Book Extract

The elements of negotiation

No matter what kind of conflict you plan to resolve through negotiation, there is one major goal. The objective in negotiation is to forge an agreement where there was once a conflict. Therefore, negotiating may begin with tension, anxiety, or disagreement over interests and issues, but successful negotiations will end with a mutually agreeable solution or compromise.

It's not just win or lose

Avoid thinking of negotiation as a game or a contest. This approach promotes the idea that one side will win and the other will lose. Neither winning at all costs nor merely defeating the opponent is a legitimate goal for negotiations. This line of thinking can lead you into perilous waters.

An example is the well-known situation where workers virtually force the management to provide a large pay raise. The workers may have won the negotiation, and the company owners lost. But when the company doesn't earn enough to fund the pay raises, what happens? Workers are laid off. Was the negotiated win at all costs really worth it?

Another example involves the compulsion to defeat the opponent, pure and simple. Two manufacturers were negotiating competitively for a limited supply of resource material available for immediate shipment. The rivalry between the two manufacturers had grown over years of sales competition until it almost took on a life of its own. Thus, one manufacturer bid an outrageously high price for the material, knowing his competitor could not meet it. He defeated the opponent, won the negotiation, and obtained the resources, but the costs prevented him from making a profit and ruined the financial performance of the company for that quarter. In negotiations, such egotism can be a very expensive habit.

Co-operation makes a difference

What might have happened in these two situations if the parties had recognised the real objective of negotiations? What if the focus was shifted from competing head-on to co-operating side-by-side?

In the first case, the workers and management might have been able to co-operate in developing a mutually satisfactory plan. For instance, they might have formulated a pay increase tied to improved productivity or profitability of the company. That might satisfy the workers' need for more money and management's need for additional production or increased profits.

In the second case, the difference would be immediately apparent to any impartial observer. The rivalry interfered with rational problem-solving and effectively prevented any real negotiations from taking place. By co-operating, the manufacturers may have agreed to split the resources in some equitable way, which would have enabled both to continue production.

Remember that negotiation is co-operation—you and the other side working together. Co-operation usually leads to conflict resolution.

Win-win negotiation

As the previous examples show, both sides in a negotiation can be winners, providing they work toward the real objective, arriving at a solution that is mutually agreeable or acceptable. The negotiating sides should be satisfied with the negotiated outcome. This does not necessarily mean that each side achieved 100 percent of its desired outcomes in negotiation. But it does mean that both sides see the value in the negotiated solution and are willing to accept it.

This type of negotiation is often called win-win negotiation because both sides win when the conflict is resolved through compromise. There simply are no losers.

Think of negotiation as the resolution of differences to the mutual benefit of all parties. It might be considered both an art and a science. It is the science of co-operative compromise, and it is the art of collaborative agreement.

Reprinted with permission from Tata McGraw Hill