- Negotiation
‘Back-and-forth communication designed to reach an agreement when you and the other side have some interests that are shared and some that are opposed’ (Fisher, Ury & Patton, 2012, p. xxv)
- Integrative approach
A negotiation method used when the negotiators believe that both parties can achieve their goals, with neither negotiator feeling like they ‘lost’
In contrast, the distributive approach assumes that the factor (or pie) under negotiation cannot be increased; therefore, if one negotiator gets more, the other gets less (Bazerman & Neale, 1992). This approach to negotiation is recommended only when there is the need for a quick outcome that is more important than the longer term relationship of the negotiators. For example, there is no point in taking an integrative approach with a child who is trying to negotiate not wearing a seatbelt in the car. This is a safety issue that requires a swift resolution. However, ‘most negotiations take place in the context of an ongoing relationship where it is important to carry on each negotiation in a way that will help rather than hinder future relations and future negotiations’ (Fisher, Ury & Patton, 1991, p. 22).
- Distributive approach
A negotiation method used when the factor under negotiation cannot be increased, and therefore if one negotiator gets more, the other gets less (Bazerman & Neale, 1992)
Frameworks for negotiating
De Janasz, Dowd & Schneider (2012) propose five stages of negotiation, each of which is discussed below.
Prepare and plan
Planning is essential to a successful negotiation, as it is important to be clear about what is wanted from the negotiation. Skilled negotiators suggest that this is the stage to identify the BATNA, defined as the Best Alternative To a Negotiated Agreement, which should be used as the standard against which a proposed agreement is measured. The BATNA is preferred to a set bottom line in negotiations, as it allows consideration of a wider range of solutions as more information becomes available during the negotiation process (Fisher et al., 1991).
- BATNA
Best Alternative To a Negotiated Agreement, which should be used as the standard against which a proposed agreement is measured (Fisher, Ury & Patton, 1991)
Considering a BATNA requires identification of the options available if an agreement is not reached. Once these have been outlined, the option that is considered to be the best is chosen. This becomes the BATNA, against which the terms of the proposed agreement can be evaluated. A negotiator should never accept an agreement that leaves them worse off than their BATNA.
The BATNA is influenced by the number of options available for achieving the required result from the negotiation. For example, if a person negotiating to buy a car would be happy with 10 or 12 different types of cars, their BATNA will be lower than if they want a specific car. This means it will be easier to find a negotiated solution that is better than their BATNA. If there is only one place to buy cars in the person’s area, they do not have much choice. However, if there are many dealers with many different models, they can shop around for the best make, price and options. Then they can set a realistic BATNA and know when they are being offered a deal that meets their objectives.
At the preparation stage it is useful to consider the possible interests and negotiating strategies of the other party. Fisher et al. (1991) suggest that writing down both one’s own interests and the possible interests of the other party helps to create a wider range of options. Consideration of the other party’s BATNA might also be helpful. In the car-buying example, at the end of a slow month the dealers may be willing to reduce their profit, as one sale at a lower price is likely to be better than a BATNA of no sales at all.
The area where negotiating parties’ BATNAs overlap is known as the zone of possible agreement. If a car-dealer will not sell for less than $20 000 and a car-buyer has only $18 000 to spend, there is no zone of possible agreement. However, if the car-buyer has $25 000 to spend, the zone between $18 000 and $25 000 is open for possible agreement.
- Zone of possible agreement
The common ground between two or more parties to a negotiation, where the possible solutions are all at least as good for each negotiator as their BATNA
Sally works in the city, managing a health promotion service at a community health centre. Her organisation has just opened a new site in a regional town and has asked her to move there to complete the planning and development of the service.
Sally calculates her BATNA in preparation for the discussions with her manager about this new role. Her salary is currently $95 000. Not accepting the new position might mean her BATNA is $95 000. Sally will be leaving friends, family and her house in the city that she loves. She considers that a bonus of $5000 to help with the move and enable regular travel home to visit her friends and family might make her happier to move.
Sally feels that she needs to accept the move if she does not want to be disadvantaged in her current organisation. But she has the option of staying in the city and getting a new job. She looks at the jobs available for people with her education, experience and skills, and finds some with salaries of $110 000 for which she would be qualified.
Sally has therefore calculated her BATNA as a salary of $110 000 plus a $5000 incentive payment. She is ready to talk to her manager about her expectations if she were to move to the regional town for the new job.
Define ground rules
The ground rules of a negotiation may address the following factors:
- who will participate in the negotiation
- who may be present to watch or provide information and support during the negotiation
- the location of the negotiation
- the time that will be allocated to the negotiation
- the parameters for the negotiation process.
Negotiation parameters may include the requirement that all parties are polite, procedures for calling time-out, the types of issues that will be discussed and which of these may be set aside for later, and a protocol that will be followed if the negotiation process is not successful. It is more difficult to agree the ground rules to a negotiation with a negotiating partner if one has not already considered what they may entail. Documenting the ground rules that one considers important before entering the negotiation can assist in subsequent work with the other party to outline a mutually acceptable process.
Clarify and justify
During this stage of the negotiation, often referred to as principled negotiation, or separating the people from the problem, each party presents their interests and uses questions to clarify the interests of the other party. It is essential to negotiate on interests and not to get stuck on the positions of the people involved in a negotiation (Bazerman & Neale, 1992; Fisher et al., 1991). Negotiations around land claims of Indigenous people can be used to illustrate this concept. If the interests are seen to be solely about ownership of the land, the positions will be adversarial. If, however, the interests are how best to manage, preserve and develop the land, the issue becomes one of management and not property rights, and the negotiations might therefore be able to end in an agreed plan for the management of the land.
Research has shown that how issues are framed has an impact on how likely people are to accept and to be able to encourage others to accept a proposal. If people perceive that they are getting a good deal, they will be more likely to accept a proposal than if they perceive they are being taken advantage of. Framing issues in a positive light generally results in less risky choices, while negative framing often results in riskier choices (Tversky & Kahneman, 1981).
- Framing
Careful choice of the language used to describe an issue to make it adopt a more positive or a more negative appearance
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