Five mistakes negotiators often make

Mistake 1: Viewing negotiation as a fixed pie

Why is combative behavior often the norm in a business negotiation, while cooperation seems like an impossible goal? Why do the negotiators often end up settling for “better than nothing” deals? It’s the mindset.

The negotiators assume a fixed “size of the prize” or resources, which leads to win-lose outcomes. For instance, if the price is the only issue on the table, your gains come at the other party’s expense and vice versa.

Skillful negotiators increase the total value by focusing on tradeoffs. For instance, buyer and seller negotiating a purchase might both be satisfied by increasing the order size and decreasing the price per unit—a better outcome.

Here are some ways to uncover value.

Share information to structure expectations. An effective way for negotiators to uncover value is to share information. The value created by sharing information will often outweigh the risk of having that information misused. “On-time delivery is critical to us,” you might say to the other party. Now tell me your concerns.”

Make proposals. Only proposals move the negotiation forward. Ask for a response to your offer. If you do not ask for it, you may not get any.

Ask good questions and then listen to the answers. Listening and asking good questions are the keys to testing your assumptions and filling in the information gaps. “What is that you do not like about our proposal? What do you like? Under what conditions would you accept the proposal?

In my next post, I will discuss Mistake 2: Not knowing what you want.