Eskom Procurement Book 2015

NEGOTIATION

Try to think carefully about when you will make concessions, and be stingy with what you offer. In this way you will lower your counterpart’s expectations of a quick and easy victory. Don’t concede too much too fast. Optimally, you should aim at getting your counterpart to make the first concession. Further, your preparation should have told you what issues are important to you and which are likely to be important to your counterpart. If you can concentrate on generating a concession from your counterpart on an issue of high importance to them while only conceding on something peripheral to you, you will appear conciliatory and co-operative while gaining an edge. We know some things about concessions. To make the negotiating process work, all parties must be willing to demonstrate flexibility. Failing to do so often leads to deadlocked agreements (failing to reach an agreement). Regardless of your opening position leave room to manoeuvre. If you take a flexible position make sure your counterpart is also taking a flexible position or you will be offering most of the concessions. And, as the negotiation progresses, make sure the frequency and value of concessions diminishes. Smaller and smaller concessions indicate a likely resistance to further concessions. Finally, remove the audience, especially managers, during a negotiation. The larger the audience the more difficult it becomes to offer concessions. The possibility exists that offering concessions will come across as weakness when others are present. In the final analysis it is important to offer concessions during negotiations but not too many. Concessions are what you are prepared to give away, and must be carefully prepared. Never attempt to improvise your concessions. In doing so, you run the greatest possible risk of giving away something that may later bear a heavy cost. If you are faced with an experienced counterpart, he/she will attempt to leverage the tension in the room and your nervousness to grab more than you are able to give. So, maintaining your calm in this part of the process is essential. A good idea is to make liberal use of your summariser and note-taker to slow things down and buy yourself time to think. Always present a concession as: ‘If you will... then I can/will...’ In this way you achieve a number of things: • You send a message that you are not prepared to give things away for nothing. • You make your counterpart work harder. • You create the opportunity for your counterpart to revise his demands, having realised that his power is limited. Give yourself room to negotiate. Start high if you are selling and low if you are buying. Have a reason for starting where you do. Don’t start at such an extreme position that hostility will be created. Encourage the other party to open up first or to put all his demands on the table. Keep yours hidden, if possible. Let the other person make the first concession on major issues. You can be first on minor points if you wish. Make the other person work for everything he gains. People don’t appreciate things that come too easily.

7.7.1 HOW TO MAKE CONCESSIONS

159 CHAPTER 7