Seven Steps To Negotiating Successfully

When you negotiate, do you use a system? Do you haphazardly jump into a negotiation without any planning or thought for what you might do if you hit roadblocks? In order to negotiate successfully, good negotiators prepare before a negotiation.

The information that follows outlines seven steps you can use to negotiate successfully.

1. Gather Background Information: When gathering background information, include the style, values, ethnicity, culture, demographics (younger negotiators on/using twitter, Facebook, LinkedIn, and their way of communicating, versus those that are slower to use these mediums) and other information that’s pertinent to that particular session.

2. Assess your arsenal of tactics and strategies: The more you’re aware of how to use the appropriate tactic with the appropriate strategy, applied at the appropriate time, the more options you’ll have and be able to execute during the negotiation.

3. Create Your Negotiation Plan: Consider the overall strategy you’ll use for the negotiation. Break strategies into tactics. Assess possible strategies the other negotiator might employ. Take into consideration the use of red herrings (Note: Red herrings are items that have little to no value to you that you position as having value, but items that possess real value to the other negotiator). Also consider how you might apply pressure to points (leverage) throughout the negotiation.

4. Engage in the Negotiation Process: Observe body language and mannerisms. This can be done in person, via the phone, and in writing (e-mail, etc.). Note the style in which the other person negotiates (i.e. friendly (let’s get along), reserved (I’m not quite sure how this is going to go and I’m apprehensive), hostile (I’ll show you mine, if you show me yours – the only way for me to win is for you to lose – I’m in the driver’s seat; it’s my way or the highway).

5. Closing the Negotiation: Be on high alert for the conclusion of what you think is an agreement, that serves as the opening of the next phase of the negotiation; in some cultures, this is a common practice. If you’re unsure of the other person’s sincerity, put deliverables into phases of the negotiation.

6. Conduct a Postmortem: Dissect the negotiation. Assess what went right – What could have been improved upon – What you learned from that person about negotiation styles – What lessons should be taken forth into other negotiations – What went wrong – Why did it go wrong – What could you have done differently – What prevented you from using a better tactic/strategy to allow you to gain control of the negotiation).

7. Create Negotiation Archive: Create an archive of your negotiations and store them in a repository. Set up keywords to cross-reference sections, tactics, and strategies in your negotiation write-ups, to be used for the extraction of quick ideas and serve as a resource, for future negotiations.

Whether you’re a negotiation neophyte or a seasoned professional, by using the platform of the “Seven Steps To Negotiating Successfully” as your negotiation foundation, you’ll be considerably ahead of the other negotiator… and everything will be right with the world. Remember, you’re always negotiating.

The Negotiation Tips Are…

• When negotiating, seek advantages that allow you to exploit your strength, but don’t disparage the other negotiator in your enthusiasm to obtain victory.

• When a negotiation outcome is less than expected, learn from the experience. Commit to getting better. Increase your knowledge of how to use the right tactic, with the right strategy(s), aligned with the right situation.

• Make sure you observe and control your biases when assessing the person with whom you’ll be negotiating.

A Twelve Step Program to Break Your Addiction to Ineffective PowerPoint Presentations

The twelve step program created by Alcoholics Anonymous has been used as a model for many people to break their addiction to alcohol, drugs and other destructive behaviours. It has been adapted to many situations to deal with different problems people have. I started thinking about these steps when I was considering how to stop people from creating and delivering PowerPoint presentations that are ineffective and damaging to their careers.

In this article I am giving you my twelve step program for breaking the addiction that many presenters have. These presenters have become accustomed to packing their slides with text and data and mostly reading the slides to their audience. They know others have somehow managed to use visuals effectively in presentations, but they need some help to break the habit they have.

I hope these steps will help you or someone you know to start to make the changes that will help improve your presentations, and lead to even greater success. The first six steps deal with making a decision to change and committing to the work it will require. Steps seven through twelve address how to make the change.

