Negotiation Preparation: Set Yourself Up for Success Before You Sit Down
The most important part of negotiation happens before you sit down at the table. Preparation determines outcomes more than any tactic or technique you use during the negotiation itself. Skilled negotiators spend significant time preparing, while inexperienced negotiators try to wing it and wonder why they consistently get poor results.
Preparation for negotiation involves understanding your own interests, researching the other party, analyzing the context, developing your strategy, and preparing for different scenarios. This preparation transforms negotiation from a stressful improvisation into a strategic conversation where you know what you want and how to get it.
Know Yourself
Effective preparation starts with clarity about your own position.
Define Your Interests
Interests are the underlying needs, desires, and concerns that drive your position. Your position is what you say you want. Your interests are why you want it. Understanding your interests allows you to be flexible about how you achieve them.
Identify your primary interests and rank them by importance. What must you achieve for this negotiation to be successful? What would be nice to have but is not essential? What are you willing to trade? Clarity about your priorities guides your decisions during the negotiation.
Set Your Targets
Determine your target outcome, your walkaway point, and your aspiration. Your target is what you realistically hope to achieve. Your walkaway is the minimum you will accept. Your aspiration is the best possible outcome you can imagine. Having all three gives you a range to work within.
Aspirational goals are important because they pull you toward better outcomes. People who set ambitious goals consistently achieve better results than people who set modest goals. Do not let fear of appearing unreasonable hold you back from aiming high.
Know Your BATNA
BATNA stands for Best Alternative To a Negotiated Agreement. It is what you will do if this negotiation does not result in an agreement. Your BATNA determines your power in the negotiation. The stronger your BATNA, the more leverage you have.
Before negotiating, identify your best alternative. Can you take your business elsewhere? Can you solve the problem yourself? Can you wait? Improve your BATNA if possible before entering negotiations. A strong BATNA gives you confidence and freedom.
Know Your Counterpart
Understanding the other party is as important as understanding yourself.
Research Their Interests
What does the other party want from this negotiation? What are their underlying interests? What pressures are they under? What constraints do they face? The more you understand their situation, the better you can craft proposals that meet their needs while also meeting yours.
Research might include reviewing public information, talking to people who have negotiated with them before, and considering their organizational context and incentives.
Understand Their BATNA
What will the other party do if you do not reach agreement? Do they have attractive alternatives? Or are they dependent on reaching an agreement with you? Their BATNA determines their power in the negotiation.
If they have a strong BATNA, you need to make your proposal compelling enough to beat their alternatives. If they have a weak BATNA, you have more leverage but should use it carefully to avoid damaging the relationship.
Plan Your Strategy
Based on your preparation, develop a strategic approach.
Choosing Your Approach
Will this negotiation be primarily competitive or collaborative? Competitive approaches work best for one-time transactions where the relationship does not matter. Collaborative approaches work best for ongoing relationships where trust matters.
Most negotiations benefit from a collaborative approach that seeks to create value for both parties. Even in competitive negotiations, maintaining respect and professionalism serves your long-term interests.
Planning Your Concessions
Plan what you are willing to concede and what you expect in return. Concessions should be planned, not reactive. Give ground on lower-priority items in exchange for gains on higher-priority items.
Never make a concession without getting something in return. Even a small concession should be acknowledged. This principle prevents you from giving away value for free.
FAQ
How much time should I spend on negotiation preparation? The more important the negotiation, the more preparation time it deserves. For high-stakes negotiations, spend several hours preparing. For routine negotiations, even fifteen minutes of focused preparation can improve your outcomes.
What is the most important thing to prepare? Your BATNA. Knowing your best alternative gives you confidence and power. Without a clear BATNA, you may accept a poor agreement because you fear having no agreement at all.
Should I share my BATNA with the other party? Sometimes revealing your BATNA can strengthen your position if your alternative is attractive. Other times, revealing it can seem like a threat and damage the relationship. Use judgment about when and how to share BATNA information.
How do I prepare for a negotiation with a more powerful party? Strengthen your BATNA before negotiating. Build coalitions. Identify what you have that the other party needs. Frame proposals in terms of their interests. Confidence and preparation can offset power imbalances.