benefits of negotiation
What are the Benefits of Negotiation?
The benefits of negotiation are numerous. Here are some of the most common of those benefits.
People often view negotiation as a win-lose enterprise, but in most situations, a win-win mindset will lead to greater benefits of negotiation. Adding issues to the discussion is often the key to value creation and a great deal. For example, in a corporate negotiation about a merger, in addition to discussing valuation and price, parties can discuss personnel issues, headquarters location, long-term strategic plans, and so on. Then explore tradeoffs based on each party’s preferences.
In integrative negotiations involving multiple issues, as compared to distributive negotiations involving just one issue, parties often achieve the benefits of negotiation by making wise tradeoffs across their differing preferences across issues. Consider the simple case of a couple that is trying to decide how to spend their evening on the town. If one member cares more about what movie they see, and the other cares more about where they have dinner, each can make concessions on an issue of low value in exchange for a concession on an issue he or he values more.
You can also get the benefits of negotiation in a distributive negotiation, where there is likely only one issue at stake, typically price. Once you get a sense of each party’s reservation point and BATNA, you should be able to determine if a zone of possible agreement, or ZOPA, exists in your distributive negotiation. The ZOPA is the range of all possible deals that both parties would accept.
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