Michael Flynn Mentor Academy Week Five Part I: The Art of Negotiation

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The fifth week of the Michael Flynn Mentor Academy was as impactful as always this article will seek to dissect some of the issues we examined during the entirety of the seminar. Some of the topics that were touched on included leadership, the power of negotiations and sales.

The Art of Negotiation 

Most of us view negotiations as a competition or as a battle. I’ll take something from you that you don’t want to give away while you try to do the same.  By focusing it as a battle we really miss the opportunities to create value and get a better outcome for ourselves and even our counterparts.This mentality creates a sort of filter through which we interpret the behavior of others thus escalating conflict where winning becomes more important than the quality of what we are winning. We should look at negotiations as an opportunity for collaborative problem-solving. Looking for a solution that makes us better off than our status quo. But because there’s no command and control in a negotiation, you cannot force the other party to say yes. All we can do is present proposals where they believe it is in their best interest to say yes. Once we take such a stance that highlights the importance of the other, as well as myself so many more things, open up to negotiation. Negotiation refers to the act of two or more people deciding what each is willing to give and hopes to get in their interaction and through a process of mutual influence and persuasion, make proposals and agree on a common course of action. Negotiation is influence.

Power of Preparation

Are we prepared? Adequate preparation is the negotiators best tool. Visualize the desired result you want before you go to sleep.Visualizing the potential positive outcome of an upcoming negotiation can greatly aid in improving the outcomes of the negotiations in your favor and help create self-confidence and self-belief.Researching extensively on the subject that you will be negotiating about is very important. Have confidence and belief in your own ability as a negotiator and you will be surprised at just how good you actually are.

In the preparation stage, you need to be certain about what you want and what you are ready to give up or lose in a negotiation while simultaneously having the knowledge of your exact walk away point. You need to have a bottom lineyou should want it but not too much; if you want it too much it is not negotiation but desperation.

Listening 

Listening is the strongest negotiation tool. Types of Negotiations include Spontaneous and Premeditated.  Listening is the best weapon. The best negotiators in the world more often than not are the best listeners. During negotiations, your counterpart may have issues opening up but if you listen you can ask the right questions so that they end up opening up to you. Usually, we listen to the first 25% of what is said then we immediately start planning our response to what is being said and as a result ending up missing 75% of the conversation. The more heated the conversation the less we listen. We do not like long pauses. When in unexpected negotiations especially spontaneous, pause and say “Let me think about it ” or say a mild “Aha”. The one who talks the most usually loses. Say nothing and see how the other party responds. Many people find silence to be quite unnerving and uncomfortable.

Knowing what you want.

“You always have vastly more power in a negotiation than you usually think you do.”  —Michael Flynn Mentor

You have to know what you want. You can’t win a negotiation until you know exactly what you want. How do you get what you want? You ask for what you don’t want. If you want three items; ask for six and fight your counterpart fiercely for them.  Ask for more than what you want. It’s about power, time and information.

“Work from the place of your phantom power, not the one you have. You must have creativity” — Michael Flynn Mentor

Bargaining Range

It is important to set a wider, longer bargaining range so as to be able to have a midpoint that is more favorable to you than your counterpart.  This is a particularly useful tool when it comes to the bargaining of items which do not have a fixed price tag and which rely on the skill of both parties to get a favorable alternative. Ideally, it should be set not more than 10% of the initial marked price.

Example:

customer: How much for a pair of khaki trousers?

salesperson: 2,000 Kshs

customer: For a pair of trousers! That’s too expensive, I have 200 Kshs.

In the example above by setting a longer, wider bargaining range he increases the probability that the midpoint of their negotiations will be more in his favor, as compared to if he had, for instance, proposed a buying price of 1000 Kshs.

Phrases and Clauses

A powerful phrase can disorient your counterpart in a negotiation and if well employed it can change completely the entire outcome of a negotiation. It enables the respondent to be able to take initiative and wrest from the seller the power of expertise. Below are examples of different phrases and how they can be employed to bring out a significant change in negotiation outcomes and dislodge an interlocutor or salesperson.

