The importance of negotiations in projects

Negotiating skills for a project manager are crucial and improving them will set the foundation for a successful project.

Project managers hold different roles at the same time: leaders, intermediaries, delegators and even negotiators.

This is why negotiation skills for project managers are on the list of soft skills they should develop.

What is the negotiation in a project

Negotiation is a process consisting of the activities necessary to resolve different types of disputes through consultations between the parties involved in order to reach a consensus.

Negotiations can take place at any time in the project lifecycle and may be formal or non-formal.

Formal negotiation implies an agreement through contracts and formal documents, while informal negotiations include debates to resolve a conflict between team members, for instance.

In project management, the negotiation process is divided into phases and include:

• Planning: the preparation of all relevant information necessary for the discussion.
• Debate: here the key issues are examined and discussed.
• Proposal: the creation of the proposal as a way of solving the problem presented.
• Revision: this can include negotiating compromises before an agreement is formalized and before the information is shared throughout the organization.

Why negotiation is important for project managers

Here are some situations where negotiating skills play a key role in the success of a project. Cases in which the project manager:

• is engaged in strategic negotiations with suppliers of goods and tools necessary for the execution of the project.
• is engaged in negotiating with a potential investor in a new project.
• is engaged in negotiations with stakeholders regarding a substantial change in the project.

Ultimately, negotiating skills enable project managers to achieve stronger relationships with stakeholders, better relationships with clients and, in general, a more positive working environment.

Negotiating can also be a useful strategy for dealing with conflicts on a project.

While it is almost impossible to avoid conflict entirely, being able to negotiate the way around it is a useful skill.

In the most serious situations, conflict can also halt a project.

Improving project manager’s negotiating skills

Here are 5 tips that can help improve project manager’s negotiating skills.

1. Improving negotiating skills: Practice

The very first thing to do, as happens in all things, is to practice a lot.

Probably everyone negotiates more than they think – both in their professional life and in their private life.

It is therefore important to be aware of these negotiating situations, to analyse how you approach and deal with the moment, how you feel and what could be improved for the next time.

2. Improving negotiating skills: Preparation

It is important to spend some effort on preparation for negotiation.

If a project manager knows they are meeting a supplier, for example, they should think in advance about what they want to achieve from this agreement and explore potential alternatives.

This way you will engage in the discussion more confidently and know in advance what you want to achieve.

However, it is important to remember to remain receptive to other people’ points of view as well.

It is not a negotiation if you refuse to change your standpoint and force the other person to accept your ideas.

3. Improving negotiating skills: Manage your emotions

Conflict situations and negotiations often expose the worst in people.

It is therefore important for the project manager to be prepared for how they will react in a potentially difficult and perhaps embarrassing conversation.

4. Improving negotiating skills: Take your time

Negotiations can take a long time and be running on a continuous basis; it is unlikely that in a single meeting, everything will be discussed and resolved.

For large projects, multiple meetings could be held to ensure that everything is documented effectively and to the satisfaction of both parties.

And even when the agreement is concluded, the project manager may find himself negotiating more precise details or new terms to move the project in the right direction.

5. Improving negotiating skills: Listen

When preparing for a negotiation, you need to try your best to think about what you want to say, how to say it, how to reply to what you think the other person will say.

Simply put, a project manager must also be ready to listen.

Listening will help you identify the other party’s weaknesses and help you really understand what others want.

When you listen actively, you are more likely to formulate answers that the other person finds acceptable.

The importance of negotiating: conclusions

Ultimately, negotiation is an excellent project management tool and is critical to getting the best out of any situation.

Negotiation goes beyond reducing or increasing the price of an offer and is a necessary tool in the daily activities of the project manager.

Like all soft skills, knowing how to hold engaging conversations that translate into good results for both parties is something that can always be improved over time.

With the right knowledge, structures and techniques, any project manager will be able to approach negotiations knowing how best to target the project and the organization in general.