Negotiating is a valuable skill in any industry or role. However, one thing that separates good negotiators from great negotiators is that the latter understand that closing the deal isn’t the end of the process. And as the world becomes more interconnected, it’s increasingly more important to comprehend the various nuances involved in international negotiations.
According to Eliane Karsaklian, visiting professor in the Department of Marketing at the University of Illinois at Chicago, and author of “The After Deal: What Happens After You Close a Deal?” the success of a negotiation depends on understanding that the negotiation process is not over when a deal is signed. “You didn’t close a deal, you opened the door to a new cooperation; it doesn’t finish when you sign a contract; it starts there,” she says.
Managing unexpected requests
It’s a good idea to make agreements as specific as possible. However, unexpected requests are going to happen, according to Charlotte Westerhaus-Renfrow, clinical assistant professor of business law and management at the Indiana University Kelley School of Business. “We call it ‘scope creep’ — you come to an agreement, and the other party says, ‘Well, could we have a little bit more of this?’ And this expands the scope of the agreement.”
She warns against taking this as a personal attack. “Once you get emotionally involved, you can’t manage these continued negotiations effectively.” However, you should ask questions to clarify what the other party wants. You should also set boundaries and limitations in your agreement and contract. “Even if you want to end negotiations with good relationships, if you’re going to be flexible, make sure you still set boundaries,” she says.
And it’s important not to necessarily view unexpected requests as negatives. “I’d seize them to see if they can expand the opportunity to expand your options,” she advises. “Scope creep can be turned into a business opportunity simply by asking great questions with great options, for example, ‘If I give you this, can I have something else?’ You can actually turn these into ways to create another option on your end.”
However, Karsaklian warns against viewing an unexpected request as an outright renegotiation, which she says can be upsetting in some cultures. “All parties should be very aware of each other’s contexts and constraints to better assess the reasons why unexpected requests are happening.” So, don’t assume that this is an act of treachery or manipulation. “Measuring the positive and negative consequences of such requests is the best way of managing them,” she says.
Dangers of thinking short-term
There’s one major mistake that people when negotiating. Karsaklian says they view the negotiation as a phone call, not a wedding. “If you think short term, you can’t expect long term results, loyalty, and sustainable growth with the same partner.” And if you have a short-term view, then she says your goals should be adjusted as such — but that’s not what typically happens.
“Most frustrations between partners come from the fact that they aim at short-term results but want them to last,” she explains. “If you have a short-term relationship with your partners, you will spend more time and energy in constantly looking for other options than in capitalizing on a long-lasting relationship with long-term results.”
Karsaklian admits that short-term results can propel your company to a good place in your market. “But it won’t be sustainable and some competitor will beat you eventually.”
If your goal is to be around for a long time, she says your goal should be sustainable growth. And if you’re doing business internationally, you’ll need the right partners. “Couple with or get married to people who can help you to go the distance — you need them, and they need you for their own growth.”
These companies may be in countries that you’ve never visited, they may speak a language you don’t know, and have habits you may not understand. “However, you need to learn how to talk with them. You need to see your future together across companies, cultures, and markets,” Karsaklian says.
Don’t view negotiation as a competition
There’s a difference between bargaining and negotiating. And according to Westerhaus-Renfrow, when you’re bargaining, you’re being competitive, and that’s a win-lose scenario. “For example, you may bargain for a price at a flea market or a car shop with someone you don’t know.”
On the other hand, she says that negotiating is a give and take exercise that produces a win-win. “Both parties should expect a give and take: if the relationship between parties is important to you, being competitive in this is not going to help you in the long run.” Instead, she says the goal is for both parties to emerge with great outcomes and a better business relationship.
In fact, if you view negotiations as competitive, Westerhaus-Renfrow warns that you’re closing opportunities to expand your options. “When you bargain, you take only what you want and not more — and the other party might have more but they won’t give it to you because you didn’t negotiate.”
But, if both parties are flexible and they trust one another, she says they’ll both be open to creating better alternatives and better options. “In business, the most important goal is sometimes not what you get, but who you know and who you keep as a business partner — in both tough times and good times.”
And that’s why Karsaklian says it doesn’t make sense to compete with people that you need to reach your goals. “Other than being a short-termed vision of negotiation, there is no certainty in competitions — you might as well lose.” Here’s what you should be doing instead. “Leverage your strength by collaborating with partners that will help you to beat your competitors,” she explains. “You should compete with your competitors — not with the people who help you to get better results.”
