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Like it or not, you are a negotiator

How to use your negotiation skills in the corporate world

by Maarten Pieck

If you are reading this, you have probably already heard that knowing how to negotiate is a very useful skill to have in the business world. This is true! Each day you experience opportunities to use the toolset that you have painstakingly developed over the past year(s). In order to fully leverage your knowledge, you need to identify these opportunities, so that you know when to turn on your negotiating switch. This article will help you with that.

The classic example of negotiating in the business world is the salary negotiation. Using the Harvard method of negotiating as a framework, a few things immediately become clear:

1. Salary paid out in cash is not the only option. Negotiation skills can help you identify alternative methods of compensation such as a company laptop/smartphone/car, more vacation time, the option to telecommute, etcetera. Options with the biggest “value differential” between both parties are the most interesting. For example, a company car is cheaper for the company than paying out the equivalent in salary because of tax reasons. The option to telecommute provides more positive value for you than negative value for the company. By considering alternative options to cash you can generate value for both sides

2. Know your counterparty. In any negotiation, it is key to find out how much wiggling room your counterparty has. Salary negotiations are a good example of this. Making a very strong case for a higher salary is wasted effort when corporate policy forces managers to pay every new employee in the same function the same salary. Make sure you are prepared by finding out how much decision power your interviewer has over your salary.

3. Having a strong BATNA will dramatically improve your negotiation position. To have a stronger position, you need an alternative to fall back on. We call this the Best Alternative To a Negotiated Agreement. If you have an offer at another firm available, negotiating your salary will become less tense for you. You can prove that another company feels that you are worth a certain salary and if this negotiation does not work out you always have your plan B ready. Even if you are only interested in one specific job, try to interview at other jobs too. This will create a strong BATNA and give you more information about the interview process and the possible range of salaries for your profile.

As you can see knowing how to negotiate provides certain advantages in the salary negotiation. Of course, there are other situations at work where utilizing the negotiation skills you have learned provides far more added value yet seems less obvious.

A big part of your career progression and satisfaction at work will be decided by the relations you have with your boss, coworkers, and clients. Life is easier when everyone is on your side. So how do you reach that point?

1. Find out their interests. If you want people to be happy with your performance the very first thing you need to figure out is what constitutes “a good performance”. What do your boss and coworkers expect from you? What are the key "measures of success"? To find this out, sit down with your manager and extract as much information from him/her as you can. Ask open questions and use your active listening skills. Try to find out the underlying interests behind what is requested from you. Just like in a negotiation, finding out all the necessary information up front will make things a lot easier for both and will avoid wasted effort on irrelevant things.

2. Manage expectations. After you have discovered what matters in the negotiation, you need to figure out the range of possibilities. What can and cannot be done by the other party? Is the other party aware of your limitations? Being upfront, i.e. “I won’t be able to get this paper ready by Friday” or “I’m not familiar with that software” will make cooperation easier in the long run.

3. How to handle conflict. Sometimes conflicts arise, that is unavoidable. Ignoring them will only let them fester and escalate over time. Instead, you should confront the issue the Harvard way: first, listen empathically to the other side, then give your own side of the story and try to come to a shared agreement. Make sure to separate the people from the problem. You can be polite and friendly towards people without having to give in. The tension between empathy and assertiveness is something you are very familiar with after negotiation training.

4. Keep each other in the loop. A negotiation does not stop when the contract is signed. It is essential to proactively keep each other up to date about new developments and potential problems. So how do you use this at your job? Proactively request occasional, informal talks with your manager where you request feedback on your performance of the past weeks. This way, issues get revealed before they become truly problematic.

Good communication skills are essential to perform well in any job. And they become even more important as you climb the corporate ladder. Therefore a course in negotiation theory is well worth the time investment for any ambitious student. Communication skills are essential to perform well in any corporate environment.