Negotiation scenario – 4 basic points
In the series of entries about business negotiations we wrote, among others on how to prepare for them and what are the negotiating styles. This time we will discuss the topic of negotiation scenarios.
How to prepare a negotiation scenario? Is it necessary every time? What does preparation of the negotiation scenario give?
Negotiation Scenario - What is it? What does it do?
The negotiation scenario is something like a project brief. We create it to accurately prepare the course of negotiation talks at an initial stage before the meetings.
This document is to be used primarily to better understand the contractor with whom we plan to start the negotiation process. In the entry about international negotiations, we wrote about factors that have an impact on the course of negotiations. It is worth keeping them in mind, but not only when the other party to the negotiations represents another country. When negotiating with compatriots, we should also gather as much information as possible about him. It is about getting to know the company's culture and the mission that the enterprise is guided by, as well as about the possible negotiating styles that the other negotiating party uses.
Based on the data collected about the contractor, we can proceed to the preparation of the negotiation scenario.
What does the negotiation scenario consist of and how to prepare it?
When creating the negotiation scenario, we should include several important elements, such as sample dialogues, possible objections from the other party, or our argumentation of individual elements of the offer. To get the best preparation for a real conversation, it's worth testing it as well. This can be done, for example, by using the partner's negotiated sparring service or as part of your own team accompanied by the so-called negotiating shadow.
The negotiation scenario should consist of two options: positive and negative, and also take into account four basic factors.
- Initial offer
This is the negotiator's proposal presented to the other party first, at the beginning of the negotiation talks. Its level should be optimal - not too high and not too low. too high a threshold could discourage the contractor and close the way for further talks from the start. On the other hand, too low carries the risk of closing the road to possible concessions at a later stage.
- Minimum threshold
The next factor that should be in the negotiation scenario is the minimum threshold we want to reach. It's a ceiling below which we can't go down. Otherwise, it would result in loss. It should also be remembered that the minimum threshold is set for two versions of the scenario - optimistic and pessimistic
- Maximum threshold
There is potentially no upper limit to negotiation. Potentially - the more the better. Nevertheless, it is worth specifying the maximum negotiation threshold that we can achieve with a positive and trouble-free negotiation process.
- Costs and profits; strengths and weaknesses
One of the extremely important points of the negotiation scenario is the identification of our strengths and weaknesses, as well as an approximate minimum, defining them for the other party to the negotiations. The same is true for costs and benefits. Although these data are difficult to estimate with full accuracy, it is worth doing at least at the level of estimation.