Ebook Negotiation

CRITICAL FOUNDATIONAL SKILL IN
BUSINESS
Advanced
Negotiation Techniques
Yim Choong Chow
THE SKILL OF
NEGOTIATION
CAN BE LEARNT &
MUST BE LEARNT
IF YOU WANT TO
WIN IN THE GAME
OF BUSINESS
1
Published as eBook 2008
Advanced Negotiation Techniques
ISBN 967 -914-787-8-1
2008 by Yim.Choong.Chow
No part of this eBook can be reproduced, stored in a retrieval system or transmitted

in any form or by any means, electronic, mechanical, photocopying, recording or
otherwise without the prior written permission.
2
FONDLY DEDICATED
TO
My Wife
Janet
Thank You for
Negotiating so tough & so hard
To guarantee our success and happiness
in the game of life.
3
Appreciation
I owe much of what I have,

What I am and who I am
To myself.
But much of what I have,

What I am and who I am would mean nothing
If not for my loving wife, my two great daughters,

Supportive colleagues and unwavering friends.
From them I have taken much too much at

times. So too from the hands of many unseen and
possibly unknown benefactors
And to them I owe

All my happiness and well being
And what little else Ill ever need to own
Thank you for crossing my path and helping me

succeed.
4
TABLE OF CONTENTS
Chapter
1
Understanding The Negotiating Game 6
2 The Two Modes & Two Styles 12
3 Preparation The Key To Success 15
4 The Five Step Methodology 23
5 Understanding & Managing Power 51
6 Tactics & Gambits 57
7 How to handle Impasse, Stalemate &

Deadlock 66
8 Some Parting Words 75
9 Self Assessment 78
10 About The Author 85
5
ADVANCED NEGOTIATION TECHNIQUES
- CHAPTER ONE -
UNDERSTANDING
THE NEGOTIATING GAME
By Yim Choong Chow 6

WHAT IS NEGOTIATION?
A game! A serious game in life, as is in business. Whether
we like it or not, are in it voluntarily or not, are conscious
of it or not, we negotiate all the time from small
inconsequential issues to matters that have major impact.
NEGOTIATION IS PROFITABLE
Why negotiate? Simply, it is the fastest way

To put money in your pocket and
For your organization, to improve the bottom line.
A dollar negotiated is a dollar earned.
We negotiate because
Just getting a deal is no longer good enough.
We must strive to get the best deal possible.
Visualize playing a game with a pile of gold in the middle
of the table. Your objective as well as the objective of
your opponent, is to complete the game by winning as
much gold as possible. If there were such a game, would
you leave any gold behind? Of course not!
Negotiation is about movement

It is about two or more players walking towards each
other until they reach a mutually acceptable position. The
name of the game is to get the other side to walk faster
and to take bigger steps than you.

NEGOTIATION IS ABOUT FINDING THE 3RD ALTERNATIVE

If neither proposal is acceptable, it is about exploring
alternatives and options synergistically until a mutually
acceptable third alternative is found.
Negotiation is about conflict resolution

Negotiation is the process through which the conflicting
parties modify and adjust the views of their ideal outcome
to an attainable outcome. In the process, the parties
modify their demands in order to achieve an acceptable
compromise.
Negotiations need not be adversarial

It is best played when it succeeds to resolve a conflict
without undermining or jeopardizing the continuing
relationship of the parties. This is done through
recognizing conflict as a fact, and not an obstacle.
Negotiation provides an avenue for the parties to find
ways to create a higher level of satisfaction.
The game presupposes there is a margin

No margin no negotiation! The parties may not know
how big the margin is,
whether it is significant or not,
whether it is within their settlement range or not,
but they expect the other party to have padded their
offer to some extent. As such, they do not expect the
other party to adopt a non- negotiable stance. Going into

a negotiation with your real best offer will mean not

having a margin to negotiate with. This can be seen as
acting in bad faith as your opponent will see you as
adopting a one off take it or leave it position.
NEGOTIATION WILL BE POSSIBLE as long as both parties

consider the benefits of resolving the conflict through
negotiation are greater than the likely benefits of
resolving through some other means.
NEGOTIATION IS THE ART OF CONVINCING OTHERS
It consists of saying and doing those things that cause

others to want to do what you want them to do.
THE NEGOTIATION CONTINUUM
THE NEGOTIATION PROCESS IS FIRSTLY ABOUT GETTING TO THE
BARGAINING ARENA. ONCE IN THE BARGAINING ARENA, IT IS ABOUT
FINDING A SETTLEMENT WITHIN IT. HAVING DISCOVERED THE
POSSIBILITY OF A SETTLEMENT, IT IS ABOUT SECURING A SETTLEMENT
AT THE LEAST COST AND AGREEING TO ITS IMPLEMENTATION.
A good way to understand negotiation is to present it as a

continuum with the opposing players ideal position as
opposites.
Negotiation pre-supposes there is a margin. The margin is

the gap between the negotiators ideal position and his
limit position.
Ideal position = the best he hopes to achieve

Limit position = the point beyond which he would rather
accept a deadlock or no settlement.
The negotiation margin is then the negotiators area of
play within which he can trade concessions. In Figure NC:
1, As margin and Bs margin overlap suggesting
possibility of a settlement.
Bargaining
Arena
Ideal Limit Ideal Limit
A A
B B
Limit Ideal Limit Ideal
Figure NC:1 Figure NC:2
The shaded area in Figure NC: 2 is the bargaining area.

Since negotiation is about movement, the players job is
to get the other side to move towards his ideal.
In Figure NC: 3, there is no overlap. If the parties refuse

to move their respective limit position, no settlement
will be possible.
No settlement as long
as gap remains
Ideal Limit
Limit Ideal
Figure NC:3

In Figure NC: 4, Bs negotiating position is too

conservative and lies well within As range. It will be easy
for both A and B to settle by maintaining the original
positions.
As new info emerges, ideal/limit

may need to be changed
Ideal Limit
B
Limit Ideal Revised
Ideal
Figure NC: 4
If this situation becomes known to B, his task would be to

move his ideal further right and entice A to move towards
that.
Failing to do that will be like leaving gold on the table.

Remember arriving at a satisfactory agreement is not
quite the same as reaching the best possible agreement.

- CHAPTER TWO -
THE TWO MODES
AND
THE TWO STYLES

The two modes of negotiation

When people negotiate, they engage in two modes of
negotiation - personal mode and organizational mode.
These two modes exist concurrently and the interplay
impacts the manner by which the negotiator goes about
his game.
Personal Mode
There is a misconception that when negotiating in official
capacity, players are only concerned about official
issues and that personal interests are left aside. By
official issues, we mean hard issues such as goods,
services, price, quality, delivery specifications etc. Soft
issues relate to feelings, likes/dislikes, emotions, face and
other personal concerns. How often have we not been
able to make a deal even though we satisfy all hard issues
fully?
Research has validated that people buy emotionally

then justify logically. People are not only satisfied at
the official level. Organizational requirements (money,
quality, delivery, specifications, etc) are just one part of
the equation
HARD Price
WHAT YOU SEE
ISSUES Goods
Services ON THE AGENDA
Terms
Feelings, Likes/Dislikes
WHAT YOU
SOFT Emotions, Face, Ego CANT SEE
ISSUES
Time, Workload, Pressures
Need for recognition
By Yim Choong Chow How would I look? 13
What does the boss want?

Often the real satisfiers lie below the water line in the
iceberg. Soft issues and other personal drivers not on the
official agenda often decide whether the negotiation will
proceed smoothly or not.
A skilled negotiator is perceptive to the forces below the

water line and leverages them to get the best deal
possible.
ORGANIZATIONAL MODE
Every negotiator has to contend with his organization.

