Negotiation techniques

What is negotiation?

Negotiation is a process whereby at least two parties, who have different views and goals, discuss an issue in order to reach a mutually accepted decision. Negotiation skills are incredibly important in the business world, both in day-to-day and formal interactions. Negotiation is used in aspects such as legal contracts, sale conditions, leases etc.

Why is negotiation important?

Negotiating is important in the business environment as it significantly contributes to business success. For example:

• it helps to build stronger relationships
• it can provide quality solutions that are long term (instead of short term solutions that do not satisfy any party)
• it can dramatically decrease the likelihood of future conflicts

What are the techniques associated with negotiating?

It is absolutely essential that you understand the interests and tactics of the other party, as this is integral to be being a good negotiator. There are several strategies that better suit their needs and interests – it is up to you to assess which is the right one.

Here are some examples of negotiating strategies:

• Problem Solving – Where both entities commit to discussing issues when entering long-term agreements
• Contending – Where one party persuades the other to agree to your outcome if you are negotiating over one-off events or over major ‘wins’
• Yielding – Where one party concedes a point that is not important to them but it important to the other party
• Compromising – Both parties forgo their desired outcome and instead settle on an outcome that satisfies each party
• Inaction – Where parties buy time to think about the proposal in order to gather more information before making a decision

The strategy you choose will depend on the needs and wants of the party you are dealing with and the type of relationship you have with them.