The document outlines the eight steps of effective negotiations: 1) Prepare, 2) Argue, 3) Signal, 4) Propose, 5) Package, 6) Bargain, 7) Close, and 8) Agree. It emphasizes the importance of preparation, including defining objectives, researching information, determining concessions, strategy, and tasks. During negotiations, parties should look for signals of changing stances, make realistic proposals, and creatively package proposals to address other parties' needs and inhibitions. The goal is to bargain and make trades to reach a mutually agreeable outcome.
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1. Eight Steps of Negotiations
Prepare
Argue
Signal
Propose
Package
Bargain
Close
Agree
Negotiation steps
by Kinshook Chaturvedi, Manager Signal & Train Control at DELHI METRO
RAIL CORPORATION LIMITED on May 19, 2011
2. PREPARE
Prepare carefully well in
advance
Prepare for
negotiations and not
defending
Be ready for
opportunities
Reconsider your
preparation items
3. Five key areas of preparation
Objectives
Information
Concessions
Strategy/Style
Tasks
4. Preparation- objectives
Define
what outcome you want to achieve
from the negotiation- ISSUES
The realistic expectation against each issuesINTEND
Minimum acceptable position on intendsMUST ACHIEVE or AVOID
What is the ideal outcome you want – WISH
LIST
5. Step 1-Preparation- Objectives
Do
the same for your opponent – ISSUES,
INTEND, MUST ACHIEVE & WISH LIST
As
negotiations progress keep your
objectives under constant review: are they
still realistic? Should your INTEND be
boosted by a few WISH LIST items? Should
you move on an INTEND to protect a MUST?
7. VALUES
Deeply
held preferences that shape our goals
and means to fulfill them. Transmitted
through socialization and enduring. Values
are shared and often culture specific . Values
create needs that we want to fulfill.
8. POSITIONS
An
opening demand that the negotiator
believes will satisfy need.
Positions
can be changed in skillful
negotiations
9. NEEDS
Needs
are specific in a negotiation , but are
derived from the values we hold. They have
to be dug out by skillful questioning and then
a suitable need satisfiers can be used to
move the negotiation forward .
If
we are not clear about our needs we may
bargain away some thing we value
10. NEED SATISFIERS
These
bring focus to the negotiation and
create a positive environment , which can
then be used to change positions
12. Tactics of Negotiation
ATTACK-
creates negative energy
EVADE- can be used meaningfully
INFORM- clears the environment
OPEN- helps in understanding needs
UNITE- build rapport – Emphasize common
ground- reframe – propose solutions
13. PREPARATION- Information
Research
both parties
Analyze the basis of power for both
Do SWOT for both
Prepare questions in advance
What is the BATNA of the opponent
What is their awareness in regard to your
issues and needs
Brutally admit to assumptions and biases
14. BATNA- Best Alternatives in a
Negotiation Agreement
Ideal----------------------------------A
Intend---------------------------------B
Negotiations Zone
Must
avoid--------------------------- C
15. PREPARATION- Concessions
Where
can we be flexible?
What concessions can we make?
What can we give in order to what we want –
TRADE
What value the concessions have to the other
party?
What will you ask in return?
16. PREPARATION-Strategy
Keep
it SIMPLE and FLEXIBLE
Avoid confusing strategy ( means) with
objectives ( objectives)
E.g. Take the train ( strategy ) to London
(objectives ). If you meet a “ gate “ adjourn or
reconsider .
17. Understand the preferred
styles of each other
DEFERENTIAL-
Respect and Hierarchy
SUBSTANTIVE-
Material issues
RELATIONAL-
Trust and good faith
PROCEDURAL-
Agenda and rules
18. Understand your personal
style
IMAGINATIVE-
creative , intuitive, integrative
and inspiring
FACTUAL- clear, focused, informed , verify
RELATIONAL- solve conflict,listen,
encourage, listen and maintain relations ,
constructive
ANALYTICAL- logical and process oriented
EVALUATIVE- weigh , measure and moniter
19. PREPARATION- Tasks
Leader- conducts the negotiation, gives information, expresses
opinions, makes proposals, trades concessions.
