What makes a good deal ?

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From the course by ESSEC Business School

Negotiation Fundamentals

127 оценки

ESSEC Business School

Negotiation Fundamentals

127 оценки

Course 1 of 4 in the Specialization Negotiation, Mediation and Conflict Resolution

This course gives you access to negotiation practical tools and best practices gathered by Professor Aurélien Colson & his team from assignments in more than seventy countries and in a wide set of sectors, be they services, industry, high tech, or public organizations. In an interactive manner, this course will help you, among other topics: get prepared for any negotiation; avoid traps; know how to prompt value-creating partnerships; structure an effective negotiation sequence; bargain in an efficient and respectful manner; overcome deadlocks; and much more! Indeed, negotiation is not simply about deciding who gets what now – it is first and foremost about creating productive, fair, and therefore long-term partnerships. This course guides you through innovative and proven approaches – “win-win…but not at any price”. Together with its specialization, this course will lead you towards high impact and sustainable negotiations at all levels, whether finding solutions to people management issues, sealing a deal on a sales package, or entering into high-level strategic or political negotiations involving multi-party stakeholders.

From the lesson

Value creation & Value claiming

This module gathers several learning goals. It will help you analyse the typical factors of failure or deadlock in negotiation, and develop proper responses. It will help you negotiate on behalf of others: getting the right instructions and respecting your negotiation mandate. You will also learn about techniques to create value through negotiation. Last but not least, this module will introduce you to the most typical bargaining techniques - and how to counter them!

What makes a good deal ?5:25

Why negotiation fail ?7:13

Meet the Instructors

Aurélien Colson
Professor, ESSEC Business School - Director, IRENE Paris, Singapore & Brussels
Political Science

[MUSIC]

In this video, I would like to discuss with you a crucial issue for negotiators.

How to evaluate the quality of a deal?

At the end of a negotiation, you have to decide whether to say yes, or no.

Either you accept the deal, and then it is a serious commitment for yourself, and

for your organization.

Or you say no to the deal,

and you will have to do with your solutions away from the negotiation table.

Either way you will be accountable.

Either way, you don't want to regret the wrong move.

So when the potential deal is on the table do not rush to conclusion.

Deal or no deal, step back, and think.

Remember that the purpose of negotiation is not to reach a deal.

It is to reach the best possible deal.

Indeed, there are bad deals to which you should have said no to.

As a result, in the last stage of a negotiation,

when the potential deal is on the table, I advise you to go through the following

checklist which can really help you make the right move.

This 10 point check-list is based on the three dimensions of any negotiation

which we have identified earlier in this MOOC.

People, who is involved in this negotiation?

Problem, what is at stake in this negotiation?

Process, how do we run this negotiation?

On the people dimension, three checks.

First, check that the negotiation has maintained or

improved the relationship between the parties around the table.

If this deal is at the expense of the relationship,

it could be the last deal you ever make with this partner.

Think long term, there's still time to do something to improve the relationship.

And this we call, sweeten the deal.

Second, check that the deal is within the instructions of your mandate.

Usually, we negotiate on behalf of someone else, our boss.

Are we sure that the deal respects the instructions we were given?

Third, check that the deal takes into account important stakeholders.

People who are not at the table so it's easy to forget them,

but they are important for the successful and smooth implementation of the deal.

It is still time to factor them in.

Now, on the problem dimension, four checks.

Check of course, that the deal satisfies your motivations.

What really is important for you.

And usually people do not forget this one.

Five, check that your motivations are better satisfied with

this deal than they would be with your plan B.

Your best solution away from the table.

Otherwise, you've wasted your time.

Six, check that the solutions at the table create as much value as possible.

Do not leave value creation opportunities on the table.

Other ideas may still be included in the deal to make it even more interesting.

Maybe for both sides of the table.

Seven, check that these solutions can be explained thanks to

objective justifications.

Your hierarchy will ask you why the deal looks like this?

For instance, why 8% in a certain contract clause?

You cannot simply answer, well,

because we thought with the other guy that it was a really nice number.

You must be able to provide a reason why you ended up at 8%.

Maybe specific stakeholders will also ask you similar questions and

you have to give a rational explanation.

Now in the process dimension, three last checks.

Number eight, check that the implementation of the deal is clearly

organized.

Who, does, what, when, etc.

Failing to agree on the organization of the execution

of a deal means organizing a future failure.

Nine, that's why you need to check also that there is no misunderstanding,

communication should clearly state rights and obligations of each side.

You may also want to discuss communication towards third parties and stakeholders,

on the given point of agreement here.

Do we also agree to let it be known by others, or

do we agree to keep it as discrete as possible?

And this may open new room for negotiation.

Last but not least, number ten, check that the logistics again is ready for

the final validation and signature.

Especially in some cultures, a ceremony will be held or drinks will be shared.

And you do not want any logistical details to be in the way.

If you want to know more about this important issue in negotiation,

read chapter eight of our book, The First Move.

And remember, the purpose of a negotiation is not to reach a deal.

It is to reach a good deal.

Evaluation before decision that makes the whole difference.

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