Statement Response:
What I normally charge is… I am not normal.
What we usually do is… Sorry our organization doesn’t work like that or We don’t usually do that
This device is made of high quality, long-lasting material. Our advice actually questions that finding or Actually, that may not be accurate.

Another powerful phrase that can be used in the negotiation process is the phrase: “How close to my figure will you go?” Not his figure but yours.  It is quite powerful as it shifts the playing field in your favor and forces your counterpart to be on the defensive and make concessions to you. We will revisit this phrase during part III of this week’s teachings when talking about the interviewing process.

Example:

Car Salesperson: The price is 22,000 pounds

Customer:  I’ve got 11,000 pounds. How close to 11,000 pounds will you go.

Car Salesperson: I can to 12,000 pounds.

Customer: Let’s Split that 11,500

Car Salesperson: Deal.

The Power of Commitment.

Get others to commit. Getting others to commit in order to use them as leverage for consequent deals with others. For example: Going to X and telling them that Y has committed to doing a deal if he foots 50% of the costs and then consequently going to Y and telling them that X has committed to doing a deal if Y foots 50% of the costs. You will end up with 100% of the costs paid without spending a single cent.

The Power of Expertise.

The more you pump out your client’s name the more validation you gain. You have to learn to blow your own trumpet in business, no one will blow it for you. Learn to play the game.

The Power of Needs.

There are needs that are stated and needs that are not stated. It is your job as a strategic negotiator to find out the unuttered needs, the unaddressed problems that your counterpart is experiencing and provide them with a solution that involves them ceding some of their demands and making concessions.

The Power of Identifying with the person/ Empathy

Empathy is a powerful tool in human interaction and the use of simple phrases such as: “I understand what you are saying. I’ve been there, I understand” can serve to smoothen conversations and interactions between individuals with differing opinions.

Never telegraph your Desperation 

Your desperation can be used against you and your pain points can be used to your disadvantage, therefore, it is crucial that you do not reveal your buttons as your opponents will press them to manipulate you at will. When they ask you the seemingly innocuous question such as “When will you buy this?” Simply give them a vague response like “When I want one.”

Whenever you run out of time you pay

Whenever you are desperate you pay.

Time is a power in any negotiation and whoever wants it first will pay.                        — Michael Flynn Mentor

Reciprocity

Reciprocity is more or less a psychological tool and can work wonders in boardrooms

The”If I can will you?” clause is a particularly useful clause. The importance of this clause is that it seals the deal and wraps things up.  “If I agree, do we have an agreement?” For example, going to a bank asking for a loan:

Banker: Is there some security there you can promise”

Customer: If I can promise some security do we have an agreement

Have a longer list than your opponent negotiator

It is important that before negotiation you understand the culture of how things are done before embarking on the talk.  It is vital to properly set up a huge bargaining range in order to influence the negotiation in your face. A range that is probably lower than your mark. Bringing in fractions, in fact, is a very reliable strategy to employ when it comes to bargaining as it is an unconscious psychological trigger that you are nearing the end of your mark.

“You don’t get what you want in life you get what you negotiate”

— Michael Flynn Mentor

Still, on the buying-selling paradigm, it is vital to ensure that the seller has invested a huge chunk of their time and resources on you as a customer such that it ends up being a loss if at the end of the entire process you should leave without buying anything. It is therefore vital not to look at the first price and instead offer 10% maximum of the stated price. This is the way to set up a bargaining range

 

Sign up to the Michael Flynn Mentor Entrepreneur Academy (here) where you can learn life-changing skills that can change the entire course of your business. Keep in touch with us on Facebook (here) by liking our page and receive instant insights on upcoming events, webinars, workshops, and seminars. We would love to hear from you and gain feedback on how we can better serve, improve and enhance your entrepreneurial journey.

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