Contending with his own organization is, more often than
not, more demanding and difficult than dealing with the
negotiator on the other side. This is because each part of
the organization has conflicting demands, priorities and
objectives.
Prior to negotiating with the other side, the negotiator has

to be able to successfully negotiate internally within his
own organization. He needs to be able to deal with
conflicting motives between departments and units.
So the negotiator you face may not be the real deal

breaker someone else behind the scene may be the
culprit.
Understanding that the negotiators are constrained by

issues imposed by other parts of the organization they
represent will often result in collaborative efforts - to help

each other get a yes from people behind the scene
from the decision making unit.
How? By understanding
his side of the story,
what his direct and indirect interests are,
how your offering affects his companys business in
total,
what your real value proposition is to him,
what his real value is to you,
most of all, what he needs from you to get a yes from
his side.
More often than not, company doing business together are

neither totally dependent nor independent of each other.
True long-term sustainable success is predicated on
interdependency. Understanding how each party
supports and helps the other will result in getting a better
deal for both sides if both sides look hard enough.

THE TWO STYLES OF NEGOTIATION

There are two common styles by which people negotiate -
competitively and collaboratively. Which one is your
preferred style? Which one is better?
Competitive people tend to see people as competitive.

Collaborative people tend to see people as collaborative.
Decide which style to use based on the situation not on

your personality. Find out whether the other party is more
competitive than collaborative. Is he willing to be
collaborative?
Competitive Style The Hunter

Competitive negotiators tend to see negotiation as a
contest. They are concerned about winning, at the cost of
the other side. They play cards close to the chest and
tend to share very little information. They often display
and deploy power tactics. The strategy is I Win - You
Lose. They are hunters in the game.
In competitive negotiations,
Talk less;
Share as little information as possible. The less he
knows about you, the better;
Watch out for dumb remarks. Collect dumb remarks
before the negotiation;

Dont trust your assumptions. Things are never what

they seem;
When it comes to trading concessions,
Always give yourself room to negotiate. Start with high
demand - never start with the real best price;
Give in stingily and slowly;
Try not be the first to concede on a major issue it will
encourage the other party to demand more;
Avoid splitting the difference;
Watch out for the deadline - large concessions are
given out during the final minutes of the negotiation.
COLLABORATIVE STYLE THE FARMER

Collaborative negotiators tend to see negotiation as a
process to find mutual satisfaction. They tend to be
committed to the strategy of I Win You Win.
Collaborative negotiators are farmers.
Commitment to greater mutual satisfaction leads them to

adopt a mindset of
What can we do together to make a better deal for
both of us, without hurting each other?
There is always a better deal for both of us if we look
hard enough.

In other words,
What can you do for me, and
What can I do for you?
The approach revolves around problem solving, exploring
and helping each other win.
Collaborative negotiators ask questions, listen carefully,

synergize with What if, are open, share information
readily and invest in building trust and rapport.
An effective way to induce collaborative mode is to trigger

this dialogue at the start of the meeting:
A: We obviously have our own objectives in this
negotiation. Would you be willing to go for win-win
solution?
B: Of course! Thats also what we want.
A: Good! Can we then agree that we will go for a
No-Go if what we come up with later is not in
accordance with this principle?
B: Sure!
A: This means that if at any time you feel that the
proposal is not a true win for you and that if at any
time I feel that it is not a true win for me, then we
can honestly raise the issue in the open and discuss
it. Fair enough?

- CHAPTER THREE -
PREPARATION
THE KEY TO
SUCCESS

Why prepare?
Preparation is the key to success. If you are not fully
prepared, then you must be prepared to lose fully, and
possibly dearly too, if the stake is high. Lets see what
happens is the alibi of the unprepared.
A badly prepared negotiator can only react to events he

cannot lead them.
What to prepare?
Everything you need! Needless to say, an update of the
most basic information about the other party (such as
customer profile, industry drivers, critical success factors)
is essential.
Specifically eight key areas require attention. Without

adequate answers to the list of questions below, we
cannot claim to be reasonably prepared.
1. WHAT MATTERS MOST?

Why are we negotiating?
What are the most important issues?
2. WHAT ARE THE OPTIONS?

What alternatives do we/they have?
What is the best thing that can happen?
What is the worst thing that can happen?

What is the likelihood of the best/worst case

scenario happening?
What is the best alternative to a negotiated
agreement B.A.T.N.A?
3. WHAT IS THE NEGOTIATING MARGIN?

What do we want to achieve?
What is the ideal position the best possible
result?
What is the limit position the point beyond which
we prefer no go?
What is the intended position a realistic target?
What is our best guess of their objectives?
4. WHAT ARE THE TRADABLE VARIABLES?

What concessions can we/they offer?
What concessions do we/they want in return?
What is the cost of each concession?
What is the value of each concession?
5. WHAT IS THE POWER BALANCE?

Who has power? Why?
What is the level of dependency of the parties?
What is the real value of our offerings to them?
What is our impact to their business?
What is the real value of their offerings to us?
What is their impact to our business?

6. WHO ARE WE DEALING WITH?

With whom will we be negotiating?
What do we know about them in terms of
seniority,
competency,
negotiating style,
interests and inhibitions?
7. WHO WILL DO WHAT?

What are the roles of our team?
Who will be the team leader, summarizer,
observer?
8. WHAT SUPPORT & RESOURCES DO WE NEED?

Do we have the necessary commitment, support
and resources from our organization to do what
we plan to do?
Some of these questions require time and effort to

prepare. It is advisable to start early. A number of these
issues should already be your focus months before the
negotiation is due. Preparation activities should be made a
matter of daily routine so that when the date of
negotiation draws near, the required information is readily
available.

- CHAPTER FOUR -
THE
FIVE STEP
METHODOLOGY

The five-step methodology

The five-step methodology is a systematic process of
engagement during face-to-face negotiation.
Step 1 Opening
Step 2 Signaling
Step 3 Proposing
Step 4 Bargaining
Step 5 Closing & Agreeing
Each step represents an essential phase in the negotiation

process from start to end and whereas the steps may not
always move sequentially, they are largely present in
most negotiations. What is important for the negotiator is
to recognize the step he is currently in and constantly
strive to drive it forward.
For example, when enough is said during the opening

phase, it pays to signal to the other side to move towards
Step 3. Similarly, it may not be useful to engage in Step
4 bargaining, before a package of proposal, Step 3, is
set up.
Step 1 - Opening
The objectives of Step 1 are:
Present opening demands;
Explain positions;
Listen to the other sides opening position;
Discuss, argue, justify.

The opening phase of the negotiation tends to be tense

because the parties are wary of their opponent at this
time. Some negotiations do not get beyond the opening
and breakdown because the inter-party tension is
heightened by the behaviour of the parties towards each
other.
In Step 1, each party will

Give reasons why it believes something to be
necessary.
Seek to show by reasoning why something is true.
Explore issues.
Explore interests and inhibitions.
Explore the gap that separates the sides.
An interest is something that motivates him to say yes
whereas an inhibition motivates him to say no. His
inhibitions and interests need not be obvious remember
the iceberg. Step 1 gives you the opportunity to test your
assumptions you made about him during preparation.
Since most negotiations break down during Step 1, avoid

destructive discussion. Features of a destructive
discussion include:
Interruption;
Ignoring your opponents interest;
Pressing on only with your own agenda;
Point scoring;
Attack-defence-blame cycle;

Threats provoking counter threats;

Loss of face.
Promote a positive atmosphere by engaging in
constructive discussion through:
Positive listening (listen more than you talk);
Positive talking (ask more open questions);
Testing your assumption by getting him to talk about
his views;
Avoiding provocative language (how do you justify that
outrageous joke of a demand you have just made?
Summarizing;
Seeking and giving information.
It is okay to disagree with the opening demand of your

opponent. In challenging your opponents position in a
constructive manner and explaining your own, you are
creating a platform from which the next steps in the
negotiation can take place. You establish in opposition the
strength of your commitment to your own position.
Examples of opening statements

