What are your realistic goals for contract negotiation?

1 Know your BATNA

Your BATNA, or best alternative to a negotiated agreement, is the option you have if you walk away from the negotiation. It is your fallback plan or your reservation point. Knowing your BATNA helps you set realistic goals for contract negotiation because it gives you a clear idea of what you can accept and what you can reject. You should always aim to negotiate an agreement that is better than your BATNA, otherwise you are better off not negotiating at all.

2 Identify your ZOPA

Your ZOPA, or zone of possible agreement, is the range of outcomes that are acceptable to both you and the other party. It is the overlap between your aspiration point, or the most favorable outcome you hope for, and their reservation point, or the least favorable outcome they are willing to accept. Identifying your ZOPA helps you set realistic goals for contract negotiation because it shows you where you have room to compromise and where you have to stand firm. You should always try to negotiate within your ZOPA, otherwise you risk reaching an impasse or a suboptimal deal.

3 Define your SMART goals

Your SMART goals are specific, measurable, achievable, relevant, and time-bound objectives that you want to accomplish through the negotiation. They are based on your interests, needs, and priorities, and they are aligned with your BATNA and your ZOPA. Defining your SMART goals helps you set realistic goals for contract negotiation because it makes them clear, concrete, and actionable. You should always write down your SMART goals and review them before, during, and after the negotiation.

4 Assess your strengths and weaknesses

Your strengths and weaknesses are the factors that influence your bargaining power and your performance in the negotiation. They include your skills, knowledge, resources, relationships, reputation, emotions, and personality. Assessing your strengths and weaknesses helps you set realistic goals for contract negotiation because it enables you to leverage your advantages and mitigate your disadvantages. You should always conduct a SWOT analysis (strengths, weaknesses, opportunities, and threats) and prepare a strategy to address them.

5 Research the other party

The other party is the person or group you are negotiating with. They have their own interests, needs, priorities, BATNA, ZOPA, SMART goals, strengths, and weaknesses. Researching the other party helps you set realistic goals for contract negotiation because it allows you to understand their perspective, anticipate their moves, and find common ground. You should always gather as much information as possible about the other party and use it to build rapport, trust, and value.

6 Review your options and scenarios

Your options and scenarios are the possible outcomes and consequences of the negotiation. They depend on your actions, the other party's actions, and the external factors that affect the negotiation. Reviewing your options and scenarios helps you set realistic goals for contract negotiation because it prepares you for different situations and contingencies. You should always consider the best case, the worst case, and the most likely case scenarios and plan accordingly.

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?