The Art of Negotiation
We spent one month discussing Negotiation. Everyone agreed that negotiations are based on relationships. However, even if there is a relationship, negotiations do fail - but why?
Our expert Jochen Luksch has 20 years of experience, first as a lawyer and then as a CEO. Jochen knows how to close a deal and we were lucky enough for him to share his INSIGHTS with us. He has been advising and training more than 5000 executives from all over the world in negotiation skills with his company Egger & Philipps.
The real secret to success is to identify and leverage mutual interests.
Getting to ‘Yes’ Without Giving In: The Harvard Concept of Negotiation
The Harvard Concept is based on the assumption that negotiation positions are only the tip of the iceberg. What really matters lurks below the surface: The motivation behind the defined positions, and the perceptions and interests that shape the positions and thinking of the negotiation partner.
“Normally the negotiations are started by positions or arguments. What we recommend is don't stick to the position - counter-position game. What happens then is position - counter-position, argument - counter-argument, pressure - counter-pressure, and maybe we end up with a compromise. So, our recommendation is try to get deep down into this iceberg.”
- Jochen Luksch
We focused on the Harvard Negotiation Concept in two sessions:
The Six Components of Successful Negotiation
Interests
Interests are key, as they define the negotiation positions.
Perception
Through clear communication, you can share your point of view. Identify areas of mutual agreement and accept any differences free of judgement.
Relationships
Trust is the overriding element in every relationship, but don’t let emotional attachment interfere. Develop the relationship and the substance separately.
“This is the main manipulation strategy used by kids: Mixing emotions with substance. ‘Can we look at the TV tonight and stay out of bed a little bit longer? By the way, you are the greatest dad in the world!’ How could you say no?... Sometimes companies exchange the procurement guys from time to time. Why? Because they want to avoid the relationship getting too good with the supplier and they could accept higher prices than necessary.” - Jochen Luksch
Options
Developing options is a collaborative process and comes down to creativity. Take a closer look with your negotiation partner to maximise value for both sides.
Criteria of legitimacy
Avoid arbitrary arguments in your negotiation by using defined norms, values or legal standards from an independent body that can be accepted by the negotiation partner.
Best Alternative to Negotiated Agreement (BATNA)
A high quality BATNA grants you power and the freedom to walk away. The BATNA also acts as a quality control mechanism. Is it better than the deal offered?
Before you start a negotiation, use this checklist to help you prepare.
Understanding the counter-party's culture helps uncover interests and build relationships
“One of the great aspects of the life science world is the multi-cultural background of our partners and customers. Not always easy to navigate, but very enriching personally!” - Jan Lichtenberg, InSphero Inc.
Even within Europe, we see a plethora of cultural quirks and behaviours. Each culture places unique weights on values such as individual vs collective rights, power dynamics, and rules and structure.
The Hofstede Dimensions of Culture app is an invaluable tool to help you identify potential areas of overlap and divergence in values. We highly recommending downloading this App from the App Store.
In our INSIGHTS event, Professor Joel Lee explained how to approach cultures with differing values, using some Asian cultures as examples. Understanding your negotiation partner’s culture helps build the relationship and uncover their interests.
The goal in negotiation is to create a win-win situation by working with your negotiation partner (rather than arguing against them) on a solution that will please everyone.
The Harvard Concept is taken from the book ‘Getting to Yes’ by Roger Fisher and William Ury, which is highly recommended for more in-depth reading on the topic.
All our articles and insights on NEGOTIATION can be found here.