How to improve my negociation skill as a PM ?

You need to have a proper preparation for any negotiations you have:
Preparation for negotiation is directly proportional to the scale of the project or argument. For a small argument or discount, extensive preparation can be counterproductive. The following should, however, be considered at various levels depending on the scale of project or disagreement that needs to be resolved.

1. Goals – Why are you going into this negotiation? What do you hope to achieve and what do you think the other parties hope to achieve as well? Never analyze from your own perspective alone.

2. Available alternatives – In a situation where you are unable to reach an agreement, what alternatives are available to you? What are the advantages and set backs of the alternatives? And what are the implications of not reaching an agreement to the project and the organization as a whole?

3. Trade Advantage – What do both of you have that gives you an advantage over the other? What are you willing to sacrifice for the agreement?

4. Relationships – What kind of relationship do you have or hope to establish with the other parties involved in the negotiation? Is it a one-off relationship or a continuous relationship? What is the implication of a failed agreement on the relationship involved?

5. Power – Who has the upper hand in the relationship? Who controls more resources and who stands to gain more or lose more if an agreement is reached or not reached?

6. Consequences – For every action, there is a consequence. What are the consequences of you winning or losing the negotiation? When is it considered to have lost the negotiation and what are the quantified implications of the project and project organization?

Mahalmadane, all the above give you food for thought. After you've prepared and worked through the negotiation process (not yet at a 'win-win'), stop and remind yourself, "The other party will never accept a bad deal. Why should I?"
Then think about Nico's insight.
In my humble opinion, negotiations have only two outcomes: #1 a 'win-win' (where both parties feel they ended up with more than they expected to gain) the preferred outcome. Or #2 no deal. Win-lose or lose-lose are not successful negotiation outcomes. Jim

On of the point that I would also like to consider is, when to stop negotiation. So, the goal of negotiation is key and once achieved need to stop and proceed with next actions. On the other note if not achieved need to have other options or plan in place to handle if the negotiation fails.

In addition to what Drake said, understanding human motivation is key to influencing others. Know what they want and what drives them, and you will negotiate effectively.

Excellent, I would add on step :
Try to identify the influencers , the guys who won't negociate directly but have a strong power on the guy who will negociate.

Mahalmadane -

Take a basic course in negotiation (1-2 days) and then practice what you've learned in both personal and professional situations.

Successful negotiation requires active listening, high EQ, and an ability to see the interest of parties rather than just focusing on their positions.

Kiron

Mahalmadane

I suggest you to listen to the free webinar at www.projectmanagement.com "PMXPO 2010 Project Negotiations: Deal yourself a winning hand" featured by Mr. Joseph Lukas.
It is very good, current, objective and useful for the Project Managers.
Miguel

Mahalmadane, all the above give you food for thought. After you've prepared and worked through the negotiation process (not yet at a 'win-win'), stop and remind yourself, "The other party will never accept a bad deal. Why should I?"
Then think about Nico's insight.
In my humble opinion, negotiations have only two outcomes: #1 a 'win-win' (where both parties feel they ended up with more than they expected to gain) the preferred outcome. Or #2 no deal. Win-lose or lose-lose are not successful negotiation outcomes. Jim