Negotiation Conference 2022: The 5%
Strategy in difficult negotiations
Important: your strategy is the guiding principle for the tactics you use.
As defined in the previous article, in order to determine your strategy, four key elements should be considered:
Power: How is power distributed in the negotiation process?
Relevance: How important is this negotiation to you?
Relationship: What kind of relationship with the negotiating partner do you want afterward?
Common interests: What do you have in common?
In the 5% – the most difficult negotiations we recommend to start with competing and later shift to cooperating.
Competing – high demands, no cooperation.
Competing is the preferred strategy to kick off difficult negotiations.
You attempt to reach your maximum target and show no willingness to cooperate. (sales/purchasing negotiations often follow through this scenario.) This strategy turns your partner into a loser and might cause an emotional reaction on their side.
Negotiators who abide by this strategy play fair and by the rules; however, they always play to win.
We recommend “putting the fish on the table” at the very beginning if you choose to commit to this strategy. The question is, who should move first? There is a window of opportunity in every negotiation that offers a potential solution. It needs to be opened by you, so take the lead.
Advantages of competing:
• It demonstrates your willingness to deal with a conflict rather than avoid it, hence, puts you in a position of power.
• Moving from competing to cooperating will come across as cooperative and accommodating.
• It is an ideal starting point, as it is easy to adopt a different strategy without losing face later.
Disadvantages of competing:
• The wrong choice of words can make this strategy seem threatening.
• If both negotiating partners want to win at any cost, it will result in a ferocious emotional battle.
• Lack of empathy could result in confrontations on the other side.
• It might be challenging to identify a window of opportunity that leads to an agreement.
Cooperating – turns both partners into winners.
The 2nd acceptable strategy in difficult negotiations after competing.
Both parties have their motives and needs addressed. This strategy requires a high level of trust and a willingness to cooperate on both sides. Additionally, the parties have to be ready to make reciprocal concessions.
Important: cooperation is entirely different from compromising:
Cooperation suggests that both parties try to get a beneficial solution. Both introduce new demands, face a conflict, address unpleasant issues, and have an intense exchange before coming to an agreement.
Compromising means giving in for a quick solution. This negotiation strategy leaves additional options unexplored. No further demands are introduced, and there is no endeavor to develop alternatives. The primary purpose is to get the issue off the table.
Pros of cooperating:
• The parties reach an agreement after intense negotiations and having considered all alternatives.
• A cooperative approach will gradually build trust.
• Any agreement is likely to last as both sides will commit to its implementation.
Cons of cooperating:
• This strategy only works if the other side is interested in a joint solution.
• If the opponent is short-term-oriented and you have a long-term approach, you will lose.
• A basic level of trust is needed. Without it, this strategy will not work.
Shifting from competing to collaborating
Changing approaches and moving from competing towards cooperating should follow the principle of reciprocity. It is all about reciprocal concessions – if you receive something in a negotiation, be ready to offer something in return.
Take the lead when cracking a window of opportunity open. Voice your offers in a conditional mood. A professional negotiator will recognize your signal and likely reciprocate with a suggestion to cooperate.
E.g., offering opportunities to collaborate: “Would you be open to discussing a contract period together?”
The practice shows that substituting competing with cooperating works well in most cases. As soon as the other side has understood that you are ready to embrace the conflict and work through it, it is time to demonstrate your willingness to cooperate.
There are two potential errors one could make when shifting the strategy from competing toward cooperating:
• Moving too quickly. If you offer to cooperate too early, the other side will notice that. They will likely try to get more concessions out of you.
• Moving too slowly. If you try to get the maximum out of your negotiating position, you risk damaging relationships.
Suppose the other side recognizes your offer to collaborate and chooses to engage; it is paramount to thank them immediately for the opportunity. Failure to express gratitude for your partner’s readiness to cooperate could be interpreted as disrespectful, resulting in an emotional reaction.
We do not recommend opting for the other three strategies described in the previous article (Avoiding, Giving in, Compromising) in difficult negotiations or when you play to win.
Follow our article series to learn more about the winning tactics in difficult negotiations.
Join us at the Negotiation Conference on October 6&7, 2022. Register here!