Negotiations 101: Get Ready!

I still remember fragments of the first negotiation I did as a lawyer more than 30 years ago. I was a new lawyer at a firm that specialized in maritime law, a subject that seemed appropriate to me, since I had sailed in the merchant navy and knew ships and nautical things well. One of the company’s clients was a tugboat owner who needed a barge for an upcoming business venture. And so it happened that, one Friday afternoon, one of the firm’s partners walked into my office, handed me a draft of a barge charter contract, and told me to “seal the deal.” This was going to be my first negotiation as a lawyer.

The next day I met the client for the first time and accompanied him to the other end of town where we met the owner of the barge and his attorney. I did my best to appear confident despite my lack of experience or preparation for this exercise. As I recall, my client was also new to the experience of negotiating such an agreement, and he indicated that he was inclined to trust my “experience” in that regard. We spent most of the day negotiating the terms of a boat charter agreement that he had read for the first time the day before. Luckily for me, the other lawyer, although he was an experienced transactional lawyer, knew as much about boats as I did about negotiation. At the end of the day, we had a deal.

I learned long ago from experience that preparation is an essential element of any successful negotiation. Preparation begins with setting goals for the negotiation; that is, determine what you want to achieve in the upcoming negotiation. Closely related to goal setting is the identification of the particular interests at stake in the negotiation; that is, the reasons why the deal is important to you. As your preparation intensifies, you should begin to anticipate the issues you expect to come up in the course of the negotiation and how each issue relates to the interests you’ve identified. An often neglected component of negotiation preparation is establishing what you and/or your client will do if you cannot reach an agreement with the other party. Of course, this degree of preparation requires time, which can sometimes be in short supply, as it was for me that day long ago.

However, if you’re pressed for time, you should focus the little preparation time you’ve been given by examining the following two questions:

1. If we could have everything we want in this negotiation, what would we want in the final agreement?

2. If everything goes against us in this negotiation, what would be the minimum we would accept to reach an agreement?

I suggest that careful consideration of those questions will help you focus your goal setting and help you set in your own mind your relative priorities, perhaps in the following categories:

offer points: These are the essential elements that you must achieve from the negotiation, or there is no reason to continue with the negotiation. They may be few in number, but they are the highest priority.

secondary points: While important, these are not necessarily vital and can be compromised if necessary to gain a negotiating point.

trading points: Everything else; these are low priority and won’t play a substantive role, at least not from your client’s perspective. What makes them important is that they can be valuable to the other side and can serve as concessions.

Preparation prior to your negotiation process will increase the likelihood of achieving your goals and help you begin to think strategically about the negotiation process. If you are negotiating on behalf of a client, this preparation will also help ensure that you and your client are on the same page about the specific interests you seek to advance through an agreement with the other party.

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