Negotiation Skills

Skills and information workshops:
Transforming Rehabilitation (TR)
Negotiation Skills
17 – 28 February 2014
Agenda
Welcome, housekeeping and introductions 5 mins
13.30 – 13.35
Update on ISPA
10 mins
13.35 – 13.45
A Definition of Negotiation
20 mins
13.45 – 14.00
A Good Negotiator
20 mins
14.00 – 14.20
4 Phases of Negotiation
15 mins
14.20 – 14.45
Break
20 mins
14.45 – 15.00
4 Phases of Negotiation cont.
20 mins
15.00 – 15.40
Negotiation DOs & DON’Ts
15 mins
15.40 – 15.50
Q&A session
30 mins
15.50 – 16.00
Finish
16.00
Update on Industry Standard Partnering Agreement
• Draft Industry Standard Partnering Agreement under consultation 10th
January – 20th February:
https://consult.justice.gov.uk/digital-communications/df97a7b1
• Intended to be used for subcontracting arrangements.
• Aims to promote fair practices and assist in the development of
diversity and transparency within supply chains.
• Developed in line with MoJ Market Stewardship principles.
• Contractual requirement for tier 1 organisations to use the ISPA when
subcontracting with organisations at lower tiers of subcontracting.
• Recommended for further subcontracting within the supply chain.
Update on Industry Standard Partnering Agreement
• Recommends minimum 3 year contracts for subcontractors.
• 6 months notice to terminate contracts (with Authority approval).
• Elements mirror head contract between Tier 1 and MoJ:
– Annual Plans and Reports, Data Protection and IPR, Confidentiality.
• Key section: Schedule 2, Industry Standard Partnering Agreement
Questionnaire
• Checklist to confirm all risks to subcontractor have been identified,
quantified, and impact on their business has been considered e.g.
–
–
–
–
Level of support from Tier 1 to subcontractor
Risk is proportionate to services and payment
Volumes are confirmed
Service levels are realistic
Definitions of Negotiation
“The process by which two or more parties attempt to
achieve agreement on matters of mutual interest.”
“Negotiation takes place when two or more people, with
differing views, come together to attempt to reach
agreement on an issue. It is persuasive communication
or bargaining.”
A Definition of Negotiation
Negotiation Skills
“Negotiation is about getting the best possible deal in the
best possible way.”
“You don’t get what you deserve, you get what you
negotiate!”
Negotiation Skills
What have you negotiated:
• What have you successfully negotiated?
• What helped enable your successful negotiation?
Negotiation Skills
Two main types of negotiation:
• Distributive / Adversarial (win: lose)
• Integrative / Co-operative (win: win)
Key to successful negotiations:
• Perceived mutual benefit
• Perceived individual benefit
• Willingness to explore alternative solutions
• Willingness to agree to disagree (on occasion)
A GOOD NEGOTIATOR
Negotiation Skills – what makes a good negotiator?
Negotiation Skills – a good negotiator
A good negotiator:
• Is thoroughly prepared for each of the four phases.
• Has an assertive negotiation style.
• Has clear exit points and a willingness to walk away.
Negotiation Skills – a good negotiator
In groups take 10 minutes to brainstorm a list of the 10
key skills that successful negotiators need.
List the key skills and note the reason why each of your ten
skills is crucial to you as a negotiator.
Negotiation Skills – ten negotiating skills
• Planning
• Ability to gain respect
• Integrity
• Leadership skills
• Thinking under stress
• Tact
• Verbal clarity
• Ability to exploit power
• Practical sense
• Open mind
4 PHASES OF NEGOTIATION
Negotiation Skills – Four phases of negotiation
Preparation – what do we want?
Discussion – what do they want?
Proposal – what could we trade?
Bargain & Close – what will we trade?
Negotiation Skills - Preparation: What do we want?
Consider:
• What do you want?
• What do they want?
• Why should they work with you?
• What are your priorities (what is valuable to you)?
• What are their priorities (is it also valuable to them)?
• How much flexibility does either party have?
• What are your Entry and Exit points?
Negotiation Skills - Preparation, priorities & exit points
Establish priorities in three categories:
• Essential – high importance – failure to secure means
exit.
• Highly desirable – medium importance – nice to have but
not critical.
• Desirable – low importance – failure won’t put the deal
at risk.
Consider the Tier 1’s potential priorities, are any of their
deal breakers in conflict with your own?
Negotiation Skills - Preparation: priority mapping
Negotiating Point
Essential
Highly Desirable
Desirable
1 – Dream
scenario
2 - Outcome
where you might
proceed
3 - Outcome
where you might
walk away
Payment terms, need money
up front for cash flow
P
P
X
Quantity
P
P
X
Price
P
X
X
Monitoring
P
P
P
Approach
P
X
X
Brand
P
X
X
Flow of customers
P
X
X
Communications
P
X
P
IPR
P
X
P
Negotiation Skills - Preparation: them and us…
In securing / delivering Transforming Rehabilitation
contracts:
What is most important to you (as subcontractors)?
