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The Making of an Effective

Negotiator

DISC – negotiation instrument

MDI - emarald
Convert Negotiation as a Corporate Capability
• Ensure that negotiators priorities remain tightly linked to
the Company’s Priorities
• Broaden the measures used to evaluate negotiators’
performance beyond matters of cost and price
• Walk away from the deal that is not of company’s
overall best interest
•Outcome of Negotiations does not
hinge solely on the negotiator’s
individual skills.
• Negotiation can be coordinated
and supported like other function.
Serfin- Mexican Bank
• Faced the problem of large number of defaulters

• Sat down with each debtor and traded concessions


over what percentage of loan would be repaid when
and what conditions
• They backed up their positions with occasional threats
of legal action
• Hired additional personnel and provided some basic
training
• Did not succeed in improving the overall health of the
bank’s loan portfolio
New Approach
• Improved negotiation-training curriculum that focused
on putting trainees into real world situations
• Further, negotiation considerations were incorporated
into initial financial analysis of each workout case.
Collaborating closely with the negotiating team Serfin’s
analysts defined the bank’s various interests in the case,
put them in the order of priority developed an
understanding of each of the debtor’s interests, laid out
a set of creative options for resolving the case and
assessed the debtor’s and bank’s alternatives to
reaching a negotiated settlement.
Categorization of Debtors
• The debtor’s ability to repay its loans over
both the short and long term
• The quality of its relationship with the bank
• the quality of its collateral and
• the quality of bank’s Best Alternative to a
negotiated agreement (BATNA)

Serfin’s workout division is considered


the best in the country, a model for other
institutions
Four types of Negotiators
•Connectors
•Networkers
•Producers and
•Analyzers
Connectors
•Connectors are down-to-earth warm and caring. They are
people oriented and have open body language and nicely
decorated offices with family photos and plants.
• Their hot button is STABILITY, which they achieve through
personal courtesies.
• They hate to feel used or unimportant. If you don’t say hello,
cut people off, or become pushy, you’ll lose.
• To interact with Connectors, be open, honest and start with
some small talk. Get to know them as people and don’t “fast
forward” to the negotiation itself.
Networkers
• Networkers desire fun, excitement and applause. They like the
big picture and aren’t usually good at details. They are congenial
and friendly, and may spend 70% of negotiation focusing on
small talk, often jumping around various topics.
• Their hot button is recognition, which they receive by being
people oriented. They are well connected and negotiate from
their gut. Their positions are largely based on how they feel
about you: The more they like and trust you, the more flexible
they’ll be.
• To interact effectively with them, show how negotiation
benefits them and their company. Networkers often close the
deal on the spot.
Producers
•Producers are direct and goal oriented: they think fast,
move fast and talk fast.
•Connector find producers the hardest to negotiate with
because they give up personal courtesies to get the
bottom line. They’re there to make deal first and a
relationship second.
•Producers hot button is POWER and they get it
through control. They will want to hear a big picture
presentation and then fire away questions at you to get
the answer they desire.
•To succeed with the producers, realize that they won’t
often take your first deal.
Analyzers
•Analyzers are straight forward. They desire accuracy
and want the details first, then the big picture.
•Their hot button is ACCURACY and they get this by
collecting data. Broad, sweeping statements annoy this
person.
•Don’t expect a quick decision. Analyzers don’t like to
finalize a negotiation on the spot. They prefer to mull
over the decision and give you an answer by e-mail,
letter or phone.
•To succeed with them provide them with facts and
data .
Conventional Negotiations
 Focus on winning
 Assert positions/personal preferences
 Concede stubbornly
 Seek compromises based on arbitrary
divisions (e.g. split the difference)
 Engage in threats, bluffs or other
negotiation tactics
Conventional Negotiation Tactics

 Bluff
 Threats
 Nibble
 Appeals to ‘reason’
An Alternative: Interest-Based
Negotiations*
 Separate the people from the problem
 Focus on interests, not positions
 Invent options for mutual gain
 Insist on objective criteria
Principle 1: Separate the People
from the Problem
 Disentangle the people from the problem
 Deal with the people problem: acknowledge
perceptions, emotions
 Listen actively
 Speak to be understood
 Speak about yourself, not them
Principle 2: Focus on Interests,
Not Positions
 Positions: What disputants say they want in
a negotiation: a particular price, job, work
schedule, change in someone else’s
behavior, revised contract provision, etc.
 Interests: Underlying desires or concerns
that motivate people in particular situations
(May sometimes be the same as their
positions!)
Principle 3: Invent Options for
Mutual Gain
 Focus on the variety of ways issues/
interests (yours/theirs) might be addressed?
 Avoid assuming there’s a single solution
 Separate brainstorming from evaluation of
options
 Don’t assume zero-sum conditions
 Think creatively
Principle 4: Insist on Objective
Criteria
 Fair standards: market value, precedent,
blue book value, professional standards,
“best practice,” industry average, equal
treatment, etc.
 Fair procedures: e.g. last best offers, taking
turns, drawing lots
Principle 5:
Change Mental Models that
Filter Reality
“Mental models are the images,
assumptions and stories which we carry in
our minds about ourselves, other people,
institutions and every aspect of the world.”

“Like a pane of glass framing and subtly


distorting our vision, mental models
determine what we see.” -- Senge
Improve advocacy: Make thinking visible
State assumptions & data that
led to them
Explain assumptions
Make reasoning explicit
Explain context & give
examples
Encourage others to explore
your view
Invite improvement
LISTEN & STAY OPEN
Improve inquiry: Uncover other’s thinking

Use non-aggressive
language
Draw out reasoning
Ask for examples
Check understanding of
what you heard
LISTEN & STAY OPEN
Effective Actions
 Be clear about desired outcomes
 Focus on outcomes—resist distractions
 Forego revenge—practice forgiveness
 Create multiple options for yourself
 Give up always having to be “right”
 Avoid arguments with someone looking for a fight
 Rehearse constructive thoughts and feelings
High High
Importance Importance
TEDDY BEAR OWL

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