Anchoring Negotiation ExampleOrlando is an applicant for an IT job.He is trying to apply for an engineering position in a prestigious IT companyOrlando arrives in the office around 5 minutes early so he can prepare for the final interview. He badly wants the job but he also wants to get a higher salary compared to his previous job. During the interview, the interviewing manager asks Orlando what his salary expectations are. Orlando immediately answers that his salary expectation is around $10,000 to $15,000 per month. The manager looks at his resume again and then informs Orlando that his company’s salary budget goes from $7,000 to $9,000 and is also entirely dependent on his work experience. Given that Orlando is lacking the experience needed by the job, the manager tries to get him to agree to meet halfway because Orlando’s skillset is perfect for the job.Without any other option and seemingly regretting that he was very impulsive regarding the numbers on his salary expectation, Orlando decides to take the offer.1. Do your ResearchLike everything else when it comes to negotiations, you need to do your research first.Before approaching the negotiation table, make sure you have every intel available regarding the other party. If you can get information on how much they’re willing to spend or offer, their resistance points, how well the negotiator for the other party is, or who is going to talk on their behalf, then you as the negotiator will have an easier time deploying negotiation anchoring like a boss.2. Prepare your ZOPAFor the seasoned negotiator, you must identify your ZOPA to use negotiation anchoring without challenges. ZOPA means Zone of Possible Agreements. It’s no less any different from the BATNA or Better Alternative to No Alternative but for the ZOPA, the options that you’ll be taking are entirely dependent on the other party’s counter-offer.In Orlando’s case, the hiring manager stated that their company’s budget for a new engineer is only from $15,000 to $30,000. With Orlando’s salary expectation, you could say that Orlando’s ZOPA is at $20,000 to $30,000 only. With that in mind, Orlando is saved from not having another job but at the same time, he doesn’t get the salary that he wants.3. Proposing a counter-anchorThe idea of proposing a counter-anchor is, again, entirely dependent on your ZOPA and research. When the other side proposes their negotiation anchoring and it’s lesser than the ideal, remind the other party first that the price they are offering is less than what you want.When you’re done with your explanation, give the other party the offer that you think would do good for you and explain why you think your offer is better. The better your explanation will be, the higher the chances that you’ll succeed with the negotiations.4. Rejecting the anchor priceShould the other party initiate the negotiation anchoring first, you can immediately reject the anchor price if the other party is not showing any signs of changing it. If the deal is also not worth the trouble anymore, you can also choose to reject the anchor price and walk away. Ideally, this should be your final resort. There is no turning back once you’ve walked away.5. Always avoid the Anchoring BiasIf you’ve initiated the negotiation anchoring and yet, you refuse to change the terms you initiated, then you’re committing one of the most common mistakes when anchoring a negotiation. This process is called anchoring bias.Taken from the root word “bias” itself, you are dead set on achieving on getting the results that you want based on your first offer. Avoid this at all costs, as it will completely alienate the other party and will affect your reputation as a negotiator too.6. To Pause or Not to PausePausing for some time off can be a welcome respite during a negotiation. As a negotiator, learning when to pause and not to pause is an effective strategy for negotiation anchoring. When you’ve initiated the first offer and the other party is trying to give some time for deliberation, you can give them some time to pause. But before doing so, remind them that about the value of your initial offer. This will give the other party some time to think while pondering on the things you’ve said.However, if you’re on the receiving end of the negotiation anchoring and the other party wants to give you some time off, it’s sometimes better to continue with the negotiations, especially if you’re setting up your counter-anchor. Giving time means getting information, so sometimes, you don’t want to give your opponent this opportunity.7. Learn from ExperienceNegotiation anchoring is one of the many skills that you can learn through experience. You take your losses and learn from them while you relish your victories while checking on the things that you can improve. Learning how to time your anchors is another skill that you’d want to master. Do all this and you’ll be a master in negotiation anchoring in no time at all.Full article with examples here. see hubwealthy.com/wealthy