I’m often asked to advise on difficult negotiations, and in most cases it’s because the negotiators are unsure what to do. They’re worried about how their counterparts will react, concerned that things might unravel and above all, they lack confidence that they’ll get the deal they want.
Confident negotiators get better deals. It’s a fact. They pick up more signals, think more clearly and invariably hold out longer than negotiators who carry the burden of anxiety. In negotiations, probably more than any other area of business, whether you think you can, or think you can’t, either way you’re probably going to turn out to be right. Confidence is decisive. So how do you get it?
There are three key elements to building your confidence. To find out more about each, just click on the heading. In a nutshell, they are:
Understanding: The first step in building your confidence is to get as much understanding as you can about your counterpart’s true situation. Look for the pressures they’re under both internally and externally, how they’re getting on against their competitors, and how well they’re getting on with yours. The more insight you get on your strengths and their weaknesses, the more confident you will be about the situation.
Alternatives: Next, look at your alternatives and at their alternatives. If you had to stop trading with them tomorrow, what would you do? If you knew you’d be stopping trading in three or six months, how would you prepare? The stronger your alternatives, the more confidently you will negotiate. And the better you understand their alternatives, the more clearly you’ll be able to anticipate and plan for what might unfold.
Plans: Finally, play the “what if” game. Use your understanding of their situation and their alternatives, bring in any knowledge you’ve got of the ways in which they’ve behaved in the past, and work through what they’re most likely to do in response to each of your moves. At each stage, there will be a couple of things they might realistically do, so plan how you’d respond in each situation.
BOTTOM LINE: Once you’ve worked out your strengths and their weaknesses and fully explored the scenarios that might unfold, you can build a plan in which you have a real confidence. A confidence that, trust me, is worth its weight in gold.