Types of Power: Negotiation Skills in Business Negotiation and Status Consciousness

Examples of negotiation skills in business communication - managing status consciousness in business negotiations

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negotiation skills in business communication

Before and during your negotiation, think about who you’ve chosen as a reference group against which you measure yourself. Did you select the group purely to enhance your own status, or did you try to make a more appropriate comparison? What are your negotiation skills in business communication?

Sometimes in negotiation, we’re forced to deal not only with the issues on the table but also with negotiator concerns about status. One famous instance took place in the late 1980s, when Robert Campeau, head of the Campeau Corporation, tried to acquire Federated Department Stores, the parent company of the prestigious department store Bloomingdale’s. A bidding war over Bloomingdale’s escalated between Campeau and R.H. Macy. Campeau won with an irrationally high offer—and had to declare bankruptcy shortly thereafter.


Discover step-by-step techniques for avoiding common business negotiation pitfalls when you download a copy of the FREE special report, Business Negotiation Strategies: How to Negotiate Better Business Deals, from the Program on Negotiation at Harvard Law School.


Famous Negotiations in History

In his book Going for Broke: How Robert Campeau Bankrupted the Retail Industry, Jolted the Junk Bond Market, and Brought the Booming 80s to a Crashing Halt (Beard Books, 2000), John Rothchild suggests that status concerns drove Campeau’s desire to break into the retail industry and beat R.H. Macy at any cost.

Like it or not, concerns about negotiator status pervade negotiations. Most people are less likely to accept a job offer, even one that would be a substantial improvement on a current job if it is worse than an offer made to a peer. The desire to achieve better outcomes than others—from friends and coworkers to competitors—can cause you to leave value on the table.

Too often, business negotiators make implicit comparisons with others and then fail to understand why the other side finds certain demands offensive. In times of economic decline, we’re all especially vulnerable to making unrealistic social comparisons. This is not the best approach to negotiation skills in business communication.

Negotiation Skills in Business Communication

Be honest with yourself.

Are you reaching for the stars, making agreement virtually impossible, or are you accurately assessing your odds of having an offer accepted?

It’s also important to consider who or what your negotiating opponent has chosen as a reference group. In all likelihood, she chose favorable comparisons, which may cause her to be overly optimistic about what she can achieve. If so, try to help her adjust her aspirations and work with her to agree on reasonable comparisons.
It often helps to have a “middle man” who can provide negotiators with accurate comparisons.

This is one of the important roles that agents play. While home sellers’ agents tend to choose somewhat pricier comparable properties than do buyers’ agents, they usually have enough experience to know that an overly optimistic assessment will not help a client reach a satisfactory deal.

Are there any negotiation skills in business communication that we may have missed? Leave us a comment.

For more business negotiation skills articles related to the concept of a negotiator’s reservation price and best alternative to a negotiated agreement (BATNA), please read BATNA: Negotiators – How you Can Avoid Striking Out (And Create Mutual Gains) in Your Next Business Negotiation and Are You an Overconfident Negotiator?


Discover step-by-step techniques for avoiding common business negotiation pitfalls when you download a copy of the FREE special report, Business Negotiation Strategies: How to Negotiate Better Business Deals, from the Program on Negotiation at Harvard Law School.


Adapted from “Status Anxiety,” by Iris Bohnet (professor, Harvard Kennedy School), first published in the Negotiation newsletter.

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