Acerca del autor

Tom Gosselin is a consultant and instructor with more than twenty years of experience training executives, managers, and salespeople. He is a member of the National Speakers Association and his corporate clients include Philips, MCI, and ExxonMobil Research & Engineering, among others. For more information, visit www.practicalnegotiating.com.

De la contraportada

Praise for Practical Negotiating: Tools, Tactics & Techniques

"Practical Negotiating is an innovative, resourceful, and—as its name implies—practical guide to the art and science of negotiating. Unlike many books on negotiating, which are filled with theories and anecdotes, this one is rich with examples, tactics, and tips, which makes it the indispensable book when you are going into any negotiation."
—Terry R. Bacon, President, Lore International Institute and author of What People Want: A Manager's Guide to Building Relationships That Work

"There is something in this book for the most experienced negotiator and the novice. Gosselin's no-nonsense?prescriptions and recommendations will hit home and give you new ideas for the most difficult of negotiating situations. Anyone in the business world will want this great bible of effective negotiating right near their desk and phone!"
—Dr. Beverly Kaye, CEO and founder, Career Systems International and coauthor of Love' Em or Lose'Em: Getting Good People to Stay

"Gosselin has written a thoughtful, engaging, and practical guide on a topic of increasing importance to leaders and organizations. There is something here for anyone who wants to learn how to deal more effectively with the inevitable conflicts that occur in working with clients, customers, and colleagues."
—Peter Cairo, PhD, Partner, Mercer Delta Consulting and coauthor of Why CEOs Fail: The 17 Behaviors That Can Derail Your Climb to the Top and How to Manage Them

"Forget the image of negotiation being a battlefield.?Gosselin guides you in the development of a road map so both sides become winners and leave the table victorious. His writing is just like his training—clear, concise, and practical. You can apply the process immediately. A handbook for life, it's?practical, thoughtful, and insightful."
—Steven Myers, Manager, Lighting Education and Sales Training, Philips Lighting Company

"Skip the workshops and buy Practical Negotiating. After field-testing the content through decades of experience, Gosselin has packed this useful book with processes that work and great questions and worksheets that force the material to become real and personal. Practical Negotiating will change your thinking about negotiating, and more importantly, will change your behavior. Highly recommended."
—Steve Hopkins, Publisher, Executive Times

"Gosselin is a most articulate and engaging businessman, and this, coupled with a keen intellect and sharp observation of behavior (and a great sense of humor!) make this a must-read. His deep understanding of effective models of negotiation and their practical application make him one of the leaders in this field."
—Keith G. Slater, former director of International Development, Ingersoll Rand

"This book is aptly titled as it provides the practical 'how to' for planning and executing effective negotiations. It's rich with examples, exercises, and reusable tools."
—Dr. Rita Smith, Dean, Ingersoll Rand University

De la solapa interior

Practical Negotiating: Tools, Tactics & Techniques

Whether you know it or not, you probably negotiate every day. At work, at home, and in public, you negotiate to resolve conflicts and make deals almost constantly. Because conflict is inevitable, successfully negotiating and resolving conflicts is a survival skill you need in order to succeed in work and in life.

Practical Negotiating teaches the art of nego-tiation for business and for life. Over the course of twenty years of teaching and consulting on negotiation, executive trainer Tom Gosselin has developed a proven system for teaching the vital skills and tactics of successful negotiation. Using a step-based framework, he shows you how to prepare the groundwork, master various negotiation tactics, and work towards fair resolutions that satisfy all parties.

Negotiation doesn't begin at the table. It starts with preparation. Gosselin prepares you for success by showing you how to identify your underlying needs and those of your opponent, how to develop objectives and establish a position, how to use currencies and concessions, and how to assess your power position in negotiation situations.

The second part of this practical guide covers the execution stage of negotiations, presenting a stage- and task-based model that keeps you squarely on track. You'll learn how to identify your style, become more flexible, develop a variety of skills, select and implement the right tactic for a win-win outcome, and respond coolly and intelligently to adversarial situations and difficult people.

