How your approach to negotiations affects your business?

Paradigms of negotiationLast week the team and I attended a presentation by J.C Maldonado, CEO of BizGro Partners ( on business negotiations. The title of the talk was, Negotiations Mastery for Entrepreneurs and Business Advisors. The unofficial subtitle was Negotiations Are More About Psychology Than Strategy. The Growth Team wants to share with you several important takeaways from his talk.

First and foremost, it is important to understand there is a difference between sales and negotiations. The essence of sales revolves around persuasion and it is one sided. On the other hand, negotiating is about bargaining and the process of arriving at a deal that is satisfactory for both parties. Hence, negotiations play a big role in business transactions.

While business depends on strong relationships, negotiations depend on understanding and respecting the boundaries of the parties, and reaching goals that both sides can be satisfied with. Maldonado presented three paradigms of negotiation that must be understood to navigate successfully through a negotiation’s process. The paradigms are: win/lose, perception based methodology, and win/win.

Win/lose, as it sounds, occurs when one of the parties’ wins, and the other loses. Think of someone unreasonable, who wants to gain at your expense. While not optimum for developing long-term relationships, it happens more often than not. Understanding this paradigm gives you an advantage and strengthens your ability to see it when it is being used against you. Recognizing it allows you to shift your strategy to navigate successfully through the situation.

Perception based methodology occurs when one party gives the recipient party the perception of winning. In a sense, this resonates with the first paradigm, where one party is looking to win, at the other party’s expense. In order to achieve this goal, the party looking to win will have to gain an understanding of what the recipient party would consider a winning situation in order to succeed with this paradigm. This draws a blurry line, however, about the boundaries of trust. One must fully understand the value of their offering, and emphasize those strengths, rather than creating an illusion of winning. This brings me to the third paradigm of a win/win.

The win/win paradigm is about both parties being satisfied with the transaction. Strong business relationships are important for conducting a successful business and this paradigm supports this; and a deal where both parties satisfactorily obtain their goal increases trust and strengthens the business relationship. No customer wants to be seen as a money bag. Customers want to feel appreciated, cared for, and they will certainly place heavy weight on trust when it comes to their business affairs.

Part two, (the steps to negotiations) coming up next week.

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