Cost of Negotiation
Exercise: Calculate The Cost Of Your Negotiations
Just in the last 2 years, how many of your deals or important conversations didn’t go to plan?
What did that cost you in terms of the following:
1. Dollar cost (hard cost, eg legal fees, or loss of current and future opportunities)
2. Time cost (wasted time, stalling or drawn out negotiations, deadlocks, lack of implementation, time devoted to resolving the conflict internally)
3. Relationship cost (broken trust, damaged or totally burnt relationships, loss of employee talent or toxic culture)
4. Energy cost (stress, effort, poor decision making, resources)
5. Credibility cost (loss of perceived power and status, loss of professional and/or personal credibility and reputation)
Write a list and quantify the costs.
Reflection
Reflect on negotiations or deals over the last 2 years. Begin a simple spreadsheet.
Answer Key Questions
Consider when you have used discounting to get the deal done.
How much does this cost you, and your business?
A New Framework
The World Economic Forum ranks negotiation in the Top 10 most important skills for leaders to take into the 2020’s. Consider the skills needed for the future and rank your own skills in order of strength.
How does this align?
Who do you need to be to lead your results and your business into a successful new era?
Defining Negotiation
Exercise: Defining Negotiation
Reflect on your recent negotiations and determine what mode of negotiation you typically fall into and under what circumstances.
Most people mistakenly believe that traditional haggling is considered negotiation. Imposing your will, giving in, or compromising (the good old “let’s split the difference”), those are NOT negotiating.
You can see that the balance between value and the health of the relationship is impacted directly by these different ways of doing business.
Win-Win negotiation is the start of the negotiation process, but is no longer enough. Win-With® is the next generation of creating value in negotiations and building trusted relationships.
Reflect on the diagram here and write your own definition of the following:
– Impose your will
– Give in
– Compromise
– Negotiate
What do you think your default approach is?
What are the benefits of this approach?
Do you get what you want?
Does your counterpart get what they want?
What’s the impact on the relationship?
Reflection
Reflect on your recent negotiations or deals. Note the intended outcome, the process undertaken, the people involved, and the emotions and triggers that presented throughout.
Answer Key Questions
Review the diagram below to answer the questions above to determine your negotiation styles and identify the triggers that activate them.
A New Framework
Consider these answers and see if a new negotiation framework could bring even more value to these deals without competition, aggression and conflict.
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