Articles

Total Negotiation is at the forefront of commercial negotiation best practice. Here we share our insights and practical advice, based on real world trading experiences and success. Contact us to improve the negotiation capability of your business.

10 Questions to uncover your team’s readiness to negotiate

27th October 2017

As the American racing driver Bobby Unser said “Success is where preparation and opportunity meet”. You want to know if your team is as prepared as possible for their next negotiation to realize the opportunities but you don’t want to distract them from their preparation or to spend too much of your own time asking questions that aren’t necessary. So, we’ve developed a list of 10 questions that home in on the key elements. The answers your team give you will indicate how well prepared they are and also where you may need to intervene.

What is the insight about your counterpart for this negotiation?

If they have asked good questions they will have a clear insight as to how to handle this person, particularly in this negotiation. They will know what the counterpart’s needs are and what they can offer to meet those needs.

What is the ZOPA in this negotiation?

A clear understanding of the Zone of Potential Agreement will reassure you that your team has considered not only their own objectives, in terms of ODE, but also those of their counterpart’s. If they are able to articulate the ZOPA, highlighting where they predict the negotiation is likely to complete, then they have considered both sets of ODE’s.

What variables will you trade and what will you expect back in return?

This will let you know how well they have thought out not only their own list of variables but also their counterpart’s variables. Check that they can also articulate the value and importance of each set of variables and how they will trade those variables in the negotiation.

What role do you want people to play in this negotiation?

You will want to hear that they have considered the relevance and value of consulting and engaging the wider group of roles within the customer, such as logistics, operations and marketing. They should be considering how to interact with more than just the buying function.

Which is worth more to our business – the BATNA or the Essential position?

This kills many birds with one stone and opens up many areas for further questioning. It helps you understand if they have a BATNA in the first place. Secondly, it helps to understand if the Essential really is the walk away point. Thirdly, it helps understand the level of value between the BATNA and the Essential position, as the BATNA & Essential should be roughly of equal value.

What agreement & alignment do you have from the other parts of the business?

This pokes around to see what the level of agreement and alignment is in the organisation. Generally speaking a BATNA requires somebody else in the organisation to do something, e.g. increase sales in another customer to offset the performance decline in a negotiated customer. Without that agreement the BATNA is worthless and your team need to re-evaluate their BATNA, Essential position and, probably, their entire negotiation strategy.

What happened in our last negotiation with this party?

Understanding your team’s performance and their counterpart’s performance in the last negotiation will let you know two things. Firstly, if the counterpart has any habits in their negotiations that your team can exploit, such as always rejecting the first three offers. In this case they would make the first three offers that much more valuable to you so that the fourth offer would have been higher than otherwise offered. The second thing it will tell you is whether your team has developed their negotiation capability and learnt from their previous negotiations. If they haven’t learnt anything, perhaps they need to build upon their capability with additional training and coaching.

What are the biggest risks in this negotiation?

Find out the size of the prize in the negotiation and the risks they have identified. Has your team considered how they will mitigate any risks in their negotiation?

What is your opening position?

Have they decided if they are opening first? Have they thought through their opening position? Do they understand where the likely ZOPA for the counterparts actually is? Are they opening too extreme compared to the ZOPA? Are they pitching their opening position within the ZOPA? Can they justify their opening?

How will the negotiation move over time, especially if negotiations stall?

This will let you know what they expect to happen after the first offer, what the triggers are between different stances, and how they will resurrect any stalled negotiations. It shows if they have thought through the steps of the negotiation dance and the stances they will adopt as they go through the negotiation.

X

Further Information