We would like to come to a mutual agreement on
We hope to reach consensus on the following issues
The issues as we see it are Did I leave anything out?
The agenda from our side is What do you have from
your side?
I suggest that we start by exchanging views about the
situation and then we will move on to discussing how
we might resolve the difficulty. Is this approach okay

with you?
It has been one year since we last reviewed our price.
With the escalation in fuel cost, it has become
necessary for us to revise our price upwards. We are
here today to explore how we can
We were given to understand that you may be
considering to divest your business. Coincidentally, we
have an immediate need to increase our capacity. What
we would like to explore today is Would you be keen
to do that?
We have a time bomb in our hand. If we continue the
high wage increase as we have done in the past, the
business will become unsustainable and the
management will be forced to consider drastic steps
including laying off workers. We should work together
to avoid this at all costs. What we would like to see
happen today is an agreement whereby What is the
position of the union?
Example of an opening dialogue
A: We have been directed by our HQ to reduce cost

by 5% across the board. I know you have been
responsive to our previous requests to cut cost and
your price is competitive. This is a serious do-or-die
mission and as our major supplier, we have no
choice but to come to you again for assistance. We

know this is difficult and what we would like to do

today is to explore with you what you need from us
in order for you to give us the 5% reduction.
B: We understand the difficult situation you are in.

We value your support and will do our best to
support your goal for reducing overall costs. As you
know, fuel and raw material costs have been on the
rise and we, too, are finding it hard to even maintain
the current price. We have already initiated price
increase discussion with some other customers. My
suggestion is that we mutually explore how we can
work together more efficiently to drive cost out of
the system and thereby achieve the reduction in
overall cost for both of us. Would this approach be ok
with you?
Opening statements set the negotiating atmosphere. A

properly and positively crafted statement puts people in
the mood to work towards a win-win outcome. A poorly
and antagonistic opening challenges people, raises their
defence and can possibly ruin the negotiation before it
starts.
Whereas Step 1 is intended for the parties to present their

respective opening demands, such opening statements
(which contain the ideal objectives) are seldom the results
they would expect to get. Therefore, it serves no purpose

to stick rigidly to opening positions for too long as this will

lead to destructive discussion, hostility and possibly
deadlock.
When enough has been said by both sides, move forward

by using Step 2 - Signalling.
To get out of
non constructive
discussion/arguments
move to Step 2
PROPOSAL
SIGNAL
Attack Defend
Justify Destructive Blame
Discussion/
Argument
STEP 2 - SIGNALLING
Negotiation is about movement. Parties must move
towards each other. Two principal forces facilitate
movement - the pain & the gain. The pain (the sanction)
is the penalty of not agreeing. The gain (the incentive) is
the benefit of agreeing.

If the parties stick rigidly to their opening (ideal) position

and not move, deadlock will occur. Yet it is not prudent to
begin moving (offer concession) before the other side has
indicated an intention to move. This is when Step 2
signalling, comes in useful. Step 2 is the bridge between
Step 1 - the opening demands and Step 3 -the proposal.
It pays to indicate a willingness to move. The ability to
read and send signals is an important skill in avoiding
deadlock.
The objectives of Step 2

To subtly tell the other party that you are ready to
move on.
To check if he is also ready to move on.
What is a signal?
A signal is a means by which parties indicate their
willingness to negotiate on something. It implies a
willingness only if it is reciprocated by the other side. It is
used to break out of the non-conclusive
discussion/destructive argument. A signal is a message.
Like all messages, it has to be received, interpreted,
understood and acted upon by the receiver.
The act of being present at the negotiating table is, in

itself, a signal for the willingness to a make a deal.

A signal is not a movement by the party sending the

signal. It is a call for the other party to move. When then
is the gain? The gain lies in what the party receiving the
signal does about the message it has received.
How to recognize signals?

Actively listen to not only what your opponents says but
also how he says it. Listen not only to the words but also
to the tone of voice. Watch the body language.
The Hidden Language of Signals

SIGNAL INTERPRETATION
We are not prepared to It is negotiable later.
discuss that at this stage.
It is not our policy to give We can guarantee

guarantee, and even if we something less than 100%.
did, we would not
guarantee 100%.
This is an extremely This is our ideal price.

reasonable price
This is our best price.
We will never agree to It is possible if some of the

what you are proposing in terms are changed.
its present form.
It will be extremely difficult It is not impossible to

to
As matter of routine, we But it can be changed.

are not set up to cope with
this demand.

It is beyond my scope of But is not beyond my

authority to decide on bosss scope.
something like this.
We normally dont We negotiate what you get

negotiate on price. for the price.
It is not our normal So what is normal?

practice to
Responding to signals
WRONG APPROACH
A: We will never agree to what you are proposing in its
present form.
B: Okay, we will amend a, b, c and d. Is that acceptable?
A: No, we will then need x, y and z beside a much lower
price.
RIGHT APPROACH
A: We will never agree to what you are proposing in its
present form
B: If you are prepared to give details on the kind of

amendments which would enable you to consider
accepting our proposal, we would certainly be prepared to
consider responding positively to what you have to say.

TECHNIQUE 1: PIN DOWN QUESTIONS
The key to responding to a signal is to ask a pin down

question. An answer to the pin down question transforms
the vague signal into a specific, understandable and
actionable message.
SIGNAL PIN DOWN RESPONSE

We dont normally give Under what circumstances
guarantee. would you consider giving
guarantee?
We cannot accept all of Which of the changes could
those changes. you accept?
Your delivery schedules are How flexible do you require

too rigid. the delivery schedule to
be?
You cannot expect us to What needs to change

accept your position in its before you will consider
current form. acceptance?
Technique 2: Restate the signal

Restating the signal into a positive statement is also an
effective way to respond. Example:
Signal: Given the current volume, we would find it
extremely difficult to change xxx.
Restatement: What you are saying is that you would

be willing to change xxx if we are willing to consider
increasing the volume commitment, am I right?
Conditional Signals
To test the water, it may sometimes be useful to send a
conditional signal.
Examples:
It would be near impossible for us to waive the

increase, but if we were to consider that, would you be
willing to consider increasing the volume?
Let us assume for the sake of argument that if we were
to accept the principle behind your proposition, what
price discount would you offer us in return?
Without prejudice to the final outcome to the basic
interest of each side, if we were to consider the points
you have raised, would you be prepared to consider our
points?
When you receive a positive response to one or more

signals, you are ready to move on to Step 3

Step 3 Proposing
In negotiation, we are saying in effect that

the position I open with is not the position I expect
to end up with.
This is not the same as saying that

any position other than the one I open with is
acceptable to me.
Proposing is the step in which parties make proposals and

counter proposals aimed at creating movement towards, if
not, into the bargaining arena.
Package for
Bargaining
Step 3
Proposing
Step 2 Response
Signaling
Counter proposing
Attack Step 1 Defend

Justify Opening Blame
Position
Proposing is the effort made to compose a package

comprising of as many tradable variables as possible for
subsequent trade-off and bargaining.

Remember it is difficult to negotiate with only one

variable. Imagine a situation where you have been
cornered to only negotiate on one issue say, price.
There is only one way the price will go with the seller
conceding without getting anything in return. (Note: This
is a technique often used by skilled negotiators, especially
purchasers, when knocking price down.)
Objectives of Step 3
Move away from the opening position.
Create an agenda or platform for bargaining.
Step 3, helps you and the other party to draw up a

parameter which contains possible definition of:
WHO gets HOW MUCH of WHAT WHEN?
Tradable Variables
The skill of proposing (and counter proposing) lies in the
ability to open up variables for trading. Identify tradable
variables by answering:
What can we give?

What concessions can we offer which is of value to
the other side?
What is the cost of such concessions?
What can they give?

What concessions can they offer which is of value to
us?
What is our estimate of the cost of such concessions?
What concessions can we trade?

