Neg Part 2-6 Phases

STRATEGIC NEGOTIATION SKILLS
6 Phases of Negotiation
6 Phases
of Negotiation
THE PHASES OF NEGOTIATION
THE PREPARATION AND PLANNING PHASE
What you do at this stage will determine the course and quite probably the
outcome of Negotiation.
There is more and more pressure being exerted on key employees in

companies and time is at a premium as never before. Therefore time
management is crucial. Those who say they have no time for any
preparation or planning are living in a “fools’ paradise” because they are
most unlikely to be securing good deals for themselves or their companies.
Research shows that a key factor separating the skilled and the pedestrian
negotiator is the way in which they prepare and plan their sessions.
In the context of Negotiation, Preparation and Planning have distinct

meanings.
1. Preparation is concerned with researching the issues to be negotiated and

is likely to include:
¾ Establishing the current state of the market

¾ Understanding precisely what your own requirements are
¾ Researching the other party – perhaps a supplier or customer
¾ Deciding what your targets and your own negotiating spectrum is –
choosing your Ideal, Realistic and Fall Back positions
¾ Making assumptions where facts are not available
2. Planning is where you look forward to the negotiation, imagine how the
session will proceed and plan your strategy. Some of the questions you
will try to answer here will be:
¾ Where will the meeting be held?

¾ How will I open the negotiation?
¾ How are they likely to respond?
¾ How can I set the Agenda?
¾ How can I condition them and reduce their expectations?
¾ If in a team, what role will each team member play?
¾ How will I respond to the difficult questions and issues that they are
likely to raise?
PREPARATION is the WHY of negotiation and PLANNING is the HOW

NEGOTIATION
PREPARATION & PLANNING
PREPARATION
AIM
OBJECTIVES: Ensure they are specific, measurable, achievable, relevant and

timebound (i.e. S.M.A.R.T)
VARIABLES IDEAL REALISTIC FALLBACK

NEGOTIATION
PREPARATION
UNDERSTANDING OUR POSITION
ASSUMPTIONS ABOUT OTHERS POSITION
INFORMATION GAPS
Known Not Known

NEGOTIATION
PLANNING
PEOPLE & ROLES
QUESTIONS TO ASK
10
11
12
13
14
15
16
17
18
19
20
NEGOTIATION
PLANNING
MOVEMENT STRATEGY
US THEM
OPENING OPTIONS
NOTE
Remember the importance of rehearsal
THE OPENING PHASE
After the Preparation and Planning it is now time to meet the other party.
During your planning you will have decided on when and where. Make sure
that you place the meeting at the location best suited to yourself and least
suited to the other party. If you are a buyer, for example, you should be
aware that sales people routinely work away from home. Why not visit them?
The purpose of this Opening is:
¾ To establish a relationship and set the scene

¾ To take control - sensitively and assertively
¾ To communicate your own expectations and begin to
condition the expectations of the other party
It must not be forgotten that a powerful impression shapes expectations. It

should be your aim right from the outset to condition the other party that
they are dealing with a senior professional and their expectations should be
set accordingly. Remember the power of a first impression – it does count!
¾ BE ON TIME – never late

¾ Good firm handshake
¾ Maintain eye contact
¾ Smile
¾ Use the other person’s name (make the meeting personal)
One of your first tasks is to check the person or team opposite has the
power to negotiate and has the authority to take decisions.
Actions to be taken:
¾ Decide the type of opening and statements to be used

¾ Identify “common ground” issues to ensure that you at least
start together
¾ Decide how to phrase your requirements – enough to start
discussions without revealing your whole hand
¾ Plan credible comments about your needs and possible
“diminishing” comments about the other party’s position
¾ Decide tactics for obtaining and keeping control
THE TESTING PHASE
Information is crucial to the outcome of a negotiation and the purpose of

this phase
is:
¾ To obtain information from the other party and test one’s

own assumptions
¾ To assess how firm the other party is on key points
¾ To probe for weaknesses in the other party’s arguments and
diminish confidence in them
¾ To “fly kites” and observe responses
You should take the initiative in this phase with a well-practised and
thorough questioning technique. Not only will appropriate questioning
provide you with information but also the phrasing and skill used should
stimulate a more open exchange of views. There is little point in excellent
questioning and probing deeply if you are not listening carefully to the
answer at the same time.
Expert negotiators know how important it is to practise good listening skills.

