* Your Four Step Negotiations Checklist – NCMA CM Magazine
in Feb 2008
Four-Step Negotiation Checklist
Negotiations are won or lost depending on the quality of preparation and planning.
Use this checklist to ensure your team has all bases covered.
Negotiation—start out with an
ideal and end up with a deal. Negotiating is the process by which two or more parties with different needs and goals
work to find a mutually acceptable solution to an issue.
my 30-year contract management career, I have negotiated many contracts and other deals. In order to systematically cover
the multitude of issues in a typical negotiation, I have developed a practical four-step negotiation checklist.
Facilitate development of a negotiation plan, which includes the team’s
key strategies, your position going in, and your desired outcome.
Many negotiations are won or lost
depending on the quality of preparation and planning for a specific negotiation—the more difficult the negotiation,
the more intensive the preparation and planning. The negotiation team has to dedicate the time and energy to properly prepare
and plan for negotiations. Lack of adequate preparation and planning is the single most serious handicap for a negotiation
team, despite the negotiation experience of the individuals on the negotiation team. By failing to prepare you are preparing
to fail. Prepare a specific written goal-oriented negotiation game plan.
Select the members of your negotiating team and choose the venue where negotiations
will be conducted. What documents and other materials will be required? Do your homework. Will your team be able to conduct
a dry run of the negotiation plan? Give each team member a copy of the plan so that each member can stay sharply focused during
and prioritize each of your team’s negotiation goals. Commit to goals that are specific, concrete, justified, legitimate,
achievable, optimistic, and challenging. Have appropriately high expectations. Have clarity of purpose and be goal-focused.
Strive for a principled integrative interest-based negotiation (problem solving) rather than a positional negotiation (my
way or the highway). For this specific situation (situational analysis),
state the negotiation team’s key actions, strategies, tactics, counter tactics, and defenses that are best suited to
achieve the team’s negotiation goals. How will the other party view
the situation? Put yourself in their shoes. What do you think the other party’s prioritized goals of the negotiation
are? Do they see the relationship as important? Do the stakes matter as much to them as they do to your team? Based on a situational
analysis of the other party, anticipate the strategies the other side can be expected to use to achieve their negotiation
Plan to have
the right people at the negotiation effectively discuss the applicable technical, operational, financial, and contractual
issues with the other party. Are there any personality-types, bargaining
styles, or emotional issues to anticipate and address prior to the start of negotiations? Will relationships play a role in
to be an active listener. The key communication skill in negotiations is listening. Plan to be silent at times while using
active listening to de-escalate conflicts. We have one mouth and two ears…use them in that ratio. You can observe a
lot by just watching.
to act with personal integrity. Credibility is an important short-term and long-term asset. What goes around comes around.
Step #2: Lead the team in implementing the negotiation plan.
After facilitating development of
an appropriately written, effective negotiation plan based upon the specific situation, plan to actively lead your team to
fully implement the plan before, during, and after negotiations.
Step #3: Adjust strategies and methods as needed during negotiations to achieve the desired outcome.
is different than flying an airplane. A pilot follows a precise pre-flight process before take-off—there is no room
for deviation. However, the negotiation process involves continuous choices and adjustments of strategies, methods, and approaches.
Being locked into one negotiation strategy or set of tactics and methods to implement the pre-determined negotiation strategy
is inefficient and often results in unwise solutions.
Be flexible and creative. Adjust your walking-in bottom line and your walking-in best
alternative to the negotiated agreement (BATNA) if the “trip wires” and other negotiation dynamics after them.
Be flexible but smart about making concessions. Brainstorm options. Be flexible about strategies for effectively closing the
Step #4: Facilitate assessment of the negotiation team’s activities.
After the completion of negotiations,
prepare an honest written assessment of the negotiation team’s activities and performance. Do a “lessons learned” analysis with the assistance of the other team members. For
continuous improvement purposes, plan to document the lessons learned by your negotiating team. Distribute the lessons learned
write-up to the other team members and your supervisor.
This negotiation checklist
is not exhaustive. Every deal has some unique aspects that may not be addressed in this checklist. However, if you routinely
use this practical four-step negotiation checklist as a resource when you negotiate a contract, you will be pleasantly surprised
with the large number of substantive and material negotiation issues that will be surfaced for proper resolution.
Stages of Interactive Negotiations
*Establishing Rapport. Obtain information on interests, issues, and perceptions
of the other party. Exchange information. Probe first, then disclose. Plan on how your team will handle the other party’s
leverage (if any). Plan how your team will use its leverage (if any). Establish an agenda.
*Determining your opening
position. Will your team open negotiations or will the other party open negotiations? What is your team’s going-in/opening
and maintaining control. How will you influence the flow, timing, and content of the negotiations? Plan on having your
team use this negotiation plan as its agenda. Separate the people from the problem. Focus on interests, not positions. Use
objective criteria, standards, or other external benchmarks. Make a list of things you want, can’t give up, and are
willing to trade. Pursue fairness. Be creative. Invent options for mutual gain. Be flexible (when you come to a fork in the
road, take it). Be patient and fight fires without burning bridges.
*Planning for alternatives and your bottom
line. What are the “trip wire” signals to watch out for (contract type, scope, schedule, risks, terms and
conditions (Ts and Cs), cost/price, capped overhead, indemnity, consequentials, cap on liability, etc.)? Avoid an arbitrary
selection of a bottom-line position (least acceptable deal) since it changes dynamically during negotiations. What are your BATNA alternatives (best alternatives to a negotiated agreement if you
are not successful) that you would use as walk-away alternatives? It’s been said before, but you indeed need to know
when to hold’em and know when to fold ‘em. You have a strong BATNA if the other party needs you to reach their
objectives. Are the trip wires and the other negotiation dynamics affecting your walk-in BATNA or bottom line? What is your
walk-away (worst than your least acceptable deal)? Plan on analyzing what the other party’s bottom line, BATNA, and
walk-away positions might be.
concessions, if necessary. What concessions is your team willing to make? What is your team’s concession strategy
during negotiations? Do you plan to proceed slowly in diminishing amounts
toward an expected level; make big moves on little issues, little moves on big issues; brainstorm options; present several
options at once; or use other concession strategies? Don’t “split the difference,” but rather, base your
decisions on facts and values.
is the key to concession-making, so; the higher your leverage the fewer concessions that you may need to make; the lower your
leverage the more concessions that you may need to make. Concessions are the language of cooperation, so, if reasonable, plan
to leave bargaining room in order to make concessions. Generally, don’t make a concession unless you get something in
the negotiation. What is your team’s closing strategy?
*Definitizing the negotiation. Confirm and record each provision agreed
to. How will the details of the negotiated agreement be memorialized? Who will draft the contract? Make every bargain clear
and plain that none may afterward complain.
*Gaining commitment by both parties. Plan how your team will display commitment to the
learned. For continuous improvement purposes, plan to document the lessons learned by your negotiating team.
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