  1. I admit that my abuse of PowerPoint has become unmanageable. I can’t seem to figure out how to stop inflicting overloaded text and data slides on my audiences. My audiences don’t find my presentations effective, even if they aren’t telling me that to my face.
  2. I have come to believe that there is a better way that can save my presentations. I have seen other presenters deliver effective presentations with persuasive visuals, so I know there is a better way. I see that they start with structure, create and use visuals that illustrate their message, and deliver their presentation as if they are having a conversation with the audience. I’d like to be able to do this too.
  3. I have made a decision to turn my presentations over to this better way of presenting. I believe that I can change my ways. I believe that it is possible and that it doesn’t require an innate design ability to do it. I believe that I can learn the skills I need to be able to create effective PowerPoint presentations.
  4. I have made a fearless inventory of my skills at design, creation and delivery of presentations. I have used honest feedback from others and independent assessments to truly evaluate what I am good at and where I need to develop skills. I have been encouraged because now I know what I need to learn in order to become a better presenter.
  5. I have admitted publicly that my presentations have not been as good as they should have been. I have committed to my family, friends, colleagues and my boss that I know I can create and deliver better presentations. I have done this publicly so that I can count on their support, guidance and encouragement through this process. I also want them to hold me accountable to make these changes. I look forward to celebrating with them as I see the changes result in successful presentations.
  6. I am ready to address my presentation faults. I know this will involve hard work and I am willing to commit to the efforts that are necessary. I will allocate the time necessary to study and practice these new skills.
  7. I have asked for assistance to address my shortcomings. Knowing that this will take time and effort, I have asked for approval at work and home for time and funding to get the training I need. I have made the time in my schedule for the required learning, better preparation of my presentations, and more rehearsal for each presentation.
  8. I have made a list of the mistakes I have made using PowerPoint and am willing to correct them. From the fearless inventory of skills in step four, I have listed the areas that I need to improve on. I will seek out the training, books, and other resources that will help me improve in these specific areas. I will seek the guidance of coaches and others who can give me the expert perspective I need.
  9. I will make my presentations better for future audiences. I know that the training and learning will be difficult at first to implement in my presentations. Change is difficult when you start it. I commit to the work required to make the changes and will push through the difficult times in order to make the changes I have committed to. I won’t give up when the going gets tough.
  10. I will continue to evaluate my presentations honestly and admit mistakes when I find them. I will use checklists and rubrics to evaluate all aspects of my presentation, from design, to content, to delivery. I will be ruthless in my evaluations so that I don’t slip back into the practices I once followed. I will ask experts for their honest opinions to help check my progress.
  11. I will continue to learn and develop my presentation ability with the goal to become the best presenter I can be. I know that this is not a one-time effort. I will need ongoing guidance and ideas in order to continue to improve. I commit to continuous learning through books, blogs, videos, courses, newsletters, conferences, etc. I will ask presenters I respect which thought leaders they follow and learn from them.
  12. Having realized the errors of my presentations in the past, I have tried to share this message with other presenters and demonstrate better presentations principles when I present. When I see an article, video, blog post, tweet, or other item that demonstrates this better way to present, I will communicate it to my network through my conversations, e-mails, blog posts, tweets, etc. I will recommend to my colleagues, bosses, and friends, those books, experts, web sites, blogs, newsletters, etc. that have helped me.

Now it is truly up to you. I know that changing from your old ways of presenting is difficult at first. I’ve done it and so have many fellow readers of my newsletter who have written to thank me over the years. You can do it too. I am here to help and encourage you along the way with articles, my blog, slide makeover videos, and many other resources. Now take that first step.

Negotiating the Best Price on an REO Foreclosure

Negotiations can be one of the most thrilling aspects for buyers of any piece of real estate. Since the average member of the buying public doesn’t get that many chances to hone their haggling skills in everyday life, they often relish the opportunity to do so when it comes to their home purchase. With regards to bank-owned foreclosures, buyers who are in the know enjoy optimal negotiation positioning, resulting in fantastic deals.

Real estate negotiations begin with the context of the potential transaction. That is to say, without a full understanding of the home, the market, and the circumstances surrounding both, buyers are flying blind. The word “buyers market” has been thrown around quite a bit over the last few years, which implies that all of the leverage is on the side of the buyers. While this is largely true in many transactions, it is by no means universal. Even today, in some cases buyers find themselves in a bidding war, at the mercy of the whims of their counterparts just like a few years back. The key is to understand what is being offered, and what one hopes to achieve as a buyer.

