Successful negotiation in the workplace depends more on mutual benefits than why you think you must be right.
Some claim to be natural-born negotiators – gifted “deal makers” – but is there really any such thing?
Most people would probably say there is. The sales person had all the right answers, even before you asked the questions. Somehow they knew which buttons to push, but still you are left wondering whether you struck the best deal possible.
Negotiation Education Australia director John Trevillyan FCPA questions the notion of “born” negotiators, stating that people start to learn basic negotiating skills from about the age of two when as children and still totally without independence, they begin to wrap their parents around their little finger.
Trevillyan, who is the facilitator of CPA Australia’s Strategic Negotiator Program, believes effective negotiation is an entirely learned behaviour.
“We acquire skills through everything we do while growing up and working through our careers,” he says.
“If we need to negotiate with teachers for an extension to an assignment, we quickly learn what will work and what won’t in terms of influencing the result.
“We’re all good at negotiation in some way or another – the problem is some people also learn a heap of habits which just don’t work for them. For example, they might give away too much information or be too aggressive when they need to be more passive.”
And therein is the key to why so many are left believing that no matter how well or hard they tried to bargain, the sales person still bettered them.
External versus internal negotiations
For the majority of everyday consumers, most major negotiations relate to the purchase of big-ticket items like a house or motor vehicle.
This generally means having to lock horns with experienced real estate or car sales professionals whose livelihood is almost entirely dependent on successfully securing a deal that is frequently only in their own best interests.
“So we’re behind the eight-ball from the start,” Trevillyan declares. “A car sales person will know how far they can drop the price, or the extras they can or can’t add-on, because they have been well trained.”
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These types of interactions are called “distributed negotiations” and normally involve a one-off purchase. They are also referred to as “win-lose”, as one party almost invariably gains at the expense of the other.
Although finance professionals may sometimes need to participate in external negotiations – for instance, finding the company new premises or negotiating terms with different suppliers – most of their focus is internal, and according to Trevillyan this necessitates “engaging, influencing and persuading people”.
“Accountants have excellent analytical abilities, but they also need to work effectively with the CEO and others in the organisation to get buy-in behind how they believe money should be best spent and budgets allocated, and to do that you need to negotiate with people not in a distributed way, but through an engagement process.”
Trevillyan calls this “interactive negotiation”, which is based on mutual gains and benefits, but without the right training it can be difficult and for some impossible to master.
Pitfalls to avoid and how to rectify them
He says the first mistake most professionals make is to approach internal negotiations in the same way they would external transactions, and just as notably, to always think the position they take must be right.
In other words, they do not spend time considering the potential impact on the other party and are already adversarial when in reality, to succeed they need to negotiate buy-in and allow the other side to work through the proposal.
“In the program we try to get people to see when certain decisive action is required and also when, to achieve something, it’s important to help someone else succeed,” Trevillyan says.
“When jointly-decided action is required, you need to build a sustainable, long-term coalition behind the project you’re trying to push forward, but most people don’t look at it that way.”
His Strategic Negotiator Program includes exercises designed to demonstrate when and how to take a conciliatory approach to bring other stakeholders on-board and thereby achieve maximum mutual benefit.
“The biggest issue in internal negotiations is that you have to protect future working relationships,” Trevillyan says.
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“In some cases the external relationship in negotiations may not be as important, but if you’re going to continue working in an organisation with the same people you can’t negotiate with the attitude that you have to win at all costs.
“People tend to only look at the outcome from a bargain, rather than listen to others about what could be wrong with that outcome. They just don’t listen to the negatives from another person’s point of view about what it is they are trying to achieve. Therefore, they are not prepared to compromise.”
According to Trevillyan, a core focus of the program is developing skills that will not only help with understanding the pivotal role allegiances and engagement play in effective negotiations, but how to look for better outcomes by – as far as reasonably possible – thinking outside the box.
“[Attendees] will also take away insights into how they deal with conflict and how better to do it, because in all negotiations there is conflict. Everyone wants something different, but knowing how to remove conflict will always help obtain a better result,” he says
Trevillyan is the first to acknowledge that CFOs and all finance professionals possess outstanding analytical skills, but believes some practitioners may be losing out in their negotiations because many of the other parties’ decisions are naturally intuitive – “they come from the back part of our brains.”
“When you’re in finance it’s very easy to analyse and say these are the figures and these are the stats, so this has to be the outcome. The problem is you’re dealing with people, all of whom make different decisions about what clothes they wear and the types of cars they buy.”
Accordingly, a degree of flexibility might well take you to where you want to go.