Negotiating for success

Aldis G. Sigurðardottirwriting from Gliwice, Poland

Negotiations are considered an important part of the sales cycle and are therefore essential for companies to succeed in today’s business world. All companies negotiate, internally, externally, directly, indirectly, formally and informally. Behind every business negotiation are negotiators, unevenly skilled.

The ability to negotiate is becoming more and more valuable for companies as they are increasingly dependent on relational capital and their ability to perform. One of the key factors in business performance is the ability to negotiate as companies commercialize their business models. The ability to bring relevant issues to the negotiating table can create value and simultaneously increase profits.

For companies to succeed in negotiation they must master both distributive and integrative negotiation. Distributive negotiation involves parties claiming value in order to get the best possible outcome for themselves and integrative negotiation involves parties creating value where they are expanding the “claiming value” framework by adding more issues to the agreement, so mutually benefiting both parties. Skilled negotiators develop their own toolkit of successful negotiation tactics and reuse them in future negotiations as appropriate to the requirements of each situation.

Studies have shown that negotiation skills are ranked the third most important type of skill that managers possess. The ability to become a successful negotiator, regardless of whether agreement is reached or not, is not a talent people are born with. It is an ability that is learned by gathering information, processing that information and matching it and estimating the results with regard to the requirements of a particular situation. Hence, one might ask, are companies training their employees in negotiation? And, if not, why not? Because the more one practices, the better one becomes and it might just increase business profits along the way.

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