This is a critical element of any successful negotiation/purchase strategy that is overlooked far too often. One must not confuse the feeling of “coming out on top” with getting a good deal in actual terms. Many buyers would feel better after paying $5,000 less for a home that is overvalued by $10,000 than they would by paying $5,000 more for a home that is undervalued by $10,000. By separating perceived savings from observed savings, buyers free themselves up to unearth fantastic savings in their real estate purchases, especially when it comes to REO properties.

When negotiating for a bank-owned foreclosure property, understanding the home’s list price and where it falls within the value range is a necessary first step, given how REO properties are valued in the first place. To say the very least, foreclosure property valuation is an inexact science. The Asset Manager (entity in charge of handling the foreclosure transaction on behalf of the bank) collects a series of agent-generated evaluations of a home, and makes a value determination based on these findings. Many of these evaluations are “exterior-only” meaning the agent merely drives by the home, snaps a few photos of the exterior, and are then tasked with determining the home’s value. Even when performing interior evaluations, agents must generate market values for properties while taking into consideration amenities, useful life of upgrades, and repair costs for damages. The asset manager, which more-often-than-not is located in another state altogether, then dictates the list value for a property they’ve only seen in photos.

The result is that from time-to-time bank-owned foreclosure properties are listed on the market at values that aren’t in sync with the area value range. Often times, listings that come on the market way under value are met with a storm of offers, some of which may even be over asking price. So as a bargain-hunter, should a competitive offer situation be seen as an indicator that no savings are to be had? No way! The key is to understand that a bargain isn’t defined as sale price vs. list price, it is sale price vs. market value.

When developing a pricing strategy for an offer, agents are full of stupid ideas. Some advise offering some arbitrary percentage under the list price if their clients have the only offer on the table, while others suggest offering some arbitrary amount extra over list value for every competing offer that has been submitted. For starters, one must make their own determination of a home’s market value, irrelevant of the list price. From there, buyers must determine how much of a savings they would feel satisfied with getting, vs. how much savings they would be willing to give up to get the home. If buyers fall in love with a home and will do anything to get it, then negotiating for maximum savings may not be the best strategy, especially in a competitive situation. Sometimes deal-seeking buyers get overzealous in a competitive situation, and offer enough as to eliminate all potential savings, or even go over market value altogether. A good negotiator knows that they must be able to make their own determination of value, and they must not let emotions govern their approach.

Speaking of emotions, they have clouded countless real estate deals over time, especially when the sellers have a personal interest in the home. When buying a bank-owned foreclosure, however, buyers can be as sassy as they want with their negotiation tactics without fear of hurting anybody’s feelings. The banks are financially invested, but not emotionally invested. Telling the banks that as a buyer you think a home is worth a lesser amount is fine, and is not taken as a personal affront. Yet if not done properly, it won’t lead to any positive outcomes either.

Lending institutions and asset managers rely on market data when determining a list price, and are open to relying on the same when deciding whether or not to accept an offer. If an offer is made that is under list price but is backed up with market data indicating that the price is justifiable in the market area given local value progression, buyer demand, economy, etc., then the banks are much more likely to play ball. The best way to steer things towards a positive result when negotiating with the banks is to speak their language.

Price is the primary factor that drives negotiations, but is not the only variable in the equation. Buyers can sweeten offers in a variety of ways, some of which come at no additional cost. For example, a buyer who has been fully vetted by their lender and has their inspectors on standby can tighten all of their contingency time frames, offering a faster, more attractive closing. If a buyer isn’t entirely happy with the present condition of the home, they may be able to negotiate for repair credits, something that is not generally known about buying bank-owned property. Credits are preferred by banks to performing repairs themselves, which often involves more red tape than they would like. By forming the other elements of an offer as per the specifications of the lending institution on the other end of the deal, one can add appeal to a deal that can sufficiently offset a lower offer price.

Given the market conditions across the country, there is an abundance of great deals on REO properties out there for the taking. Whether the goal is paying bottom dollar, or getting the home that is desired above all others, the path to success is essentially the same. By properly defining true value for any home, and formulating an offer strategy that is attractive to the banks and asset managers in all of the most important ways, buyers can achieve any goal when negotiating their next home purchase.