1 Beyond Dealmaking Five Steps to Negotiating Profitable Relationships Dr. Melanie Billings-Yun

Copyright © 2012 by Melanie Billings-Yun. What is Negotiation? 1.A game or trial with a winner and loser? 2.A test or battle? 3.Something we do nearly every day, to resolve issues so that we can live and work beneficially with one another. Slide 2 You BossPartnersVendorsStaffClientsFamily

Copyright © 2012 by Melanie Billings-Yun. Slide 3 Why Collaborative Negotiation?  Helps you create value  Emphasizes long-term interests  Doesn’t create sense of defeat / backlash  Goal is results, not promises Psychologists have found that people assume almost no responsibility for promises they feel they were forced to make and reduced responsibility when they don’t understand the reason.

Copyright © 2012 by Melanie Billings-Yun. Core Components of Collaborative Negotiation Decides issues on Reason and Fairness Focuses on INTERESTS of all parties Seeks SOLUTIONS not victory Slide 4

Copyright © 2012 by Melanie Billings-Yun. Slide 5 Even Monkeys Demand Fairness

Copyright © 2012 by Melanie Billings-Yun. Slide 6 Positional Styles Forcing/ Appeasing Withdrawing Splitting “Win”-Lose Lose-Lose

Copyright © 2012 by Melanie Billings-Yun. Slide 7 Problem-Solving é Leads to an optimal outcome é Meets interests of both parties é Seeks to enlarge value é Is justifiable, therefore sustainable é Builds relationships ê Takes time, patience, open mind, creativity

Copyright © 2012 by Melanie Billings-Yun. Slide 8 G G oals What do I / they want to achieve or avoid? A A rguments What legitimate reasons support my chosen route? S S ubstitutes Where else can I go to achieve my goals? P P ersuasion Why would they take this route? How can I best reach my goals by working with the other side? R R outes I nformation what information do I or they need? Q uestions what questions should I ask? The GRASP Negotiation Method

Copyright © 2012 by Melanie Billings-Yun. Slide 9 G : Determine Your Goals  What you want to Achieve Separate from positions by asking “Why?” Think broadly, beyond immediate issue Consider long- and short-term goals Prioritize by importance  What you want to Avoid Risk factors Relationship considerations

Copyright © 2012 by Melanie Billings-Yun. Slide 10 Balance Against Their Goals  Learn all you can about other side Who are the relevant parties? What is their current situation? What are the external pressures on them?  Put yourself in their shoes What do they want (value)? What are they afraid of (risk)? Think broadly

Copyright © 2012 by Melanie Billings-Yun. Three Types of Goals  Shared— Why we’re talking  Conflicting— Why we’re negotiating  Different— The trading zone Slide 11

Copyright © 2012 by Melanie Billings-Yun. Slide 12 R : Consider All Possible Routes  How could you reach both sides goals?  Which is your preferred route?  What trade-offs could enlarge the pie?  Plan fallback routes The Anchor: In price negotiation, start as high as you can justifiably go. In influencing action, start at high but comfortable level, then build up collaboratively.

Copyright © 2012 by Melanie Billings-Yun. Slide 13 A : Develop Legitimate Arguments Valid, documented reasons for each position Benchmarks Consistency Quality TimeCost Market price Fairness

Insist on Legitimate Arguments Don’t Feed the Bears! Copyright © 2012 by Melanie Billings-Yun. Slide 14

Copyright © 2012 by Melanie Billings-Yun. Slide 15 S : Consider All Parties’ Substitutes What other ways can you satisfy your goals?  Establish your Walk-Away Line Build your WAL as high as possible Make sure it is firm (NO bluffing!) No deal if they can’t top your WAL  Consider their probable WAL Do your homework Both company and individual

Copyright © 2012 by Melanie Billings-Yun. Slide 16 P : Persuasion focuses on Them  Speak to be understood Address their interests while sharing yours Say it in the way they will hear it best Give them time to think and reply  Listen to understand Ask questions to clarify Listen actively and patiently Respond to what they say  Separate the people from the problem Don’t attack or argue Hold firm to legitimacy and fairness Use positive language

Copyright © 2012 by Melanie Billings-Yun. Four Persuasion Techniques  Logic Show how this would meet their objectives  Connection Highlight shared goals/ values/ constraints  Reciprocity Trade off between different goals  Ask them for problem-solving ideas “How could we make it this work?” Slide 17

Copyright © 2012 by Melanie Billings-Yun. Slide 18 Review: 5 Steps G oals R outes A rguments S ubstitutes P ersuasion