Negotiation is widely recognized to be a four-step process. These are preparation, opening, bargaining and closing.
1. Preparation:
The first stage in a negotiation process relates to planning and preparation. It is the stage where the parties decide what they want, what are their minimum expectations, how much they will yield and how they will go about the negotiations.
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Each party will also try to visualize what the other party will be expecting from the negotiation. Preparations for the negotiations would consist of collecting relevant information, obtaining the required authority and outer limits, having intense discussions and collecting details of the previous negotiations on similar issues.
As we have noted earlier, a well-informed and a well-prepared party enters the negotiation process with a high level of confidence. In this stage, the parties also look at the time frame, availability of the team members, relative roles and their strategies.
While the teams should enter the process with a positive bent of mind, prudence suggests that they should also discuss beforehand what they should do if the negotiations break down and the agreements are not reached.
2. Opening:
The second stage in the negotiation process concerns opening. This is when the parties concerned come to the negotiating table and meet each other. Opening has two steps—rapport building and probing.
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Rapport building is the process of getting to know each other. Thus, introductions are made, pleasantries are exchanged, and names and backgrounds are noted. Care should be taken to address the persons by their correct names.
Even if someone in the other group is already known, too much of familiarity or intimacy should be avoided. Negotiations should start on a friendly note, but with a professional approach. While meeting people and interacting with them, perceptions do matter.
Make sure that negotiations begin on the right note. Be polite and pleasant. Use appropriate words. Is opening minded? Show enthusiasm. Listen attentively.
Once the pleasantries are over, the teams enter the stage of probing. Each party tries to know more about the other through open-ended questions. They get to know the needs and expectations of one another. Statements made are more exploratory than assertive.
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The more they listen and probe, better will be their appreciation of the other party’s stand or position. Probing takes place through open-ended questions like, ‘How shall we proceed?’, ‘What do you suggest?’, ‘What is the time frame we are looking at?’ and ‘Which issues shall we take up first?’
3. Bargaining:
It is the stage when the negotiating teams really sit down and talk it out. They state their positions and put forth the supporting arguments. In any negotiation, the question uppermost is, ‘What’s there in it for me?’
Bargaining is nothing but a give and take. You are prepared to concede something provided you get what you want. During the course of hard bargaining, all the relevant negotiation skills we noted earlier are brought into full play.
Assertiveness, substantiation, logic, reasoning and persuasion are all put to good use. A good negotiator does not yield easily. He or she uses silence effectively and keeps the other party guessing.
When both the parties are tough negotiators, deliberations become more challenging and progress becomes slow. It may become necessary to take a break and get back after a gap.
Quite often, there is a total disagreement and when that happens, both the parties should take a longer break and meet at a later date. Complex negotiations take time and the pace cannot be forced.
4. Closing:
Finally, you enter the settlement stage and work towards a ‘close’. After completing all the bargaining, the negotiating parties come to the stage of settlement or agreement. The final terms as agreed upon are documented and the agreement gets signed.
Even after all the hard bargaining and intense deliberations, quite often there are still some loose ends that have to be tied up. It is only after some deliberation that both the parties agree upon the final draft of the agreement.
Negotiations by their very nature involve some compromises and sacrifices. Neither party should expect a settlement or deal that is totally as per their expectations. As they say, you win some and lose some. Good negotiators view the outcome in proper perspective and take the gains and compromises in their stride.