The art of negotiation isn't a game. It's a serious process with a beginning, middle, and end. Use the right model and master the right skills, and you'll excel at this vital practice that can get you anywhere in life. Practical Negotiating shows how you can plan and execute negotiations that reach better, more fulfilling conclusions for all parties involved especially you.

Fragmento. © Reproducción autorizada. Todos los derechos reservados.

Practical Negotiating

John Wiley & Sons

Chapter One

Conflict in Our Lives

Conflict is inevitable; therefore, negotiation is a survival skill. From the sandbox to the Sinai, every Dick, Jane, Mohammed, and Moshe needs a method to reach workable agreements or suffer the consequences of unresolved conflicts. Whenever one individual's needs, wants, and desires conflict with another's, we have the potential for negotiation. For most of us, 90 percent of the resources we need to do our jobs and live our lives are owned by someone else. Pick up any newspaper and, on the front page, there are numerous examples of conflict situations. To begin, let's define the terms conflict and negotiation:

Conflict: A situation where two or more parties have interests or perceptions that differ.

Negotiation: A process of exchange to resolve conflict and reach a mutually beneficial agreement.

Consider the number of conflict situations any person experiences in his or her life. From early childhood, we recognize conflict as a part of life:

"I want that." "No, it's mine."

"I want to ride on Daddy's shoulders!" "But it's my turn!"

"I want the window seat!" "So does your sister."

Later, conflict may involve disputes about being included in peer groups or competing to be captain of a team. In adulthood, we want to purchase houses, cars, and other items to meet our needs; and many conflicts arise with the significant other in our life. If not handled well, relationships deteriorate and couples divorce. Without a doubt, we encounter many conflicts throughout our lives.

How do we resolve these conflicts? As we grow and mature, we learn to share, compromise, or suspend fulfillment of our needs. We often turn to reason as a method to resolve differences. We reason with the neighbor about the barking dog or overhanging tree branch, but often discover the limits of logic and try to compromise, usually resulting in an unfulfilling solution. Even though these are ways of solving the problem, none involves truly getting our needs met.

In some instances, we depend on the skills of others to help us resolve conflict. When we lack the skills, or the parties involved cannot resolve the conflict, we engage others to explore the issues and reach agreement. These methods have names that include the "-tion" words: mediation, arbitration, or litigation. In the end, the parties expend time and money, and become aggravated, before finally settling a dispute. At that point, the relationship between the parties is often strained or destroyed. To both meet our needs and sustain relationships, negotiation becomes the preferred method for reaching agreements. Especially when the exchange is friendly, we may not even realize that we are negotiating as we solve everyday problems, ask for what we want, and make group decisions.

Why is negotiation the preferred method? First, both parties maintain control of the process. Second, if done well, the negotiation can strengthen the relationship between the parties and lead to a deeper understanding and respect-especially, if a long-term relationship is desirable.

Negotiation involves continued interaction and dialogue between parties to find a solution with maximum advantages to both. By negotiation, mutual interests are met and the most satisfactory solution is achieved. However, a negotiation is not a negotiation when one of the parties is powerless, politically, psychologically, or physically, to say no. If you can't say no, call the situation hopeless but don't call it a negotiation.

Conflict inside Organizations

One of the most significant arenas for generating conflict is the workplace. As organizations become less hierarchical and more cross-functional, managers as well as individuals are under increased pressure to resolve conflicts. Interdependence and collaboration are increasingly important issues of nearly everyone's work life. Despite the benefits that accrue from working together, one problem that emerges is the increased likelihood of conflict. Interdependence between individuals and departments with diverse interests and points of view can lead to better results precisely because it forces us to deal with the conflicts.

Other trends in business such as lean manufacturing, downsizing, and increased competition for resources also contribute to the increasing frequency of conflict.

Nonproductive Reactions to Conflict

How do people in organizations react to conflict? Some adopt a strategy of denial, choosing to ignore the conflict or pretend that it doesn't exist. They assert that conflict shouldn't exist in organizations because we all share the same goals and objectives. After all, aren't we on the same side?

