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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Dear Negotiation Coach: What Happens When a Business Contract Falls Apart?

PON Staff   •  10/25/2022   •  Filed in Business Negotiations

business contract

We recently received a question from a reader regarding a business contract conflict. Robert Mnookin, Williston Professor of Law at Harvard Law School, chair of the Program on Negotiation, and author of Bargaining with the Devil: When to Negotiate, When to Fight (Simon & Schuster, 2010), explains that you may have more options than it … Learn More About This Program 

How to Find the ZOPA in Business Negotiations

Katie Shonk   •  10/24/2022   •  Filed in Business Negotiations

zopa in business

In business negotiation, two polar-opposite errors are common: reaching agreement when it wouldn’t be wise to do so, and walking away from a mutually beneficial outcome.

How can you avoid these pitfalls? Through careful preparation that includes an analysis of the zone of possible agreement, or ZOPA in business negotiations. … Read How to Find the ZOPA in Business Negotiations 

Bargaining for a New Car: Real World Negotiations Examples

PON Staff   •  10/20/2022   •  Filed in Business Negotiations

bargaining for a new car

When it comes to bargaining for a new car, are women negotiating harder bargains than men?

According to a recent report from NPR Morning Edition’s Sonari Glinton, women not only negotiate harder bargains than men when it comes to vehicle purchases, but also they do more extensive preparatory work (See: Negotiating for What You Really Want- … Learn More About This Program 

Dear Negotiation Coach: Coping with a Change-of-Control Provision

PON Staff   •  10/18/2022   •  Filed in Business Negotiations

change-of-control provision

We recently received a question regarding a change-of-control provision and how to move forward with potentially renegotiating a contract. We spoke with Faculty Chair, Program on Negotiation at Harvard Law School, Guhan Subramanian, to answer the question.

Q: I represent a company—let’s call it “ClientCorp”—that has a long-term contract with another company, “TargetCorp.” A change-of-control … Learn More About This Program 

Contract Negotiations and Business Communication: How to Write an Iron-Clad Contract

PON Staff   •  10/18/2022   •  Filed in Business Negotiations

contract negotiations

In contract negotiations, writing a contract that both encapsulates the negotiated agreement but also incorporates future elements such as the business relationship and the sustainability of the agreement can be a daunting task for even the most experienced negotiators. Executives often leave the legal issues surrounding their deals to their attorneys. While this division of … Learn More About This Program 

Business Negotiation Skills to Curb Your Overconfidence

PON Staff   •  10/13/2022   •  Filed in Business Negotiations

overconfidence

To avoid the pitfalls of overconfidence, you need a clear understanding of how overconfidence is likely to affect your judgments and decisions (and those of your counterparts) at the bargaining table. Fortunately, new research suggests exactly when to expect overconfidence and offers insight into how you can prevent it from getting you into trouble in … Learn More About This Program 

Dear Negotiation Coach: How Can You Simplify Complex Negotiations with Stakeholder Alignment?

PON Staff   •  10/11/2022   •  Filed in Business Negotiations

complex negotiations

In complex, multiparty negotiations, the task of value creation can quickly become overwhelming because of the large number of parties and interests at stake. An emerging process called “stakeholder alignment” can help construct order from chaos in complex negotiations, according to Joel Cutcher-Gershenfeld, a professor at the Heller School for Social Policy and Management at … Learn More About This Program 

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