Negotiating skills for financial planners Peter Belsey, Business Director Financial Services.
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Transcript of Negotiating skills for financial planners Peter Belsey, Business Director Financial Services.
Negotiating skills for financial plannersPeter Belsey, Business Director Financial Services
Agenda
Understanding the other side Thinking through the strategy Annihilation or win:win? Body language and approach
Skilled negotiatorsSkilled negotiators
Judges effective by both slides
Track record success
Low implementation failure
Average negotiatorsAverage negotiators
Experienced
Moderate track record
Huthwaite’s research into negotiation
Versus
Quiz: Question One
True or FalseSkilled negotiators spend more time (than average negotiators) preparing the negotiation, by gathering more information and setting their objectives, priorities and limits
Quiz: Question Two
True or FalseIt is important to present as many reasons as possible to support each of your proposals
Quiz: Question Three
True or FalseThe key to persuading someone is to present your argument logically
Quiz: Question Four
True or FalseWin-Win negotiating involves both parties stating their ideal outcomes and then splitting the difference
Strategies & tactics
Preparation & planning
Face-to-faceskills
EffectiveNegotiation
POWER
Negotiation – a complex skill set
Do you have opportunities to negotiate already?
With clients, when you’re advising/selling?When you’re buying, e.g. to outsource services?Will you have more negotiation opportunities in future?What makes these negotiations difficult?
Negotiation
ME YOU
What is negotiation?When:you can vary the termsthe resource is scarceagreement and conflict both exist
ME YOU
No common ground – so nothing to gain from
negotiation
ME &YOU
In total agreement
– so why negotiate?
YOU
ME
What is the difference between persuasion and negotiation?
Persuasion = unilateral moves towards accepting your position
Capitulation = unilateral moves towards accepting their position
ME
YOU
What is the difference between persuasion and negotiation?
Negotiation = a bilateral process, you and they make moves towards each others’ positions
YOUME YOUME
Why is the difference important?
Persuasion is successful when the other party says:“I would like to do a deal with you if ...”
Average persuaders give things away to achieve this position – skilled persuaders don’t
Effective negotiation involves movement by both parties, a creative agreement and a perception of Win-Win
The golden rule of negotiation
Persuade first and only negotiate later...... if you have to
So, do you have opportunities to negotiate or persuade?
With clients, when you’re advising/selling, may you give things away too soon?
When you’re buying, e.g. to outsource services, may they give things away too soon?
Preparing and planning to negotiate
Prepare and plan with great care, including identifying ‘negotiable issues’
Identify and use your ‘levers’
‘Trade concessions’ – don't give them away
Preparing and planning to negotiate
Negotiable issues:
a)With clients
b)With outsourced suppliers
What issues do you have?What issues may they have?Are there enough issues to negotiate with? Any others you can introduce, that may be negotiable? If no, plan to persuade; if yes, plan to negotiate.
Identify levers
Low High
High
Importance to us
Low
Lubricators Your levers
DifficultIssues
Their levers
Importance to them
Importance to them
Identifying your and their levers
a) With clientsb) With outsourced suppliers
What are your levers? What are their levers? Likely difficult issues? Any lubricators?
May you need to instigate the client negotiation? ‘I could re-consider my fee if you can offer me more of your portfolio and/or commit longer.’
A principle for persuasion
Being right is not persuasive
“I owe my success to having listened respectfully to the very best advice, and then going away and doing the exact opposite.”
G.K Chesterton
Traps in persuasion
What I Want
Logical Arguments
More Logical Arguments
Irritators
Logic is notpersuasive
Another trap: argument dilution
... as your weakest link
Your chain is as strong ...
Planning for effective persuasion 1 or 2 good reasons per issue A good reason = will help them
meet their needs
Check you’ve covered all their concerns
Summarise the Benefits Propose an appropriate fee
structure for the client
Note your key arguments on each issue
Concluding a new deal with a client
Persuading outsourced suppliers
Create doubt and movement about their position
Expose argument dilution– seek more reasons?
Ten steps for effective negotiation
1. Persuade 1st and only negotiate later…if you have to
2. Logic is not persuasive!
3. Beware argument dilution
4. Effective persuasion leads to ‘I’d like to deal with you if…’
5. Average persuaders give things away to achieve this
Ten steps for effective negotiation
6. Identify and use your levers
7. You may need to instigate the negotiating
8. Trade concessions, don’t give them away
9. Remember Win-Win is not 50:50
10.Never, ever forget that ‘no deal’ is better than a bad deal
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