You’d never leave on a family vacation without knowing where you’re going and what you’ll do when you get there. So, why would you begin a business negotiation without knowing what your objectives and acceptable outcomes are? My answer – you shouldn’t.
So, am I saying you need to know exactly where your negotiations must conclude before you even begin discussions? Of course not – negotiations necessarily involve multiple parties, all of whom have their own goals and expectations. It would be foolish to think you can predict and control all possible outcomes, and short-sighted and unrealistic to believe the only successful outcome will be exactly the one most beneficial to you. After all, successful negotiations almost always require give and take from all parties to ultimately arrive at a win-win arrangement. Without this, at least one party will, presumably, have no incentive (or not enough incentive) to do the deal.
What is critical, however, is that you not enter into negotiations without giving careful thought to what your objectives are, the ways that you might be able to achieve them, and the outcomes that would be acceptable. Note that I’ve said objectives, ways and outcomes – plural. Just like the old saying, “there’s more than one way to skin a cat” – there’s almost always more than one way to structure a business deal.
I recommend you follow these basic suggestions before entering into business negotiations:
• Identify your ultimate objectives – the primary reasons you’re considering this deal.
• Consider the various ways that you might be able to achieve those objectives.
• Identify your secondary objectives – things that would be nice to get, but are not essential.
• Consider the various ways that you might be able to achieve those without compromising on the primary objectives. Also consider things that you would view as deal-killers.
• To the extent you’re able, go through the same analysis from the other party or parties’ perspective – see the deal through their eyes.
• Now, once again, consider how you can achieve your primary (and hopefully secondary) objectives AND how the other parties might also achieve theirs. Hopefully there are several ways to get there – some of which may be more or less desirable to you, but all of which would be acceptable.
• Having gone through this exercise, it’s now time to negotiate.
Remember, your best way to achieve a successful outcome is to consider what that might look like before entering into negotiations, rather than looking back and wondering what went wrong.