Negotiations: the art of management

Negotiations deadlocked? Both sides do not want to concede to each other in any of the points? The situation only superficially resembles a stalemate. In fact, this is a process that can and should be learned to manage, says Moti Kristal, professor of negotiation practice at the Skolkovo Business School. And he puts forward 10 theses that will help to conduct any negotiations with the most positive effect.

Moty Cristal’s approaches have been repeatedly tested in practice. And what a practice! In 1994-2001, he worked in the Israeli administration and took part in the negotiation process between Israel and the countries of the Arab world. During this time, he gained experience in negotiating in tense situations. For example, during the Palestinian-Israeli conflict, together with the team, he prepared them for 3 weeks, calculated all the possibilities and interests of both sides, studied opponents. Then the negotiations themselves took only 4 hours and led to the fact that the parties agreed for a while. Since then, the most important thing in the conduct of difficult negotiations, Moti Kristal considers the preliminary process. “You need to prepare for any negotiations,” he says. – “If you failed to prepare – prepare to fail” *. His author’s term Negotiation thinking – “negotiation thinking” – means that such thinking can be developed in oneself, to cultivate an understanding of the mechanisms of the negotiation process in difficult conditions. Including using his 10 “tips” on how to win any negotiation.

10 Steps to Controlling Business Negotiations

Step 1. Parsing the context

Are your negotiations taking place in a conflict or peaceful agreement of interests? This is a very important aspect. Because it dictates emotions – positive or negative, high or low. And they, in turn, determine the atmosphere in the negotiations: irritation and rejection or the search for a compromise and a willingness to listen. In addition, a conflict situation is usually associated with some event from the past, while a deal through agreement is directed to the future, that is, to the development of both parties.

Another aspect of the context: internal or external negotiations? In both cases, professional negotiators are invited to the negotiations so that they look at the problem from the outside. But often it turns out that the essence of the conflict is rooted within the team. “Believe me,” says Moti Krystal, “within one company, negotiations usually go terribly long and painful.”

The third contextual aspect is the “citizenship” of the negotiations, that is, are they conducted between two Russian companies or at the international level? Because the national mentality determines a lot. “Strength is in truth,” Moti Krystal quotes the characters from the film “Brother.” “The problem is that here, in Russia, the word “strength” is sometimes understood too straightforwardly.”

The context also includes the willingness of both parties to engage in real or fictitious negotiations. The latter means that the negotiators are playing for time, scanning the market and figuring out opportunities for better deals. Finally, the number of participants in the process is important. After all, knowing how many defendants will be involved in the negotiations, you can plan the time and strategy in advance.

2. Drawing up a “map of the area”

We are talking about who is involved in the negotiations from our side. Or wants to be involved. Sometimes our people take up a lot of our time simply because their role in the negotiation process is not specified. These may be our bosses, shareholders and colleagues, with whom it is necessary to jointly develop the conditions that will be offered to another company. Therefore, it is worth not only compiling a list of “actors”, but also distributing them according to the following matrix: significance and relevance for these negotiations – horizontally, and the power of influence on the project – vertically. And divide them into four groups.

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The first group are those who can be kept somewhere in sight, but very much taken into account. The second group is people who are important for a particular project, but are not involved in the management of the company. For example, IT people. The third group is those who have great influence in the company, but have little understanding of our project. They need to be constantly “fed” with information, ask for their opinion and advice. The fourth group is those who actually develop the project, know the intricacies of the market, prepare negotiations, etc.

3. Collection and exchange of information

This means not focusing on yourself and your preparation for negotiations, but constantly communicating with those who deal with clients or are involved in the production process.

4. Prioritization

At this stage, it is very important to understand that position and interests are completely different things. “Position is what we say what we want. Interests – why do we want this, ”postulates Moti Kristal. When negotiating, it is worth understanding the true interests of each negotiator. Because often they are not related to material gain. Intangible interests are a natural need for any person to respect, recognize, and be evaluated by other people. And in negotiations, it may happen that the representative of the opposite side does not agree with you just because he does not like the conditions imposed by you, even if they are financially beneficial for him.

5. Alternatives

Sitting down at the negotiating table, you need to decide what to do if an agreement with the other side is not found. It is necessary to constantly analyze the market and changes in it and evaluate alternative deals already at the negotiating table.

6. Basic deal

In negotiations, it is very important not to play hide and seek, but to make it clear to the other side what we want from the negotiations and the final deal. Otherwise, the enemy will start thinking for us, drawing wrong conclusions… And this will lead the negotiations to a dead end. Therefore, the sixth step involves a description of the agreement that we would like to come to.

7. Negotiation strategy

It is important not to go to extremes here. “It is impossible to sit down at the negotiating table with the attitude “We are friends with everyone”. But the bazaar bargaining is inappropriate here,” says Moti Kristal.

8. Time Management

It is necessary to clearly determine how much time will be spent on the execution of one or another stage of the negotiations: how long the papers will be signed by lawyers or how much time the opposite side will spend on developing an interim solution.

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9. Solving problems at the final stage of the transaction

Closing a deal is usually a very problematic stage. “Most often, negotiations start quickly and dynamically, and at the end, because of some minor details, they slow down or even stop,” says Moti Krystal. What is it – a trick or sincere concern and psychological discomfort caused by the need to subscribe to serious obligations? There are many techniques that help get out of the impasse. For example, the technique of small modification, including minor concessions. Announced at the end of the negotiations, they are taken for granted.

10. Negotiation is a “step-by-step game”

“I was often asked: “Is it worth it to lie in negotiations?” recalls Moti Krystal. “I think lying in negotiations is stupid. This is most often a reusable action, so sooner or later the truth will come out, good relations and reputation will be undermined. And the truth in the form of timely informing the opposite side only helps to strengthen the positions in the negotiations.”

* “If you are poorly prepared for the negotiations, prepare for the fact that the negotiations themselves will go badly” (English). Master class by Professor Moti Kristal, Moscow, January 2014.