What concessions can we give and what do we want
in exchange?
In itemizing tradable variables, think beyond the obvious.

Think in terms of value exchange. What is our value to
them and what is their value to us?
In a seller/buyer scenario this be listed as VALUE TO

CUSTOMER Versus VALUE OF CUSTOMER
Value OF Customers Value TO Customer

Acceptable yield Continuity of supply
Commitment of volume Consistency of quality
Predictability of revenue stream Flexibility in operations
Assurance of future income Timeliness of delivery
stream Speed of response
Capacity utilization/commitment Responsiveness to change
Base volume Order size flexibility
Marginal volume Price differentials
Prestige USP giving customers a distinctive
Breadth of business edge
Growth potential
In making the tradable variable list, consider the impact of

our offerings to the other side. Make it contextual and
relate it to the issues at hand. Avoid generalizing.
Situations, especially in business, are dynamic and

constantly changing. Take into consideration the business

drivers when proposing. If we had to cut price the last
time to get a deal, it does not mean that we have to do it
again this time!
Imagine negotiating with a mobile phone manufacturer

who has a deadline to launch a new model ahead of his
competitor and in time for the next shopping season,
would lower price be the only tradable variable he is
seeking from you? And if the answer is no, what would
you like to get out of the deal?
Package your proposal to address the interests and
inhibitions of the other party. Think creatively about all
the possible variables. Money produces many variables:
stepped increases, shared costs, extended credit, fixed
charges, variable charges, penalty clauses, compensation
clauses, interest rates, denominated currencies, etc.
How to package a proposal

Follow this formula:
If you do we are prepared to consider doing
Example:
If you are prepared to increase the M.O.Q., we are
prepared to consider reducing the quantum of
increase
If a justification is required, feel free to add the reasons
If you do we are prepared to consider doing
This is because

Example:
If you are prepared to increase the M.O.Q., we are

prepared to consider reducing the quantum of
increase. This is because we can offset part of the
price increase from the efficiency savings we get
from a longer production run.
Notice how you present your condition first and make it

specific:-;
to do not consider doing
and, how you make your part of the proposition
tentative:-
consider doing
In other words, separate the proposal from its explanation

and its justification. If multiple issues are involved,
itemize what is in the proposal first and then, if necessary,
explain or justify its contents.
Example:
If you can meet the following conditions 1,2,3. We will be
prepared to consider offering the following 1,2,3. Our
reasons for doing so are a,b,c.
After making the proposal, shut up!!!

Keeping quiet puts the pressure on the opponent to
speak.
How to receive a proposal
Do not interrupt hear him out fully.

Do not engage in instant rejection. Apply considered

response.
Treat the proposal and the proposer with respect, you
cannot seem to be considering it seriously by rejecting
it outright.
Ask questions to clarify any points you are unclear on
as this may give you signal clues.
You can tell which parts of the proposal are of interest
and which are not.
Say No, because
How to counter propose

Perception differs. What is one mans meat is another
mans poison. Your perception of the other partys interest
may be different from their perception of their own
interests. Counter proposal enables you to influence them,
perhaps enough to alter their perceptions.
You might say:

If we were to meet you on we would have to
If we were to meet that quality specification, we would
have to increase the frequency of inspection.
If we were to increase the M.O.Q., we would need to
increase the storage area.
By doing so, you are showing them the consequences of
their insistence on a course of action. This can be followed
by a counter proposal that meets their interest.
However, if you are prepared towe could and meet
your

However, if you are prepared to cover the additional

cost associated with inspection, we could achieve the
higher quality and meet your specification in full
However, if you can arrange to schedule the delivery on
a just in time basis, then we could do away with the
additional holding storage and meet your request for
the increase in M.O.Q. in exchange for the waiver in
price increase.
To link or not to link

During this phase of the negotiation, it is common
strategy for buyers to present a list of demands,
objections and requirements followed by the logical
suggestion that they are dealt with one at a time.
Watch out! This may be a trap. Negotiating piecemeal
could get you chopped up and exhaust your negotiating
capital especially if your power position is low.
So, sellers beware. Endeavour, instead, to keep all the

issues in dispute linked up to the bargaining step Step 4

Step 4 Bargaining
Having defined the platform for bargaining, time has come
to trade concessions.
Step 4
Bargaining
Step 3
Proposing
Step 2 Response
Signaling
Counter proposing
Attack Step 1 Defend

Justify Opening Blame
Position
Negotiation is an exercise in trading not conceding.

Trading is about exchanging something gained for
something given up.
Objectives of Step 4
Trade and exchange concessions.
Maximize satisfaction for both parties.
How to Bargain
Use the BIG IF formula
If you then I
If you agree to X, then I will agree to Y.
The single most important rule for bargaining is to make

all concessions conditional. Every thing is conceded in
exchange for something else. Nothing is given away free.

We have been taught to give and take This may not the
best approach in negotiation. Dont assume that if you
are generous to your opponent, you can persuade them to
be generous to you in return. To be sure, take then
give.
The Big IF achieves two things.

Your opponent will receive a clear signal about the price
you place on a concession;
You will educate him in bargaining behavior all
concessions from you must be paid for by concessions
from him.
Otherwise he will naturally assume that concessions from

you are his by right or by might. Neither assumption is to
your advantage. Negotiating becomes a process of
surrendering to his ideal position and you have to settle
for less than you need to.
Dos and Donts in bargaining
DOs
Lead with conditions:
If you agree to X, we will agree to Y.
Provided that you accept X, we will agree to Y.
On condition that you do X, we will do Y.

DONTs
Never If I Then you?
If I agree to X, then will you do Y?
Expressing this as a question often invite Nos
If you offer a concession first, you risk that being
pocketed and getting nothing in return.

Step 5 Closing & Agreeing

Successful negotiation leads to closure and agreement.
OBJECTIVE OF STEP 5
To end the negotiation process by:
Closing the deal.
Ensuring a common understanding of the agreement.
STEP 5 HAS TWO SUB STEPS:

CLOSING, AND
AGREEING.
CLOSING
Closing is effectively telling your opponent that they must
now choose to accept things as they stand. This is
presented in a way that emphasizes both your
determination not to concede more and that it will be in
their best interest to settle with you at this point.
Features of a close
Must be credible he has to believe you mean what
you say.
Package must meet enough of his needs to be
acceptable anything less he would opt for a no-deal.
When to Close?
It is difficult to decide when to close because neither side
is sure where the other partys limit really is. This makes

the decision to close a matter of judgment. It is easier to

learn how to close than when to close. Timing is essential
and again calls for judgment. Too early: he will interrupt
your move or regard it as a hostile act as he is not done
bargaining.
If you are on or near your limit position, you will have a

strong incentive to try to close. Essentially, you close
when you believe there is no more gold on the table.
How to close
Technique 1: The Concession Close
This technique terminates the bargaining step by offering
a concession to secure agreement. Possibilities include
conceding:
On a major element in your opponents demands;

On a major stumbling block;
On a minor issue;
Introducing a new concession not originally demanded
but attractive to your opponent.
YOU HAVE ALREADY RECEIVED A COMPREHENSIVE LIST OF
CONCESSIONS WHICH MAKES OUR PROPOSAL VERY
ATTRACTIVE. IN THE INTEREST OF A SUCCESSFUL
RELATIONSHIP, IF YOU AGREE TO THE PROPOSAL NOW, WE
WILL AGREE TO INCLUDE XXX IN OUR OFFER ON

Technique 2: The Summary Close

This terminates the bargaining step by summarizing
everything that has been agreed to up to now,
highlighting the concessions that the opposition has
secured and emphasizing the benefits of agreeing to what
is on the table.
Let me summarize the discussion as we see it.

aaa, bbb, ccc We cannot emphasize enough that
we have conceded all we can on these issues.
There is no more in the kitty and to prolong the
negotiation in the hope that there is more would
be futile. This is our final position and we are
requesting that you accept what is on the table
and sign the agreement
The package as we see it is aaa, bbb, ccc. You

must acknowledge that we have conceded all we
could. The package you now have is attractive and
is the best that we can offer. We cannot do better.
Lets sign the deal and go celebrate the start of a
good business partnership
Technique 3: The Either/Or Close

The purpose is to give the opposition the choice of
alternatives, any one of which is within the limit of the
closer.

