Contingent contract
In essence, a bet about how future events will unfold.
Works best when negociations get stuck because of disagreements on how certain scenarios will play over time.
E. g.: if you doubt a contractor’s claims that he can finish your home renovation project in 3 months, propose a contingent contract that will penalize him for late completion and/or reward him for early completion.
MORE IDEAS FROM THE ARTICLE
Refers to your “best alternative to a negotiated agreement,” or the best outcome you can expect if you fail to reach agreement at the bargaining table with your counterpart.
An evaluation of your BATNA is critical if you are to establish the threshold at which you will reject an offer.
Effective negotiators determine their BATNAs before talks begin.
Carefully negotiate how you will negotiate in advance. Discussing procedural issues will clear the way for much more focused talks.
Don’t assume you’re all on the same page when it comes to determining when to meet, who should be present, what your agenda will be, and so on.
You and your counterpart may be more collaborative and likely to reach an agreement if you spend even just a few minutes trying to get to know each other.
If you’re negotiating over email, even a brief introductory phone call may make a difference. This is one of the most valuable negotiation skills to master.
Resist the common urge to think about what you’re going to say next while your counterpart is talking and listen carefully to her arguments, then paraphrase what you believe she said to check your understanding.
Acknowledge any difficult feelings, like frustration, behind the message. Not only are you likely to acquire valuable information, but the other party may mimic your exemplary listening skills.
Ask lots of questions that are likely to get helpful answers.
Avoid asking “yes or no” questions and leading questions, such as “Don’t you think that’s a great idea?” and craft neutral questions that encourage detailed responses, such as “Can you tell me about the challenges you’re facing this quarter?”
Try to identify issues that your counterpart cares deeply about that you value less. Then propose making a concession on that issue in exchange for a concession from her on an issue you value highly.
The first number mentioned in a negotiation, however arbitrary, exerts a powerful influence on the negotiation that follows.
You can avoid being the next victim of the anchoring bias by making the first offer (or offers) and trying to anchor talks in your preferred direction.
If your counterpart rejects all of them, ask him to tell you which one he liked best and why. Then work on your own to improve the offer, or try to brainstorm with the other party an option that pleases you both.
Consider agreeing to meet at regular intervals throughout the life of the contract to check in and, if necessary, renegotiate.
In addition, adding a dispute-resolution clause that calls for the use of mediation or arbitration if a conflict arises can be a wise move.
RELATED IDEAS
...depending on different social motives:
- Individualists seek to maximize their own outcomes with little regard for their counterparts’ outcomes. .
- Cooperators strive to maximize both their own and other parties’ outcomes and to see that resources are divided fairly.
- Competitives seek to get a better deal than their “opponent.” They behave in a self-serving manner and often lack the trust needed to solve problems jointly.
- Altruists, who are quite rare, put their counterpart’s needs and wants above their own.
- Integrative negotiators: create value between negotiating counterparts.
- Distributive negotiators: maximize their claim to value in the negotiation at hand.
- Crisis negotiators: apply advanced conflict resolution skills strategically according to context.
The most successful negotiators don't entertain dirty tricks in negotiation but instead strive to reach agreements that are satisfactory to both parties.
But if you find yourself on the receiving end of something that doesn't feel quite right, provided you recognise what's happening, you can address the situation and swiftly bring it back to a better place.