Negotiating

Managers spend a lot of time negotiating, and need to be able to do it well.

Negotiation is a process by which tow or more parties exchange goods or services and attempt to agree upon the exchange rate for them. Managers spend a lot of time negotiating, and need to be able to do it well. They have to negotiate salaries for incoming employees, cut deals with superiors, bargain over budgets, work out differences with associates and resolve conflicts between members of their team.

There are two general approaches to negotiation: distributive and integrative bargaining. distributive bargaining assumes zero-sum conditions, that is: "Any gain I make is at your expense," and vice versa. Integrative bargaining assumes a win-win solution is possible. Each is appropriate in different situations.

Distributive bargaining tactics focus on getting an opponent to agree to a deal that meets your specific goals. Such tactics include persuading opponents of the impossibility of getting their needs met in other ways or the advisability of accepting your offer; arguing that your position is fair, while theirs is not; and trying to get the other party to feel emotionally generous toward you and accept an outcome that meets your goals.

Integrative, or win-win, bargaining is generally preferable to distributive bargaining. Distributive bargaining leaves one party a loser, and so it tends to build animosities and deepen divisions between people. On the other hand, integrative bargaining builds long=term relationships and facilitates working together in the future. It bonds negotiators and allows each to leave the bargaining table feeling that he or she has achieved a victory. For integrative bargaining to work, however, both parties must openly share all information, be sensitive to each other's needs, trust each other , and remain flexible.

ACTION POINT: Understand the two type of negotiations distributive and integrative.