In business, there are different types of negotiation, each needing distinct approaches for success.
When preparing to negotiate, business professionals often wonder what types of negotiation are available to them. Some of the most common are distributive negotiation, integrative negotiation, team negotiation, and multiparty negotiation.
In distributive negotiation, parties compete over the distribution of a fixed pool of value. Here, any gain by one party represents a loss to the other. You may also hear this referred to as a zero-sum negotiation or win-lose negotiation.
Integrative negotiation gives us one of the biggest chances of a win-win. In these types of negotiation situations, there is more than one issue to be negotiated, and negotiators have the potential to make tradeoffs across issues and create value. In many cases, distributive negotiations can become integrative if we take the time to search for additional issues to include.
Team negotiations are those types of negotiation situations where the negotiating parties are made up of more than one person. These might include union contract negotiations or major business negotiations.
Lastly, mulitparty negotiations include, as you might imagine, multiple parties. These types of negotiation situations might include municipal projects or international negotiations. Multiparty negotiations do require more complex negotiating skills, but there is also more opportunity to find tradeoffs and create value.
One of the final types of negotiation that you may encounter is the “one-shot” negotiation where parties have no intention of continuing to work together. One-shot negotiations often carry a risk of unethical behavior and hard bargaining if parties believe they have no need to build a trusting relationship.
When we think of failed business negotiations, most of us picture negotiators walking away from the table in disappointment. But that’s only one type of disappointing negotiation. Failed business negotiations also include those that parties come to regret over time and those that fall apart during implementation. The following three types of negotiation failures are … Read More
Men tend to achieve better economic results in negotiation than women, negotiation research studies have found overall. Such gender differences are generally small, but evidence from the business world suggests that they can add up over time.
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When we think of our worst negotiation mistakes, they tend to be recent blunders. But what about negotiation mistakes whose repercussions accumulate over years, even decades? A failed negotiation case study from 1976 shows how carelessly negotiated deals can lead to long-term headaches and losses.
A Short Season
In 1974, brothers Ozzie and Daniel Silna, Latvian immigrant … Read More
Among many useful negotiation skills and strategies, a right of first refusal can often benefit negotiators. In a right of first refusal, the right holder is typically given the power to buy an asset on the same terms that the grantor would receive from any other legitimate, prospective bidder, according to Harvard Business School and … Read More
In an interesting example of negotiation team dynamics, during a 2018 New Year’s Day address, North Korean leader Kim Jong-un proposed opening talks with South Korea to discuss the North’s possible participation in the Winter Olympics, to be held in Pyeongchang, South Korea, the following month. Hoping to avoid disruption by the North, South Korean … Read More
Some people learn to negotiate on the job, in a classroom, or in a therapist’s office. In Nelson Mandela’s case, “prison taught him to be a master negotiator,” writes Bill Keller in his New York Times obituary of the legendary activist turned president, who died on December 5, 2013.
Soon after his arrival at South Africa’s … Read More
Businesspeople who are looking for effective negotiation strategies often confront a dizzying array of advice. It can be useful to take a step back and categorize these strategies into various types of negotiation tactics. Highlighting the benefits of negotiation in business, the following five types of negotiation tactics can help you think more broadly about … Read More
The barriers women negotiators face when negotiating for jobs and career advancement are well known: Women who ask for more money or better opportunities can face a backlash for violating traditional gender norms.
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The winner’s curse negotiations, when a negotiator overbids for an item due to competitive pressure or other non-value related factors, is a major pitfall that integrative bargainers should seek to avoid.
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In the aftermath of George Floyd’s killing in Minneapolis by a White police officer, activists, politicians, and other concerned citizens are grappling with a big question: Where do we go from here? The quest for reforms to policing and other societal institutions can be pursued through many means, including continued demonstrations, political lobbying, and community-wide … Read More
We might hope that when we adopt effective negotiation strategies—such as spending lots of time preparing and asking questions at the table—we would achieve consistently strong results in our negotiations. Yet as most of us have experienced, our outcomes and personal satisfaction can vary a great deal from one negotiation to the next. Why? Likely … Read More
When trying to negotiate a deal with a potential business partner, you need to come up with a plan for ensuring the two sides will mesh rather than clash. Facebook’s leaders and WhatsApp’s founders appeared to skip that vital step when negotiating the social media giant’s purchase of the text-messaging app in 2014—an oversight that … Read More
We tend to enter new business partnerships and ventures with a great deal of optimism and excitement. Yet ventures that held so much promise often end up dissolving into costly legal disputes and contract dispute resolution efforts.
Formal contracts offer a method for reducing the risks of new partnerships and clarifying commitment in negotiation, but negotiators … Read More
What is negotiation? In her book The Mind and Heart of the Negotiator, Northwestern University professor Leigh Thompson defines negotiation as “an interpersonal decision-making process necessary whenever we cannot achieve our objectives single-handedly.” This definition stresses the interdependence that’s fundamental to any negotiation.
Narrowing in on this definition, when preparing to negotiate, business professionals often wonder … Read More
Have you ever found yourself negotiating with someone who seemed entirely ruthless and lacking in empathy? From time to time, we may end up in the deeply unsettling position of handling difficult people who appear to have no concern for us or our outcomes.
People who are antisocial, lack empathy, and habitually engage in impulsive, manipulative, … Read More
Even experienced negotiators often make the mistake of treating important talks as a win-lose negotiation. Overlooking effective win-win negotiation techniques, they focus on trying to claim as much value as they can without trying to create new sources of value.
It’s also the case that competitors in a given market or field may fail to recognize … Read More
Imagine you’re a chef who is having trouble finding cooks in an oversaturated restaurant market. You’re so desperate to get fully staffed that you find yourself making significant concessions on salary, scheduling, and other issues during interviews with potential hires.
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Imagine that while exploring an outdoor bazaar in a foreign country, you see a beautiful rug that would look perfect in your home. While you’ve purchased a rug or two in your life, you’re far from an expert. Thinking on your feet, you guess that the rug is worth about $5,000. You decide to make … Read More
Many things factor into whether you choose “fight or flight” when faced with a difficult situation in life. Whether it is a disagreeable coworker or a border struggle between nations, the decisions made at the onset of conflict often determine the tenor of the entire proceeding.
Along with information and a good-faith desire for collaboration, knowing … Read More
Adapted from “When Does Gender Matter in Negotiation?” by Dina W. Pradel (vice president, Y2M), Hannah Riley Bowles (professor, Harvard Kennedy School), and Kathleen L. Mcginn (professor, Harvard Business School), first published in the Negotiation newsletter.
Businesspeople often wonder whether men or women are better negotiators. According to research, gender is not a reliable predictor of … Read More