The UK is about to embark on one of the most complex negotiations in history.
Having triggered Article 50, teams of negotiators will be deployed to Brussels. But negotiation is something which we all do almost every day, from concluding high value contracts to arguing over whose turn it is to do the dishes.
Here are some useful tips to help you get the best possible deal:
Preparation
Before you even schedule a meeting, ensure you clearly identify your purpose: what do you want to achieve? Prepare the questions you need to raise, prepare answers to likely questions and practice. You risk being exposed if you are not fully prepared and this could affect your chances of success at the negotiating table.
Make the first move
If you don’t set the agenda and take control early, your opponent will.
Email your agenda in advance and print copies for your meeting so you dictate the process from the outset. Making the first move also hands you the psychological advantage. Studies suggest that negotiators who make their offer first will more often than not come out on top; the battle will be fought on the grounds of your choosing, increasing the chances that the results will be in your favour.
Knowledge is power
Doing your homework is vital. Gather as much pertinent information on your opponent as you can as this will strengthen your position. What are their needs? What is their financial situation? What options do they have? Why is this deal good for them?
Perhaps the most important question is: “What are the pressures on the other side in this negotiation?” Once you have identified these you can look for ways to exploit that pressure to achieve a better result and divert attention away from your own pressures.
Learn to listen
Good negotiators are like good detectives: they ask probing questions and then they shut up. We have two ears and one mouth; use them in this ratio in the negotiation to encourage the other side to talk. Ask lots of open-ended questions. The other person will tell you everything you need to know. All you have to do is listen.
Fortune favours the brave
The most successful negotiators are those willing to take calculated risks. A common mistake is to lose sight of the big picture and forget the overall value of the contract.
Lawyers can minimise the adverse effects of risks contractually – performance levels, thorough due diligence, penalty clauses for delays and minimum quality levels are just some of the ways to manage and limit the detrimental outcomes of risk taking. Often the perception of risk is a greater barrier in negotiation than the risk itself.
The sky’s the limit
The message is “be bold and aim high”. If you go in with a very high offer and it is accepted, that’s a win. If you have to negotiate down slightly to your second (perhaps more realistic) offer then you’ve still got a deal which will work for you. Aim above to hit the target.
Build a relationship
Often negotiations sour because one or both parties let their emotions take over. Negotiating the sale of a much-loved family business for example can be a difficult and emotionally draining experience.
Fixating on personalities or issues that aren’t relevant to the deal is a distraction that can jeopardise negotiations. Never lose sight of the bigger question: how do we get this deal over the line and secure a deal that works for both parties?
Although tempting, don’t leave your opposing party feeling you have “won”. As you negotiate, always think about how your actions can help establish a long-term business relationship.
This doesn’t mean conceding to all their points; satisfaction means their basic requirements have been fulfilled, not that all their demands have been met.
Building a long-term relationship not only makes negotiating easier the next time, it also makes your business world a better place.
Now that is something which I’m sure we can all agree on.
Christian Farrow, Partner in the Corporate/Commercial team at Acuity Legal
