In negotiations where you value the relationship too much to risk breeding resentment, a winner-takeall strategy is a losing proposition. With direct reports, superiors, customers, or suppliers, negotiation is about reaching deeper, shared understandings and agreements that strengthen your relationships for the long term.
In a culture so focused on winning, it is easy to forget that negotiation isn’t a mud wrestle to see who comes out with the most money or the biggest piece of the pie. It is about reaching an understanding between parties whose interests may not be perfectly aligned. When negotiating parties are members of the same team and company (or larger business ecosystem), it is even more valuable to remember that the primary element of negotiation is communication. “Negotiation, regardless of the context or the issues involved, is fundamentally about human interaction,” Deepak Malhotra writes in his book Negotiating the Impossible. The end of a negotiation signals a new start to a relationship, and both sides should try get off to the best start possible.
Why smart conflict resolution is a business imperative
Supporting research shows that there is a downside when participants view negotiations as a win-lose proposition. “Winning” often has unintended consequences. “Counterparties who feel bullied into a bad deal may choose to underperform, especially when delivering services,” Horacio Falcão and Alena Komaromi write in their February 2018 article for INSEAD.1 If you take a take-no-prisoners approach to negotiating a new labor contract with your teams, for example, you might win concessions but at what cost? You don’t want your teams to walk away from the negotiation feeling they have been treated unfairly – unless your aim is to stoke smoldering resentment and undermine productivity. Instead, Falcão and Komaromi suggest that you ask yourself if a fee or salary reduction is worth the risk in loss of productivity… If you really have no choice, make sure that your offer is transparent and has a “strong, legitimate basis” — and be open to new information that might change your off er. Whether the issues are simple or complex, “the question we are always trying to answer in negotiation is this,” Malhotra writes: “How might we engage with other human beings in a way that leads to better understandings and agreements?”
Conflicts of interest in business, as in life, are inevitable, but the way they are resolved within an organization can yield positive results, including:
• Deeper understanding between parties
• Necessary evolution of business practices
• Strengthening of working relationships
It’s all in the presentation
Negotiations are above all about communication; hence the importance of presentation. “Objectively identical proposals can be made more or less attractive simply by how they are presented,” Malhotra writes. Consider the example of a conflict between players and owners in the National Football League in the US. At issue was the collective bargaining agreement, which dictates, among other things, how revenue is distributed between players and owners.