We have explored many options. The two best

alternatives which are closest to your
requirements are aaa or bbb. Which one would
you prefer?
This technique can be used in conjunction with an

adjournment close when they can adjourn to consider
which alternative they prefer.
Technique 4: The Adjournment Close

This technique terminates the bargaining process by
calling for a time out for the opponent to make a decision.
It would seem that we both need time to
evaluate the proposal. Why dont we take a two-
hour recess and reconvene at 4pm to finalize the
agreement?
It appears that we would not be able to come to
an agreement today. May I propose that we
adjourn and meet again next Monday at 2pm to
finalize the outstanding points?
Technique 5: The Final Offer Close

This close is used to give a final opportunity for your
opponent to agree. A final offer increases in creditability
when it is
formally made,
delivered by a senior person,
made in public,
tied to a specified date of acceptance.

Bluffing final offers can destroy creditability in the
current negotiations and in subsequent ones and never
force a final offer under emotional pressure
The final package from our side is xxx. We have

explored all possible options and are not in a
position to improve our offer any further. In the
interest of yyy, we asked that you accept the
proposal by latest Sept 11.
What is on the table is the best deal possible.
When can we start?
Agreeing
The purpose of the closing step is to secure agreement to
what is on offer. Agreeing is the last step in the
negotiation towards which all the others have been
working. We negotiate to agree.
The final step agreeing, is a dangerous time for

negotiators. Closing the deal can lead to a high degree of
euphoria as previous tensions dissipate themselves in the
natural relief of arriving at agreement. It can put you off
guard and less attentive to the finer details of what you
have agreed.
Genuine error and misunderstanding on both sides as to
what really was agreed can also occur. People often
believe something was agreed when it was not.

SUMMARIZE THE AGREEMENT
Before leaving the table, be sure that both sides are

absolutely clear on what they have agreed to. Summarize
what has been agreed to and get an agreement on the
summary. Remember one comma can make a big
difference!
KILL HIM NOT LET HIM GO
WHO SHOULD SUMMARIZE BUYER OR SELLER? HOST OR
GUEST?
YOU do! And if both sides volunteer, do it jointly.
KEY POINTS ON AGREEING

If the close has been successful: what has been agreed?
List the key points of the agreement.

List the points of explanation, clarification,
interpretation and understanding.
Try to prevent your opponent from leaving the table
until an agreed summary has been recorded.
If the agreement is oral, send a written note to your
opponent of what you believe was agreed as soon as
you can after the meeting.
If there is disagreement on an alleged agreement, the
negotiation must recommence until an agreement is
reached again.
- CHAPTER FIVE -
UNDERSTANDING
AND
MANAGING POWER

What is power?
Who is the most powerful person on earth? The answer
depends on who you ask. Power is a state of mind. It is
perceptual. It is relative. It is situational. You have as
much power as you think you have.
Power only exists to the extent it is accepted. If a buyer

insists that he will not be exploited even in a monopolistic
situation, he wont.
Power may be exerted without action. If one party

believes the other party will take action then action may
not be necessary.
The exercise of power entails risks and costs. Power

balance can change and changes constantly.
Who has power?

Negotiation presupposes that neither party has absolute
power. This does not mean they have equal power. Your
opponent may have enough power to cause you to settle
near your limit but not enough to force you to surrender.
He may act as if he has sufficient power or lead you to

believe that he is in a powerful negotiating position, when
in fact he has/is not. Just think about how some buyers
behave and how many sellers are led to believe that
they are at their mercy.

You are more powerful if:

the cost of NOT reaching a settlement hurt your
opponent more than they hurt you.
You are in a relatively weaker position if:
the cost to you from not getting a deal is greater than
the cost to you of the deal on his terms.
Bear in mind that estimating your own and your

opponents bargaining power is a subjective exercise open
to wide margin of error.
The stronger you feel, the narrower the margin between

your ideal and your limit and the greater your
commitment to the opening position. The weaker you feel,
the wider the margin and the weaker your commitment.
Sellers tend to underestimate their power and over

estimate the power of the buyer.
Sources of power
Remember power is a state of mind, an attitude and a
belief. It is a perception on the quality of the relationship
between the parties. If you think and believe the other
side has power over you, you will tend to behave in a way
that lessens your assertiveness fulfilling the notion that
the strong always dominate the weak.

In assessing the power balance, adopt the view that they

need us as much as we need them. If not, why do they
bother they negotiate they might as well order you to
comply!
Never base your negotiation strategy entirely on power

especially when you are in a position of strength - even if
it were true that you are more powerful. Using power
solely to negotiate means beating the other side into
submission. You may win now but what about tomorrow?
Every dog has its day.
Here is a partial list of power sources which may be

helpful to strengthen your position:
KNOWLEDGE
Advanced information.
Insider information.
Technical competence, know-how.
Knowledge is only power when put in use.
COMPETITION
Obvious but,
What would prevent them from using the
competitors?
Why are they not using them now?
COMMITMENT
Personal commitment you can count on me
Commitment made in public.

FINANCIAL STRENGTH
Remember to ask what is in it for me by you being
strong financially.
CONNECTIONS
Know-who.
Be sure the who is the real thing!
LEGITIMACY
Anything which symbolizes legitimacy.
Forms, brochures, memo, price list, memo,
instruction.
Policy, guideline, standard procedure.
TIME
Deadline whose deadline is it?
You have more power if time is on your side.
SIZE
The bigger the better?
Again what is in it for me how can your size
benefit me?
COLLECTIVE BARGAINING
United we stand, divided we fall principle.
MARKET LEADERSHIP
What is the value of that prestige when dealing
with the market leader, such as the biggest
shipping company in the world?
RISK TAKING
Give me something in return for the risk I am
taking.
FIRST MOVER
What can I get in return for being your first
customer?

Four Questions to help build power
How can I enhance my power by

1. Taking an action I am not presently taking?
2. Not taking an action that I am presently taking?
3. Allowing/forcing the other party to take an action he is
not taking?
4. Taking an action together with the other party?

- CHAPTER SIX -
TACTICS
AND
GAMBITS

WHAT ARE GAMBITS & TACTICS?

Negotiation is a game. Strategy is the game plan used to
achieve the objectives. Tactics and gambits are the
individual moves of the game plan.
We must recognize tactics as tactics and deal with them

as such. Your opponent is playing a game, doing his job
and trying to get a better deal. So must you. Viewing
tactics this way helps remove some of the emotion, anger
and hostility which often surface when someone uses a
tactic on us.
The objective of this section is to enable you to:
Identify common negotiation tactics.

Understand how they work.
So that you can apply and counter them when they are
used on you.
Be alert to tactics it comes in great varieties and

numbers.

10 COMMON TACTICS
Tactic 1: The Good Cop - Bad Cop
HOW TACTIC WORKS?

The bad cop takes a tough stand, makes high
demand and acts aggressively. He intimidates you.
After a while, the good cop takes over. His demands
are presented in a nice and friendly way and made to
look reasonable by comparison even though they
may not be. You may be lured into the pleasure of
dealing with the good cop. Bad cop may not
necessarily be at the table. Nor have they to be real
people. Policy, rules, etc can be presented as bad
cops.
HOW TO COUNTER?
Remember good cop/bad cop are on the same side
even if one of them may appear to be on your side.
Let the bad cop talk himself out. Listen with
detachment and without getting emotional. Deal with
the demands of the good cop with no comparison to
the bad cops demands, which could be decoys. You
may consider bringing in your own bad cop

TACTIC 2: TAKE IT OR LEAVE IT
HOW TACTIC WORKS?

