Work in group and decide how good negotiator you are and who is the best negotiator in your group.
HOW GOOD A NEGOTIATOR ARE YOU?
Like any skill, negotiation can be learned, practiced and mastered. Personal and professional growth in any area of life usually involves a combination of awareness and risk-taking. Fill out this questionnaire on the personal characteristics necessary to be a great negotiator and your answers will help you determine where you have strengths as a negotiator and where you may need improvement.
Instructions: Click the bubble next to the number that best reflects where you fall on the scale, with 5 being extremely typical of you and 1 being never typical of you.
Never typical of me
Extremely typical of me
1) I enjoy dealing with other people, and I am committed to building relationships and creating win-win outcomes.
2) I have good self-esteem and tend to have a high level of aspiration and expectation.
3) I work to create a comfortable, professional atmosphere.
4) I enjoy coming up with creative solutions to problems.
5) I am able to think clearly under pressure.
6) I am well prepared prior to entering a negotiation.
7) I am able to clearly identify my bottom line in every negotiation. (If I go below or above a certain point, I will walk out.)
8) I am willing to ask as many questions as it takes to get the information needed to make the best decision.
9) I communicate clearly and concisely.
10) I work to see each issue from my counterpart's point of view.
11) I confront the issues, not the person.
12) I focus on shared interests, not differences.
13) I look for ways to "grow the pie"-rather than simply dividing up the existing pieces-thereby expanding the relationship with my counterpart.
14) I do not take my counterpart's strategies, tactics and comments personally.
15) I like to uncover the needs, wants and motivations of counterparts so I can help them achieve their goals.
16) I recognize the power of strategies and tactics and use them frequently.
17) I know how to effectively counter a counterpart's strategies and tactics.
18) I am willing to compromise when necessary to solve problems.
19) When a counterpart and I come to an agreement on an issue, I ensure that the issue is measurable and time-bound.
You are working for Colonial Pipeline Company and going to discuss with your manager, Mr David Barry your potential promotion. Study how a good negotiation process should be prepared.
v Preparing to Negotiate
1. You Prepare to Negotiate with Mr David Barry
You approach Mr Barry on Friday afternoon and ask if Mr Barry can arrange a meeting to discuss a potential promotion. Mr Barry sighs and reminds you that you already had this discussion last year. You agree, but remind Mr Barry of his loyalty to the company and insist that you should speak again on the subject next week. Eventually Mr Barry, who is afraid that you might quit on the spot, agrees to meet on Monday during the lunch.
Over the weekend, you think about Monday's meeting. Last year, you were unprepared to negotiate and ended up only getting a 50 cent/hour pay raise. This did not satisfy you, and you have continued to feel undervalued ever since. Many times, after a hard day at work, you have considered quitting. However, it is difficult to find work in a good oil company. You have a family to support and he can't afford to lose your job.
You decide to do some research on negotiating. You learn the principles behind collaborative negotiating, and decide that this is the approach you will take this time. After you have understood the concept you can ask yourself the preparatory questions above. Finally, you can apply the rules of collaborative negotiating to your own case.
2. You prepare the questions to ask yourself before beginning talks with Mr Barry:
ü What is my main objective?
ü What are all of the alternatives I can think of?
ü Why do I deserve to have my goals met?
ü What will my opponent's counter proposal likely consist of?
ü How can I respond to this counter proposal?
ü When would I like to have this issue resolved?
ü What is my bottom-line?
ü What market research/homework do I need to do to back up my cause?
ü What is my bargaining power compared to my opponent's?
ü What do I know about the principles of negotiating?
3. You Answer the Preparatory Questions
Your main objective is to be named Senior Pipeline Engineer and to earn a salary that is competitive with other Senior Pipeline Engineers in oil industry.
Alternatives include looking for work elsewhere, asking for a dollar more an hour, suggesting that Mr Barry hires someone else to take on extra duties.
You deserve this promotion because you have worked with the Colonial Pipeline Company for five consecutive years, and you are highly qualified and skilled, motivated and team player. You are the team member who reports early every morning and leaves last. If You are under a deadline, you work through your lunch hour. All of the other team members come to you with their questions.
Mr Barry will likely say that he can't afford to pay you more because business is slow now. He will say that there are plenty of pipeline engineers who will do the work for less money.
Both of these arguments are probably true. The World Crises makes many companies save but Colonial delivers refined petroleum products – gasoline, diesel fuel, home heating oil, jet fuel and fuels for the U.S. military and Mr Barry had to pay you anyway because of your contracts. And, unemployment is at an all time high. However, Mr Barry just signed a contract with a new company that will mean regular work for at least the next two years. Also, the other team members rely on you, and none of them have the experience to take over your position if you quit. It will cost Mr Barry a lot of money to train a new pipeline engineers to do everything that I do.
