Conversations and Negotiation

• Chapter focuses on understanding conversations and negotiation

Learning Objectives

• Understanding strategies for a good conversation
• Understanding how to deal with arguments
• Understanding characteristics and strategies for negotiations
• Understanding when to negotiate and when not to
• Understanding negotiation strategies in various situations

Negotiating Salary

• Raman left a business school faculty position, sought a corporate role, and faced initial resume rejections due to his 'teaching tag'
• Raman needed to convince the interviewer if his teaching background was suitable for the corporate world
• He felt the initial salary offer of ₹500,000 per annum was too low, given his five years of work experience and two years of teaching experience
• The HR manager stated that the offer was more than double he earned in college
• Raman pointed out the unfairness of comparing a business school's non-profit salary scale to a company's
• Raman proposed a salary of ₹700,000 per annum
• Raman justified his worth based on industry standards and the value he could contribute
• Ability to work in diverse backgrounds and past achievements were additional reassuring factors of his abilities
• HR manager countered with a best offer of ₹600,000 after consulting colleagues
• Raman accepted the ₹600,000 offer, recognizing a win-lose situation - forgoing ₹700,000 vs. losing a good brand name and learning opportunity
• The current offer was three times his business school salary

Introduction

• Negotiation happens daily when dealing with clients and colleagues
• New employees may lack initial negotiation power, but gain it with experience to discuss salary and desired departments
• Negotiation applies to work with bosses, colleagues, and business suppliers
• HR managers also negotiate with employees on issues like bonuses
• Business requires negotiation skills to be good at talking, conversing, and being assertive with arguments
• The higher someone rises in an organization, the more critical negotiating skills become

Negotiating at Executive level

• A Chief executive officer can negotiate business deals, mergers, and strategic development
• New employees can negotiate promotions, a pay hike, or transfer to ensure fair workload
• Negotiation timelines vary, from a few minutes to years to reach an agreement
• Sales, marketing and customer service rely heavily on conversations and negotiations
• Roles facing clients require strong negotiation and conversation skills

Business Conversations

• It's hard to differentiate business conversations from casual talks
• It is vital to still make meaningful conversation
• Business conversations are formal leading to positive impressions

Characteristics of Conversations

• Important for companies to share opinions
• Employees should engage in conversation on the phone
• Formal conversations relate directly to business
• Structured conversations are better than casual
• All key people must be involved in the conversations to be meaningful
• Conversations must be risk-free for people to express their views freely

How to Converse

• Conversation is an art, practice the skill over years
• Guidelines that will help you with your conversations:
• Learn more about the other person - by being aware of person's likes, dislikes, and aspects that are related to work and those that are not
• People may be reserved on family issues
• Listen and encourage being a good listener is essential
• Don't ask too many questions to continue flow of thoughts

Making Conversations

• Encourage the person you are conversing with to continue speaking to improve their emotional levels
• You can say 'So, what did you do?' , What is the other alternative?, Go on, or other encouraging words like “Tell me more
• Acknowledgement of the best way to do that is to say 'yes'
• While you are acknowledging ideas, it is important that you do not counter-evaluate the ideas of the other person
• Maintain a positive body language by listening carefully, keeping eye contact, and maintaining the right distance with the person
• Do not fidgit
• Make the conversation interesting with jokes and breaks
• Include all key people to ensure all those necessary are talking
• Communicate what you want when making request

Arguments

• Individual opinions can cause conflicts
• Conflicts will turn conversations into arguments
• Arguments stem from conflicts or clash of egos
• Arguments are often an extension of conversations that result in a war of words
• Exit arguments as they may turn bitter
• Understand the other person's point of view by understanding everyone is different
• Try and build your case, backed by suitable data for your claims
• Try to remain calm
• Don't try to use undue advantages
• Avoid pushing opinions in relationships
• Ego forces arguments beyond control
• Avoid using emotions that will lead nowhere
• Remember winning an argument may lose the relationship

Being Assertive

• Being assertive in conversations require skill
• Being assertive means thinking of a possible solution to stressful opinion
• Never use a 'you' statement
• By acting like 'Broken record' your repeat yourself by insisting that this person performs the task, you are behaving like a broken record to be assertive.
• Empathize with one of the important skills to step into someones shoes
• Consider outcome planning of preferred plan
• Consider an alternative when someone say no

Negotiations

• Professionals need to negotiate
• There are varying degrees of situations
• Negotiations have a common factor with parties trying to solve with conflicting goals or a common goal
• Negotiation is a process between two or more to achieve consensus

Relationship Between Communication and Negotiation

• How you communicate will often be a function of how you negotiate
• Skills have to be strong when you negotiate
• Understand someones views and positions
• Negotiating requires arguing rather than fighting
• A crucial skill set is converse and talk effectively

Reasons for Staying Away from Negotiation

• Fear of rejection can hinder
• Fear of developing relationship
• Fear of failure

Failed Negotiations

• Negotiations will stem to consensus
• Negotiations are two-way process to ensure two or more are in accord
• Excellent communication is needed

BATNA

• BATNA means "Best Alternative to Negotiation Agreement"
• A negotiator may enter the talks with a preconceived idea of the best alternatives available to both parties, but must not be bound by them.
• Cost estimation may entail both the short term and the long term, it boils down to figuring out which of your options is the most affordable.
• Circumstances can alter rapidly from the information
• The one danger happens when the parts reveal over-estimated BATNA

When to Negotiate

• Not all situations in life, including those at work, give you an authority to negotiate, and if you are doing it in the wrong way, you may end up in a mess and probably offend the other person.
• Understand the areas of disagreement and agreement
• Try to come to a plan
• Understand critical components

When not to Negotiate

• There is nothing to negotiate
• The other party is becoming unreasonable
• You are not mentally ready

Approaches to Negotiation

• Integrative/Collaborative/Cooperative approach (Win-win approach)
• Distributive or competitive approach (Win-lose approach)

Strategies to End Deadlocks

• Deadlocks are not uncommon, and when you chance across such a situation, here is what you should do:
• Ask yourself if there is another area (other than the one that has caused the deadlock) that you can negotiate on or add value to.
• Explore the possibility of providing concessions or adding value to the project.
• Focus on newer avenues, not on areas that were the bone of contention the last time.
• Listen to the other party.
• Refrain from making statements that will raise the other party's sentiments against you.

Basic Phases of Negotiation

• Planning
• Preparation and briefing
• Bidding
• Settling the deal
• Confirming the deal