In negotiation, preparation is the most important thing you can do. Doesn’t matter if you’re buying a TV, discussing childcare arrangements with your ex-husband or trying to finalise a peace agreement in a war torn country, you need to be prepared. Real-life negotiations are not scripted by Aaron Sorkin or David E. Kelley. They take time and energy and a lot of considered thought if you want to achieve a certain outcome for yourself.

First, you need to know what you want out of the negotiation. If you can pair that with why you want it, even better. If you don’t know what you want you’ll find yourself getting what the other party gives you and you might not recognise a good deal when you see one. If you don’t know why you want it you may settle too soon for too little. Don’t be afraid to clearly identify what you want because you’re worried that someone may judge you. You’re allowed to want what you want.

Second, you need to try and determine what the other party wants and why. Sure, this is largely a guessing game on your part but you will learn a lot and therefore be able to prepare your case better. Sometimes the objective of the other party is clear and straightforward with the negotiation itself being little more than bartering. Often, it’s not. People don’t want to disclose what they really want for fear that the cost to them will go up. There is a lot of bait and switch in negotiation. Role play the negotiation from the other party’s point of view. Try and understand their motivation. What’s the perceived power balance? What’s the actual power balance? Remember, even if there is a perceived imbalance in power, if Party A didn’t need something from Party B there wouldn’t be a negotiation.

Third, learn everything you can about the subject at hand. Write down your questions about the negotiation and answer the ones you can now and the rest as the negotiation progresses. It is unusual that you will only have a couple of minutes to complete the whole negotiation so you will have opportunities to regroup and re-evaluate the answers to your questions.

Fourth, set your negotiating strategy. This will include your style and tactics. Are you going to be aggressive or unfailingly polite? Are you going for a smoke and mirrors approach? How many lies are you prepared to tell to get what you want? (None is a perfectly okay answer to this question.) Are you going to work collaboratively or is it every person for themselves? Every negotiation will differ. Whilst an aggressive approach can backfire (you catch more flies with honey), sometimes that’s what’s required or else the other party will walk all over you.

Fifth, understand what your negotiation levers are and where you can compromise. What is it that you have that the other party wants and vice versa? This will often include peripheral items or benefits. What is of a lot of value to them but of little value to you? These are the best levers to be able to pull (just don’t let the other party know that these items are of low value to you or else they’ll want more). There is no limit to creativity here.

Sixth, set the negotiation agenda. Take the lead and set the time and place. Write out a list of points to address in the negotiation. You don’t have to share this list, you can keep it private for your own reference. Just know that you don’t have to remember everything and you’re allowed to have your own notes. However, if it’s a complex negotiation with a number of deal points you may choose to prepare a formal agenda and give it to the other party.

Seventh, know what your agreement range is. Your ideal outcome is X but you’d settle for Y. Anything between the two is your agreement range. When you overlap your agreement range with that of the other party you get what is typically called a ZOPA, or zone of possible agreement. You don’t have to settle for the bottom end of your range. Always push for more but if you don’t get it at least you’ll know if you’re happy to settle. It’s like the reserve price on an action. Just because the price hits the reserve doesn’t mean the auction stops, it just means that anything about the reserve is gravy and the auctioneer does their best to get as much gravy as possible.

Eighth, know what your walk away point and BATNA are. Your BATNA is your best alternative to a negotiated agreement, more commonly known as Plan B. If the negotiation isn’t successful, what are your alternatives? How much do you actually have riding on this negotiation? At what point are you willing to walk away from the negotiation and not reach an agreement? Just because you’ve been in a negotiation doesn’t mean you have to do a deal. Sometimes walking away is actually the best deal you can make at the time.

When preparing for a negotiation, the time spent preparing should be significantly more than the time spent actually negotiating. If you’re buying a car then you might find that you can do a couple of hours of research for 30 minutes of talking to the salesperson. If you’re buying a company, you might spend several months doing due diligence for a negotiation that takes a few weeks.

There’s a reasonable chance that things will come up in the negotiation process that you didn’t prepare for, but you’ll have the bandwidth to process these items in real time because you’ve already thought through everything else. Preparation will increase your confidence, reduce your anxiety and hopefully convince your partner that you’re a negotiating force to be reckoned with.

There is no way that you lose from preparing for a negotiation. Even if things go better than expected it’s not wasted effort. You’ve learned a lot that you will find yourself applying to future negotiations.

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If you ask someone to think of a negotiation situation they’ll typically think of a scenario that involves large amounts of money, such as buying a house or a car or negotiating their salary. Most people think negotiation means money, when in the scheme of things, negotiations that involve money are actually in the minority or our day-to-day lives, even if they have the most obvious tangible impacts.

Fear of money actually comes from all sorts of places. It may be that money (or lack of it) was a sensitive issue in your childhood home and so you learned that every time money came up in conversation that people had a fight over it. It may be that you don’t consider yourself very good at maths so because money means dealing with numbers you psychologically shut down as soon as money comes up conversation. It could be that society or your upbringing has socialised you to think that talking about money is distasteful. Did you have a parent who used to say that people who had more money than they did were greedy? Maybe you’ve heard too many people selectively quote the Bible and say “money is the root of all evil. (For reference, the full Bible verse is 1 Timothy 6:10 “For the love of money is the root of all evil”. The meaning of the statement changes significantly when you read the whole verse, doesn’t it?)