Most people don't enjoy dealing with conflict, so another common reaction is escalation to a higher authority. Let someone else resolve it. Still another reaction is to capitulate and give in whenever conflict arises. This occurs when someone values peacekeeping more than his or her own needs and desires. One of most insidious reactions is the passive-aggressive response, where the conflict goes underground. The person or group tacitly agrees to a change, yet continues to operate as usual-all smiles, no commitment.

Ignoring the conflict, escalating to higher authority, giving in, and responding passive-aggressively are not productive ways to deal with conflict. The underlying issues aren't resolved, relationships are usually strained, agreements aren't honored, and time is wasted. In this book, I explore some productive ways to deal with conflict. If you acknowledge that conflict is inevitable, then learning how to manage conflict well is critical to your success. New leaders especially need negotiation skills: "New leaders fail at an impressive rate. That's because many don't know how to negotiate what they need to improve their odds for success." The challenge for managers and employees involves learning how to resolve conflict, not to minimize or ignore it. This requires negotiation.

Conflict with Customers

Conflict in the arena of sales, and the relationship between the supplier and the customer, deserves special consideration. Most sales-people tend to think of themselves as good negotiators because they have numerous opportunities to negotiate with customers. In workshops with salespeople over the years, their classic dilemmas usually involve two questions:

1. When do I stop selling and start negotiating? 2. How do I avoid giving away too much to make the sale?

The answer to these questions is not simple. Throughout the sales cycle, the supplier and customer have different expectations. As the salesperson works to manage the expectations of the buyer, conflict often arises. Figure 1.1 shows the typical sales cycle.

Consider each of the boxes as a milestone in the sales process. Getting the customer's attention requires expending marketing resources. Once the customer has enough interest in the product or service to spend some time exploring possibilities with a salesperson, we engage in selling. During the selling process (i.e., determining needs and presenting benefits), the salesperson and customer determine whether there is a good match between needs and product or service. The ideal outcome is a decision in favor of the supplier and a commitment to draw up a contract or agreement toward implementation.

Conflict arises in several areas. First, the customer has competing demands for his or her attention. Second, the customer wants the supplier to start making concessions early (i.e., between interest and decision), while the supplier attempts to hold firm until after the decision has been made and other suppliers are eliminated. We hear salespeople complain:

"The customer really holds all the cards." "I know my customers pit us against our competitors. I feel like we have to say yes just to stay in the running."

Finally, conflict surfaces in customer situations that involve the interaction of the salesperson as an advocate for the customer with his or her company. This phenomenon is best represented by the equation:

1External negotiated agreement = 3Internal negotiations

For every external negotiated agreement with a customer, count on at least three internal negotiations required to make the deal work. Picture this: You've just made a deal for a major piece of business with a new customer. Now you have to fight for the resources to make it happen, such as pricing, delivery, credit and payment terms, technical support, and others. Once the deal is done with the customer, the salesperson's internal negotiating has just begun. Chapter 11 covers specific techniques to handle internal negotiations.

Process of Exchange

In the earlier definition of negotiation, I used the phrase process of exchange. In the varied ways we exchange currencies for goods and services, negotiation is only one of several processes of exchange. Figure 1.2 represents a hierarchy of the exchange processes based on level of power.

At the top of the power scale, the not engaging strategy involves a refusal to even open the negotiation. Consider the example of a person who owns a beautiful art object with so much value or meaning to the individual that it's not on the market. Along comes a buyer willing to pay such an outrageous price that the other party is stunned into at least consideration of selling. However, the power lies with the person who owns the object and does not want to sell.

Consider the folksy story of the driver who comes across a beautiful seaside home. The home owner is working in her garden as the potential buyer approaches. Potential Buyer: Good afternoon. What a beautiful house you have here.

Home Owner: Why thank you, it's been in my family for generations.

Potential Buyer: Is it for sale?

Home Owner: No. There's no way I would ever sell this house.

Potential Buyer: I would give you $500,000 for it. (Close to market value.)

Home Owner: Perhaps you didn't hear me the first time. It's not for sale!

Potential Buyer: I could increase my offer to $1 million.

Home Owner: I wouldn't sell this house for $10 million!

Potential Buyer: Would you consider $20 million?

Home Owner: Well, I guess I'd be foolish not to consider that offer.