You will look into three other pipeline companies and inquire about the salary and benefits of their employees. You will also review the classified ads to see if any other pipeline companies are hiring or looking for a pipeline engineer.
Your bottom-line is to receive an extra dollar an hour and to be named Senior Pipeline Engineer.
You think Mr Barry and you have equal bargaining power right now. None of the other current members of your team are as committed to the job as you are. However, unemployment is high and there are other people he could hire.
You have never been a strong negotiator. You need to learn more about negotiating strategies and tactics.
4. You study more about Collaborative Negotiating
In business, the goal of negotiating parties should always be for mutual gain. This type of win-win negotiation is often called collaborative negotiating. The opposite of collaborative negotiating is called competitive negotiating. The goal of competitive negotiating is for one party to win and the other to lose. Dishonest practices, such as lying, manipulation, intimidation, and bribery are often used in this type of negotiation.
Main Principles of Collaborative Negotiating:
ü Resolve previous conflicts ahead of time.
ü Deal with issues, not personalities.
ü Commit to listening more than speaking: The more you know about your counterpart, the more likely you will achieve your goals. You cannot convince someone of something when you do not know anything about them, or what their own needs are. A common mistake is to prepare one's next question or point while the opponent is speaking.
ü Establish trust in the onset.
ü Develop a common goal.
ü Discuss a common enemy.
ü Take opponent's views/needs into careful consideration: Not only do you want to win this negotiation, you want your opponent to win as well, so that he or she will negotiate with you again in the future.
5. You apply the Principles for Collaborative Negotiating
You will not discuss the fact that you were only offered a 50 cent raise last year. It was your fault for not being prepared to negotiate.
Even though you think Mr Barry is lazy, and takes too many days off when you are busy, you will not point out his shortcomings. This is about your promotion, not his work ethic.
You will first thank Mr Barry for employing you for five consecutive years. You will tell him that the stable work has meant a lot to you and your family, and you appreciate the security, especially with so many people out of work.
You will tell Mr Barry that you think Colonial Pipeline Company is one of the most respected companies in oil industry, and ensure him that your goal is to have a lifelong career at Colonial Pipeline Company.
6. It's time to negotiate! Here are a few golden rules to successful negotiations:
1) Always try to negotiate for at least 15 minutes. Any less than that and it is unlikely that either party has had enough time to fairly consider the other side. Generally, the size or seriousness of the negotiation determines the amount of time needed to negotiate it. Setting a time limit is a good idea. Approximately 90% of negotiations get settled in the last 10% of the discussion.
2) Always offer to let the other party speak first. This is especially important if you are the one making a request for something such as a raise. The other party may have overestimated what you are going to ask for and may actually offer more than what you were going to request.
3) Always respect and listen to what your opponent has to say. This is important even if he or she does not extend the same courtesy to you. Do your best to remain calm and pleasant even if the other party is displaying frustration or anger. Remember some people will do anything to intimidate you.
4) Acknowledge what the other party says. Everyone likes to know that what they say is important. If the other party opens first, use it to your advantage, by paraphrasing what you have heard. Repeat their important ideas before you introduce your own stronger ones.
5) Pay attention to your own and your counterpartner's body language. Review the chart below to learn how to interpret body language during the negotiations. Make sure that you aren't conveying any negative body language.
Avoiding Eye Contact
Lying / Not interested / Not telling the whole truth
Serious Eye Contact
Trying to intimidate / Showing anger
Touching the face/fidgeting
Nervousness / Lack of confidence / Submission
Agreeing / Willing to compromise
Shaking the head/turning away
Frustrated / In disbelief / Disagreeing with a point
7. Language to use to show understanding/agreement on a point:
ü I agree with you on that point.
ü That's a fair suggestion.
ü So what you're saying is that you...
ü In other words, you feel that...
ü You have a strong point there.
ü I think we can both agree that...
ü I don't see any problem with/harm in that.
ü Language to use for objection on a point or offer:
ü I understand where you're coming from; however,...
ü I'm prepared to compromise, but...
ü The way I look at it...
ü The way I see things...
ü If you look at it from my point of view...
ü I'm afraid I had something different in mind.
ü That's not exactly how I look at it.
ü From my perspective...
ü I'd have to disagree with you there.
ü I'm afraid that doesn't work for me.
ü Is that your best offer?
8.You Open the Negotiations (Read the dialogue and act it out).
It's finally lunchtime and Mr Barry and you meet as planned. You offer for Mr Barry to speak first, but Louis declines.
YOU: Thanks again for agreeing to meet today. I really appreciate you taking the time during your lunch.
MR BARRY: Okay, well, let's get started. I'd like to resolve this as soon as possible so we can get back to work.
YOU: Great. Okay, well, if there's anything you'd like to say first, please be my guest.
MR BARRY: Oh, no, I insist you go first. After all, you're the one who asked to meet with me.
