Module 2
Strategy & Tactics of Negotiation
An Overview of the Integrative Negotiation Process
The fundamental structure of an integrative negotiation situation is such that it
allows both sides to achieve their objectives.1 The goals of the parties in integrative
negotiation are not mutually exclusive. If one side achieves its goals, the other is not
precluded from achieving its goals as well. One party’s gain is not at the other party’s
expense. Although the situation may initially appear to the parties to be win–lose,
discussion and mutual exploration will often suggest alternatives where both parties
can gain. A description of the efforts and tactics that negotiators use to discover these
alternatives is the major part of this chapter. Important characteristics of integrative
negotiators are listed in Box 3.1. Even well-intentioned negotiators can make the
following three mistakes: failing to negotiate when they should, negotiating when
they should not, or negotiating when they should but choosing an inappropriate
strategy. As suggested by the dual concerns model described in Chapter 1, being
committed to the other party’s interests as well as to one’s own makes problem
solving the strategy of choice. In many negotiations there does not need to be winners
and losers—all parties can gain. Rather than assume that negotiations are win–lose
situations, negotiators can look for win–win solutions—and often they will find them
inhibiting factors and search assertively for common ground. Those wishing to
achieve integrative results find that they must manage both the context and the
process of the negotiation in order to gain the cooperation and commitment of all
parties. Key contextual factors include creating a free flow of information, attempting
to understand the other negotiator’s real needs and objectives, emphasizing
commonalities between parties, and searching for solutions that meet the goals and
objectives of both parties. Managing integrative negotiations involves creating a
process to identify and define the problem, surface interests and needs, generate
alternative solutions, and evaluate and select alternatives.
Negotiators differ in their values and preferences, as well as their thoughts and
behaviors.3 What one side needs and wants may or may not be the same as what the
other party needs and wants. One must understand the other’s needs before helping to
satisfy them. When negotiators are aware of the possibility that the other’s priorities
are not the same as their own, this can stimulate the parties to exchange more
information, understand the nature of the negotiation better, and achieve higher joint
gains.4 Similarly, integrative agreements are facilitated when parties exchange
information about their priorities for particular issues, but not necessarily about their
positions on those issues.5 Throughout the process of sharing information about
preferences and priorities, negotiators must make a true effort to understand what the
other side really wants to achieve. This is in contrast to distributive bargaining, where
negotiators either make no effort to understand the other side’s needs and objectives
or do so only to challenge, undermine, or even deny the other party the opportunity to
have those needs and objectives met. The communicative aspects of information flow
and understanding, while critical to integrative negotiation, also require that Kelley’s
dilemmas of trust and honesty be managed (see Chapter 1).6 In addition, negotiators
may differ in their ability to differentiate needs and interests from positions, such as
when one party knows and applies a truly integrative process while the other party is
unskilled or naíve about negotiations. In such situations, the more experienced party
may need to assist the less experienced party in discovering his or her underlying
needs and interests.
To sustain a free flow of information and the effort to understand the other’s
needs and objectives, negotiators may need a different outlook or frame of reference
(see Chapter 6 for a discussion of framing). Individual goals may need to be redefined
as best achieved through collaborative efforts directed toward a collective goal.
Sometimes the collective goal is clear and obvious. For example, politicians in the
same party may recognize that their petty squabbles must be put aside to ensure the
party’s victory at the polls. Managers who are quarreling over cutbacks in their
individual departmental budgets may need to recognize that unless all departments
sustain appropriate budget cuts, they will be unable to change an unprofitable firm
into a profitable one. At other times, the collective goal is neither so clear nor so easy
to keep in sight. For example, one of the authors worked as a consultant to a company
that was closing a major manufacturing plant while simultaneously opening several
other plants in different parts of the country. The company was perfectly willing to
transfer employees to new plants and let them take their seniority up to the time of
their move with them; the union agreed to this arrangement.
However, conflict developed over the transfer issue. Some employees were
able to transfer immediately, whereas others— those who were needed to close and
dismantle the old plant—could not. Because workers acquired seniority in the new
plants based on the date they arrived, those who stayed to close the old plant would
have comparatively less seniority once they arrived at the new plants. The union
wanted everyone to go at the same time to avoid this inequity. This was unworkable
for management. In the argument that resulted, both parties lost sight of the larger
goal—to transfer all willing employees to the new plants with their seniority intact.
