How to plan a negotiation - 7 top tips

How to negotiate anything

With UK inflation at a record high and global crisis upon crisis pushing the price of everything up, good negotiation skills are essential. 

Management consultant Naomi Clews shares her 7 top tips on what to consider when planning for your next negotiation. 

What is a negotiation plan? 
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Negotiation is a discussion aimed at reaching an agreement.

​How you approach a negotiation (e.g. your next contract review meeting) is of vital importance. 

Before entering into any negotiation, you need a negotiation plan. 

A negotiation plan may help you to determine and mitigate any negative behaviour and conduct from the start.

My 7 top tips may help to influence the negotiation from one that is savage to civilised.  ​

​1. What is the existing relationship?
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What is the existing relationship between you and the other party you are negotiating with? 

An adversarial relationship has a formal communication style and no direct contact.

A partnership relationship is where the parties work together to solve problems and evaluate solutions. 

​Adversarial relationships are more common in short term, transactional contracts.

For example, in a competitive market, (where lots of suppliers sell the same or similar goods and services), buyers don't usually enter into partnership relationship with those suppliers.

Often the buying decision is based on price and/or availability, not brand loyalty.  

Partnership relationships are more common in markets that rely heavily on innovation, intellectual property and/or technology driven advances.

By identifying your existing relationship in your negotiation plan you can use this to determine the best strategy to use in the negotiation. 

2. Will threats be used in the negotiation? 
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Where an adversarial relationship exists, threats are more  commonplace in a negotiation than they are if a partnership relationship exists. 

For example, in an adversarial relationship, one party may threaten to take their business elsewhere.
 
A good negotiator (who fully understands the existing relationship) will have anticipated threats and included them as risks in their negotiation plan.
 
The good negotiator will attempt to predict what the other party is willing to except and when they will walk away from the negotiating table.
 
A negotiators success is often dependent on how well they actually know their opponent. ​

Documenting what you know in the negotiation plan will help to highlight any gaps in your existing knowledge.  

3. The devil is in the detail 
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A good negotiator will base all their decisions on the intelligence they have gathered about their opponent, included in the negotiation plan. 

The negotiation plan can help to predict how the opponent will respond to any offers made. 
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A good negotiator will offer something, BUT not everything that is included in the negotiation plan. 

4. Who has the power?
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When one party to a negotiation feels that they have no power and therefore no choice, this is very bad.

​This situation can quickly escalate, leading to unpredictable behaviour and may lead to devastating consequences for both parties to the negotiation.  
 
In this situation, the party without power will usually look for an alternative.

The success of this strategy will depend on how motivated the party is to regain their power.   
 
If the party is very motivated to regain their power and they succeed in finding an alternative, they may be highly motivated to destroy their opponents power completely. 

​It's therefore prudent to include a risk assessment in a negotiation plan. ​

5. What is a disruptor?
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A disruptor is something that causes a disturbance or problem.

​For example, technology has already caused radical changes in existing markets and industries. 
 
Disruptors incentivise parties to change their usually predictable behaviour, habits and beliefs and take more risks.

This can cause an individual who previously had no power to gain power as a result of a disruptor.

​Including alternative options in your negotiation plan is a shrewd move.

6. Can the balance of power change?  
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​It’s important to recognise that because of disruptors, the balance of power is forever changing. 

Both internal factors (those in your control) and external factors (those outside of your control) will have an impact on your power over time. 

Power is almost never 100% under your control. 

A party who once had all the power, can find themselves with none. 

This is when so called "insurance policies" e.g. backup plans, bargaining tools and strategic alliances are useful to include in a negotiation plan. 

7. The human response to power loss

A loss of power will kick start the inbuilt human survival instincts.

​Our natural fight or flight mechanism. 

This will often make a negotiation more difficult.

A good negotiator knows this and avoids making their opponent feel completely powerless.

Good negotiators will consider in their negotiation plan how to allow their opponent to retain some of their power.  

If you've got this far, why not leave a comment below and share your top tips on how to have a successful negotiation. 

About the author
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Naomi Clews

Naomi Clews, management consultant and owner of boutique procurement advisory firm Naomi Clews Consultancy Limited is a highly experienced contract negotiator based in Lichfield, Birmingham, UK. Find out more here.