negotiation mistakes

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Negotiation MistakesSrinivas Biranthbail

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Introduction

During negotiations, six common mistakes candistract you from your real purpose: gettingthe other guy to choose what you want forhis own reasons.Avoid negotiation pitfalls by mastering the artof letting the other guy have your way everyone will win.

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Six common mistakes

Neglecting the other sides problem.Letting price bulldoze other interests.

Letting positions drive out interests.Searching too hard for common ground.Neglecting BATNAs ( best alternative to a

negotiated agreement )Failing to correct for skewed vision.



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Neglecting the other sides problem.

If you don t understand the deal from theother side s perspective, you cant solve hisproblem or yours.



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Example

A technology company that created a cheap,accurate way of detecting gas tank leakscouldn t sell its product. Why? EP A regulationspermitted leaks of upto 5,600 liters, while thisnew technology detected 237ml leaks. Fearingthe device would spawn regulatory trouble,

potential customers said, No deal!



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Letting price bulldoze other interests.

Most deals involve interests besides price.A positive working relationship, crucial in long

term deals.



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Letting price bulldoze other interests.

The social contract, or spirit of the deal ,including goodwill and shared expectations.

The deal making process: personal, respectful,and fair to both sidesP rice centric tactics leave these potential jointgains unrealized.



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Letting positions drive out interests.

Incompatible positions may mask compatibleinterests. Your gain isn t necessarily your

opponents loss.



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Example

Environmentalists and farmers opposed apower company s proposed dam. Yetcompatible interests underlay these seeminglyirreconcilable positions: Farmers wantedwater flow; environmentalists, wildlifeprotection; the power company a greener

image. By agreeing to a smaller dam, water flow guarantees, and habitat conservation,everyone won.



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Example

An acquirer and entrepreneur disagree on theentrepreneurial company s likely future. Tosatisfy their differing interests, the buyeragrees to pay a fixed amount now andcontingent amount later, based on futureperformance. Both find the deal more

attractive than walking away.



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Neglecting BATNAs

BATNA s ( best alternative to a negotiatedagreement ) represent your actions if theproposed deal weren t possible; e.g. walkaway, approach another buyer. Assessing yourown and your partner s BATNA revealssurprising possibilities.



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Example

A company hoping to sell a struggling divisionfor somewhat more than its $7 million valuehad two fiercely competitive bidders.Speculating each might pay an inflated priceto trump the other, the seller ensured eachknew it rival was looking. The division s selling

price? $45 million.



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Failing to correct for skewed vision

Role bias over committing to your own pointof view and interpreting information in self serving ways. A plaintiff believes he has a 70%chance of winning his case, while the defenseputs the odds at 50%. Result? Unlikelihood of out of court settlement.



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Failing to correct for skewed vision

P atrician perceptions painting your side withpositive qualities, while vilifying your

opponent. Self fulfilling prophecies mayresult.Counteract these biases with role plays of the opposition s interests.



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Videos

Links1) Negotiation Skills

2) Short movie clip

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Q& A

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Source : http://www.articlealley.com/article_1884619_15.html

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