Do Learn to Use Higher Authority

In a negotiation it may help us if we have limited authority. What we can give away is 'apparently' minimised. 'I need to discuss that with my MD', or 'with my partner', or 'with my department manager'. You can make a company policy that actually reinforces the fact. In other words, if you wish, you can actually make it company policy that your authority is limited in certain situations and you must therefore refer to whoever is stipulated as the authority.

In real terms, don't go beyond your own authority. If you are reaching a point in the negotiation where you are being asked to agree terms for which you do not have the authority, use a phrase like this: 'I am authorised to negotiate within certain parameters. I can take this one back to my MD, I doubt if he will agree. But what if we could...'

Do know the boundaries of authority within which your counterpart operates. Make sure you know what they can and cannot agree. Otherwise you may trade a concession unnecessarily.

Where it helps, insist on speaking to a higher authority in your counterpart's organisation. A friend of mine was negotiating a price from his insurance company. He selected a policy from a company offering a special deal for a second car. He was refused because of a minor accident three years earlier. He would not take no for an answer. He patiently elevated the issue through two levels of management before finding the individual to whom the gain or loss of the business really mattered, when he finally secured his deal. The result for him was a real saving of £300 pa. The lesson learnt was to escalate the process and use higher authority to get the result he wanted.