Key Steps in the Integrative Negotiation Process 63 Only by constantly stressing this
larger goal were the parties able to maintain a focus on commonalities that eventually
led to a solution; management allowed the workers to select their new jobs in advance
and transferred their seniority to those jobs when the choice was made, not when the
physical move actually occurred.
The success of integrative negotiation depends on the search for solutions that
meet the needs and objectives of both sides. In this process, negotiators must be firm
but flexible— firm about their primary interests and needs, but flexible about how
these needs and interests are met.7 When the parties are used to taking a combative,
competitive orientation toward each other, they are generally concerned only with
their own objectives. In such a competitive interaction, a low level of concern for the
other’s objectives may cause two forms of behavior. First, negotiators may work to
ensure that what the other obtains does not take away from one’s own
accomplishments. Second, negotiators may attempt to block the other from obtaining
his or her objectives because of a strong desire to win or to defeat the opponent. In
contrast, successful integrative negotiation requires both negotiators not only to define
and pursue their own goals, but also to be mindful of the other’s goals and to search
for solutions that satisfy both sides. Outcomes are measured by the degree to which
they meet both negotiators’ goals. They are not measured by determining whether one
party is doing better than the other. If the objective of one party is simply to get more
than the other, successful integrative negotiation is very difficult; if both strive to get
more than the other, integrative negotiation may be impossible.
Key Steps in the Integrative Negotiation Process
There are four major steps in the integrative negotiation process: (1) identify
and define the problem, (2) surface interests and needs, (3) generate alternative
solutions to the problem, and (4) evaluate those alternatives and select among them
(see Table 3.1). The first three steps of the integrative negotiation process are
important for creating value. To work together to create value, negotiators need to
understand the problem, identify the interests and needs of both parties, and generate
alternative solutions. The fourth step of the integrative negotiation process, the
evaluation and selection of alternatives, involves claiming value.
The problem identification step is often the most difficult one, and it is even
more challenging when several parties are involved. Consider the following example:
A large electronics plant experienced serious difficulty with a product as it moved
from the subassembly department to the final assembly department. Various pins and
fittings that held part of the product in place were getting bent and distorted. When
this happened, the unit would be laid aside as a reject. At the end of the month, the
rejects would be returned to the subassembly department to be reworked, often
arriving just when workers were under pressure to meet endof-the-month schedules
and were also low on parts. As a result, the reworking effort had to be done in a rush
and on overtime. The extra cost of overtime did not fit into the standard cost
allocation system. The manager of the subassembly department did not want the costs
allocated to his department. The manager of the final assembly department insisted
that she should not pay the additional cost; she argued that the subassembly
department should bear the cost because its poor work caused the problem. The
subassembly department manager countered that the parts were in good condition
when they left his area and that it was the poor workmanship in the final assembly
area that created the damage.
The immediate costs were relatively small. What really concerned both
managers was setting a long-term precedent for handling rejects and for paying the
costs. Eventually an integrative solution was reached. During any given month, the
subassembly department had some short slack-time periods. The managers arranged
for the final assembly department to return damaged products in small batches during
those slack periods. It also became clear that many people in the final assembly
department did not fully understand the parts they were handling, which may have
contributed to some of the damage. These workers were temporarily transferred to the
subassembly department during assembly department slack periods to learn more
about subassembly and to process some of the rush orders in that department. This
example captures several key aspects of the problem definition process.9 The problem
definition process is critical for integrative negotiation because it sets broad
parameters regarding what the negotiation is about and provides an initial framework
for approaching the discussion. It is important that this framework is comprehensive
enough to capture the complexities inherent in the situation, while not making the
situation appear more complex than it actually is.
Ideally, parties should enter the integrative negotiation process with few
preconceptions about the solution and with open minds about each other’s needs. As a
problem is defined jointly, it should accurately reflect both parties’ needs and
priorities. Unfortunately, this often does not occur. An understandable and widely
held concern about integrative negotiation is that during the problem definition
process, the other party will manipulate information to state the problem to his or her
own advantage. For positive problem solving to occur, both parties must be
committed to stating the problem in neutral terms. The problem statement must be
acceptable to both sides and not worded so that it lays blame or favors the preferences
or priorities of one side over the other. The parties may be required to revise the
problem statement several times until they agree on its wording. It is critical to note
that problem definition is, and should be, separate from any effort to generate or
choose alternatives. Problems must be defined clearly at this stage.