Maybe, deep down you feel that you’re not worthy of having money. (Newsflash: you are DEFINITELY worthy of having money. Everyone is.)

If you are going to master (or at the very least improve) your negotiation skills, then you will need to be comfortable talking about money. For starters, money is a necessary part of life. If you don’t have any money, then your life is going to be very difficult. Yes, we’ve all read about the studies that show there is a point where more money doesn’t mean more happiness, but that is well after we have put groceries on the table, a roof over our heads, clothes on our backs, can afford the endless stream of insurance bills, taxes and life necessities such as transport. Then throw in a few indulgences, some quality of life purchases to make life feel like more than a daily grind, and try to have enough money in the bank so that we’re not living paycheck to paycheck with the constant threat of wolves at the door. Money is important.

If you’re making $10 million a year and you’re miserable, you have some internal reflection to do. If you’re making $50,000 a year and you’re miserable, that’s understandable and you’ll want to do whatever it is you can to better your situation and give yourself some breathing space. If you’re not earning as much money as you’d like and you don’t like talking about money, then there may be a connection there.

The first step to getting past a fear of money is acknowledging that the fear even exists. If you can identify what might have contributed to money making you feel uncomfortable, then that is a hugely useful step. If you can’t identify the root of your fear of money, then that’s okay, you can still reprogram your thinking and your relationship with money. You may discover it in the future and you can address it then.

This may not be what you expected from a Negotiation blog, but reprogramming your relationship with money is going to have a huge impact on your life, but it is going to require you to go back to basics with some exercises that quite probably are going to make you feel a little silly. That’s okay, because no-one is watching.

There is a well-established process in life that goes Thoughts à Feelings à Actions à Results. What you think influences how you feel, how you feel influences how you act and it is your actions and actions alone that get results. Most people are aware that their actions and behaviours are influenced by their mood. For example, if we’ve had a crappy day then we are more likely to be snappy with our co-workers or family members or be quick to beep the horn in the traffic on the way home. But not everyone realises that how they feel can be significantly impacted by what they think.

There are mountains of research to show that we can think ourselves into and out of bad moods. Thoughts may randomly occur, but we can choose which thoughts we are going to entertain and continue thinking about. Everyone has been in the situation when a thought has popped into their head but they didn’t want to think about it right then and they pushed it back out. We can all do it and it gets easier with practice. Now we just need to apply this skill to improving our relationship with money.

So, how do you retrain your mind to not fear money? Start with looking at yourself in a mirror and saying the following phrases until they no longer make you feel uncomfortable. Don’t just think them, say the words out loud. This may require you to do the mirror routine several times a day (start with three times a day) for a number of days or weeks, but your mind will start to believe what you say and you will feel noticeably more relaxed whenever money comes up in conversation.

• Money helps me achieve my goals and desires.
• I am worthy of having money.
• I deserve a salary of $XXX a year. (Insert your target number that is at least 20% more than you are earning now.)
• I am confident in my ability to manage my money.
• I am confident talking about money.

You can learn every negotiation trick in the book, but if you are scared of money you’re going to find it really hard to negotiate a deal that gets you more money. When we face our fears head on, we often find out that there wasn’t as much to be scared of as we thought. If you find negotiation intimidating and you also find it uncomfortable talking about money, I hope you’ve just had a lightbulb moment!

The post Negotiation Obstacles: Fear of Money appeared first on My Blog.

The problem is that people – and in particular women – think that being nice in a negotiation means that you continue to make concessions until the other side is happy even if it means that you aren’t happy with the outcome of the negotiation. Why? Because if the other party isn’t happy then they won’t like you and that’s anathema to most women.

Nice in negotiation isn’t about walking away with a new BFF. Nice in negotiation isn’t about being a pushover. Nice is negotiation is about building a relationship such that the other party enjoys dealing with you, but still respects the fact that you are each looking to maximise the value of the deal to yourselves. You can still drive a hard bargain whilst being a nice person to deal with, and this is the only place nice should have in a negotiation.

A lot is written on relationships in negotiation. The best way to approach a new negotiation relationship is to behave as though this will be the first of many transactions together. Even if you’re pretty certain you’ll never deal with this person again it’s a small world and you never know when or where someone is going to show up again in the future.

Being nice is an important part of building trust in a negotiation relationship.

Nice can be lots of things in negotiation. Nice is having good manners. Nice is having a smile on your face. Nice is showing the other party that you’re interested in them as a person. Nice is not abdicating your responsibility to yourself or the party you are advocating for fear of upsetting someone.

Have you ever had a minor car accident that wasn’t your fault? Just because someone bumped you from behind at the traffic lights doesn’t mean you have to get out of your car and string together a bunch of four letter words. Even though they’ve damaged your car you can still be nice to them. Being nice doesn’t mean that they’re going to get away without dealing with any consequences – you’re still going to register a police report and notify the insurance company. If they’re not complying with the law and this has consequences these aren’t your problem. Being nice just means that you follow the same course of action but without the yelling and without the obscenities.

Negotiation is the same. Be pleasant to deal with. Practise good manners at all times. Earn the respect of the other party. But don’t let being nice stop you from getting what you want out of the negotiation. You have as much right to a good deal as the other party, so go and get it!

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