Negotiation strategies that make money

Interpersonal Orientation (IO) provides an insight into social interaction between two individuals. People with high levels of IO are interested in building relationships with others. People with low levels of IO are less interested are less interested in building relationships, but more interested in what advantages they can get out of it. The degree to which a negotiator operates interpersonal orientation depends also on the context of a negotiation. Whenever two negotiators with the same level of IO meet, there is less chance of the other being exploited. High levels result into high cooperative behavior and personal relations, whereas low levels result into self-oriented behavior and low trust between the parties. If your levels of IO are too high, meaning you are too friendly and want to be friends with everybody, you are in danger of making a bad deal. You will feel bad asking for more and you won’t be able to drive a tough negotiation. When meeting a low IO negotiator, it ...

As consumers we often find it hard and difficult to change banks, mobile phone providers or energy suppliers despite being able to get a better deal elsewhere that could save us money. We all know that changing a service provider requires effort. You need to do your research, compare prices and services and trust that the new provider offers you the same or better service for a better price. That can be daunting, and we tend to become complacent and procrastinate. Big business are aware of our switching inertia and this can be exploited. Think about the Royal Commission Inquiry into the banking sector in Australia in 2019; I know of many people who wanted to change from the Big 4 to another smaller bank that was not involved in the banking issues. Others wanted to use the circumstances to get better deals from their existing bank. A year later hardly anyone did what they said because it is just 'too hard'! There is also another factor that stops us from making th...

You finally found the perfect job and you really want it! But you are not the only one, there are many others who are thinking the same and want this job as much as you. This is always the case, when applying for a job there are so many competitors, so many other applicants. So you need to stand out of the crowd and apart from having the right skills and experiences there is the following strategy that you should use. To have a greater impact on the long term memory two effects come into play which you can use to your advantage. These are the primacy and the recency effects. The primacy effect suggests that information that is mentioned in the beginning of the process is better remembered than later down the track. The recency effect has the same application, only that information is mentioned at the end of the process. For a job applicant this means that you should always try to get the first or last interview in the process as this means that you are most likely to be reme...

Whether in business or in private life, we are all dealing with people, people are emotionally charged and don’t always look at issues and situations rationally. In business everyone will encounter issues, conflict and difficult situations at some point.   You really get to know someone in a difficult situation. How are they handling the situation and how are they conducting themselves? It is therefore so important to learn how to handle such situations as it is not only about future business and long-lasting relationships, it is also about reputation. Do people want to come and do business with you or are they afraid that if there is a problem you become emotional, angry and difficult to deal with? Here are a few lessons that can be learned from difficult conversations: Don’t procrastinate Having a difficult conversation is uncomfortable, but avoiding a conflict situation is just making it worse and the situation will become even more emotionally charged. Once a...

To great extent personality traits contribute to questions of why some people are more effective negotiators than others. Surely, there are more factors to a negotiation than personality, such as specific contexts, individual strategies and the emotional interpretation of the process. However, to better understand the causes of successful negotiation outcomes, a deeper understanding of the personalities involved is vital. Here we will discuss three important negotiation traits that will take your negotiation game to the next level. Assertiveness Assertiveness is the ability to stand up for your own rights in a calm and proactive way by articulating the necessary steps and demonstrating confidence and control. Take charge of the negotiation by positioning yourself first. Discuss an agenda and set deadlines in a respectful and composed manner. Be creative – Think outside the box. Being creative in a negotiation means to take everything into consideration and to identify other v...

Every negotiation will be peppered with some tactics. Tactics help us pretend that we have the power over the other party so we can achieve the best deal possible. Here I discuss 4 common negotiation tactics and show you how you can counter them. Tactic #1: High ball – Low Ball The offer of the other party is either extremely high or extremely low. The purpose of this is to make you re-consider your own point of maximum or minimum acceptance. It also serves to shock you and even throw you off making you think that you might have made a mistake. If you are not prepared and have not done your research, then you might fall for it.   The best way to navigate this situation is to call them out and tell them that you feel insulted by their offer. Tell them that unless they revise their offer you are willing to walk away. This forces the other party to revise their offer straight away and continue the negotiation on your terms. Calling this out also shows them that you are a...

Sharing information builds trust which is the basis for any long term relationship and good outcomes. The art is to understand what information is appropriate to share, what should be kept for a later time and what information can’t be shared. Sharing information also calls for reciprocity meaning that the other party feels obliged to give something in return, in this case also share information. Social psychologists call it The Law of Reciprocity, meaning that when you get something you have the urge to reciprocate and give something in return which in many cases can be far more generous. While information sharing builds trust and appeals to the law of reciprocity it is important that before going into a negotiation one must calculate the risks and benefits of sharing information with their counterpart. A common mistake people make is that they share too much information.  Sharing too much information can damage your position of power because information is power and the mo...