Let’s take a look at two basic types of negotiation. We’ll consider the three phases of negotiation and the skills you need to become an effective negotiator.
Types of Negotiations
The two basic types of negotiations require different approaches.
- Integrative negotiations are based on cooperation. Both parties believe they can walk away with something they want without giving up something important. The dominant approach in integrative negotiations is problem solving.
- Distributive negotiations involve a fixed pie. There is only so much to go around and each party wants as big a slice as possible. An example of a distributive negotiation is haggling over the price of a car with a car salesman. In this type of negotiation, the parties are less interested in forming a relationship or creating a positive impression.
The Three Phases
The three phases of a negotiation are:
- 1. Exchanging Information
- 2. Bargaining
- 3. Closing
These phases describe the negotiation process itself. Before the process begins, both parties need to prepare for the negotiation. This involves establishing their bargaining position by defining their BATNA, WATNA, and WAP. It also involves gathering information about the issues to be addressed in the negotiation.
It is essential to pay attention to all the phases of negotiation. Without the first phase, the exchange of information, and the establishment of bargaining positions, the second phase cannot happen in any meaningful sense because no one knows where they stand. It sets a scene for demands to be manageable and reasonable. Negotiations are, after all, about the art of the possible. Without the third phase, anything that has been decided during phase two cannot be formalized and will not take hold – leading to the necessity for further negotiation or an absolute breakdown in a relationship.
Skills for Successful Negotiating
These are some of the skills needed for successful negotiating.
- Effective speaking
- Effective listening
- A sense of humor
- A positive attitude
Without the above factors, negotiations will be difficult if not impossible. The necessity for negotiation arises because neither party will be able to get everything they want. Knowing that there must be concessions, each party in the negotiation is required to adopt an attitude of understanding that they must get the best deal possible in a way which is acceptable to the other party. The importance of effective speaking and listening is clear; it is necessary to establish what you are looking for and what you are prepared to accept, while understanding what the other parties will be happy with.
Good negotiators understand the importance of balance. Yes, you will have to make concessions, but the point of making concessions is to secure what you can get – so you need to pay attention to your bottom line and ensure you are not beaten down to a minimum. Knowing what is realistic, and ensuring that you can get the best deal, relies on being ready to insist upon something that the other side may not be willing to give initially. Emotional intelligence, persistence, patience, and creativity can all play a part here.
This post is from July’s topic on Negotiation Skills, which is also a course on our Executive Mini-MBA program online from Harvard Square.