What is most important to them (as Tier 1 contractors)?
BREAK
Negotiation Skills - Discussion
Likely that majority of discussions / negotiations in
Transforming Rehabilitation done by telephone or email.
Get face to face meetings wherever possible.
Agree purpose of meeting - e.g. discuss and clarify, or
conclude deal?
Ensure correct people attend, and they are clear on the
limits of their authority.
Negotiation Skills – Discussion – interpersonal skills
Negotiation Skills – Discussion: interpersonal skills
Use meetings and interpersonal skills to:
• Establish a rapport – people buy from people.
• Test their willingness to negotiate.
• Listen and validate assumptions.
• Understand their perspective (and empathise).
• Identify their problems (and develop solutions).
Negotiation Skills – Discussion: interpersonal skills
Identify who and how to deal with the various people, and
who you are:
• Avoider: dislikes conflict.
• Compromiser: fair-minded people interested in
maintaining relationships.
• Accommodator: resolve interpersonal conflicts by
resolving the other person’s problem.
• Competitor: winning is the main thing.
• Problem-Solver: seeks to find the underlying problem,
use brainstorming to solve.
Negotiation Skills - Proposal
• Conditional proposals – use ‘if’ followed by ‘then’:
– “if you agree to… then I will agree to…”
• Unconditional proposals:
– Unconditional demand - “I must insist on / you will”
counter with if/then).
– Unconditional offer - “we’ll give you…”
Negotiation Skills - Proposal
Negotiation Skills - Proposal
• Aim high to begin with – it is easier to lose ground than
gain – but be realistic.
• Give concessions ‘reluctantly’ – however low a priority
they are.
• Make proposals with open questions such as:
– “what would happen if we…?”
– “suppose we were to…”
– “what would be the result of…?”
• Be clear on what has been proposed and regularly check
agreement.
Negotiation Skills – Bargain & Close
Negotiation Skills – Bargain & Close
• By aiming high, negotiators create sufficient room to
make and request the necessary concessions.
• Negotiators with high aspirations consistently outperform
those with low aspirations.
• High aspirations generate a positive state of mind and
prevent a negotiator from being rigid and defensive.
• Remember the value of compromise, particularly when
dealing with stone-walls: “what would need to happen
for you to be willing to negotiate over this?”
Negotiation Skills – Bargain & Close
• Be bullish, but not pig-headed.
• Trade concessions, don’t give them up freely.
• Be prepared to concede on some things and
push hard on others.
• Remember your exit points, and be ready to
walk away.
• Remember why you’re there.
• Get everything in writing!!
Negotiation Skills – Do’s
• Prepare
• Set your negotiables
• Estimate their entry and
exit points
• Set your entry and exit • Estimate their priorities
points
• Find out their roles and
authority
• Set your priorities
• Set your strategy and
tactics
• Consider their interests
• Set your roles and
responsibilities
• Be prepared to mediate
• Consider their drivers
Negotiation Skills – Don’ts
• Argue with them
• Argue among your team
• Lie or overstate your capabilities
• Feel rushed / pressured into making concessions
• Make only unconditional demands
• Take an aggressive approach to negotiation
• Assume they want the same outcome as you
Negotiation Skills – Walking away…
Remember!!
Walking away doesn’t mean you can never
go back. But once you sign a deal you’re
stuck with it.
Q&A
We will be sending you a survey to gather your feedback
on this event. Please do let us know what you think.
You can also send any additional questions you may have
to [email protected]
Briefing packs including a full Q&A document will be
published after this set of events at
http://www.acevo.org.uk/events--pd/moj-events
Contact details and links
•
•
•
•
•
Mike Harvey, Director Candour Collaborations [email protected]
Natasha Newson, Director Candour Collaborations
[email protected]
Emily Jolley, Director ACEVO Solutions [email protected]
Sally Gibbs, Associate Director ACEVO Solutions [email protected]
Ruth Breidenbach-Roe, Public Services and Partnerships NCVO [email protected]
For any questions you have following this event contact [email protected]
Recommended reading / links:
• MoJ Transforming Rehabilitation
– http://www.justice.gov.uk/transforming-rehabilitation
• Industry Standard Partnering Agreement (ISPA)
– https://consult.justice.gov.uk/digital-communications/df97a7b1
• KnowHow NonProfit Guide - Negotiating with prime contractors
– http://knowhownonprofit.org/funding/service/commercial-masterclasses/negotiatingwith-prime-contractors/?searchterm=negotiation