Negotiation Techniques and Strategies

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Table of Contents

Importance of Negotiations and Strategy Choice
Negotiation Strategies
Distributive Negotiations: Strategy and Techniques
Integrative Negotiations: Strategy and Techniques
Conclusion
References

Negotiations play a decisive role in the life of any person living in a society as long as the interaction between people involves communicative means. Moreover, the trends of globalization that impact economy, politics, trade, business, labor, and many more spheres particularly affect negotiations or bargaining to achieve agreement between parties. The choice of strategies and appropriate techniques commonly depends on the time, power, and information and the context and participants of the bargaining process (Carrell & Heavrin, 2013). Therefore, this paper aims to explore negotiation strategies and techniques to assert that the variety of negotiation approaches allows for meeting different bargaining goals depending on agents’ interests.

Importance of Negotiations and Strategy Choice

The bargaining process has proven to be an omnipresent attribute of the everyday life of both the private and professional lives of people. The achievement of agreement over household decisions commonly involves similar communicational tactics as labor-related issues (Fisher et al., 1991). The relevance of negotiations to the sphere of labor and management is validated by the continuous emergence of problems and questions related to the quality of workplace conditions, wages, workers’ safety, development, and other pivotal issues. Qualitative and goal-oriented interactions between employees and employers are inherent in adequate well-structured negotiation of fundamental problems that play a decisive role in the prolonged cooperation of the parties on mutually beneficial terms (Huang et al., 2017). Thus, the ability to engage in the bargaining process on terms that allow for presenting one’s requirements and interests constitutes the essence of a democratic workplace setting.

Although the interaction between employers and employees is commonly regulated by labor law, the processes related to negotiation are not strictly defined since parties might select any strategy or tactics they consider relevant in a particular situation. At the same time, “National Labor Relations Act requires that the parties bargain in good faith,” which is why the agents of the negotiation process must meet at a bargain table (Carrell & Heavrin, 2013, p. 172). Moreover, this regulation “provides that neither party has to agree to any particular proposal as long as it continues to bargain in good faith” (Carrell & Heavrin, 2013, p. 172). In such a manner, the negotiation process is defined and imposed by boundaries and general principles; however, there are several strategic options for parties to consider depending on their goals, interests, and resources.

The choice of a negotiation strategy depends on the timing, information, and power as essential elements; it is also predetermined by the context in which the negotiations are undertaken. According to Carrell and Heavrin (2013), information, time, and power are essential elements of negotiations. Firstly, the information factor “shapes individuals’ assessment of reality, their negotiation strategy, and their expectations of what can be achieved, and thus the outcome of a negotiation” (Carrell & Heavrin, 2013, p. 168). Since the exchange of information is the core of bargaining, its quantity and quality defines the type of strategy used by the parties. Commonly, the integration of information into the bargaining process involves the evaluation of BATNA (Best Alternative to Negotiated Agreement) and ZOPA (Zone of Possible Agreement) (Sebenius, 2017; Yao et al., 2020). Secondly, the time factor involves deadlines and timing frames for both sides, within which decisions should be made, which triggers the choice of a certain strategy. Thirdly, power distribution sets the leverage opportunities for the bargaining sides; it predetermines whose interest might be dominating within BATNA (Sebenius, 2017). Thus, these elements determine whether distributive or integrative negotiation strategy applies.

Negotiation Strategies

Indeed, among negotiation strategies addressed by negotiation theory, distributive and integrative approaches are the two dominating ones. Both types require the parties to follow ethical rules in negotiations, namely ethics of purpose, ethics of principle, and ethics of consequence (Carrell & Heavrin, 2013). Abiding by the ethical principles, the sides devote to bargaining in good faith, and mutually beneficial outcomes are possible to be achieved. As Fisher et al. (1991) state, this principle might be called a win-win strategy through getting to yes. In other words, regardless of strategy and techniques pertaining to that strategy, the outcome pursued by skilled negotiators should be based on mutual gains.

Distributive Negotiations: Strategy and Techniques

The first negotiation strategy is referred to as distributive negotiation and deals with the bargaining over a single issue. According to Carrell and Heavrin (2013), distributive bargaining is a “negotiation method in which two parties strive to divide a fixed pool of resources, such as money, each trying to maximize its share of the distribution” (p. 173). It is often called a fixed-sum or zero-sum process since the participants share a finite quantity or amount of resource where “the other party loses the amount gained by one party” (Carrell & Heavrin, 2013, p. 173). Since it might be challenging to achieve a win-win situation under the procedures of distributive negotiations, the parties use specific techniques and tactics to pursue their goals (Schaerer et al., 2020). Five essential elements of distributive negotiations are commonly apparent in the zero-sum bargaining process.