The parties should define the problem as a specific goal to be attained rather
than as a solution process. That is, they should concentrate on what they want to
achieve rather than how they are going to achieve it. They should then proceed to
specify what obstacles must be overcome for the goal to be attained. In the previous
example involving production defects in an electronics plant, the goal might have
been “to minimize the number of rejects.” A clearer and more explicit definition
would be “to cut the number of rejects in half.” After defining the goal, the parties
should specify what they need to know about how the product is made, how defects
occur, what must be done to repair the defects, and so on. One key issue is whether
the obstacles specified can be changed or corrected by negotiating parties. If the
parties cannot address the obstacles effectively, given limited time or other resources,
the obstacles then become boundary markers for the overall negotiation. A clear
understanding of which obstacles are addressable and which are not can be just as
critical to realistic integrative negotiation as an explicit awareness of what is
negotiable and what is not.
When parties are engaged in conflict, they tend to become evaluative and
judgmental. They view their own actions, strategies, and preferences in a positive
light and the other party’s actions, strategies, and preferences in a negative light. Such
evaluative judgments can interfere with clear and dispassionate thinking. Telling the
other party that “Your point of view is wrong and mine is right” inhibits integrative
negotiating because it combines attacking the problem with attacking the other
negotiator. In contrast, depersonalizing the definition of the problem—stating, for
example, “We have different viewpoints on this problem”—allows both sides to
approach the issue as a problem external to the individuals rather than as a problem
that belongs to one party only. Another way to say this is “I respect that you have
constraints and a way of looking at this problem that may be different than mine. I ask
that you recognize that I do as well.”
Finally, it is important not to jump to solutions until the problem is fully
defined. In distributive bargaining, negotiators are encouraged to state the problem in
terms of their preferred solution and to make concessions based on this statement. In
contrast, parties engaged in integrative negotiation should avoid stating solutions that
favor one side or the other until they have fully defined the problem and examined as
many alternative solutions as possible. Instead of premature solutions, negotiators
should develop standards by which potential solutions will be judged for how well
they fit. These standards can be created by asking interested parties questions.
Many writers on negotiation—most particularly, Roger Fisher, William Ury,
and Bruce Patton in their popular book, Getting to Yes10—have stressed that a key to
achieving an integrative agreement is the ability of the parties to understand and
satisfy each other’s interests. Identifying interests is a critical step in the integrative
negotiation process. Interests are the underlying concerns, needs, desires, or fears that
motivate a negotiator to take a particular position. Fisher, Ury, and Patton explain that
while negotiators may have difficulty satisfying each other’s specific positions, an
understanding of the underlying interests may permit them to invent solutions that
meet each other’s interests. In this section, we will first define interests more
completely and then discuss how understanding them is critical to effective
integrative negotiation.
Lax and Sebenius have suggested that several types of interests may be at
stake in a negotiation and that each type may be intrinsic (the parties value it in and of
itself) or instrumental (the parties value it because it helps them derive other outcomes
in the future).12 Substantive interests are related to focal issues that are under
negotiation—economic and financial issues such as price or rate, or the substance of a
negotiation such as the division of resources (like the tangible issues discussed in
Chapter 1). These interests may be intrinsic or instrumental or both; we may want
something because it is intrinsically satisfying to us and/or we may want something
because it helps us achieve a long-range goal. Thus, the job applicant may want
$40,000 both because the salary affirms her intrinsic sense of personal worth in the
marketplace and because it instrumentally contributes toward paying off her education
loans. Process interests are related to how the negotiation unfolds. One party may
pursue distributive bargaining because he enjoys the competitive game of wits that
comes from nose-to-nose, hard-line bargaining. Another party may enjoy integrative
negotiating because she believes she has not been consulted in the past and wants to
have some say in how a key problem is resolved. In the latter case, the negotiator may
find the issues under discussion less important than the opportunity to voice her
opinions. Process interests can also be both intrinsic and instrumental. Having a voice
may be intrinsically important to a group—it allows them to affirm their legitimacy
and worth and highlights the key role they play in the organization; it can also be
instrumentally important, in that if they are successful in gaining voice in this
negotiation, they may be able to demonstrate that they should be invited back to
negotiate other related issues in the future.
Relationship interests speak to the value of the ongoing relationship between
the parties and the future of that relationship. Intrinsic relationship interests exist
when the parties value the relationship both for its existence and for the pleasure or
fulfillment that sustaining it creates. Instrumental relationship interests exist when the
parties derive substantive benefits from the relationship and do not wish to endanger
future benefits by souring it. Finally, Lax and Sebenius point out that the parties may
have interests in principle. 13 Certain principles—concerning what is fair, what is
right, what is acceptable, what is ethical, or what has been done in the past and should
be done in the future—may be deeply held by the parties and serve as the dominant
guides to their action. These principles often involve intangible factors (see Chapter
1). Interests in principles can also be intrinsic (valued because of their inherent worth)
or instrumental (valued because they can be applied to a variety of future situations
and scenarios).
