Effective business negotiation

February 16, 2018

By: Astrid Vélez*

When great opportunities arise, it is important to negotiate effectively to be able to take advantage of them. A negotiation is an agreement between parties that ideally should ensure, among other things, fulfillment of responsibilities, expectations and guarantees.

I use the adverb “ideally” to mean preventing concerns.

In my work as a strategist, I have encountered many agreements that do not turn out as the parties stipulated. Then, business relations become a battlefield that ends up with no winners. In my practice, I have categorized negotiations into three kinds:

  1. Battlefield negotiation: This is a negotiation that has the goal of individual rather than mutual benefit, which leads to the parties fighting to take control. It arises from a lack of trust generated by bad experiences or by doing business with the goal of thinking of the good of the individual without considering the benefit for others.
  2. Negotiation by chance: This is a negotiation that develops without expectations, without having well defined benefits and without evaluating potential risks.
  3. Strategically designed negotiation: In this negotiation, opportunities are evaluated, abilities and resources are evaluated, risks are recognized and alternative plans are identified.

Effective negotiation should:

  • Define the need so it can be matched with a product, service or talent that enables the main goal to be achieved
  • Determine the main goal
  • Validate the expectations of the negotiation
  • Determine the non-negotiable points within the negotiation
  • Determine if external resources are needed, such as legal counsel or specialized consultants
  • Listen carefully to all parties
  • Identify challenges or threats
  • Include the team in designing the negotiation

Designing a plan for effective negotiation that meets the expectations of everyone is a big challenge. It is possible, however, if we find the correct match with the needs, resources or tools required.

Negotiations should be clear and should be written, designed and formally accepted with a beginning date, metrics for measuring the objective and an exit clause. Successful businesses begin with strategically designed negotiations so that each action, acquisition and alliance – among other objectives – can be evaluated, allowing an effective result.

 

*Astrid Vélez is an international business strategist, coach and speaker, as well as the owner of Astrid Vélez & Alliances. She is a specialist in transforming central areas of businesses and companies to achieve increased sales rapidly and efficiently. Innovation, self-motivation and strategic alliances are some of her main tools.

Banco Popular de Puerto Rico (Popular) has no affiliation or relationship with Astrid Vélez & Alliances. This article is informational and does not represent an endorsement or guarantee of the accuracy of its contents. Neither Popular nor any of its affiliates, subsidiaries or related entities are or will be responsible for any special, direct or indirect, or incidental damages, including but not limited to loss of earnings, resulting from or related to communications, articles or advice provided by Astrid Vélez & Alliances or that may arise from information contained in this article. Popular is dedicated to providing banking services and does not provide (directly or indirectly) any type of tax, accounting, human resources, training or marketing services. In the event you require any of those services, you should consult the competent professional advisor of your preference. Popular is in no way responsible for the results of any related effort if you decide to communicate voluntarily with Astrid Vélez & Alliances.

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