How can you master contract negotiation skills for different industries?

1 Understand the industry context

Before you enter a contract negotiation, you need to do your homework and research the industry context of your counterpart. What are the common practices, norms, and regulations in their field? What are their main goals, pain points, and motivations? How do they measure success and value? By understanding the industry context, you can tailor your approach, language, and arguments to suit their perspective and needs. You can also avoid potential misunderstandings, conflicts, or pitfalls that may arise from different industry standards or cultures.

2 Identify the key stakeholders

Another important step in preparing for a contract negotiation is to identify the key stakeholders involved in the decision-making process. Who are the people who have the authority, influence, or interest in the outcome of the negotiation? What are their roles, responsibilities, and preferences? How can you communicate and build rapport with them effectively? By identifying the key stakeholders, you can map out your negotiation strategy, prioritize your issues, and address their concerns and expectations. You can also leverage your network and relationships to gain insights, support, or referrals from other stakeholders who may be relevant or helpful.

3 Define your objectives and alternatives

Once you have a clear understanding of the industry context and the key stakeholders, you need to define your objectives and alternatives for the contract negotiation. What are your main goals and interests? What are your minimum and maximum expectations? What are your non-negotiables and trade-offs? What are your best and worst alternatives to a negotiated agreement (BATNA and WATNA)? By defining your objectives and alternatives, you can establish your negotiation range, criteria, and priorities. You can also evaluate your options and outcomes realistically and strategically.

4 Use the right negotiation style

Depending on the industry, the situation, and the relationship, you may need to use different negotiation styles to achieve your desired results. Negotiation styles are the patterns of behavior and tactics that negotiators adopt in a negotiation. There are five common negotiation styles: competitive, collaborative, compromising, accommodating, and avoiding. Each style has its advantages and disadvantages, and you need to choose the one that suits your goals, interests, and values. You also need to adapt to the negotiation style of your counterpart and find ways to influence, persuade, or cooperate with them.

5 Manage the negotiation process

To facilitate a smooth and productive negotiation during the contract negotiation process, it is important to follow certain best practices and techniques. These include setting the agenda and ground rules, asking open-ended questions and listening actively, framing the issues and options positively and constructively, using objective criteria and evidence to support your claims, exploring interests and needs instead of positions and demands, creating value and finding win-win solutions, handling emotions and conflicts professionally and respectfully, as well as making concessions and closing the deal.

6 Review and follow up

After the contract negotiation, you need to review and follow up on the agreement and the relationship. You need to ensure that the contract is clear, accurate, and complete, and that it reflects the terms and conditions that you have negotiated. You also need to monitor the implementation and performance of the contract, and address any issues or changes that may arise. Moreover, you need to maintain and nurture the relationship with your counterpart, and provide feedback, appreciation, and recognition. By reviewing and following up, you can ensure that the contract is successful and sustainable, and that you build trust and goodwill for future negotiations.

7 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?