No more haggling. $2000 and the business is
yours.
Presented as final and non negotiable.
The term take it or leave it is often never
mentioned. Fixed price items in department stores
are examples of this tactic.
HOW TO COUNTER?
Separate what is not negotiable and what is.
E.g.: Price is not negotiable but terms may be.
Continue to talk/sell
What if
Use the Nibble tactic to get something back.
Protest to higher management, say
You cant do that to us!
Test it by walking away, but leave door open for
return if you want the business.
Tactic 3: The Bogey
HOW TACTIC WORKS?

I like your service, I want to use you. You meet
my requirements and you have a good track
record. Look I have even written a
recommendation in your favor. Problem is XX.
XX is the bogey.
This tactic raises your ego.
Gives you a problem to tackle.
HOW TO COUNTER?
Go to collaborative mode. Offer alternatives.
Repackage.
What if
What do you suggest we do?
TACTIC 4: THE KRUNCH
HOW TACTIC WORKS?

You have to do better than that!
You have to do significantly better than that!
You are very close!
You have to sharpen your pencils a little more!
Plays on the emotion and insecurity in his own bid
without directly knocking him. Leads him to
believe we are in the chase.
HOW TO COUNTER?
This is an unspecified objection that you dont
understand. You cannot possibly handle something
which is not clear.
Probe further
What makes you say so?
Whats the problem?
Where are we off?
What would we need to do specifically to meet
your needs?
Dont assume anything and never assume it is the
price that is not good enough.

TACTIC 5: THE NIBBLE
HOW TACTIC WORKS?

Getting small concessions and other freebies.
After agreement has been reached I just
remember something minor. Would you mind
including this in the agreement?
Some nibbles are visible. Others are non visible.
HOW TO COUNTER?
Every concession, no matter how small, costs.
Remember little drops make an ocean.
Respond by saying
We never do that!
I have no authority.
Use power of legitimacy.
Put a price on the nibble
That will mean an increase of.
Get something in return
Nibble back
If you can increase Then we can decrease...

Tactic 6: The Authority Tactic
HOW TACTIC WORKS?

I have no authority to decide.
I need to run this over with my boss.
This needs the approval of the committee.
This exceeds the limit of my authority.
HOW TO COUNTER?
Pre-empt this by getting him to say No to
If our proposal meets all your requirements, is
there any reason why you would not be able
give us a firm decision today?
Appeal to his ego
They always follow your recommendation,
dont they?
You will recommend it to them, wont you?
Introduce your own higher authority
Tactic 7: The Deadline
HOW TACTIC WORKS?

Tendency to be pressurized to conclude deals as
deadline approaches
Get it over and done with
Dont come home without it

HOW TO COUNTER?
Whose deadline is this? Yours or his?
Deadline is often self-imposed. Can you extend
your own deadline?
Re-negotiate the deadline.
Stand firm and use his deadline to counter
pressure him.
Tactic 8: The Flinch
HOW TACTIC WORKS?

Flinch in reaction to a proposal from the other side
act surprised, shocked
You want us to do what?
You must be kidding!
We are not prepared for this!
A concession often follows a flinch.
Flinching is an effective way to counter opening
demands.
If you dont, they may think that their opening
offer is reasonable.
HOW TO COUNTER?
Know that it is a deliberate tactic.
Dont react as the flinch is designed to make you
react by conceding.
Re-state or repeat your proposal giving reasons
why.

Yes, we would like you to increase the M.O.Q.

in order for us to pass you the efficiency savings
from longer production run
Tactic 9: Lets split the difference
HOW TACTIC WORKS?

We have negotiated for so long now. Lets not let
$200 block this deal. Why dont we split the
difference?
Appeal to your sense of fairness. We tend to
automatically split half/half
Designed to make you move first.
HOW TO COUNTER?
Who says split has to be 50/50?
Commit him to move first.
Are you saying that you are willing to settle at
X?
Yes.
Then use the authority tactic
Thats good, let me check with my HQ for
confirmation that we can proceed based on X.
Tactic 10: Escalation
HOW TACTIC WORKS?

Raising demands after both sides reached
agreement.
Escalation may not be ethical.
HOW TO COUNTER?
Use Authority tactic to counter.
Tell him that your board of directors will never
approve.
Escalate your demand in return.
- CHAPTER SEVEN -
HOW TO HANDLE
IMPASSE
STALEMATE
&
DEADLOCK

HOW TO HANDLE IMPASSE, STALEMATE & DEADLOCK
Who is a better negotiator?

A: A negotiator with 100% closure makes a
deal every time, or
B: A negotiator with 90% closure no deal
10% of the time?
WHICH NEGOTIATOR IS CONSISTENTLY TRYING TO GET A BETTER
DEAL? WHICH ONE MAY BE LEAVING GOLD ON THE TABLE?
It is not realistic to expect 100% closure all the time.
No deal can be the result of

an impasse,
a stalemate or
a deadlock.
AN IMPASSE HAPPENS WHEN THERE IS DISAGREEMENT ON A MAJOR
ISSUE AND THAT ISSUE THREATENS THE NEGOTIATION.
A stalemate occurs when the parties are still talking but

are unable to make any progress toward a solution.
A deadlock is when the lack of progress has frustrated

the parties so much that they no longer wish to continue
talking.

How to handle an impasse

Impasse can easily be confused as a deadlock. Because
the disagreement is over one major issue, some
negotiators are cornered into either giving in or giving up.
Remember it is unwise to negotiate on one single issue. If

there is only one issue to negotiate, you have only two
options concede without getting something in return or
not concede and end in deadlock.
Things are seldom so black and white. Our value

proposition to the other side normally contains more than
one factor. It is therefore important to know how our
offering impacts the other side by understanding what our
value is to the other side. If we truthfully believe that the
value to them is zero, then we dont really deserve to get
more, do you?
Having this in mind, the strategy to handle an impasse is

to side-step the impasse and create momentum by
gaining agreements and resolving other minor issues first.
How to side step? By making a side stepping statement:

Leaving aside the question of XXX, what other issues
are important to you?
If XXX is acceptable to you, what else needs to be
addressed also?

Impasse situation 1
Customer says your price is too high and you are not
allowed to lower the price to match competition.
Buyer: I would love to give you the business but

your price is too high and unless you can match what
your competitors are offering, there is simply no go.
Sorry!
Seller: I understand price is important in this

business and if our price is fully in accordance with
what you are willing to pay, how many units would
you order next year?
Buyer: Maybe 100,000.
Seller: Would you be willing to increase the order

size to 150,000 if we help you install a just in time
delivery inventory system?
Buyer: I have reservation about J-I-T. Too many

problems.
Seller: Would you mind telling me what

reservations you have and what problems you are
concerned with?
<<<< And you are on your way to opening up

impasse and continuing the dialogue >>>>
Impasse Situation 2
Negotiation with the labour union. After the initial
breakdown, management wants to have a peace talk.
Union leader says he want to talk. You have been asked to
convince the union to come to the table.
Union: Given how we were treated by the
management the last time, we are opposed to the
idea of a peace talk at the moment. They only come
to us when they need us. Now that productivity is

hurting, you want to talk heh? Tell them we dont
want a peace talk. We want them to agree to our
proposal in full!
You: I understand your sentiment and I realize that

you are not ready for a peace talk just yet. Lets
leave that aside for the moment. For the sake of
argument, if we did have peace talk, where do you
think would be the ideal location?
Union: I dont know!
You: OK. Would it make more sense to do it at

location A or B?
Union: We must do it in a neutral ground. C would

be best
You:: Thats fair! And if we did meet up, who

should be represented?
Union: I cant stand that General Manager. Send

the M.D.
<<<< and you inch you way beyond the initial

impasse>>>>

How to handle a stalemate

Stalemate happens when both sides are still talking but
seem unable to make any real progress toward a solution.
In a stalemate, both sides are still motivated to find a
solution but are unable to find a way forward.
A change in negotiating elements often helps.
10 ideas to handle stalemate

1. Change the venue.
2. Change the room set up to a round table.
3. Go off record.
4. Talk over a meal or a golf game.
5. Change the negotiator.

