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Thus, one relatively objective way to evaluate a crucial element of negotiation success is to compare the terms of your final deal with what you initially would have done if you had not negotiated it. The difference will be the relative impact of your negotiation effort.
Assume John at ABC Corp. has been asked to get the best deal he can for 100 hotel rooms for ABC's annual conference. He contacts three quality hotels and is quoted the following rates: Hotel X, $13,000; Hotel Y, $13,500; and Hotel Z, $14,000.
John subsequently negotiates a rate of $12,000 at Hotel Y. How can you measure John's negotiation ability? Compare ABC's best alternative at the start of the process with ABC's deal after John has completed his negotiation. This $1,000 difference is attributable to John's negotiation effort.
3. Evaluate the result vis-ŗ-vis objective standards.
Another critical element to track is your employees' results relative to objective standards such as market value, efficiency, costs/profits and expert opinions.
Let's say Linda is the hiring partner at a 20-lawyer law firm that has decided to hire a three-year lawyer. So she hires Sally at a $100,000 annual salary.
If most three-year lawyers receive offers at about $100,000, that salary is market rate, Linda's negotiation effort was average. But if Sally agreed to $90,000, a below market rate, Linda's effort was above average. Linda's partners might also evaluate her effectiveness by:
Many companies may find resistance to these ways of evaluating negotiation skills. Employees become accountable for their negotiation effectiveness. Some will welcome this. But many will resist.
That's a negotiation worth winning.
Marty Latz, a negotiation columnist for The Business
Journal of Phoenix where this column originally appeared, is President of Latz
Negotiation Institute, a national negotiation training and consulting firm based
in Phoenix, Arizona. He has developed and taught negotiation training programs
and seminars for corporations, cities, bar associations and law firms nationwide.
Participants at his courses leave behind the intuitive and instinctive -- along
with their inherent uncertainties -- and develop the strategic mindset thatís at
the heart of successful negotiation.
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Copyright © 2004, Marty Latz
Copyright © 2004, The Negotiator Magazine