Summarizer- asks questions to test understanding, draws
attention to , clarifies , summarizes to buy thinking time, confirms
areas of disagreement and agreement . Does NOT give personal
opinions, information's, and concessions,
Observer- watches, listens, records and tries to understand the
motivation , concerns, priorities, & inhibitions,
20. STEP 2- ARGUE
It
is an opportunity to –
Exchange information
Review issues
Structure expectations
Test assumptions
Probe motives
Explore opportunities
Identify inhibitions, & chinks
Influence, persuade & inform
Review sanctions & concessions
21. STEP 4- Signal
Signals
indicate change in stance
They are verbal or non verbal
When opponent moves from absolute to
qualified statements it is a signal
Listen , reward, expand and confirm signal
Signals indicate when to make a proposal
22. What are qualified statements
Can
you explain the reasons?
Suppose I agree to that what can you offer?
Which aspects are you unhappy with?
Why is it important?
23. STEP 5- PROPOSE- ENTRY
OFFER
Open
realistically- entry offer
A realistic proposal is based on facts that
support the proposal
Address the key issues & your intend list
Matches the other parties BATNA
24. Making proposals
Propose
– Explain – Summarize
Invite response
If you have to modify the proposal the
secondary proposal is tentative
If there is a grievance suggest a solution
25. RECIEVING PROPOPSALS
Never interrupt
Question – clarify – summarize
Response could be No- this gives the other party the
initiative.
If Yes- Are you missing an opportunity to add some
thing from your wish list?
Instant counter proposal- leads to haggling and
arguments
Adjourn- gives time to consult and think
Detailed response – encourages repackaging, to
make the proposal more acceptable
Considered counter proposal- best response
TRY TO GIVE THEM WHAT THEY WANT ON YOUR
TERMS
26. More about proposals
If
you are asked to concede something from
your intend list then add something from your
wish list
Remember the strengths of your proposal
Proposal set the agenda
A proposal beats arguments
27. STEP 6 - Package
Packaging adjust the variable without increasing the offer in
order to make the proposal more acceptable
If you have opened realistically then you may reach a deal
without making any adjustment or concessions.
In order to do get more out of the other identify inhibitions and
interests and address the package to them.
If you use a competitive stance likelihood of identifying needs
about inhibitions are low , so use a cooperative stance
Proposals are solutions to needs
Think creatively about all the variables or services while
packaging
28. Styles of Negotiations
Co operative
Long term relationship
Voluntary relationship
Trust
Private and informal
Tolerance of others views
Emotional detachment
Skilled negotiations
Win - win
Competitive
on recurring transactions
Mandatory relations hip
Suspicion
Public and formal
Intolerance of others
Emotional involvement
Poor negotiators
Win lose
29. Step 7- Bargain
Bargain is any trading activity , You can bargain at any
stage of the negotiation:
For information
For concessions
For signals
For time’ for the deal
The fundamental rule in bargain is TRADE. You should
always have an answer to the question “ What did you
get in return?
Be prepared to concede in areas of lesser importance to
gain in areas of greater importance
Put an unreasonable price to an unreasonable demand
30. Step 8- CLOSE
Trial closure is useful device for drawing out issues.
Ask “ Are you saying if I agree to both of those items you will be
satisfied?” - this insures if there are hidden issues they will
emerge
What is the most important closing opportunity – a minor
question that the other party asks about your proposal e.g. –
“does that include delivery ?” or “ Would that be back dated?”
If both parties are happy
31.
Closing concessions should be :
Conditional ( on the deal)
Specific
Small
Don’t get greedy
Agree
Agree to what is agreed- any ambiguity gets cleared up easily
32. When to go for adjournment
When
you feel you need to reconsider your
objectives
New critical information emerges
Your strategy is over taken
Stuck in circular argument
When you need time to repackage
33. How to make adjournments
Summarize
the position the negotiation has
reached
Withdraw to a private place and discuss with
your team before breaking away
Agree on a new meeting date
Give home work to the other party