New people.
New level.
6. Change style.
From competitive to collaborative.
7. Change mode
Are below waterline issues being ignored?
8. Try brainstorming.
9. Repackage.
Introduce new tradable variables.
What if?
10. Strive to reach an agreement in principle then

delegate the details to be worked out by the experts or
a committee.

Deadlock
Deadlock occurs when the parties find it futile to continue
talking. In business real deadlock is rare. Often impasses
and stalemates are mistaken as deadlock.
Deadlock can be
Intentional (deliberately staged)
Unintentional
Intentional deadlock is often used in negotiations where
no deal is considered to be more beneficial than a deal.
International negotiations are full of examples where
issues will never be resolved because of hidden agenda.
In these negotiations, parties are more focused on
position (we never negotiate with terrorists) rather than
interests (the safety and dignity of human lives). Many of
the free trade negotiations under the auspice of WTO offer
prime examples.
In business negotiation, intentional deadlock is sometimes

used as a tactic. People normally soften up after a
deadlock and become more open. A staged deadlock can
produce otherwise unobtainable concessions. This strategy
entails risks but can result in a better deal. Always ask
is intentional deadlock appropriate in this case?
Needless to say, we need to watch out that we are not

causing unintentional deadlock.

Why Deadlocks Occur

People cause deadlock often due to below water line
issues such as
Personal interests, inhibitions, fears, likes, dislikes,
prejudices, opinions, ambitions, consciences,
good/bad manners, hopes, attitudes, hidden agenda.
Personality differences.
Provocative behaviour.
Indecisiveness and prolonged indecision leading to
lack of movement,
lack of progress.
Over estimation and use of power.
When the positions of both sides are so far apart that
the likelihood of there being an early identification of an
overlap is remote.
How to avoid deadlock

Watch your own ego. Save his face.
Dont ask Why questions; Ask How questions.
Dont ask loaded questions.
Do you believe you are always right?
How long are you going to continue to beat that dead
horse?
Why do you claim to be innocent when you admit
liability?
Dont you agree that you made a cock-up once
again?
Offer a concession to generate movement.

How to handle a deadlock

When a deadlock occurs, the only way forward is to bring
in a third party to act as a mediator or an arbitrator.
A mediator is someone brought in to facilitate a solution.

He is catalyst, a coach, a moderator using mediating skills
to help the parties find a third alternative which is
acceptable to all parties. A mediator need not be
someone from outside the organization. To resolve
business negotiation deadlock, senior managers are often
brought in to rescue and endeavour to overcome the
deadlock. If an internal mediator is used, he must appear
to be neutral and creditable to the other side.
Arbitrators are often used as an alternative to a legal

proceeding. In arbitration, the parties agree upfront that
they will abide and be bound by the decision of the
arbitrator.

- CHAPTER EIGHT -
SOME
PARTING WORDS

Some Parting Words
Successful negotiators are successful because they do

things in a certain way. Because they do things in a
certain way, they are certain of success when they
negotiate. These are the great negotiators.
Here are three key elements of that certain way to help

you achieve that certainty towards achieving greatness in
the art of negotiation.
Great negotiators are businessmen/business women at

heart. They understand what matters most in the
negotiation. They dont just want to win the battle. They
have the best overall interest of the war at heart. They
have the mindset of a simple merchant and are guided by
common sense. Before you can be a great negotiator,
learn to be a businessman or businesswoman.
Great negotiators are focused on makes a great win-win

deal, for both sides. They are not only concerned about
their self interest but interests of the other party. They
only push for what is good for you when they and
subsequently you are both assured that dealing will do
you no harm.
Great negotiators have a big and a constantly expanding

comfort zone. They understand that the size of the

comfort zone dictates their success zone. So they stretch

their own limits, try new things, explore uncharted
horizons. They understand that doing the same thing will
get them the same result. Different results require
different actions. They are not afraid of rejection and
failure. They are certainly not afraid to ask. Remember
those who dont ask dont get.
Do you want to be a great negotiator? To not only get

more deals but better ones? Then start to model what
successful negotiators do. First become more skilful and
more competent. The techniques in this book will go a
long way towards helping you do that. Then make
negotiating a way of life in everything you do in your
professional working life as well personal life. And enjoy
the process. Why, you might ask, the need to negotiate?
My friend, this is because
In business, as in life, you dont get what

you deserve. You get what you negotiate
And what you settle for!
Start negotiating and keep negotiating See you at the

top.

SELF ASSESSMENT
INSTRUCTION:
CHOOSE AN ANSWER THAT MOST DESCRIBE YOU. BE HONEST. DONT TRY TO SPOT
THE RIGHT ANSWER.
TALLY YOUR SCORES USING THE SCORE SHEET IN THE LAST PAGE
78
1. Do you generally go into negotiations well prepared?

a. Very frequently
b. Often
c. Sometimes
d. Not very often
e. Play it by ear
2. How uncomfortable do you feel when having direct conflict?

a. Very uncomfortable
b. Quite uncomfortable
c. Dont like it, but face it
d. Enjoy the challenge somewhat
e. Welcome the opportunity
3. How do you look at negotiation?

a. Highly competitive
b. Mostly competitive but a good part cooperative
c. Mostly cooperative but a good part competitive
d. Very cooperative
e. About half cooperative and competitive
4. What kind of deal do you go for?

a. A good deal for both parties
b. A better deal for you
c. A better deal for him
d. A very good deal for you and better than no deal for him
e. Every person for himself
5. Do you like to negotiate with merchants when you buy furniture,

cars, major appliances?
a. Love it
b. Like it
c. Neither like it nor dislike it
d. Rather dislike it
e. Hate it
6. Are you a good listener?

a. Very good
b. Better than most
c. Average
d. Below average
e. Poor Listener
79
7. How do you feel about ambiguous situations situations which

have a good many pros and cons?
a. Very uncomfortable. Like things one way or the other
b. Fairly uncomfortable
c. Dont like it but can live with it
d. Undisturbed. Find it easy to live with
e. Like it that way. Things are hardly ever one way or another
8. How would you feel about negotiating a 10% raise with your boss if
the average raise in the department was 5%?
a. Dont like it at all. Would avoid it
b. Dont like it but would make a pass at it reluctantly
c. Would do it with little apprehension
d. Make a good case and not afraid to try it
e. Enjoy the experience and look forward to it
9. How good is your business judgment?

a. Experience shows that its very good
b. Good
c. As good as most other executives
d. Not too good
e. I hate to say it but I guess Im not quite with it when it comes
to business matters
10. When you have the power, do you use it?

a. I use it to the extent I can
b. I use it moderately without any guilt feelings
c. I use it in behalf of fairness as I see fairness
d. I dont like to use it
e. I take it easy on the other fellow
11. How do you feel about getting personally involved with the other
party?
a. I avoid it
b. Im quite uncomfortable
c. Not bad not good
d. Im attracted to getting close to him
e. I go out of my way to get close. I like it that way
80
12. How sensitive are you to the personal issues facing the opponent
in negotiation? (The non business issues like job security, workload,
vacation, getting along with the boss, not rocking the boat)
a. Very sensitive
b. Quite sensitive
c. Moderately
d. Not too sensitive
e. Hardly sensitive at all
13. How committed are you to the opponents satisfaction?

