour because it has more experience in the industry.

Rather than accepting or rejecting the proposal outright, the other party might suggest using objective criteria to determine the profit split. They might suggest taking into account factors such as each partner’s financial investment, the value of intellectual property contributed, market research conducted, and anticipated risks and responsibilities.

For example, if one partner has invested significantly more capital in the venture, they might argue that a fairer profit share would be based on the proportion of each partner’s financial contribution. Alternatively, if one partner brings unique expertise or proprietary technology to the table, they could propose a profit-sharing arrangement based on the relative value of these contributions.

Maintain a BATNA (Best Alternative to a Negotiated Agreement) and understand the BATNA of the other parties:

Understanding your BATNA and the other party’s – the course of action you or the other party will take if no agreement is reached – can enable negotiators to negotiate from a position of strength or to know what is really at stake if no agreement is reached. By evaluating alternatives and assessing their relative merits, negotiators can set realistic expectations and determine their „walk away“ points. This knowledge provides leverage and helps negotiators make informed decisions during the negotiation process.

Let’s say you’re an account executive at a SaaS company and you want to negotiate a raise with your manager. Having a concrete offer from another company (your BATNA) for your manager to agree to increase your income will not only allow you to set a realistic and fact-based target (salary) for your negotiation, but will also strengthen your position.

In addition, knowing whether you are the only AE who can serve a particular market without a potential replacement in case you decide to accept your alternative offer, or whether your manager has a list of several suitable candidates, will allow you to assess the situation correctly and navigate the negotiation in the most beneficial way for you.

Build and Maintain Rapport:

Effective communication and relationship building are essential components of successful negotiation. By actively listening, showing empathy, and demonstrating respect for the other party, negotiators can create a positive atmosphere conducive to finding common ground. Building rapport fosters trust and increases the likelihood of reaching a mutually acceptable agreement.

Separate the Emotions from the Substance:

Emotions can often cloud judgement and derail productive negotiations. Fisher and Ury advise negotiators to acknowledge emotions but to focus on the substantive issues at hand. By maintaining a calm and rational demeanour, negotiators can prevent conflicts from escalating and focus on reaching a constructive solution.

In conclusion, the principled negotiation framework presented in Getting to Yes emphasises collaboration, creativity and mutual respect. By focusing on interests, generating options and using objective criteria, negotiators can navigate complex issues and reach agreements that satisfy all parties. Ultimately, mastering the principles outlined in this book can enable you to negotiate effectively in both personal and professional contexts, fostering better relationships and achieving optimal results.

FAQ:

How do good negotiators separate the people from the problem?

Good negotiators separate people from the problem by focusing on the issues at hand rather than personal attributes or emotions. They strive to understand the underlying interests and concerns of all parties involved and avoid making assumptions or judgments based on personalities. By fostering open communication, showing empathy, and addressing emotions constructively, negotiators can create a positive atmosphere conducive to finding mutually acceptable solutions.

What are practical approaches to identifying the interests behind the positions of the other party?

Practical approaches to identifying the interests behind the positions of the other party involve active listening, asking probing questions, and engaging in collaborative problem-solving. Good negotiators seek to understand the reasons behind the other party’s demands or positions by exploring their underlying needs, goals, and motivations. By focusing on shared interests and common goals, negotiators can uncover creative solutions that address the concerns of all parties involved.

How can I bring back a negotiation back to objective criteria when the other party is not playing along?

When the other party is not adhering to objective criteria, it’s essential to remain firm but respectful in steering the negotiation back on track. One approach is to calmly reiterate the importance of using fair standards and benchmarks to make informed decisions. Presenting compelling evidence or examples of objective criteria can help demonstrate the rationale behind your position. Additionally, offering to collaborate on developing mutually agreeable criteria or involving a neutral third party as a mediator can facilitate a return to a more objective and constructive negotiation process.