Pre-Negotiation Check List
This pre negotiation check list will help you prepare a successful negotiation strategy for any potential conflict and attain the best possible agreement.
1) Assess the Situation
Each negotiation is going to be different, no matter how often we've addressed similar situations. We will always be negotiating with people who have different styles, goals and objectives, and who are coming from different circumstances and have different standards.
2) Kind of Negotiation?
There are basically 3 circumstances to consider.
· Is it a one time negotiation?
· Is it a negotiation that we are going to be repeating again?
· Is it a negotiation where we are going to form some kind of long term relationship?
Most of our business negotiations are likely going to fall in the last two categories. We will be handling a lot of repeat negotiations Or, we will be seeking a long term negotiated agreement such as a joint venture, where we will be mutually entwined over a long period of time.
3) Type of Conflict?
There are basically two types of conflict situations we may encounter in a negotiation:
A)Agreement conflict, where one person views or position are in conflict with another individual, or members of a group. This is a situation that takes into account their conflicting views relating to opinions, beliefs, values and ideology.
B)Allocation of resources like money, quantity, production or things. Any physical commodity will fall into this category of conflict. Resource issues though, are more tangible as they comprise knowable items, or particular products.
By analyzing the types of conflict into categories, negotiators can have a better understanding of the real measure of the disputes, and frame or focus their strategies more effectively.
4) The Meaning of the Negotiation
There are only two reasons why we enter into a negotiation:
· Necessity, we have to. This could be due to either some immediate need or it could be that we face severe cutbacks in personnel.
· Seeking out an opportunity. This situation may arise simply because an opportunity has sprung up.
5) The Ripple Effect
We also need to ask ourselves whether the results of the negotiation we are conducting, will affect other negotiations or agreements later. It's vital that we, as negotiators, consider the impact or consequences of an agreement in developing our strategy.
6) An Agreement is Needed?
We either enter into negotiations because we have to, or because we want to. Part of our strategy will involve a careful analysis of our best alternative to a negotiated agreement). If an agreement is absolutely essential, and we have few alternative options, in the event of talks collapsing, this will affect our strategy. Or, if the negotiated agreement is not essential because we have a strong option, and can walk away with confidence, this also influences the approach to our strategy.
7) Formally Approve the Agreement
Many agreements made during the negotiated process require formal approval, or ratification before an agreement is official. Union members may vote before they accept a tentative labor agreement that was previously negotiated between management and the union. A Board of Directors, CEO, stakeholders, or other outside constituents, may need to review and ratify an agreement, before it comes into effect.
8) Time Frame
A)Deadlines might be imposed, to either make or break an agreement. Offers with expiry dates may be tendered.
B) 'Time is money'. Negotiations use up time, and The point to remember is that the longer the negotiations drag out, time will negatively affect the bottom line.
9) Place to Negotiate
In much the same way as sports teams enjoy a 'home advantage', negotiators playing away from home need to adjust their game plan and strategies. We can either hold the talks in their offices, our offices, or at a neutral domain.We might choose the latter so no one has the psychological and resource advantage, of holding the negotiations on their premises.
10) Public Interest
Negotiations are often private affairs with little fanfare, until an agreement is signed. There are also agreements that are advertised afterwards, to maximize the mutual benefit both sides obtain. On other occasions, negotiations may be held in strict secrecy. Sometimes there are the highly publicized occasions when the press becomes actively involved. It could be that one of the negotiating parties uses the powers of the press, to lever an advantage to sway and manipulate the outcome. Press releases and Public relations are another means to use as an effective strategy in the negotiation process.
11) Mediators?
Third parties have many different functions and roles to play in developing a negotiation strategy. They may act as agents, intermediaries, translators, consultants, or other specialists who have an expertise, that one or both parties require. There are occasions when a neutral third party will act as a facilitator or chairperson, to manage the negotiations such as in multiparty negotiations, inter organizational negotiations, or even international negotiations.
During these times we may use a neutral third party to act as a mediator or an arbitrator, to either facilitate an agreement or to impose an agreement, such as in a labor dispute for example.
12) Lead the Process
There are situations when we have to decide how a proposal or offer is to be presented, or in deciding who is going to go first. Of course, this will all relate to the issues, positions, goals and objectives that will determine our approach.
13) Decision Makers
Before we enter into the negotiations, we must establish who is going to make the decisions. What is our authority and who do we report to in our organization? Similarly, what are the authority levels of our counterparts?
14) How Long Will It Take?
Negotiations can be a one shot occurrence where one party comes right out and says 'This is a one time offer - take it or leave it.' There are some instances where haggling is not considered acceptable, and will not be tolerated by the other party. Other situations will drag out into the equivalent of a marathon ping-pong match, as each party bounces offers and counter offers, back and forth between them. It also depends on the offer and proposal, in relation to the circumstances such as time considerations, need, and many other factors.
15) Dis? - Advantage?
Two or more parties who are about to engage in a negotiation, seldom operate from an equal power base. If one party has something that we desperately need, for our company's survival and we have no alternatives, then we may find ourselves negotiating at a disadvantage. Size is not necessarily relevant, as we've all heard the old account of 'David versus Goliath', and how that conflict turned out.
Also, we should seek ways to diminish the power base of the opposing party where possible, before we begin our negotiations, or even during the negotiation process itself.