It is Obvious

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Archive for the ‘Negotiate’ Category

A bargain – at last

Posted by chrisrick13 on April 21, 2011

It is obvious: always negotiate

I had a lesson in negotiating yesterday.  (I’ll take up my intended series on this when I have worked out how to answer one of the comments on BATNA’s.)  I have plumbing insurance.  Had it for 11 years.  I have never used it and I don’t think the policy allows of any condition where I can claim under it.  I have been going through my expenditure and eliminating stuff I don’t need.  And that is another lesson: why didn’t I do it earlier?

I decided that I would cancel the plumbing insurance.  I know where all mine is and can easily get at it to fix it if I need to.  Copper pipes just sit there and don’t often decide to play-up.  I had put myself into a position of strength.  I was going to ring up and cancel.  I mentally prepared myself.

The phone was an 0800 number.  What a rarity nowadays?  The person I spoke to had a number of telling questions and some uncomfortable scenarios for me to consider, but I had made my mind up.  I persisted, thanking him for his time.  Then he asked if I would reconsider if I had 35 sliced off an annual bill of 84.  I had made my mind up.  I was in a position of strength.  I said ‘No’ again.  what about 54 off he said?  I should have been affronted.  How many people have been caught by that first offer (remember – never accept a first offer).  How long had I been paying an extra 54?  11 years for nearly 600?

You can guess.  I took his offer.  Another year.  Put it in the diary to make sure I leave next year if it goes up.  I wonder.  Was there a third offer in there?

It is obvious: always negotiate – the other side always does

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Negotiate (2)

Posted by chrisrick13 on December 9, 2010

It is obvious: negotiating is easy.

The BATNA is an acronym created by Fisher and Ury in 1981.  It stands for: Best Alternative To a Negotiated Agreement. Creating one is an essential part of your preparation for the negotiaton.  BATNA’s were done before Fisher and Ury, but they put a neat name on it and defined much of the thinking around it.  They did a great service for people not expert at negotiating.

Without a BATNA there will be a fear of failing to reach agreement without knowing what the consequences are.  You will be much more likely to agree to something that is not in your best interest which can simply be bettered by not negotiating at all.

At every stage during the negotiation you can compare where you are with your BATNA.  You can continue to negotiate until the current agreement is better than your BATNA.  You don’t have to think and you don’t have to worry about the consequences of not agreeing – you have something better.  This puts you in a very strong position.  You will genuinely be able to get up and walk away from a negotiation that is poor for you.

During the negotiation you should keep your BATNA secret or you will find yourself always arriving at your BATNA in any negotiation.  There is always a better deal out there and you want it.  By the same token you should try and find out the BATNA of the other side – it is an essential part of your preparation.

Of course, if your BATNA is something you absolutely must improve on then you are not as strong as you might be.  At least this will help you work out what you really want from the negotiation and the extra things you need to achieve.

Once you have reached the stage where the agreed items are better than your BATNA then you have to start thinking.  At this point you are invested in the negotiation and you do not want it to fail.  This weakens you and will change your perspective.  However you must not let the other side see any change in you or they will be well on the way to discovering your BATNA.

The BATNA: an essential tool for all negotiators.

It is obvious: negotiating is easy to do poorly.

Copyright © Chris Rick 2010

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Negotiate (1)

Posted by chrisrick13 on November 26, 2010

It is obvious: negotiating is easy.

I am not a good negotiator.  I used to be a very poor one.  The difference is that I have studied it quite a lot.  I can now recognise when tricks are being run against me and know the best counter.  I even know how to start in the best position.  I know a lot of the things not to do…but still often do them.  My biggest regret about my 21 years of education is that not once did anyone teach me anything about negotiating…something we do almost all of our lives.

I have been putting my thoughts together and this is the first of, possibly, a number of entries on the subject.

The first, most important and easiest is possibly the simplest: never accept a first offer.  You will be doing both sides a favour.  If you accept, the other party will forever be kicking themselves that they did not start higher.  When the deal has happened you will always be wondering if you could have got it for less.  You will save both of you years of anguish by not accepting that first offer even if the ultimate price is that first price.

I always do principled negotiating and do not lie or pull any of the nasty tricks I will tell you about.  So when I am offered a deal I always suck in my breath and put a grave expression on my face.  At the very least I know I am doing us both a favour even if I think this the best deal ever.

You can put a counter offer in, but that then limits the negotiation.  Best is to simply say something like: “I don’t think I could go that high”.  If the other party is a good negotiator he will have mechanisms to limit the downward move, so let him employ them not you.

The big temptation if it is a good deal is to accept so that they won’t walk away.  Even if they say no to your counter offer you can always pull them back and go for the original price.  Suck that breath in.

As important as this is, it is not the first act of a negotiation.  The next article covers the starting point and the all important BATNA.

It is obvious: negotiating is easy to do poorly.

Alas:  Copyright © Chris Rick 2010

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