These are skills that can be learned and used. Hearing is not listening;
listening needs effort and can be hard work.
The more that people talk the more they give away. A good listener is able
to gather a great deal of information when confronted by a talkative person
across the table. Encourage them to talk.
Actions to be taken:
¾ Predict the other party’s arguments and decide how they will
be answered or defused
¾ Use open questions to test assumptions and encourage the
free flow of information from the other party
¾ Anticipate the reasoning the other party will use and gather
facts to counter this
¾ Plan how to find out the other party’s “shopping list” and to
avoid unwittingly revealing your own
¾ Anticipate Persuasion methods which will be used and
prepare to match them
Getting the other party’s “shopping list”
Find out what they want by using something along these lines:
“What would we need to do to get you to do X?” - X being what
you want.
Get as full a list of items as possible before pursuing any one of
these.
Then use the “If ... Then” approach - “If we do Y what do we get
in return?”
THE MOVING PHASE
A great many definitions of negotiation contain the work ‘movement’. A

negotiation can involve movement or change towards an agreement that is
seen as beneficial to each party.
This does not mean, however, that the process of movement has to be bi-
lateral. Two-way movement is a perfectly proper process but the key point
to make here is that you should only contemplate moving once you have
exhausted the means by which you can get the other party to move on their
own.
The purpose:
¾ To persuade the other party to move as far as possible

towards the position desired, bearing in mind that some
concessions may be necessary using the 5 key approaches as
follows: Emotion, Logic, Threat, Bargaining and Compromise
¾ To control the extent to which you move from your “Ideal”
Settlement point and to know the total cost implications of
any movement
Once you decide to move you must move only in the smallest of increments.
Plan the sizes of the steps you will take. Remember also that you must try
never to move unilaterally. That’s what you want the other party to do! If
you move try to receive something in return for your move! If you do …….
then I will …… is the script. IF ……. THEN
Once you move, you have advertised the fact that you can move. You are
also allowing the assumption that you may have more movement to offer.
Therefore never give anything away for nothing. You must trade your
moves, not give them away.
When the Other Party Moves
You should always promote in the other party a willingness to make

concessions. Try to convince them that their current position is untenable,
that they will not lose face if they do move, or that you may reciprocate the
move yourself if they go first.
THANK AND BANK
When you are offered something in a negotiation get into the habit of
immediately saying ‘thank you’ and moving on.
Actions for this phase are as follows:
¾ Work out the cost of any concession - estimate the costs of

concessions which may be made by the other party
¾ Order concessions - which will cost you least - yet would be
valued by the other party
¾ Consider the personal needs of the other party as well as
their corporate needs
¾ Plan how the other party can concede without losing face
¾ Plan recesses or adjournments – it will help you keep control.
THE AGREEING OR CONCLUDING PHASE
As the end of the negotiation moves into view you need to be prepared
either to make an alternative offer or to accept the offer on the table. This
presumes that you haven’t decided to call it a day, i.e. go elsewhere.
This is why it is the Agreeing or Concluding phase because in the latter case
sometimes you will have to walk away without an agreement.
However if an Agreement is to be made then the purpose of this phase is:
¾ To reach a workable agreement on the points at issue