YOU: Very well then. First of all I want you to know that I am fully aware of the challenges you have faced in running this company in the last few years. I understand that the World Crises makes a company save. However, I think you realize that I am unsatisfied with my current salary. I've been with Colonial for 5 years now and there have been many other years that were profitable. Despite how much your business has grown, I'm making less than a dollar more than I was the day I started.
MR BARRY: You're lucky to have a job in these times. YOU: Yes, and I'm very thankful that you have employed me all this time. It means a lot to me to have that stability, which is why I have remained loyal to Colonial.
MR BARRY: You haven't had much choice but to remain loyal. There are no jobs out now.
YOU: Well if you don't mind, I'd like to finish what I have to say and then you can let me know what your position is. As a matter of fact, there are a few companies hiring right now. These are not all necessarily companies that I would be interested in working with. I'd much prefer to be associated with a company like Colonial because we do a good job. Having said that, I took the liberty of calling a few other pipeline companies to find out what type of salary packages they offer to their Senior Pipeline Engineers.
MR BARRY: Senior Pipeline Engineer?! Don't forget, you're a contract pipeline engineer just like the rest.
YOU: Yes, I thank you for bringing that up. Besides deserving a higher salary, one that is competitive with other pipeline companies, I also think that I deserve a new title. You and I both know that the employees look to me as though I am a senior pipeline engineer, even though I don't have the title.
MR BARRY: You don't have the title, but you also don't have the responsibility. It's a lot of work being a senior pipeline engineer.
YOU: Exactly. And you can't say that you haven't noticed me coming in earlier than the others and leaving later. I also designate jobs to all of the employees each morning and call suppliers when needs arise. These are duties of a senior pipeline engineer, am I right?
MR BARRY: I suppose. But a senior pipeline engineer also helps solve conflicts that arise within a team, and deals with customer complaints. You always pass those things on to me
YOU: I agree with you on that. However, I would be willing to take on these extra responsibilities, should you offer me a senior pipeline engineer position at a rate of $25.00 per hour.
9. Coming to a Close or Settlement
There are a number of signals that indicate that negotiations are coming to a close. This may not always mean that an agreement has been reached.
Here are some signals of talks coming to a close:
ü A difference of opinion has been significantly reduced
ü One party suggests signing an agreement.
ü One or both parties indicate that a period of time to pause and reflect is necessary.
ü Be prepared to stand your ground firmly, yet cordially, especially in the last few minutes of the negotiations. This is the time when manipulative parties may employ certain tactics in order to try to fool you into losing focus or lowering goals and standards. Remember that conflicts are generally resolved in the last few minutes.
Here are some last minutes tricks that negotiators often use at this time:
ü Walking out of the room
ü Offering a short-term bribe
ü Telling you to take it or leave it
ü Giving an ultimatum
ü Introducing new requests (used at to get you to concede with little thought or consideration)
Language to use in closing:
ü It sounds like we've found some common ground.
ü I'm willing to leave things there if you are.
ü Let's leave it this way for now.
ü I'm willing to work with that.
ü I think we both agree to these terms.
ü I'm satisfied with this decision.
ü I think we should get this in writing.
ü I'd like to stop and think about this for a little while.
ü You've given me a lot to think about/consider.
ü Would you be willing to sign a contract right now?
ü Let's meet again once we've had some time to think.
10. Mr Barry Signals an End to the Negotiations and Attempts some Last-minute Tactics
MR BARRY: Look, we're running out of time here and I've barely had a bite of my lunch.
YOU: I know, and we have a lot of work to get done this afternoon.
MR BARRY: Well, I guess we'll have to settle this at another time.
YOU: Actually, I'd really like to get this settled today. I know how busy you are, and it's not easy to get you to sit down and talk.
MR BARRY: (standing up and getting ready to walk out of the room) Well, we're not getting anywhere.
YOU: Please sit down for a few more minutes so we can make a decision.
MR BARRY: And what if I don't? Are you going to quit?
YOU: I am a loyal employee, and I believe that it is in the best of both of our interests to have this conflict resolved. This should only take a few more minutes.
MR BARRY: Fine. You can be the senior pipeline engineer. I'll even change the title on your pay stub. But no raise. YOU: I think you and I both know, that the raise is more important to me than the title itself. Look, I'd be willing to accept $24.00/hr, if you agree to review my salary next year.
MR BARRY: Fine. I guess, that's fair. You are my best employee, right now at least.
YOU: Great, then, you won't mind changing my status to crew foreman. I won't disappoint you.
MR BARRY: Oh, I'm expecting an important phone call in ten minutes, so let's wrap this. up.
YOU: Well, I think we've both agreed on the terms. Can we shake on it? I mean, can I have your word that my new hourly wage will begin at the beginning of next month?(You holds out your hand).
MR BARRY: (Mr Barry shakes it.) Okay, Mr. Roxby. Get back to work, would you.
YOU: Thanks, Louis. I'll get on that right now.