By Ross Buchanan & Kuldip Taggar, CHRP

*Negotiaphobia…the fear of Negotiating

Do you know how much money is “left on the table” from those in your organization who don’t negotiate, or don’t know how to negotiate?  We could be talking about thousands and thousands if not millions of dollars.  Negotiating impacts all areas of the business, from those who purchase products and services for your company to those who secure sales.   Are you and your employees negotiating effectively to optimize possible discounts, cash flow and grow your bottom line?

As supposedly polite Canadians, we may think that negotiating is not polite, but the reality is it’s nothing to be embarrassed about. In business, as in life, you don’t get what you want; you get what you negotiate. Seen as part of operating a successful business, negotiating needs to be a skill your people have and a key part of your culture.  If your employees are not skilled in negotiating, the great news is that this is a skill that can be learned.  Not only should your sales team know how to negotiate, but so too should everyone in the company who buys goods or services. 

Some people simply don’t know “how” to negotiate. For the most part, people know they should negotiate and they want to negotiate but they don’t know the “how”. As a first step in enhancing negotiating effectiveness, here are seven simple strategies that have the potential to make a huge difference for the performance of your people and the profits of your organization:

1. When you are negotiating it doesn’t have to be a confrontational process, it’s about understanding each other and asking open-ended questions. If negotiations are seen as confrontational, my experience is that most people simply won’t do it. The most successful negotiators use skills and strategies in a soft and gentle way to produce amazing results.

2. All people are motivated. Until you understand the other party’s motivation, it is as if you are trying to negotiate with a blindfold on. Ask questions and listen to understand the perspective of the other party. Not just what they need but, perhaps more importantly, what do they want. People do things for their reasons not ours.

3. Recognize that if you don’t negotiate in your personal life, the chances that you are going to do it effectively in your professional life are limited. Negotiating isn’t something that you can just switch “on” and “off” but rather is a way of being.

4. If you are selling, start high and if you are buying start low. There is a direct relationship between where you start or set your anchor and what you eventually agree to. Most importantly, don’t negotiate with yourself before establishing your starting point and setting your anchor.

5. If you offer a concession, be certain to ask for something in return. If you understand the psychology of reciprocity you will know why this works so well. You might be surprised with what you are offered in return.  Ask, “I might be able to help you with that. If I do that for you I wonder what you might be able to do for me?”

6. Remember that when it comes to negotiating it is often the process that matters more to the other party than the price. Don’t get price and process confused. They both start with the letter “p” but other than that they are two very different things. Negotiate with patience and, if necessary, make concessions slowly. To others negotiating is often a way of life so to them there is a greater appreciation of the process rather than simply rushing to the bottom line.

7. The ‘inside secret’ to effective negotiating? Just do it.

There you have it: seven simple strategies for enhancing negotiating effectiveness. One thing that I have learned along the way is that skilled negotiators are not born; skilled negotiators are trained. The development of negotiating skills has the potential for a significant impact on the bottom line of any organization and perhaps has the most amazing ROI of any single business skill. Just do it.

Ross Buchanan is presenting How HR Leaders Can Impact & Influence Sales Performance at BC HRMA’s 49^th Annual Conference. For more information on this and other sessions, please refer to www.bchrma.org/conf2011.

Ross Buchanan is the CEO of Strategic Results International a professional development and business consulting firm based in Vancouver, Canada.

Kuldip Taggar, CHRP, is a senior consultant with Strategic Results International specializing in talent management, change management and leadership development.