a. Very committed. I try to see that he doesnt get hurt
b. Somewhat committed
c. Neutral, but I hope he doesnt get hurt
d. Im a bit concerned
e. Its every man for himself
14. Do you carefully study the limits of the other persons power?
a. Very much so
b. Quite a bit
c. I weigh it
d. Its hard to do because Im not him
e. I let things develop at the session
15. How do you feel about making a very low offer when you buy?
a. Terrible
b. Not too good but I do it sometimes
c. I do it only occasionally
d. Its hard to do
e. I make it a regular practice and feel quite comfortable
16. How do you usually give in?

a. Very slowly, if at all
b. Moderately slowly
c. About the same pace as he does
d. I try to move it along a little faster by giving more
e. I dont mind giving in hefty chunks and getting to the point
17. How do you feel about taking risks that affect your career?
a. Take considerably larger risks than most people
b. Somewhat more risk than most
c. Somewhat less risk than most
d. Take slight risk on occasion but not much
e. Rarely take career risks
81
18. How do you feel with those of higher status?

a. Very comfortable
b. Quite comfortable
c. Mixed feelings
d. Somewhat uncomfortable
e. Very uncomfortable
19. How well did you prepare for the negotiation of the last house or
car you bought?
a. Thoroughly
b. Quite well
c. Moderately
d. Not well
e. Played it by ear
20. How well do you think when not under pressure (compared to
your peers)?
a. Very well
b. Better than most
c. Average
d. A little worse than most
e. Not too good
21. How would you feel if you had to say, I dont understand that,
four times after four explanations?
a. Terrible - wouldnt do it
b. Quite embarrassed
c. Would feel awkward
d. Would do it with feeling too badly
e. Wouldnt hesitate
22. How well do you handle tough questions in negotiations?

a. Very well
b. Above average
c. Average
d. Below average
e. Poorly
23. Do you ask probing questions?

a. Very good at it
b. Quite good
c. Average
d. Not very good
82
e. Pretty bad at it
24. Are you closed-mouth about your business?

a. Very secretive
b. Quite secretive
c. Secretive
d. Tend to say more than I should
e. Talk too much
25. How confident are you about your knowledge in your own field or
profession (compared to your peers)?
a. Much more confident than most
b. Somewhat more confident
c. Average
d. Somewhat less confident
e. Not very confident, frankly
26. You are the buyer of some construction services. The design is
changed because your spouse wants something different. The
contractor now asks for more money for the change. You need him
badly, because hes well into the job. How do you feel about
negotiating the added price?
a. Jump in with both feet
b. Ready to work it out but not anxious to
c. Dont like it but will do it
d. Dislike it very much
e. Hate the confrontation
83
SCORE SHEET
To evaluate yourself, check the answer key. Add positive and
negative scores separately then subtract them from each other
QUESTION a b c d e POSITIVE NEGATIVE

SCORES SCORES
1 +20 +15 +5 -10 -20
2 - 10 -5 +10 +10 -5
3 -15 +15 +10 -15 +5
4 +10 +5 -10 +10 -5
5 +3 +6 +6 -3 -5
6 +15 +10 0 -10 -15
7 -10 -5 +5 +10 +10
8 -10 +5 +10 +13 +10
9 +20 +15 +5 -10 -20
10 +5 +15 +10 -5 0
11 -15 -10 0 +10 +15
12 +16 +12 +4 -5 -15
13 +12 +6 0 -2 -10
14 +15 +10 +5 -5 -10
15 -10 -5 +5 +15 +15
16 +15 +10 -3 -10 -15
17 +5 +10 0 -3 -10
18 +10 +8 +3 -3 -10
19 +15 +10 +5 -5 -15
20 +15 +10 +5 0 -5
21 -8 -3 +3 +8 +12
22 +10 +8 +2 -3 -10
23 +10 +8 +3 0 -5
24 +10 +10 +8 -8 -15
25 +12 +8 +4 -5 -10
26 +15 +10 0 -10 -15
+ -
Total
Total Score
SCORE RANGE INDICATION

+250 to 340 Congratulations! You are negotiating
well already
+180 to 250 You have a good measure of the
qualities it takes to negotiate
successfully
Below 180 to Your negotiating skills need honing
Negative and improvement
84
ABOUT THE AUTHOR
YIM CHOONG CHOW A.K.A. Y.C. Chow is a success coach, strategy

consultant, author and a much sought after trainer in Asia. His work
reflects over 35 years of senior management experience both as a
practitioner and a consultant. His interests are in helping organizations
and individuals succeed through transforming and transcending their
performance.
Yim regularly conducts high energy soft skills training workshops

revolving around selling, service delivery, interpersonal skills,
communication, leadership & management, time management and
success strategies.
Yim is the Executive Director of Puncak Jupiter - a company he

established in 2001 after a long and illustrious career in a major
international shipping company where he held, interalia, the position
of Managing Director.
His hobbies include martial art, gardening, trekking and writing. Yim
holds a third degree black belt in Karate, has trekked to the Everest
Base Camp and is the author of 6 books. In the past twelve months,
Yim has trained in Malaysia, Singapore, Indonesia, India, China, UAE,
Vietnam & Myanmar.
The author can be reached at yimchoongchow@yahoo.com
85
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CRITICAL FOUNDATIONAL SKILL IN

Yim Choong Chow

Advanced Negotiation Techniques

ISBN 967 -914-787-8-1

No part of this eBook can be reproduced, stored in a retrieval system or transmitted

Thank You for

Negotiating so tough & so hard

To guarantee our success and happiness

in the game of life.

I owe much of what I have,

But much of what I have,

If not for my loving wife, my two great daughters,

From them I have taken much too much at

And to them I owe

Thank you for crossing my path and helping me

2 The Two Modes & Two Styles 12

3 Preparation The Key To Success 15

4 The Five Step Methodology 23

5 Understanding & Managing Power 51

6 Tactics & Gambits 57

7 How to handle Impasse, Stalemate &

8 Some Parting Words 75

10 About The Author 85

THE NEGOTIATING GAME

By Yim Choong Chow 6

Why negotiate? Simply, it is the fastest way

Negotiation is about movement

By Yim Choong Chow 7

NEGOTIATION IS ABOUT FINDING THE 3RD ALTERNATIVE

Negotiation is about conflict resolution

Negotiations need not be adversarial

The game presupposes there is a margin

By Yim Choong Chow 8

a negotiation with your real best offer will mean not

NEGOTIATION WILL BE POSSIBLE as long as both parties

NEGOTIATION IS THE ART OF CONVINCING OTHERS

It consists of saying and doing those things that cause

THE NEGOTIATION CONTINUUM

THE NEGOTIATION PROCESS IS FIRSTLY ABOUT GETTING TO THE

BARGAINING ARENA. ONCE IN THE BARGAINING ARENA, IT IS ABOUT

FINDING A SETTLEMENT WITHIN IT. HAVING DISCOVERED THE

POSSIBILITY OF A SETTLEMENT, IT IS ABOUT SECURING A SETTLEMENT

AT THE LEAST COST AND AGREEING TO ITS IMPLEMENTATION.

A good way to understand negotiation is to present it as a

Negotiation pre-supposes there is a margin. The margin is

Ideal position = the best he hopes to achieve

Ideal Limit Ideal Limit

Limit Ideal Limit Ideal

Figure NC:1 Figure NC:2

The shaded area in Figure NC: 2 is the bargaining area.

In Figure NC: 3, there is no overlap. If the parties refuse

By Yim Choong Chow 10

In Figure NC: 4, Bs negotiating position is too

As new info emerges, ideal/limit

If this situation becomes known to B, his task would be to

Failing to do that will be like leaving gold on the table.

By Yim Choong Chow 11

THE TWO MODES

THE TWO STYLES

By Yim Choong Chow 12

The two modes of negotiation

Research has validated that people buy emotionally

What does the boss want?