Supply chain 13 July 2017

The art of negotiation – What small business leaders can learn from Brexit

European union flag against parliament in Brussels, Belgium
To master the art of negotiation, need to be adaptable to every possible situation

Here, Neil Clothier, a senior strategist at Huthwaite International, talks the art of negotiation, the David Davis approach and what small business owners can learn from conversations in Brussels.

When it comes to Brexit, it’s fair to say that we have a complex negotiation deal on our hands. Indeed, we’re arguably about to embark on the largest negotiation process that has faced the UK since perhaps our entry into the EU itself.

With a web of policies to unpick and unprecedented amounts of regulation to negotiate, teamed with a changeable political climate and media exposure to boot, the chances are David Davis – and Theresa May alike – are feeling more than a little overwhelmed when it comes to planning and preparing to make the negotiation of the century.

That said, this does pose an opportunity for small businesses to learn some key lessons when it comes to negotiating. Savvy small business owners should take heed, we’re about to witness an example of complex negotiation skills being played out on the world stage like never before, and it’s almost a certainty that key lessons can be learned and maximised for those that deal with negotiations day in day out – no matter what your company size.

In fact, lessons have already been learned. There are four key ingredients to perfecting the art of negotiating; power, strategies and tactics, preparation and planning and, finally, behavioural skills. If you master these four elements, you will become an effective negotiator. That said, these skills are by no means easy to implement – something that has already been demonstrated three-fold when it comes to Brexit.

By calling a snap election, May was looking to send out a clear tactical message – we are united, we are strong and we are ready for a challenge. May didn’t win a majority and, as a result, we have the first example of how utilising power, tactics and behaviour skills when negotiating is no easy task, not least when concerning a high-risk deal.

Information is power. The messages sent by either party, intended or not, have impact. We’ve already seen the British government very deliberately send messages that the Chinese market, the Commonwealth and USA are fall back markets and they’d do well to bolster alternative trade deals to avoid appearing too eager to gain a deal at any cost with the EU.

A “no deal is better than a bad deal” stance requires viable and credible alternatives if it is to be used to leverage concessions from the other party. Power in negotiation is only ever as good as the alternatives or fall back positions one party has at its disposal if this negotiation breaks down.

On the other side of the channel we’ve already seen the other 27 member states collectively and very effectively, so far, control their information flow to avoid leaks that could erode the EU’s position and trading power.

Those of you involved in multi-stakeholder deals will know all too well the political turf wars that go on within your own organisations to understand just how challenging this must be, and the amount of influencing, preparation and planning taken to corral 27 governments, their politicians and civil servants, all with their own objectives and demands!

Negotiating is hard. There are hundreds of variables and you need to be adaptable to the situation, who you’re dealing with and the current environment, whilst keeping your eyes on the prize and being sensitive to what you’re able to offer in conjunction to what your fellow negotiator needs. We recently undertook a report that revealed some key learnings that we should consider prior to Brexit and any other business deal.

Power is important, but doesn’t guarantee success

Interestingly for the UK post-snap election, whilst feeling less powerful at the start of negotiations means that you are more likely to be unsuccessful, feeling more powerful doesn’t necessarily guarantee success – it depends on how the negotiator harnesses their power.

So, it’s essential that David Davis, and indeed any other negotiator, carefully considers their position and their strength from day one.

 It’s easy to irritate your opponent, and this can lead to failure

Our study also revealed just how easy it is to become irritating when negotiating – placing an importance on the behavioural element of the four pillars. Testing understanding is a behaviour that remains crucial in negotiation, whether used for clarification or in an incredulous way to challenge thinking whilst avoiding being irritating.

To this end, successful negotiators are those who are more likely to ask questions to persuade or influence the other side, as opposed to being overly pushy and forgetting to listen.

Preparing for all circumstances is paramount

As demonstrated by the EU referendum itself, and indeed the lead up to negotiations, preparing for a curve ball as part of your strategy and tactical approach is essential. Without flexibility and the ability to adapt your approach according to circumstances you can find yourself in a stalemate situation, or worse; out of the negotiation all together.

Reading behaviour, utilising the information you have effectively and remaining personable are all core skills required to really ensure that, despite those unexpected bumps on the road to striking a deal, you have the flexibility, finesse and skills to overcome such challenges.

Despite the uncertainty surrounding Brexit, a deal will have to be made, and to that end small businesses will have the opportunity to learn and gain a new level of understanding of what it is to negotiate effectively, be it through the failings or the successes of the deals made in Brussels.

If you’re looking to discover more about the art of negotiation, Huthwaite International has a whole host of online resources to help educate and up-skill those interested in improving their techniques.

  1. Improving negotiation performance
  2. How well are you negotiating?

Huthwaite International is a leading global provider of sales, negotiation and communication skills development

With the art of negotiation mastered, find out how to secure the best deal from suppliers

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