As you can see, the initial strategy of not engaging may be overcome by an overwhelming offer from the other side. However, the home owner displays a very high power position by her unwillingness to engage. The home owner has no need to sell, representing a high power position.

The next exchange option is fixed price (i.e., take-it-or-leave-it). Most American retail trade is based on this process. The price is established and customers are faced with the decision of whether to buy. This is considered a relatively high power position because the seller has more options (other customers), who are willing to pay the listed price. The advantage of such an approach involves efficiency. Can you image what would happen if every person shopping for groceries engaged in a negotiation for each item in the store? The produce would go bad and the ice cream would melt even before they loaded it into the car. The level of power is contingent on the retailer's belief that "if you don't buy it, someone else will." This stance represents a knowledgeable assessment of the number of potential buyers willing to pay the retailer's price. Retailers do run sales in which they discount from the list price; however, this discount represents a unilateral approach to all buyers, rather than a negotiation with a specific individual.

I first learned about negotiating from my father and uncle in Boston's famous Haymarket. With the wide variety of sidewalk vendors selling the same produce, we could often pit one against the other and get better prices. Our other strategy involved waiting. As the Saturday afternoon sun began to set, we could push prices down even further as the number of customers dwindled. Fixed price depends on the pressure that other buyers are willing to pay the asking price. Consider what happens in a gas crisis when prices are high and supply appears to be low. Drivers will pay the high price believing they have no choice or that prices may rise even further. Couple this with the occasional dwindling supply and anxious consumers will pay dearly to ensure a full tank.

Bargaining, a third process of exchange, involves two parties arguing or haggling over a single currency, usually price, as in the following example:

Buyer: This copy machine looks like it will meet my needs. How much is it?

Seller: That machine is $5,000 with a one-year warranty on parts and service.

Buyer: That's more than I have budgeted. How about $3,500?

Seller: That just would not work for us. Let's say $4,500.

Buyer: How about we split the difference-$4,000?

Seller: Done!

Most of us are familiar with bargaining and consider it negotiating. But the real distinction between the two involves the use of multiple currencies in negotiating. Let's take the copy machine example and change the dialogue slightly:

Buyer: This copy machine looks like it will meet my needs. How much is it?

Seller: That machine is $5,000 with a one-year warranty on parts and service.

Buyer: That's more than I have budgeted. How about $3,500?

Seller: Tell me more about your budget. Have you considered the operating costs in that figure? There's paper, toner, and other supplies. In addition, our maintenance contract is 10 percent of the initial price per year.

Buyer: I hadn't really considered paper, toner, maintenance, or other costs. What can you do for me on that?

Seller: How about if we offer you a two-year warranty and free toner for a year. In addition, we'll give you the maintenance contract free for the first year, if you pay full price.

Buyer: That's better for our budget. But it still won't work at the $5,000 price.

Seller: Given your budget constraints, how about leasing the machine for two years and we'll give you a buy-out provision so you can purchase it at the end of the lease. Will that help with your budget?

Buyer: That might work very well. Let's work up the figures and get this going.

Besides price, the seller introduced several other currencies-extending the warranty, free toner, lease versus buy option, and maintenance contract. Once additional currencies are on the table, the parties are freer to mix and match to make the deal more interesting, as well as to meet additional needs for both sides.

Negotiation is the process of exchange that provides the highest likelihood of satisfying the needs of both parties. As in the previous example, the seller was able to generate revenue by leasing the machine. The buyer gained by paying less initially while maintaining the right to purchase at the end of the lease. The other issues of paper, toner, and maintenance fees would be worked out in the negotiation, but consider how much more there is to work with at the end of that meeting than at the beginning.

Introduction to Planning and Executing the Negotiation

This book is organized into two major sections (1) Planning the Negotiation and (2) Executing the Negotiation.

(Continues...)

Excerpted from Practical Negotiatingby Tom Gosselin Copyright © 2007 by Tom Gosselin. Excerpted by permission.
All rights reserved. No part of this excerpt may be reproduced or reprinted without permission in writing from the publisher.
Excerpts are provided by Dial-A-Book Inc. solely for the personal use of visitors to this web site.