In negotiation, all the goodwill, trust, and cooperation you create can seem useless if you and your negotiating counterpart disagree about how future events may play out. In such cases, a contingent contract can be a highly useful, though widely overlooked, tool for creating value in negotiation. … Read More
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creating value in negotiation
What is Creating Value in Negotiation?
Add the collaborative element of negotiation to the table, and you’ll be creating value in negotiation and making the process more enjoyable and also more rewarding.
Negotiations involving multiple issues are known as integrative negotiations, or value-creating negotiations because they allow parties to integrate various sources of value through tradeoffs and other creative dealmaking strategies. This process of creating value in negotiation encourages negotiators to make the most of differing priorities.
In fact, those differences often are opportunities for creating value in negotiation, write Harvard Business School professor Max H. Bazerman and the University of California, Berkeley professor Don A. Moore in their book Judgment in Managerial Decision Making.
If you aren’t sure where to begin, try breaking the problem down into more easily managed component parts. This constructs a multi-issue negotiation out of what at first is a single-issue negotiation, allowing both parties to make tradeoffs based upon their differing preferences.
When you and your counterpart can uncover additional value, make useful trades, and put together a package that exceeds your party’s expectations, you’re creating value in negotiation.
Remember that situations that appear to be zero-sum rarely are. The key to value creation? Bringing a degree of optimism about the chances of expanding the pie to every negotiation.
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The following items are tagged creating value in negotiation:
Imagine you’ve received a salary offer for a new job that’s less than you’d hoped for, or a client has delivered a “take it or leave it” ultimatum. While there is ample advice available to negotiators on how to make the first offer in negotiation, the question of how to counteroffer in business negotiations often … Read How to Counteroffer in Business Negotiation
Typically, when parties are negotiating over a resource they both desire – whether fees, budgets, salaries, schedules, or staff – the process results in an uninspired compromise somewhere between their positions. Is it possible to avoid a compromise when negotiating tough distributive issues. … Read More
Many people say they dread negotiating and avoid it whenever they can. Why? Typically, because they view negotiation as a competition in which one party’s gains come at the expense of the other party. … Read Value Creation in Negotiation
Many of us know the feeling of being frustrated by a superior’s involvement in our business negotiation strategies, whether because she hovers too closely over the talks, contradicts our carefully crafted strategy, or doesn’t give us the authority we need to sign off. … Read More
Adapted from “Strike the Right Balance Between Trust and Cynicism,” by Harvard Business School professor Max H. Bazerman, first published in the Negotiation Briefings newsletter. Negotiators often must choose between trusting their counterparts and being cynical of their motives. The consequences of such decisions can be serious in dealmaking: trust too much, and you’ll lose big; … Read Building Trust in Negotiations
As experienced negotiators well know, the more parties involved in a negotiation, the more difficult it often is to come to agreement, due in part to the logistical challenge of making sure each voice is heard. Yet multiparty negotiation offers considerable benefits. Most notably more opportunities for making tradeoffs and creating value in negotiation than … Read Deal Design: Strategies for Complex Dealmaking
When talks stall, it’s tempting to jump to conclusions: “It’s purely a price gap.” “They’re being unreasonable.” “We’re not communicating well.” “We’re in a weak position.” … Read What’s Keeping You from Closing the Deal?
There is “nothing worse than a debate about debates,” John Podesta, the chairman of Hillary Clinton’s presidential campaign, recently said in the midst of his candidate’s heated negotiations with Democratic rival Bernie Sanders about the terms of their debates. Many who participated in these negotiations would likely agree. But the debates about debates—both on the … Read Learning from the Debates About the Debates
The Clearinghouse at PON offers hundreds of role simulations, from two-party, single-issue negotiations to complex multi-party exercises. Telecom Services is a two-party, two-issue, integrative, scorable negotiation over the terms of a telecommunications services contract. Scenario: Data Voice markets telecommunications (“telecom”) services to residential and business customers. This year, a small firm … Read Negotiations in the telecommunication industry