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6 Important Factors that affect the Process of Negotiation

January 8, 2019 0 Comment

1. Authority:

The first key factor affecting any negotiation is authority. Negotiation may start with deliberation but to be effective, it has to end up in a conclusion or settlement. For this, both the parties should have the power or authority to conclude the deal.

If one party believes that the other party does not have the requisite authority to make a commitment or at least mediate and carry the process forward, he or she may not be keen to come to the negotiating table.

If the parties derive their authority from a higher authority, they should know to what extent they can stretch. Committing beyond the extent of authority they are vested with may result in negating the negotiation.

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In real-life situations, we do come across instances where due to improper understanding, one party commits certain concessions or facilities which the higher authority does not approve and honour. Lack of authority or ability to stand by the settlements arrived at undermines the effectiveness of negotiation.

2. Credibility:

Trust and mutual confidence are very relevant in any process of negotiation. People who are known to be honest, sincere, steady and reliable have an edge when they enter the process of negotiation.

The question in the mind of a group when the other person speaks is can we trust this person’s perspectives, opinions and statements? For negotiations to proceed smoothly, the answer to this question should be positive.

Credibility comes from the person’s knowledge, expertise, track record and relationships. It is essential that both the parties have in their teams those people who are perceived as being credible.

The authority or power to enter into a negotiation should be supplemented by the credibility of people sitting across the negotiation table.

3. Information:

Negotiation often proceeds on the basis of facts, figures, past data, future trends and outlook, studies, empirical data and calculations. Information, to repeat a cliche, is power. Adequate and reliable information about the various issues involved is essential for ensuring the success of a negotiation exercise.

The party which is better informed has an advantage. Logical and persuasive arguments cannot be put forth in the absence of all relevant information.

Before coming to the negotiating table, each party should make conscious efforts to gather as much information as possible on all the issues that will be raised during negotiations. Effective negotiation often involves hard bargaining and well-informed teams enjoy better bargaining power.

It is likely that one of the parties in the negotiation has greater access to information than the other. In the interest of ensuring a smooth flow of negotiation, information that is relevant for deliberations should be shared with the other party.

How to share it, when to share it and in what manner it should be shared are matters of judgement and should be decided depending upon the situations.

4. Time:

The time frame within which the negotiation should be completed is another important factor affecting the process of negotiation. One of the parties may have a certain urgency as a result of which they may be in a hurry to conclude the negotiation.

It is due to time constraints that negotiations cannot go on endlessly and both the parties should agree on a time frame within which the process has to be completed.

At the same time, the very process of negotiation is such that the other party cannot be hurried too much. Both the parties need to have adequate patience. Putting the other party under undue pressure is certainly not desirable.

Negotiations having wider impact on all the parties need to necessarily follow a well laid down process, which takes time. However, as the process progresses, the deliberations should gather the required momentum and the deal should be clinched or the settlement concluded towards the peak of the negotiation. Each party should take care not to delay too much resulting in a stalemate.

5. Emotional control:

Human beings are not just rational, they are also emotional. Every person has his or her qualities of the head and heart. It is true that in business situations, people take decisions based on thinking and reasoning and after a careful evaluation of choices before them.

Yet, if we scratch the surface, we do find emotions at play. Good negotiators are aware of the play of emotions and are responsive to them. Apart from assessing the emotional state of the people in the other party, the negotiator should himself display the appropriate emotional state. Sometimes, it would be appropriate to come on strong with forceful points.

At other times, a whisper and a soft touch would do. The idea is that whatever be your position, try to match the emotional furore of the other party and establish a facilitative ground. While a certain emotional awareness is no doubt relevant, there is nonetheless no room for excessive display of emotions in the process of negotiation.

6. Communication Skills:

As we have already noted, negotiation is an intense process involving exchange of messages. These messages are not necessarily bits and pieces of information.

What needs to be shared with others during the process of negotiation would be a complex mix of ideas, attitudes and even emotions. The negotiator needs to state, articulate, explain, reason out, appeal, concede, persuade, persevere and even remain silent depending upon the situation. Good negotiators use silence effectively.

They know when to remain silent. Effective negotiation calls for not only saying the right thing at the right time, but also leaving unsaid what need not be said. A good negotiator needs to have a good command over language.

The process of negotiation is not always conducted in a serious manner. There maybe instances of inter-cultural group negotiations, where it would be inappropriate to use jokes, humour and light-hearted comments since they are likely to be misunderstood.

In other situations where the relationship between the negotiating teams is not too formal, relevant humour and lighter moments may help in building rapport and easing tension.

Besides using the right words and tone, effective negotiators supplement their arguments with stories, metaphors and analogies to make their positions come alive.

Given the importance of communication skills in the negotiation process, parties concerned choose people who have good interpersonal skills as members of the negotiating teams.

Display of arrogance, hurtful comments, sarcastic remarks, emotional outbursts and overfriendly approaches are inimical to the smooth flow of the negotiation process.

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