Artykuły dot. negocjacji

Step 5 – concessions

listopad 28, 2015 - Artykuły dot. negocjacji

Negotiator / Knowledge base  / Concessions

Step 5 – concessions

Can you make concessions with style? Concessions are a natural element of negotiations. That is solely a good reason to know how to walk through them victoriously. Due to their character of depriving us from things, we can intuitively feel reluctance to make them. A mandatory habit of business negotiators is conscious observation of emotions concerning concessions and rational evaluation of each concession. The mechanism described below will help you with this. Concessions should be made with respect to our interests. You lead talks with a partner because you have reasons to believe that through cooperation with them you will close in on your goals. Let’s remember that at some point this might turn out to be false. One symptom to have your eye open for is pressure to make prohibitive concessions, which might also be a sigh that your interest are more out of line than initially assumed. It is crucial to know the hierarchy of value for your areas. If your partner is demanding that you give up something of utmost importance to you, then it is time to call for a break and grab your excel spreadsheet. First check if no mistake was made when calculating your desired values. If not, take a minute to consider finding a partner who will show more respect towards your interests. Basic concession mechanisms:

1. Descending steps – each next concession has a smaller value. This gives your partner a heads up that you’re closing in on a value which is the bottom line. By making several small steps instead of one leap, you create more opportunities to gain something. For example: if your first offer was at 480,000.- and your minimum was 455,000.- then hypothetically your concessions could look like this: first: 12,000.- second: 8,000.- third: 4,000.- fourth: 1,000.-

2. Packs – concessions in several areas. By combining trade in several areas, one have greater possibilities due to a larger number of potential combinations. For example, in a purchase transaction we demand a deferred payment and transport costs covered by the supplier, offering to increase the volume and oblige to place another order next month.
3. Presents – if we give something and take nothing in return there are two things that can happen. Firstly, in the case of a small present we might arouse a need to reciprocate or raise our partner’s vigilance – depending on the experience of the other side. Secondly, by giving presents we teach the receiver that we are a giver. In the future, they might demand to get more.
4. Leverage – sometimes a small give away can bring a huge profit. Concessions are never monovalent. Relating to the hierarchy of value, it is worth the while to check what small concession can give our partner an disproportionate benefit. This way we can give them immense value with little cost… and vice versa.

NEGOTIATION PROCESS: How to begin negotiations? Preparing for negotiations. Information exchange in negotiations. Relationship building in negotiations. Influence and persuasion. How to made concessions in negotiations. Agreements.