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KNOWLEDGE the negotiating battlefield” – or, in layman’s terms, doing your homework thoroughly. Most importantly, it is more than just understanding preparation phase of any negotiation. You will the other party better – it is about understanding IS POWER yourself, your motives and your style as well. Really good negotiators understand themselves with stark clarity – they know their own foibles and weaknesses as well as their stronger points. SIMON BUZZA provides the next two rules in his They are able to deploy different persuasion and behavioural styles appropriate to the situation new series explaining the 12 key rules of negotiating and the other party. As a consequence, they achieve huge successes at the negotiating table. RULE NUMBER 3: know neither themselves nor the other party in KNOW THE ENEMY AND anything like sufficient detail. Unfortunately, KNOW YOURSELF these negotiators blunder into their negotiations “If you know the enemy and know yourself, supremely unaware of their own strengths and you need not fear the result of a hundred weaknesses, let alone the other party’s. The battles. If you know yourself, but not the resultant, “Wow, that was tougher than I enemy, for every victory gained you will expected, but at least we got there”, hides the also suffer a defeat. If you know neither the painful truth that they were totally ill-prepared enemy nor yourself, you will succumb in for this negotiation and consequently will almost every battle” certainly have lost a Sun Tzu, from The Art of War “It is more than just understanding huge amount of value. There was no greater war leader and strategist the other party better – it is about Beneath the veneer of simplicity implied by than Chinese military general Sun Tzu. His understanding yourself as well” Sun Tzu’s statement, philosophy on how to be a great leader and there is a raft of greater ensure you win is often quoted in relation to detail covering vital areas in negotiation work, management, and life – for good reason. preparation, such as: Sun Tzu also states, “Every battle is won before l Real objectives and business needs it is fought” – a point we picked up in my Rule l Commercial and financial requirements No 2 (See Winning Edge May/June 2016). l The importance, or not, of the relationship

Let’s be clear: although we are not fighting l Relative power and the fear of loss wars, we all negotiate on a daily basis. We l Potential “tradables”, their value and how they negotiate with family members about how to can best be used spend our holidays; with friends about how to l Different behavioural types and their pick up the bill for dinner; and with contractors important implications about when to come to the house for a delivery l Your interests versus positions taken by the or repairs. Doctors negotiate with patients when other party discussing the choice between medical therapy l Roles and responsibilities in the team and surgery or perhaps no intervention at all. l Attitudes and frame of mind before, during Scientists negotiate for resources, time and space and after the negotiation to conduct experiments. And buyers and sellers l Effective communication styles negotiate over products and services. All of us l Appropriate persuasion and influence negotiate for salary and job responsibilities. techniques to be deployed

Spare a second for this thought: if we could l Worst case scenarios, best alternative to a understand ourselves and the other party a little negotiated agreement (BATNA) and contingency better, our chances of success in all our dealings plans would increase dramatically. We call this the l The impact of culture and values. However, in my experience, most negotiators be a better negotiator if you prepare thoroughly. My advice is to spend half your preparation Simple advice, but worth emphasising. time on your own position and the other half on

This particular quote from Sun Tzu is a the other party’s. And be objective in your favourite of mine. In the starkest and simplest analysis: do you really know what you need to? terms, it lays out what needs to be done during You can, of course, continue to blunder blindly the preparation phase before a negotiation. into future negotiations, but beware for, as Sun To continue the military theme, it might be Tzu went on, “If ignorant both of your enemy considered as the “intelligence preparation of and yourself, you are certain to be in peril.”

RULE NUMBER 4: CLARIFY AND UNDERSTAND YOUR OWN VALUE BEFORE YOU START Value is the extent to which a product or service is perceived by the other party to meet their needs or desires, measured by their willingness to pay for it. It commonly depends more on their perception of the worth of the product than its intrinsic value.

So… if we’ve “delivered value”, we’ve satisfied a need or desire of someone at a price they were willing to pay. We’ve provided someone with a benefit for a reasonable cost – value for money. That sounds straightforward enough. So, why then is value one of the most talked about aspects of sales, purchasing and negotiation, but also one of the least well understood, implemented or used? Because it takes time, effort and emotional intelligence to understand the other party’s perception, drivers and motivation, and is therefore difficult. UNDERSTANDING VALUE The secret to understanding these issues is to prepare and plan carefully (again, see Rule No. 2) and to be able to listen and hear and use your emotional intelligence. Because most negotiators only consider the other party rationally, their research focuses on purely rational issues. However, the key to utilising value effectively is understanding the difference between what people say they want – their explicit wants, such as lower prices – and what they are implicitly asking for, which could be recognition that they’re important, want genuine dialogue and feel the need to be taken seriously. Emotional understanding goes beyond the obvious explicit requests. Only by asking intelligent open questions about the other party’s challenges, needs and desires, and really letting them answer, can we get under the skin of their real drivers. Here are three commonplace, but very different aspects of value to the other party: 1 Financial value – the real financial benefit to the other party of a given proposition

BE PREPARED: FOCUS EQUALLY ON YOUR OWN AND YOUR OPPONENT’S POSITION

SIMON BUZZA is a Fellow of the ISM and founding partner of NewDawn Partnership, an advisory service that focuses on delivering operational improvements to the buyer and seller interfaces of a business. Visit: www.newdawnpartners.com 2 Operational or business value – such as efficiencies in terms of time and resources, or competitive advantage (all of which have a knock-on financial value too) 3 Personal value – such as enhanced individual performance and reputation. It is often the most important factor in a value proposition, really attracting an individual’s attention.

It gets more complicated. Big decisions are rarely made by one individual, but more often by committee, with a host of influencers and advisers. Now, our definition of benefit or value includes the term “…the other party”. But in committee negotiations we have different stakeholders with different goals and needs, and they all have their individual definition and view of value. So, we have some work to do. DEFINING VALUE It might sound crazy, but busy decision-makers don’t care about what you’re selling – the features of your product or service. They only care about what it does for them (“what’s in it for me” or WIIFM). That’s why a value proposition is so important today. It’s a clear statement about the benefits (value) they get from using your product, service or solution. Now have a fresh look at your website, your marketing materials and your proposition – are they feature rich or benefit rich?

The most effective value propositions target the two issues customers care about most: l What’s in it for them? Customers focus on their own pain points and aspirations – what they are trying to fix, accomplish or avoid. Value propositions that focus on solutions to those points really resonate with customers. l Why you? What sets you apart from the competition is called differentiation. Try breaking your value proposition down into the following three key areas: Points of relevant and irrelevant parity (POPs) These are the features and benefits that both you and your competitors offer. Relevant POPs – those of interest to your prospects – are the basic entry requirements to the game. Your prospects need to know that you offer them, but emphasising them won’t impress anyone. Points of irrelevance (POIs) All the other features that you alone offer, but which aren’t interesting to your prospects, are quite simply irrelevant – or POIs. Points of differentiation (PODs) These are the features and benefits you alone offer your prospects, and which are important to them. Because they are not available from your competitors, this is where you can win the game.