Imagine that you’re buying a used car from its original owner. Of course, you want to get the best deal you can for your money, while your counterpart wants to maximize the value of his asset. After haggling with one another, each side finally arrives at a price point acceptable to both parties. But how much better could the deal have been for both sides if they’d used integrative bargaining?
The above scenario is common in many transactional negotiations: You hold your cards close and share as little information as needed to achieve your goal.
Michael Wheeler, Harvard Business School and Program on Negotiation at Harvard Law School faculty member, asks us to imagine a different scenario, one in which both parties reveal their interests at the onset of a negotiation.
An article by Katie Johnston for Harvard Business School, “The Art of Haggling,” describes the difference between distributive bargaining and integrative bargaining. Getting to Yes, the seminal work from Harvard Law School professor and Program on Negotiation founder Roger Fisher and Harvard Negotiation Project Senior Fellow and Program on Negotiation cofounder William Ury, advocates for integrative bargaining. In integrative bargaining, each side seeks to create an agreement beneficial to both parties.
The integrative approach is taught in most professional schools. Professor Wheeler emphasizes that situations that initially look like win-lose negotiations can often be turned into opportunities for mutual gain and value creation.
Of course, the integrative approach has its limits, and Wheeler notes that the art of negotiation lies in simultaneously creating and claiming value, or “riding two different horses at the same time.”
Negotiators are often cautious about revealing too much information, but integrative bargaining explicitly relies upon revealing preferences and interests. As Professor Wheeler cautions, “Sometimes getting 70 percent of the small pie might be better than getting 50 percent of a marginally larger one.” An emphasis on relationship building marks integrative bargaining’s approach as being oriented toward a long-term vision for future negotiations with your counterpart.
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Adaptability at the Bargaining Table – How Improvisation and Jazz Music Inform Negotiation Strategy: Hard-bargaining negotiation strategies may seem appealing, but Program on Negotiation faculty member Michael Wheeler argues that adaptability to ever-changing circumstances is essential for the negotiations one encounters in daily life. In his latest book, The Art of Negotiation, Prof. Wheeler researched negotiations from a random, chaotic perspective: “I had this bug in my head that it’s all well and good in terms of decision trees and probabilities and so forth, but the fact of the matter is everyday transactions cannot be scripted or even necessarily predicted.” Read this article to learn more about Prof. Wheeler’s insights into the nature of everyday negotiations and how the skilled negotiator can benefit from a bit of improv in negotiations.
How have you used integrative bargaining? Let us know in the comments.
Originally published in 2012.
I enjoyed this idea and form of negotiation very much. I think the only people that would have a problem with this would be greedy. The “pie” is huge, there is certainly enough for everyone to get a fair share that pleases them.
Regarding the car example where you ask how much better could the deal have been for both sides if they’d used integrative bargaining? I don”t know as a read the rest of the article looking for an example in the car scenario. Did I miss it ?
I was looking for the same!
It is impossible with the car negotiation I think. May be in a car dealer: talking about interests will get to: I want a car that is comfortable to sit in, looks good, never delivers me too late, never fails me. Then the dealer would nog only sell the car, but also the navigation, the maintenance. In an attractive package for the buyer, so both win. Further more, this buyer is now a regular customer of the garage, so can buy more for the car later on (winter tires, new audio), AND will become an ambassador for the dealer. This is how I see integrative negotiation.
I am a full time circuit civil mediator in South Florida. I have often wondered why some of the best trial lawyers in America need my help to settle their cases without trial. As I reflect on your article above, it occurs to me that the mediation process is a perfect vehicle to transform a negation from positional to integrative.