¾ To agree next steps
¾ To control what has been agreed
¾ To set the scene for future business relationships
¾ To gather information - for next time
No matter how professional the negotiators, the deal must be recorded. It is

at this time that misunderstandings will be ironed out and final numbers
agreed. Details that were left ‘on the back-burner’ need to be clarified and
the final terms and conditions signed off. With today’s technology it should
not be too difficult to get a preliminary copy of the deal initialled by both
parties as quickly as possible.
At the final stages of a deal it is possible to strengthen relationships ready

for the next round, next time. Never underestimate the importance of this
stage.
Remember:
¾ Prepare closing tactics - summarise and get agreement to

these summaries
¾ Decide how confirmation of points agreed will be done and
retain control of the confirmation process
¾ Prepare proposals for next steps should agreement not be
reached
¾ Don’t forget - people often reveal information during the
post-agreement relaxation period which they were not
prepared to do during earlier phases
Key aims for this phase:
¾ Don’t trust to memory – write it down

¾ Make the final agreement a pleasant experience
¾ Make the other party feel that they have ‘earned’ the deal
¾ Don’t show triumph
¾ Try to build the basis for a long term relationship if
appropriate
Negotiating proper really begins in phase three. Many negotiators make the
mistake of going from the Opening Phase to the Agreeing Phase without
spending sufficient time at the Testing/Information Gathering Phase.
THE REVIEW PHASE
This phase could also be entitled ‘Measuring for Success.’

Expert negotiators are never satisfied. You could always walk away from a
negotiation with a feeling that you could have done better.
The Post Negotiation Review is often missed but it is an essential ingredient

of a successful negotiators toolbox. The skilled negotiator is constantly
seeking to improve – to be more successful. It is rare that you will leave a
negotiation feeling that if it were to be done again nothing would be
changed – there is nearly always some opportunity that is perceived after the
event when it is too late to do anything about it.
Therefore you must measure your success or otherwise
¾ Outcome – look at what you planned and what actually happened

¾ Were your objectives SMART?
(Specific, Measurable, Achievable, Relevant and Timebound)
¾ What aspects went well – what didn’t?
¾ Check behaviours of both parties against the results
¾ What could I or we have done better?
¾ What were the concession patterns?
DON’T FORGET – This could be the start of your preparation for the next
negotiation with this party.

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STRATEGIC NEGOTIATION SKILLS

THE PREPARATION AND PLANNING PHASE

There is more and more pressure being exerted on key employees in

In the context of Negotiation, Preparation and Planning have distinct

1. Preparation is concerned with researching the issues to be negotiated and

¾ Establishing the current state of the market

¾ Where will the meeting be held?

PREPARATION is the WHY of negotiation and PLANNING is the HOW

PREPARATION & PLANNING

OBJECTIVES: Ensure they are specific, measurable, achievable, relevant and

VARIABLES IDEAL REALISTIC FALLBACK

PREPARATION & PLANNING

UNDERSTANDING OUR POSITION

ASSUMPTIONS ABOUT OTHERS POSITION

Known Not Known

PEOPLE & ROLES

The purpose of this Opening is:

¾ To establish a relationship and set the scene

It must not be forgotten that a powerful impression shapes expectations. It

¾ BE ON TIME – never late

¾ Decide the type of opening and statements to be used

Information is crucial to the outcome of a negotiation and the purpose of

¾ To obtain information from the other party and test one’s

Expert negotiators know how important it is to practise good listening skills.

A great many definitions of negotiation contain the work ‘movement’. A

¾ To persuade the other party to move as far as possible

When the Other Party Moves

You should always promote in the other party a willingness to make

THANK AND BANK

Actions for this phase are as follows:

¾ Work out the cost of any concession - estimate the costs of

However if an Agreement is to be made then the purpose of this phase is:

¾ To reach a workable agreement on the points at issue

No matter how professional the negotiators, the deal must be recorded. It is

At the final stages of a deal it is possible to strengthen relationships ready

¾ Prepare closing tactics - summarise and get agreement to

¾ Don’t trust to memory – write it down

This phase could also be entitled ‘Measuring for Success.’

The Post Negotiation Review is often missed but it is an essential ingredient

Therefore you must measure your success or otherwise

¾ Outcome – look at what you planned and what actually happened

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