Dealmaking

Dealmaking is defined as the art of crafting deals through negotiations focused on an integrative, or value-creating process, rather than through distributive bargaining, or a haggling process. Dealmaking includes the range of activities both at the bargaining table and away from it that seek to bring two or more parties together toward some common end, whether it is the sale of an asset, a vendor agreement, or a merger between corporations. The Program on Negotiation emphasizes integrative bargaining in its dealmaking literature and teaches methods and techniques from this school of thought in its executive education courses.

In corporate dealmaking, much of the action happens away from the negotiating table. Successful dealmakers understand that deal set-up and design greatly influence negotiation outcomes and successfully closing a deal. Other critical factors in successfully making deals include strategic behavior – the unwillingness of one or both sides to make a best offer – psychological factors, lack of a deadline, poorly-prepared formal documents and refusal to allow the other side to make a graceful exit, even when they’ve agreed to your demands.

Strategies for successful dealmaking include tactics such as creating more value by exploring hidden interests and adding issues that appeal to your bargaining opponent. Another tactic is recruiting a third party mediator when the dealmaking process is at an impasse. Sometimes, Harvard experts find, it pays to be the first person to make an offer, while at other times, it pays to wait.

Articles from the Program on Negotiation focus on a vast array of dealmaking strategies, and explore the latest concepts such as expanding the pie, “negotiauctions,” anchors in negotiation and bartering.

Contract Negotiation Skills: Setting Yourself Up for Success

Katie Shonk   •  04/19/2021   •  Filed in Dealmaking

productive negotiations Contract Negotiation Skills: Setting Yourself Up for Success

Business negotiators tend to focus on getting to the finish line, which is typically defined as a signed contract. The contract negotiation skills we need to get there—such as building trust, brainstorming issues, and negotiating a great price—are pivotal, yet we often overlook the importance of setting up our agreement for success during the implementation … Read More 

How to Get a Great Deal When Trust is Low

PON Staff   •  04/01/2021   •  Filed in Dealmaking

Negotiators from Western cultures, such as the United States, tend to be trusting. They’re often open to sharing information with counterparts, and expect ideas to flow freely. But in many other cultures, negotiators tend to be less trusting and more cautious about sharing information about their interests.

Of course, there are many ways to build trust … Read More 

When Negotiations is a Love Song

Katie Shonk   •  04/01/2021   •  Filed in Dealmaking

On Valentine’s Day, 1945, Matilda Genevieve Scaduto, the 20-year- old granddaughter of Sicilian immigrants, was working the elevator at a Milwaukee hotel when she met a traveling violinist named Boudleaux Bryant. He started calling her Felice, saying it suited her better than Matilda because she was happy all the time, according to American Songwriter magazine. … Read More 

Negotiation Logistics: Best Practices for Better Deals

PON Staff   •  03/01/2021   •  Filed in Dealmaking

Negotiators are often so intent on preparing for the substance of a negotiation—researching the other party, analyzing their alternatives, and so on—that they neglect to devote adequate time to critical negotiation logistics, such as where to negotiate, how formal or informal talks should be, and even the shape of the negotiating table.

Before the official start … Read More 

Why It Pays for Powerful Parties to Negotiate

PON Staff   •  02/28/2021   •  Filed in Dealmaking

In recent years, the U.S. film industry has avoided dealing with a mounting inefficiency. Historically, theater companies have negotiated with film studios for the right to screen movies for three months before they can be released in other formats, including streaming, on demand, and DVD. Staggering the release of films in different formats has benefited studios … Read More 

Making the best of pandemic-era deal disruptions

PON Staff   •  01/31/2021   •  Filed in Dealmaking

This past fall, three grown children set about helping their mother, Mina, find a memory care facility for John, their 85-year-old father. John’s previously mild dementia had progressed rapidly during the Covid-19 pandemic, to the point that he could no longer live safely at home.

John’s children gathered a short list of affordable long-term care facilities … Read More 

Negotiation in the News: The NBA tries to make the best of another (projected) bad season

PON Staff   •  12/31/2020   •  Filed in Dealmaking

In negotiations across the world, financial troubles brought on by the Covid-19 pandemic have left parties squabbling over smaller and smaller pies. The silver lining? Negotiators may have little choice but to get a deal done, and awareness of this reality can motivate creative thinking and cooperation. Negotiating the terms of their upcoming season, the National … Read More 

MESO Negotiation Strategies and Negotiation Techniques

PON Staff   •  11/24/2020   •  Filed in Dealmaking

MESO negotiation techniques for negotiators include creating value at the bargaining table by identifying multiple proposals of equal value and presenting them to your counterpart simultaneously. By making tradeoffs across issues, parties can obtain greater value on the issues that are most important to them. But how can you be sure you’re making the right … Read More