Negotiation - Making it fun.

When the topic of negotiation is raised it seems to bring one of 2 images to people's minds:

1. It's a dark art which requires huge amounts of specialist training or
2. Its a game of poker, just out-bluffing the other party to get the better end of the deal.

On the other hand, when you visit many countries you are invited to haggle in the markets, which is negotiation at its most basic. Some people relish the challenge, whilst others dread it. I was amused some while back by a comment from a Times columnist on this very topic, which went along the lines of 'my approach to haggling is simply to stare at a point on the ground - just in front of the vendor's foot - until he drops to a price which I'm happy to pay'.

The main reason people fear negotiation is that they see it as a kind of face-off, where inevitably one party will win and the other, by definition, will lose. The reality can be very different and, done correctly, that old cliche of a win-win situation is a real possibility.

The first rule of negotiation is not to make it personal or 'separate the people from the problem'. This isn't a battle between you and them it is a business discussion. Keep your terminology business-like, not personal - eg 'I just can't make the project pay on those terms' vs 'you're taking the p!@s, don't try and rip me off'.

The second rule is to understand the relative cost and benefit of what each party holds or consider your currency. In the vast majority of cases there is more to a transaction than price (in these cases the biggest single mistake is to focus on price alone). The other party might have huge benefits they can deliver at little or no cost to themselves whilst you might have skills or contacts which are disproportionately valuable to the other party. This is where the true win/win comes in. These currencies might be esoteric and entirely irrelevant to the core of the trade; an example I once saw was a customer who offered the use of parking spaces as a concession on payment terms.

The large brewers are masters of secondary negotiation and will often strike supply deals where their buying power enables them to supply something of value - at little cost to themselves - against contracts to buy (eg: We will provide you with quality garden furniture if you commit to stocking our beers on 2 of your pumps').

The concept of empathy to revolves around the ability to see a situation though the eyes of the other party; not only will this make you an interesting and engaging business partner, but it will help to move the focus from a single point negotiation to a discussion that takes on all facets of the deal. You will be surprised at how different the final result of a negotiation can be from your expectations.

Perhaps the most dangerous negotiating tactic is to fixate on what the other party gets out of it. In my opinion one of the worst mistakes the FSA made was forcing commission disclosure. This is just a red herring which leads customers to make decisions based on the -often erroneous - assumption that whats worst for the vendor must be best for them. Mature business discussions revolve around maximizing your benefits - if that outcome earns the other party good money, then that is an all-round good decision, surely?

Finally, with a bit of homework and lateral thought, negotiation can become enjoyable. And if you enjoy it, you will probably become good at it.