Business Negotiations

Effective business negotiation is a core leadership and management skill. This is the ability to negotiate effectively in a wide range of business contexts, including dealmaking, employment discussions, corporate team building, labor/management talks, contracts, handling disputes, employee compensation, business acquisitions, vendor pricing and sales, real estate leases, and the fulfillment of contract obligations. Business negotiation is critical to be creative in any negotiation in a business setting. Business negotiation strategies include breaking the problem into smaller parts, considering unusual deal terms, and having your side brainstorm new ideas.

Leveraging the contrast effect is also a powerful tool in negotiations. You might ask for more than you realistically expect, accept rejection, and then shade your offer downward. Your counterpart is likely to find a reasonable offer even more appealing after rejecting an offer that’s out of the question. Additionally, offering several equivalent offers that aim higher than your counterpart is likely to accept will elicit reactions that can help you frame a subsequent set that, thanks in part to the contrast effect, are more likely to hit the mark.

Building a team is critical to negotiations in business. To prevent conflicts among diverse, strong-minded team members from overshadowing group goals, negotiation teams should spend at least twice as much time preparing for upcoming talks as they expect to spend at the table. Because the other side will be ready and willing to exploit any chinks in your team’s armor, it’s important to hash out your differences in advance.

Other business negotiation tips include curbing overconfidence, creating value in the negotiation, establishing a powerful BATNA, effective use of emotions at the bargaining table, caucusing, delineating your zone of possible agreement, and other skills geared toward an integrative bargaining outcome rather than a distributive, or haggling, bargaining outcome.

In addition, considering the ethical and legal repercussions of a deal to insure that it is a true win-win is the hallmark of every experienced business negotiator.

Articles include many business negotiation examples, and explore concepts such as creative dealmaking, renegotiating unfavorable deals, seeking advice from a negotiation opponent, identifying a solid BATNA and crafting draft agreements.

Discover step-by-step techniques for avoiding common business negotiation pitfalls when you download a copy of the FREE special report, Business Negotiation Strategies: How to Negotiate Better Business Deals, from the Program on Negotiation at Harvard Law School.

Business Negotiation Skills: How to Deal with a Failing Business Partnership

PON Staff   •  05/23/2016   •  Filed in Business Negotiations

It had seemed like the beginning of a fruitful relationship. In April 2012, six wealthy businessmen teamed up to buy the Philadelphia Inquirer and several affiliated businesses for $61.1 million, promising to work together to reverse the newspaper’s flagging fortunes. Their infusions of cash and appointment of a Pulitzer Prize–winning reporter, William K. Marimow, as … Read More 

The Importance of Negotiation in Business

Katie Shonk   •  05/12/2016   •  Filed in Business Negotiations

What are the essential ingredients to getting ahead in the workplace? Hard work, communication skills, and a generous dose of luck all play a role, of course. Another key ingredient—one that is often overlooked—is the ability to recognize and capitalize on opportunities to negotiate for your career success.

Why is negotiation important in business? Because our … Read More 

Business Negotiation Skills Tips: Curb Your Overconfidence

Keith Lutz   •  05/09/2016   •  Filed in Business Negotiations

Here are four pieces of advice that current negotiation research offers to reduce your overconfidence:

1. Collect information.

When the stakes are high, you must overcome the common tendency to spend too much time looking in the mirror, admiring virtues and fretting over flaws. Negotiators get into trouble when they lack information about the other players in … Read More 

Managers – Think Twice Before Setting Negotiation Goals

PON Staff   •  05/03/2016   •  Filed in Business Negotiations

To encourage the negotiators they supervise to do their best, managers routinely rely on performance benchmarks, the promise of bonuses, and other types of goals. But before you engage in further goal setting, consider the following real-life disasters: Under the leadership of turnaround expert Q.T. Wiles, quarterly earnings goals became a company wide obsession at … Read More 

Integrative Negotiations Strategies and Negotiation Ethics: Social Proof and Acceptable Behavior

PON Staff   •  05/02/2016   •  Filed in Business Negotiations

What do we do when we’re uncertain about how to behave in business negotiations? We study the behavior of others in similar situations.

When we look for social proof regarding the “right” way to behave, we tend to make quicker, more efficient decisions, writes psychologist Robert Cialdini of Arizona State University. … Read More 

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