Once I had learned how to negotiate it no longer looked like sorcery - managing the negotiation was easy because it is just simple structure and process that can be managed with a simple decision tree. But the bit that I still find the hardest is working out my intend-to-achieve positions (the most optimistic, but still realistic available).
It is hard to work out because what we really want to know in setting it is how far might we be able to push someone, and they aren’t going to be inclined to simply offer it up.
Sometimes we can simply work it out with research of readily available information in the market – for example buying or selling a popular model vehicle and referring to market data.
Some things are harder – for example a house or a business. While there may be a lot of data about typical business multiples or property sales in that suburb, there really won’t be any/many like-for-like comparison points.
Some are really tricky because there will be almost no data available to get a sense of the market – for example buying/selling a used custom engineered piece of machinery. It is in these scenarios we put our negotiating skills to practice.
Regardless, a good discovery/disclosure with the counterpart and active listening with curiosity is critical to help inform your position (even if you have plenty of data). I’ve found questions around these areas in particular have been useful to inform my positions:
- Exploring their level of motivation/desperation to reach a deal
- Surfacing what competition I might have from the market
Coming up with the areas to explore and specific questions to ask before you enter the negotiating room will help immensely. Most people don’t think as well under pressure.
Generally, I’ve been quite surprised about how much people open up when I ask them, but it doesn’t mean they answer truthfully. It is the skill we bring to the table in picking up their signals and qualifying their disclosure.
Of course, if you are thinking about what questions you might ask them… it would also pay to think about what questions they might ask you, and how you could respond.