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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Managers: improve your team members’ negotiating power

PON Staff   •  01/23/2012   •  Filed in Business Negotiations

Research on stereotypes has reached conclusions about how lack of power and status can affect performance on negotiation and other tasks. Laura Kray of the University of California at Berkeley and her colleagues found in their research  that women negotiators performed worse than men when they were led to believe that their performance reflected negotiating … Learn More About This Program

Negotiate your role as advisor

PON Staff   •  12/20/2011   •  Filed in Business Negotiations

Whether you spend most or just a fraction of your workday advising others, it pays to reconsider how you approach your advisees, writes Tufts University professor Jeswald W. Salacuse in his book The Wise Advisor: What Every Professional Should Know About Consulting and Counseling (Praeger, 2000). When advisors and their clients clash over expectations and … Read Negotiate your role as advisor

Negotiator toolbox: Capitalize on differences

PON Staff   •  12/14/2011   •  Filed in Business Negotiations

The problem: You and your negotiating counterpart express differing opinions about the future success, performance, or timeliness of an item or service. A homeowner might be skeptical of a contractor’s promise to complete an extensive remodeling project within six months, for instance. Differing forecasts can breed suspicion and stand in the way of agreement.

The tool: … Read Negotiator toolbox: Capitalize on differences

Professor Susskind talks negotiation obstacles

PON Staff   •  11/30/2011   •  Filed in Business Negotiations

Q&A with Professor Susskind, MIT’s Ford Professor of Urban and Environmental Planning, and Vice Chair of the Program on Negotiation at Harvard Law School

Q: You’ve taught for years about overcoming organizational obstacles. What are the most common roadblocks to effective negotiations?

Typically, obstacles occur at all four stages of the negotiation process. First is the preparation … Read Professor Susskind talks negotiation obstacles

Hardball tactics from a major leaguer

PON Staff   •  10/25/2011   •  Filed in Business Negotiations

Adapted from “Becoming a Team Player: Lessons from Professional Athletics,” first published in the Negotiation newsletter, October 2009.

In Major League Baseball (MLB), one particular player’s agent is widely blamed for the contentious nature of contract negotiations: Scott Boras. Boras has negotiated unprecedented contracts for many of the most highly paid players, including Manny Ramirez, Johnny … Read Hardball tactics from a major leaguer

Squeeze that orange

PON Staff   •  10/20/2011   •  Filed in Business Negotiations, Daily

Many of us operate under the assumption that any given pie is fixed. More for me means less for you, right? Not necessarily. While you still want to claim your fair share, in many negotiation situations, there exist value-creating opportunities that can be exploited to provide “more pie” to both parties.

This counterintuitive approach is just … Read Squeeze that orange

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