Preparing for a Negotiation
Before a negotiation takes place, it’s important to determine exactly what you want. This helps you make informed decisions throughout the negotiation process and, also, gives you an aura of confidence and knowledgeability that may positively influence the other party. It also prevents you from making a shaky agreement that leaves the other party angry or resentful.
The ideal scenario is to create value so that you leave the negotiation shaking hands, smiling, and feeling pleased that you work together to make the best deal possible for both sides.
Practice asking for what you want in a non-threatening way and use “I” statements. For example, instead of saying, “You shouldn’t do that,” try saying, “I don’t feel comfortable when you do [or say] that.”
You also need to have a strategic plan before you enter a negotiation, and pre-planning can make the difference between success and failure.
Try practicing the negotiation in your mind before you negotiate with a prospect, client, or underwriter. Then role play with a friend or colleague. Role-playing will increase your confidence while providing you with a framework for negotiation success.
As you practice for your negotiation, know what you want. This ensures you don’t make promises in the heat of the moment that you’ll later regret.
According to Harvard Business School, 90 percent of negotiation can be anticipated. If you know what you want, anticipate what your prospects, clients, or underwriters want, set your strategy, and plan for any tactics you might face, you can usually resolve any problems to everyone’s satisfaction.
Stay Calm and Confident
In 2011, the Wharton School of Business, University of Pennsylvania, conducted a research study showing that anxiety is harmful to negotiator performance. Anxiety makes negotiators seem weak and easily exploitable, expect poorer outcomes, settle more quickly, and, ultimately, obtain inferior results.
On the other hand, when negotiators are calm and clear-headed with a high degree of belief in their abilities and skills, the difference is dramatic. How do you achieve that calm mentality? By gaining a sense of control through rigorous preparation. The bigger the issue, the more important it is to identify core interests, weigh walkaway options, and assess how the other party sees his or her options. When you are practicing, identify your emotions and learn from them so you can adapt during the negotiation and engage successfully. In other words, get emotionally prepared to serve as an advisor rather than growing anxious or tuning out during the actual negotiation.
The key is to confidently stand your ground and maintain a trusted partnership approach to the negotiation, even if the prospect takes an adversarial stance.
During a recent Beyond Insurance Trusted Risk Advisor™ program, Megan Smith, CPCU, API, Company Partners Manager for the Ohio Insurance Agents Association, shared how she applies the concept: “When confronted with an issue where the other party and I have a difference in perspective, I try my best to control my emotions and listen. I am very passionate about what I do, so it can be tough sometimes to just sit back and listen to a prospect or a client and truly hear them out in order to better understand where they are coming from. I try not to jump to conclusions. Reflecting on past experiences, the best outcomes happen when I remain calm and listen.”