When the Government first announced that the public sector would have to make severe cuts, Richard Crouch, HR director of Somerset County Council, suggested that some HR teams would lack the necessary negotiation skills to deal with the changes.
Since then, Crouch has been forced to change his mind. He believes that, since the economic downturn started to bite, HR professionals now enter so many discussions about redundancies, pay and performance that they have had no choice but to hone their negotiation skills. "We've become far more fluid in our negotiations. Less bureaucratic and more process-driven," he says.
Negotiation itself tends to have an image problem. It is often associated with Mafia-style confrontations that go on long into the evening and resolve nothing. In reality, whether you're in the private or the public sector, you will be entering into different levels of negotiation every day. There are negotiations with suppliers, such as recruitment agencies or training providers, and differences of opinion between line managers and staff. Even something as simple as working out the holiday rota is a basic form of negotiation.
What to consider when entering a negotiation:
- Have an idea of what "success" looks like. What will be an acceptable outcome?
- Position yourself on the other side of the table - what would you say if you were asked to take a pay cut?
- Build a rapport before you enter a negotiation with someone. That means your relationship is not all about confrontation.
- Remember, you may be working with these people tomorrow, so don't let the discussion become too emotional.
- Think about your long-term relationship. If you take advantage of someone this time, you may not get the chance to work with them again.
- Consider a feedback session after a negotiation or an "objections clinic" so you can discuss about what works and what doesn't.
However, there are times when these discussions become unavoidably public. Unilever, for example, has experienced media scrutiny of its employees' decision to take strike action over their pensions. Similarly, British Airways' failed negotiations with cabin crew in mid-2010 happened under the glare of the media spotlight. Negotiations in the public sector, in particular, tend to enter the public eye because everything is a matter of record.
Most day-to-day negotiations, however, happen without fanfare. "There will be negotiations that are quite political and play out on a big stage, but most of it happens privately and quietly," says Alan Warner of HR consultancy Alan Warner Associates. "I think HR people are generally successful at negotiating because they do it in a way that is unseen."
Where HR professionals do sometimes fall down is in recognising how their negotiations could affect not just their department, but the rest of the business, argues Nick Holley, director of the HR Centre of Excellence at Henley Business School. "The problem is they can be too internally focused and not see how what they're trying to negotiate might impact on other areas, for example line managers' time," he says. "They have to think about the 'what's in it for me?' factor; why would the other person want to do what they're proposing?"
Ways to improve negotiation skills
While there are courses available on negotiation skills (through professional bodies such as the CIPD or through commercial organisations), the best way to improve your negotiation skills is often by exposing yourself to situations that require you to negotiate. "I think it's best to learn from someone else. Sit in on a negotiation and pick out the good bits," advises Warner.
At Somerset County Council, the HR team reviews any situations where it has had to negotiate, and looks at what might be done better next time. Crouch also suggests immersing yourself in different types of negotiation at different levels, rather than the same situation over and over again.
Negotiations can become emotional, particularly in discussions around redundancy or pay. Warner advises the best way to deal with this is to remain calm and not rise to any insults, adjourning the meeting if need be until everyone has calmed down. "It's not about victory or defeat, it's about what's acceptable," he says.
Being prepared to reach a compromise can help the negotiation process to stay on track. While your ideal target may be to reduce the asking price of a service by 20%, "rehearse" how you would feel if you reached agreement on 15%. It's also important to spend time finding out what comprises a successful negotiation for the other party, says Holley: "Successful sales people spend a good part of the negotiation process understanding the other person's point of view. What are their issues and problems? How can you add value for them?"
Confidence is key
One of the hurdles to overcome, Holley adds, is simply having the confidence to negotiate. While negotiations are almost second nature to more "traditionally" commercial functions, especially on price, HR professionals may not feel as comfortable asking others to compromise. But the rise in outsourcing relationships or deals with external suppliers means that there is a greater than ever need to overcome the fear that your proposals will be rejected.
In one of his previous roles, Holley used to take part in an "objections clinic", where his team would come up with all the possible objections someone might have with a product and think about how they would revise what they had to offer. In a negotiation, this approach could work by enabling you to think about where the sticking points will be, and rehearse how you'll get over them.
While negotiation is a difficult skill to learn, it is absolutely vital if you want your HR function to become more commercially focused, as well as more understanding of the needs of your employees and managers.