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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Business Negotiations: Advice for the Rights Holder – Know What You’re Getting

Guhan Subramanian   •  10/31/2013   •  Filed in Business Negotiations

Not all matching rights are created equal.

As the prospective right holder, you should know precisely what a proposed matching right will give you. Many deals that seem to guarantee a matching right are, in fact, murky about the exact consequences that could arise.

For potential right holders, the most common mistake is to fail to specify … Learn More About This Program

Matching Rights in Business Negotiations: Advice for the Grantor – Use Matching Rights to Bridge the Gap

Guhan Subramanian   •  10/29/2013   •  Filed in Business Negotiations

In negotiation, including a matching right in an agreement can be a classic win-win move.

Suppose you’re a landlord negotiating with a prospective tenant. You want to maintain the ability to sell the apartment to someone else in the future, while your prospective tenant wants a commitment to rent the apartment for as long as … Learn More About This Program

A deal blows up

PON Staff   •  09/15/2013   •  Filed in Business Negotiations

When negotiating a new business partnership, what should you do if you begin to believe that your partner is less attractive than he (or it) first appeared? Duke Energy faced this question during the course of its nearly two years of merger negotiations with Progress Energy.

In July 2012, the two North Carolina– based companies closed … Read A deal blows up

Becoming a More Ethical Negotiator

Max Bazerman   •  06/28/2013   •  Filed in Business Negotiations

Given the prevalence of corporate scandals in recent years, many have questioned whether ethics training for professionals has done much good.

One of the reasons that such training has achieved limited success is its focus on intentional, explicitly unethical behavior. Such training encourages students to do what is right rather than what is profitable. Yet, most … Read Becoming a More Ethical Negotiator

Bet you didn’t know… New research on employee satisfaction, sadness, and selfless negotiators.

PON Staff   •  05/15/2013   •  Filed in Business Negotiations

Satisfied employees, satisfied customers?
In a new study, Shu-Cheng Steve Chi of the National Taiwan University and his colleagues find that the degree to which salespeople enjoy their work has a significant impact on customer satisfaction with the outcome of sales negotiations.

The study examined negotiations over the price of eyewear between salespeople and customers at the … Learn More About This Program

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