It's a must-have business skill, says consultant Katherine Baker.
by Adam Gale
We tend to think of negotiation as a big deal, and a rather formal one at that. Blame politics, where the convenient myth of international relations has deals struck by leaders at grand, first-one-to-blink-loses summits rather than by teams of lawyers picking their way through thousand-page treaties.
Most negotiation is much more prosaic than either, a bread-and-butter people skill that’s absolutely essential for both business success and career progression (who was the last captain of industry you met who was a complete pushover?).
There is, at the risk of sounding a little Trumpian, an art to striking deals and getting your way, whether that’s getting good terms with your suppliers or just persuading a peer to help you out.
Katherine Baker a seasoned dealmaker. She gave her five rules for negotiation to the audience of Management Today’s recent Young Women in Business conference.
RULE 1: KNOW WHO YOU ARE AND WHAT YOU WANT
"Think big picture and give yourself room to negotiate," says Baker. If you don’t really know what you want out of the discussion, it’s very unlikely you’ll get very far. It’s important to know what issues are at stake, so you can trade them.
"You don’t want to go into a negotiation only wanting one thing. If you go in for a pay rise, don’t just think about the money. Do you also want flexible working or a management role? Are you willing to work longer in exchange?"
RULE 2: KNOW AT WHAT POINT YOU’RE WILLING TO WALK AWAY
You may have had enough of the expression ‘no deal is better than a bad deal’, but there’s some truth to it. "You need to know your BATN - your best alternative to a negotiated agreement," says Baker. "The stronger your answer, the more confident you’ll be."
RULE 3: KNOWLEDGE IS POWER
The person with the loudest voice and the loosest lips is rarely the winner in a negotiation. "Don’t give information for free, and learn how to listen. Understanding what they need will help you get the result you want," says Baker, who recommends asking open-ended questions like "describe your situation" or "tell me what you’re looking for". It may reveal a win-win solution you would never have thought of.
RULE 4: KNOW YOUR STRATEGY
If you’re haggling down the souk, and you make a take-it-or leave it offer at a tenth the asking price in your opening salvo, you’re more likely to get shouted out the shop than snag a bargain. Negotiation is a game, which means it has both rules and strategies.
"Your strategy will change depending on who you’re negotiating with. If the relationship is important, then you’re going to have to go in softer. If it’s with an influencer rather than the ultimate decision maker, then you don’t want to go in with your bottom line, as they’ll report back and the decision maker will ask for more," advises Baker.
RULE 5: PRACTICE MAKES PERFECT
If your first experience of negotiation is sitting across from Michel Barnier in a wood-pannelled Brussels meeting room, you’re not going to have a great time of things. Fortunately, there are ample opportunities to practise your skills.
Baker suggests low stakes scenarios like asking for hotel upgrades. "Don’t be afraid to make mistakes. Just keep asking for more, because more often than not people will give it to you."