Firstly, the identification of a target point is essential at the beginning of the negotiation when a negotiator defines the terms on which he or she would be ready to end the bargaining. Secondly, a resistance point or a bottom line is “a maximum or minimum beyond which the negotiator will not accept a proposal” (Carrell & Heavrin, 2013, p. 174). Thirdly, an initial offer is a starting point of negotiation when a party makes an offer. Fourthly, a settlement range or ZOPA identification allows for showing the acceptable range within which an offer might be accepted (Yao et al., 2020). As for techniques, an anchoring technique might be applied at this point to fix an initial offer and ZOPA. Finally, to achieve the settlement point, parties might apply the technique of bracketing, which is “the process of moving toward a middle point between the opening offers (or brackets), which is the logical bargaining process” (Carrell & Heavrin, 2013, p. 177). Thus, upon eliminating the alternatives outside both parties’ ZOPA, an agreement might be achieved.

Integrative Negotiations: Strategy and Techniques

An integrative negotiation strategy embodies a different principle due to the involvement of multiple and more complex issues; therefore, different techniques apply. According to Carrell and Heavrin (2013), integrative negotiation strategy “involves making concessions to reach an agreement, but in addition, it involves searching for mutually profitable options and logical trade-offs” (p. 186). However, since this strategy applies to cases when the issues under negotiation are not fixed, as in distributive bargaining, more creative, win-win solutions might be achieved. This approach is characterized by significant complexity since it is challenging for negotiators to “make required trade-offs to attain optimum results due to restricted information processing capacity and capability, cognitive biases, and social-emotional difficulties” (Park, 2019, p. 2). Therefore, specific techniques are required to identify both parties’ desired outcomes.

The process of integrating negotiators’ interests into the final agreement depends on the accuracy of the articulation of their goals. The most effective techniques applicable to this strategy are addressed by Fisher et al. (1991) with their four principles of getting to a win-win agreement. Firstly, the authors propose parties unveil their sincere interests instead of claiming their positions. In such a manner, more options for creative solutions might be identified. Secondly, by separating people from issues, negotiators will be able to eliminate the emotional and interpersonal relationship element and concentrate solely on the matters at the center of negotiation (Fisher et al., 1991). Thirdly, a technique of inventing options for mutual gain is based on the previous aspects and allows for achieving win-win agreement even in the most challenging situations. Finally, insisting on using objective criteria will allow for effective managing of conflicting positions and interests by fixing commonly acknowledged metrics (Fisher et al., 1991). Thus, these techniques or principles allow for achieving agreement in integrative negotiations providing both parties with means for establishing their interests and goals.

Conclusion

In summary, negotiation strategies and techniques provide negotiators with a choice of means for achieving agreement. While some negotiations might be simple in their nature and tasks, involve a small number of agents, and pertain to insufficient consequences, others might relate to strategically important issues. Similarly, labor and management are particularly dependent on negotiations since issues of collective decision-making are resolved by parties’ communication. Therefore, different strategic approaches and techniques of negotiation help to achieve an agreement that would satisfy the interests of all sides. Distributive and integrative negotiation strategies constitute two main approaches with distributive applied to single-issue bargaining and integrative method pertaining to complex or multiple issues. The application of specific techniques plays an essential role in satisfying negotiator’s interests as outcomes of bargaining.

References

Carrell, M. R., & Heavrin, C. (2013). Labor relations and collective bargaining: Private and public sectors (10^th ed.). Pearson.

Fisher, R., Ury, W., & Patton, B. (1991). Getting to YES: Negotiating an agreement without giving in (2^nd ed.). Random House Business Books.

Huang, Q., Jiang, F., Lie, E., & Que, T. (2017). The effect of labor unions on CEO compensation. Journal of Financial and Quantitative Analysis, 52(2), 553-582.

Park, J., Rahman, H. A., Suh, J., & Hussin, H. (2019). A study of integrative bargaining model with argumentation-based negotiation. Sustainability, 11(23), 1-21.

Schaerer, M., Schweinsberg, M., Thornley, N., & Swaab, R. I. (2020). Win-win in distributive negotiations: The economic and relational benefits of strategic offer framing. Journal of Experimental Social Psychology, 87, 103943.

Sebenius, J. K. (2017). BATNA s in Negotiation: Common errors and three kinds of “no.” Negotiation Journal, 33(2), 89-99.

Yao, J., Zhang, Z., & Liu, L. A. (2020). When there is no ZOPA: Mental fatigue, integrative complexity, and creative agreement in negotiations.Negotiation and Conflict Management Research. Web.

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