What is Negotiation?

Learn the building blocks of indispensable negotiation business skills.

By on / Negotiation Skills

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Many people dread negotiation, not recognizing that they negotiate on a regular, even daily basis. Most of us face formal negotiations throughout our personal and professional lives: discussing the terms of a job offer with a recruiter, haggling over the price of a new car, hammering out a contract with a supplier.

Then there are the more informal, less obvious negotiations we take part in daily: persuading a toddler to eat his peas, working out a conflict with a coworker, or convincing a client to accept a late delivery.

“Like it or not, you are a negotiator … Everyone negotiates something every day,” write Roger Fisher, William Ury, and Bruce Patton in their seminal book on negotiation, Getting to Yes: Negotiating Agreement Without Giving In.

What do these negotiations have in common, and what tools should we use to get what we need out of our everyday negotiations, large and small?


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What is Negotiation?

The authors of Getting to Yes define negotiation as a “back-and-forth communication designed to reach an agreement when you and the other side have some interests that are shared and others that are opposed.”

Other experts define negotiation using similar terms. In her negotiation textbook The Mind and Heart of the Negotiator, Leigh Thompson refers to negotiation as an “interpersonal decision-making process” that is “necessary whenever we cannot achieve our objectives single-handedly.” And in their book Judgment in Managerial Decision Making, Max H. Bazerman and Don A. Moore write, “When two or more parties need to reach a joint decision but have different preferences, they negotiate.”

Together, these definitions encompass the wide range of negotiations we carry out in our personal lives, at work, and with strangers or acquaintances.

Seven Elements of Negotiation

Unfortunately, most people are not natural-born negotiators. The good news is that research consistently shows that most people can significantly improve their negotiation skills through education, preparation, and practice.

Members of the Harvard Negotiation Project developed a framework to help people prepare more effectively for negotiation. The Seven Elements framework describes the essential tools needed to identify our goals, prepare effectively to minimize surprises, and take advantage of opportunities as they arise in negotiation, writes Patton in The Handbook of Dispute Resolution.

Here, we overview the seven elements:

  1. Interests. Interests are “the fundamental drivers of negotiation,” according to Patton—our basic needs, wants, and motivations. Often hidden and unspoken, our interests nonetheless guide what we do and say. Experienced negotiators probe their counterparts’ stated positions to better understand their underlying interests.
  2. Legitimacy. The quest for a legitimate, or fair, deal drives many of our decisions in negotiation. If you feel the other party is taking advantage of you, you are likely to reject their offer, even if it would leave you objectively better off. To succeed in negotiation, we need to put forth proposals that others will view as legitimate and fair.
  3. Relationships. Whether you have an ongoing connection with a counterpart or don’t think you’ll ever see her again, you need to effectively manage your relationship as your negotiation unfolds. Relationship dynamics become all the more important when you have an ongoing connection: future business, your reputation, and your relationships with others may hang in the balance. You can strengthen the relationship by taking time to build rapport and by meeting your own high ethical standards throughout the process.
  4. Alternatives and BATNA. Even as we take part in a negotiation, we are aware of our alternatives away from the table—what we will do if the current deal doesn’t pan out. Negotiation preparation should include an analysis of your BATNA, or best alternative to a negotiated agreement, according to Getting to Yes. For example, a job candidate may determine that she will start applying to grad schools if a particular job negotiation falls apart.
  5. Options. In negotiation, options refer to any available choices parties might consider to satisfy their interests, including conditions, contingencies, and trades. Because options tend to capitalize on parties’ similarities and differences, they can create value in negotiation and improve parties’ satisfaction, according to Patton.
  6. Commitments. In negotiation, a commitment can be defined as an agreement, demand, offer, or promise made by one or more party. A commitment can range from an agreement to meet at a particular time and place to a formal proposal to a signed contract.
  7. Communication. Whether you are negotiating online, via phone, or in person, you will take part in a communication process with the other party or parties. The success of your negotiation can hinge on your communication choices, such as whether you threaten or acquiesce, brainstorm jointly or make firm demands, make silent assumptions about interests or ask questions to probe them more deeply.

Armed with a better understanding of these building blocks of negotiation, you are positioned to learn more about how to prepare to create and claim value in negotiation, manage fairness concerns, and reach the best deal possible—both for you and for your counterpart.

Comments

One Response to “What is Negotiation?”

  • Eldonna L.

    Yes! We negotiate every single day of our lives as I say in my talks whether it’s a multimillion dollar deal, how to get your kids to do their homework or where to meet for dinner, our lives are filled with negotiation opportunities. Thank you for sharing this article.

    Reply

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