New Way of Negotiation

Think back to a recent negotiation that you were involved in. Were you apprehensive that your counterpart in the negotiation would be better prepared or more skillful? Perhaps you were hopeful that the facts favored you and that your alternatives were much better than those of your counterpart. Were you nervous because your processional possibilities were tied to the outcome? During the negotiation, were you surprised by some new facts you didn’t know or made angry by the patronizing attitude of the other negotiator? And at the end, were you thrilled at the outcome.

Don’t let them get to you, good advice for negotiating? But what is the way to become the expert negotiator? I have experienced the new way of negotiation, which is very intrinsic, primary and fundamental part of human experience. We often negotiate under the influence of emotions, it plays many important roles: it motivates us to act; it provides us with important information about ourselves, the other party, and the negotiation; it helps organize and sharpen our cognitive processes; and it enhances the process and outcome of a negotiation when used strategically. While the emotion we experience provides us with information, the emotion we display provides information to others that can be an incentive or deterrent to their behavior. 

Initially, emotion was considered to be an obstacle to a good negotiated outcome and a foe to an effective bargaining process. Emotion in negotiation is a very common thing. Yet, many people suggest that being emotional is a sign of a weakness or is the behavior of an unsophisticated negotiator; some say that emotions must be repressed. 

There are many advantages to being an emotionally intelligent negotiator. For example, an emotionally intelligent negotiator is able to gather more and richer information about the other side’s underlying interests and reservation points; can more accurately evaluate risk, which leads to better decision making; can better perceive opportunities to use negotiation strategies and tactics that involve emotions; and can more successfully induce desired emotions in negotiation opponents. 

Negotiations often suggest a variety of emotions, especially anger and excitement. Angry negotiators plan to use more competitive strategies and to cooperate less, even before the negotiation starts. However, expression of negative emotions during negotiation can beneficial: legitimately expressed anger can be an effective way to show one’s commitment, sincerity, and needs. Excitement provides the high charge of negotiation.

Negotiation & the Art of Rapport

Asking questions works better than making demands in any area in life. You don’t always have to get your own way to win in a negotiation. Patience, listening skills and presenting alternatives can smooth over ruffled feathers. Experienced negotiators listen patiently and ask questions and then propose the alternatives. Recognize the other party has opinions and propose valid options to get to a goal. It’s not just your way, even when you want it to be.

Successful negotiators disagree without undermining the rapport they have taken time to create. They do this by listening patiently and confirming by repeating back to the speaker what they have just heard before they start contradicting the statements or proposing different options.

Whatever you do, do not try to push your opposing party into a corner, this will not make matters any better for your negotiation. It’s not a murder trial! It’s a negotiation where you should be working towards a mutually beneficial outcome. First and foremost, make the statement that you understand where they are coming from. Showing commonality & compassion will not cause them to react negatively to you. Then, at this point, you can disagree with them, but do so without insulting or putting them down. Don’t let the disagreement become confrontational. By all means, don’t out do the opponent.

Rather than a direct confrontation, use the salesman’s feel, felt, found formula. It’s been used for a hundred years but it works.

Think It Out To Yourself

Mean it when you say it. I understand how you feel (Be sure you do) then add “I’ve felt the same way” (You probably have) and conclude with “But in my experience I’ve found….” Then slowly present or propose an alternative solution. It’s a negotiation, not you getting everything and they get nothing.

Identify With The Opponent

What you strive to accomplish with this strategy is keep rapport and disagree in a non-confrontational manner. Most of all you’ve identified with the opponent and hopefully your suggested solutions will guide the opponent to a different point of view.

Another method of non-confrontational disagreement is to state how you’ve solved a similar disagreement in the past. Most opponents are willing to listen to suggestions and solutions that worked before.

Alternatives And Solutions Are The Best And Easiest Way To Negotiate

That way you are not criticizing the opponent and you are cooperating. Be first to present alternatives – that’s plural. Many of your opponents will say no to all of your suggestions. Prepare for that. Time is a significant part of the negotiation and it takes time for people to consider alternatives and options. They need time to think about it. People are begging to be lead, make suggestions. Encourage the opponent to participate. Show that you can go beyond what’s normal. Show them a better solution. When they are confronted with something better, when it’s staring them in the face, it’d hard for them to argue.

Differing Opinions

The intensity of a negotiation can create clashing and violent differences of opinions. Let the other party have equal say so, so they don’t get frustrated and become hostile. The more you listen the more you know what they want and you can pin point the solution or alternative.

Open ended questions, such as “Why do that?…”, “What are you thinking…” or “What other suggestions would you like to make…”, “Do you have other options…” or “What’s the consequences of that proposal?”

The idea is to create reciprocity, equals working towards a common benefit.

Using these techniques will help you to gain perspective in any negotiation, and tend to help you reach the goals you set forth to accomplish.

How do you invest in ELSS Tax Saving Mutual Funds to Save Tax

Though Tax planning can be challenging, it can also be rewarding if you choose the right mode of investment. If you are looking to save tax and long term risk-adjusted returns from your investments both, then maybe you may consider adding an ELSS tax saving mutual fund to your portfolio. The simplest thing to do would be to invest in an ELSS tax saving fund, which helps you build wealth and reduce your tax liability. How much tax is saved in the ELSS tax saving mutual fund?

If you are looking for a tax benefit of upto Rs 1.5 lakh under Section 80C of the Income Tax Act, 1961, Equity Linked Savings Scheme (ELSS) is the answer offering you tax savings of upto Rs.46,800 for the highest tax bracket.

How to invest in ELSS tax saving mutual fund?

You can easily invest in an ELSS scheme with a few clicks. If you have already selected a fund of your choice then you may visit the company’s website, select the fund and make an investment. If you are confused about which one to choose among the available funds, then you may choose to approach a distributor who can guide you on which fund to invest in.

Let’s take a quick run on how you can save your hard-earned money by investing in an ELSS Tax Saving scheme.

Is an ELSS tax saver alone?

An ELSS (Equity Linked Saving Scheme) could become your best choice if you are looking for:

Deductions under section 80C of the Income Tax Act, 1961

Opportunity to invest in the equity markets

Long term capital appreciation

The shortest lock-in period of all the tax saving instruments under Section 80C

As per SEBI’s mutual fund categorization norms, ELSS tax saving mutual fund is an open-ended equity-oriented mutual fund scheme that needs to invest a minimum of 80% of its assets in equity & equity related instruments (in accordance with Equity Linked Saving Scheme, 2005 notified by Ministry of Finance).

Generally investment objective of an ELSS tax saving mutual fund is to achieve long-term capital appreciation by investing in equity instruments.

A unique feature about ELSS tax saving mutual fund is that when compared to the other open-ended diversified equity mutual funds, investment in ELSS is subject to a mandatory lock-in period of three years. During this lock-in holding period, you cannot redeem your investments before the completion of three years from the date of the purchase of an investment. After the lock-in, if you decide to redeem the investment on the realized gain, as per the current tax rules, LTCG tax applies.

There are various types of ELSS tax saving mutual funds in the financial markets each following a particular investment objective. Remember, though tax saving could be one of the key objectives behind investment in tax saving fund; it’s a general expectation that any investment should also deliver some return.

Hence, while evaluating your options for investment in ELSS scheme, you need to look at the return column as well as the qualitative aspects too. You need to remember that as an investor, you should know the risk and reward attached to investment before taking the plunge with your hard earning money.