Business Negotiation, Negotiating in Life July 23, 2007

What Level of Authority Should You Have?

Most negotiators ignore the fact that having limits on their authority can make their jobs easier – it's a source of negotiating power.

A negotiator with limits becomes harder to deal with. They can say "no" gracefully – someone else is saying it. That someone else can be a procedure, a policy, a budget, an engineering standard, or maybe a regulation that can't be changed.

Often one person's limits can become the other person's problem. If you and I are negotiating and I have limits to my authority, it is up to you to figure out a way around them. You are forced into a choice: either accept the deal at my limits or make a lot of work for yourself, and maybe get no deal at all.

If you challenge my lack of authority by taking the problem to a higher authority, other apprehensions set in. Now you must take on my boss, or their boss, or the legal department, or the engineering staff – all of whom represent new relationships and a greater degree of preparation on your part. Also, if you do go to higher levels, there is always a chance the party you are negotiating with will get angry.

There is greater strength in not having authority than in having it. A person going into a negotiation needs to ask, "What limits do I want imposed on my authority?" Well chosen limits can make a big difference in the outcome of your negotiation.

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Kim C.
PROCUREMENT at AMERICAN EXPRESS

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INTERNATIONAL SOURCING at FMC TECHNOLOGIES

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VICE PRESIDENT at GE

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PLANNER at HONEYWELL

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CONTRACTS MANAGER at HEWLETT-PACKARD
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