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.

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Negotiation in the News: The selfless QB? Tom Brady renegotiates with the Patriots

PON Staff   •  03/05/2015   •  Filed in Business Negotiations

After renegotiating his contract with the New England Patriots, star quarterback Tom Brady attracted almost as much admiration for his seemingly selfless concessions as he has for his stellar performance on the field. But a closer look at the restructured deal suggests that Brady, once again, looked for an advantageous opening and came out a … Learn More About This Program 

Negotiation Research You Can Use: Two new studies look at how our emotions affected negotiated outcomes

PON Staff   •  03/05/2015   •  Filed in Business Negotiations

Feeling ambivalent in negotiation? No worries 

Business negotiators often find themselves feeling positive and negative emotions simultaneously, such as concern that an offer won’t be received well and excitement over the offer’s potential.

We often try to squelch our emotions for fear of appearing unstable or vulnerable. Indeed, past research has suggested that expressions of emotional ambivalence—the signs … Learn More About This Program 

Lessons in Negotiation: Guhan Subramanian Cited by US Securities and Exchange Commissioner Daniel Gallagher

PON Staff   •  02/27/2015   •  Filed in Business Negotiations

Program on Negotiation executive committee member and Harvard Law School and Harvard Business School professor Guhan Subramanian was recently cited by Commissioner Daniel M. Gallagher of the United States Securities and Exchange Commission during his opening statement at the Proxy Voting Roundtable.

In discussing the equalizing effect of a universal balloting system on corporate governance, Commissioner … Learn More About This Program 

Successes and Messes

PON Staff   •  01/14/2015   •  Filed in Business Negotiations

In negotiation, as in other areas of life, the early bird often gets the worm. That’s just one of the lessons of a new deal reached between the National Basketball Association (NBA) and television networks ESPN and TNT in October.

A running start
As they considered the end of their eight-year television contracts with the NBA in … Read Successes and Messes 

In business negotiations, share the wealth wisely

PON Staff   •  01/14/2015   •  Filed in Business Negotiations

After graduating from the University of Chicago’s business school in 1971, David G. Booth took what he had learned and ran with it. The firm he founded, Dimensional Fund Advisors, bases its investment decisions on the type of academic research Booth absorbed from his professors in Chicago. That scholarly approach has paid off: Dimensional Fund … Read In business negotiations, share the wealth wisely 

Women and Negotiation: Why Women Sometimes Ask for Less

PON Staff   •  12/05/2014   •  Filed in Business Negotiations

The average college­-educated woman earns $713,000 less over the course of her working life than her male counterpart, according to the Coalition of Labor Union Women. What explains this persistent gender gap? Women employees’ awareness that they could be penalized for negotiating assertively on their own behalf is one factor, according to new research from … Learn More About This Program 

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