Negotiators are more satisfied with the outcome of a negotiation when they think the process has been fair, research shows. To maximize satisfaction and build a strong working relationship, don’t leave the process of business negotiation up to chance. Given the importance of negotiation in business communication, you’d be wise to consider the following seven questions about the process of business negotiation with your counterpart:
- Who Will Negotiate?
Aside from you and the other party, should anyone else be present at your talks, such as assistants, lawyers, or other experts? If you are negotiating in teams, who will be present on each side, and what role will each person play at the table? When you jointly decide who will be present at your first official meeting, you avoid unpleasant surprises.
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- Where Will You Negotiate?
Don’t assume that the other side will be coming to you or vice versa; your counterpart may have an entirely different idea than you do about where you should negotiate. Negotiating at your office allows you to control the environment and feel at ease. But traveling to the other party’s turf can communicate that you are serious about making a deal, notes professor Jeswald W. Salacuse of Tufts University, and also gives you opportunities to observe your counterparts in their surroundings. You might also choose to negotiate on neutral territory (such as a hotel conference room) or remotely via e-mail or telephone.
- What Issues Will You Discuss?
You may know exactly what you want to discuss with your counterpart, but she may have a very different agenda in mind. For this reason, take time to brainstorm a list of all the issues you might cover. You might also talk about how you will handle opportunities or wrinkles that emerge during the process of business negotiation, such as shifts in the economy.
- What Approach Will You Use?
Sometimes professionals seeking to negotiate business contracts come to the table with very different approaches to bargaining. To achieve strong business negotiation solutions, most experts encourage negotiators to carry out talks with twin goals in mind: creating value for both sides and claiming value for yourself. But you may discover that the other side was planning a very different approach to the process of business negotiation, such as a presentation of detailed drafts, an exchange of best-and-final offers, or a hard-bargaining battle of wills. Work together to pick a negotiating strategy that’s acceptable to both sides.
- What Ethical Standards Will Guide You?
Most negotiators enter talks with the intention of being fair and just. Yet people often have different standards of fairness in a corporate negotiation, depending on their perspective. Moreover, we sometimes unintentionally violate our own moral code—for example, by justifying unethical behavior or imitating the bad behavior of others. Expressing your intention to behave fairly and honestly throughout the process of business negotiation will bring ethical concerns to the surface. This could inspire all involved to be vigilant about their manner of decision making.
- How Will We Finalize the Deal?
For legal reasons, it can be wise to discuss in advance how you will seal your eventual deal. Will a verbal agreement be sufficient, or should parties sign on the dotted line to show their commitment? For formal talks, it usually makes sense to draft and finalize a written contract once a deal is completed. You should also discuss how much authority you’ll each have during the process of business negotiation. Will one or both sides need to sell a proposal back at the office? If the answer is yes, then you know to include extra time for this approval process. Raising this issue might also inspire parties to seek greater authority from their superiors to make binding decisions.
- What Is Our Timeline?
Clarifying how much time each party has to hammer out a deal can eliminate stress and confusion once talks officially begin. If you know why someone is rushing through the process of business negotiation, you’ll either be more tolerant of the need for speed or you’ll know to look for a negotiating partner with more time to spare. If neither side is facing a firm deadline, you might consider imposing one so that talks don’t drag on forever. In addition, consider creating a timeline that sets goals for each stage of the negotiation.
What other factors do you consider to be an important part of the process of business negotiation?
ALL of the above points are very important. Interestingly the best deals I / the team ever secured were driven by 3 things – firstly, the demonstration that can be demonstrated to the other / counter party of market knowledge (“their business”) and what a good deal looks like; secondly, the authority demonstrated by the lead negotiator and their ability to agree to positions (without referral to Head Office…comes from pre authorisations from the top / contract signatories and thirdly, the ability to secure the deal quickly (simple contract / pre authorisations obtained / the ability to influence the counter party the deal is open for a limited time because alternatives exist). All elements require deep preparation befor formal negotiations begin.