Summary

Although there is no single method that works for every circumstance, it is clear that negotiation is about using the right type of strategy for the right type of situation. The main component of all situations you will apply negotiation towards is the person you are negotiating with. Knowing their characteristics and what influences them will allow you to identify which approach to negotiation is likely to be the most effective.

The majority of negotiation you engage should be looked at achieving a win/win outcome. This means that you need to look at the situation from both your own perspective as well as the perspective of the other person. In the case of clients looking to hire you, negotiation often revolves around price. Different clients have different motivations that affect how they negotiate the price they pay – what you must identify is whether they are looking to negotiate the price they "want" to pay or the price they "can" pay. Knowing the difference between "want" and "can" allows you to engage negotiation methods that produce a better response; someone trying to negotiate a lower price because they can't afford the full price is more likely to be open to consider eliminating part of their requirements in exchange for a lower price.

On the other hand, someone wanting to get a lower price just for the sake of a perceived better deal will want everything without compromise – a completely different situation.

Success in negotiation comes from the use of give and take, where being flexible to give in one factor results in taking away of another factor. In the case of negotiating the budget of project, this could be to provide a lower price by eliminating the less important features – something that is likely to appeal to someone who can't afford the full price, whilst still emphasizing to someone who just wants a lower price that they also have to sacrifice if they want to negotiate.

The final part of negotiation is to make sure that the agreement is clearly understood by both parties and fully documented. This avoids problems from misinterpretation or even deviousness of one party whose intention is to covertly force the other to give more at a later date; this type of strategy is never good to consider because it leads to long term distrust that can damage the ability to cooperate for the success of the project and missed opportunities to generate new business.

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