Negotiation Basics

“In business as in life, you don’t get what you deserve but what you negotiate” –           Chester L Karrass

Negotiation is a dialogue between two or more people or parties intended to reach a mutually beneficial outcome, resolve points of difference, to gain advantage for an individual or collective, or to craft outcomes to satisfy various interests.

Negotiation occurs in business, non-profit organizations, government branches, legal proceedings, among nations and in personal situations such as marriage, divorce, parenting, and everyday life. Professional negotiators are often specialized, such as union negotiators, leverage buyout negotiators, peace negotiators, hostage negotiators, or may work under other titles, such as diplomats, legislators or brokers.

The American Heritage Desk Dictionary defines negotiation as “conferring with another in order to come to terms or reach an agreement.”

Here are some other ways to think about negotiation:

• Negotiation is simply stated, formalized discussion between two parties or organizations.
• Negotiation refers to the process we use to satisfy our needs when someone else controls what we are seeking. Other words sometimes used to describe negotiation are: bargaining, exchanging, and haggling.
• Negotiation has traditionally been thought of as the process of attempting to satisfy your wants, by giving up something you now have in exchange for something else you want.
• Negotiation and conflict are closely related. Sometimes we negotiate to avoid conflict. Other times, we use negotiation to resolve conflict.
• Negotiation applies to everyday exchanges in business or personal life where agreement is reached over buying and selling, exchanging services or property, resolving differences, or engaging in mutually desirable projects.
• There are many examples, from such simple tasks as deciding with colleagues where to have lunch to such complex issues as discussing with a builder the cost of constructing a new home.

One thing is guaranteed about negotiation—we all practice it every day! Some of us are better skilled at it than others, and sometimes we get more of what we desire. Sometimes we can be involved in negotiating without even being aware of it. But negotiation results are enhanced when we know that is what we are doing. Therefore, having a deep understanding of what the negotiation process entails and how it works, and being effectively prepared to negotiate should lead us to the desired results.

Identifying Opportunities for Negotiation

Many people fail to spot the opportunity to make a more positive exchange because they fail to distinguish the opportunity to negotiate. But any part of a transaction that is not totally satisfactory to you has a scope for negotiating. Here is a list of the kinds of transactions we might face in our own lives.

• Purchasing a new car
• Deciding with the family where to vacation this year
• Getting a raise in pay
• Selecting a dress for the wedding
• Meeting with an employee group over work rules
• Deciding on a new product to launch
• Buying new furniture for the office
• Deciding who gets to use the family computer each evening
• Agreeing on the terms of a new business loan

As you may have understood by now, all of the above situations could involve some degree of negotiating. Some are more challenging than others. Some require serious thought and planning. Others can flow quickly and easily. It is important to identify the opportunities for negotiation to not only fulfill one’s own needs but also to effectively satisfy and meet the needs of the various stakeholder involved in the decision making process. A successful negotiation in one where the negotiating parties have reached an agreement after fully taking into account each other’s interests, in such a way that there is no future scope for improvement in the agreement and all the creative option for the same have been explored.

To Negotiate or Not—That Is the Question?

A swift response to certain situations, especially conflict, hardly requires negotiation. They may require discussion, emotions, upset, even anger, but not negotiation. Before deciding how to negotiate, we must first consider if negotiation is the best choice or most appropriate in the given situation. Negotiation can only happen when there is time to do it and when there is an aim or there is something you need to achieve. So, there will be instances where there is either no time, or no purpose is accomplished by being involved in the process of negotiation. We’ve seen that opportunities to negotiate take place in many personal interactions, but sometimes you don’t want to negotiate, or should not do so. The following are two examples:

• Your niece runs into the street and you fear for her life. Are you going to negotiate her return to the sidewalk? No way! You are going to get her out of the street as quickly as possible using any means, verbal or otherwise, to accomplish that goal.
• Let’s say you have agreed at work to put in extra hours for no extra pay because of the financial condition of the firm. Your valiant efforts have helped, but your boss seeks to add one more hour a day without pay. You are already stretched thin with home and financial responsibilities. Are you going to negotiate that extra non-paid hour? Maybe, maybe not.