Negotiation is simply the process of discussion between two parties, with different wants or needs, in order to see if a possible deal can be reached. We probably aren't even aware of how much we make use of negotiation in our day to day lives. Most of us make use of negotiation regularly in our day-to-day lives, but when it comes to business negotiations, sometimes, we lack confidence.
Different negotiation styles
Historically, business tactics dictated that negotiators would enter a boardroom with a set idea of what they wanted to achieve from the discussions, and employ all their negotiating skills to ensure that they achieved it. Arriving with a clear idea of their ‘bottom line’, or the worst deal they would accept, and whether it was acceptable not to agree at all. They would try to get as close to their best position as possible, while the other side did the same.
In the last few decades, the concept of mutual gains bargaining, or win-win negotiation, came about. Here, the parties will enter the negotiation with less of a fixed idea of what they want to achieve, and aim to discuss the issues more broadly. The tendency of this negotiation style is to yield more creative and mutually beneficial results since the parties stay flexible in their approach.
Tactics versus strategy
Tactics are more associated with the first style of negotiation, and include tricks or common sense techniques such as not revealing your bottom line, always ensuring the person with a final say is not present, and implying that one is ready to walk away if the negotiation does not achieve sufficient results, whether or not this is true.
Strategy is more of a big-picture approach and includes principles such as being prepared and keeping an open mind, listening to the other party, addressing all relevant issues and knowing in which areas compromise is preferable.
Many companies send employees on expensive negotiation courses as part of their skills training. However, some would argue that these courses teach little other than tactics or tricks. The ability to be effective in negotiation may depend more on the ability to listen and identify the other party’s requirements, to think outside the box and be flexible throughout the negotiation process.
Another important thing to remember, is that even within the above framework, negotiation styles are strongly informed by culture. Analyses of negotiation styles suggest that the British tend to take a direct but open-cards approach, and pride themselves on being forthright in business discussions. Other countries which prioritise different values may express themselves very differently in negotiations, from the super-polite Japanese, to more aggressive and volatile continental countries.