The search for alternatives is the creative phase of integrative negotiation.
Once the parties have agreed on a common definition of the problem and understood
each other’s interests, they can proceed to generate alternative solutions. The
objective is to create a variety of options or possible solutions to the problem;
evaluating and selecting from among those options will be their task in the final
phase. Several techniques have been suggested to help negotiators generate alternative
solutions. These techniques fall into two general categories. The first requires the
negotiators to redefine, recast, or reframe the problem (or problem set) to create win–
win alternatives out of what earlier appeared to be a win–lose problem (see Box 3.2).
The second takes the problem as given and creates a long list of options from which
the parties can choose. In integrative negotiation over a complex problem, both types
of techniques may be used and even intertwined.
The techniques in this category call for the parties to define their underlying
needs and to develop alternatives to meet them. We present eight methods for
generating alternative solutions by redefining the problem or problem set. Each
method refocuses the issues under discussion and requires progressively more
information about the other side’s true needs. Solutions move from simpler,
distributive agreements to more complex and comprehensive, integrative ones, and
there are several paths to finding joint gain.20 Each approach will be illustrated by the
example of Samantha and Emma, two partners in a successful enterprise called
Advanced Management Consulting, which employs eight other nonpartner
consultants. The partners are deciding where to locate their new office; half their
clients are downtown and half are in the suburbs. There are two possible locations that
they are considering leasing. Samantha prefers the downtown location. It has less
floor space but is a more prestigious address. While its offices are smaller, its location
is equidistant from where both partners live. Emma prefers the location in the
suburbs. It has more floor space and larger offices, and it is newer. It is also located
closer to Emma’s house, but farther from Samantha’s.
Successful logrolling requires the parties to find more than one issue in
conflict and to have different priorities for those issues.21 The parties then agree to
trade off among these issues so that one party achieves a highly preferred outcome on
the first issue and the other person achieves a highly preferred outcome on the second
issue. If the parties do in fact have different preferences on different issues and each
party gets his or her most preferred outcome on a high-priority issue, then each should
receive more and the joint outcomes should be higher.22 For instance, the Advanced
Management Consulting could lease the downtown location and give Emma the
bigger office. Samantha would get her preferred location, which is more important to
her, and Emma would receive better working space, which is more important to her.
Logrolling is frequently done by trial and error—as part of the process of
experimenting with various packages of offers that will satisfy everyone involved.
The parties must first establish which issues are at stake and then decide their
individual priorities on these issues. If there are already at least two issues on the
table, then any combination of two or more issues may be suitable for logrolling.
Research suggests that negotiators reach better agreements as the number of issues
being negotiated increases.23 Negotiator satisfaction may be less when more issues
are negotiated, however, because negotiators believe that they could have done better
on one or more issues. (Negotiator cognition and satisfaction is discussed in more
detail in Chapter 6.) If it appears initially that only one issue is at stake, the parties
may need to engage in “unbundling” or “unlinking,” which is the process of
separating a single issue into two or more issues so that the logrolling may begin.24
Additional issues of concern may also be generated through the brainstorming
processes described later.
Many negotiations begin with a shortage of resources, and it is not possible for
both sides to satisfy their interests or obtain their objectives under the current
conditions. A simple solution is to add resources—expand the pie—in such a way that
both sides can achieve their objectives. For instance, Advanced Management
Consulting could lease offices both downtown and in the suburbs to serve both sets of
its clients. A projected expansion of the business could pay for both leases. In
expanding the pie, one party requires no information about the other party except her
interests; it is a simple way to solve resource shortage problems. In addition, the
approach assumes that simply enlarging the resources will solve the problem. Thus,
leasing both locations would be a very satisfactory solution if Samantha and Emma
like both locations and want to expand their business. However, expanding the pie
would not be a satisfactory solution if their disagreement is based on other grounds—
if, for example, they have different visions about the future of the firm—or if the
whole firm has to gather for meetings frequently. In addition, to the extent that the
negotiation increases the costs of a person or organization not directly involved in the
negotiation (e.g., the employees in this example), the solution may be integrative for
the negotiators but problematic for other stakeholders.
While expanding the resource pie may be attractive, it does not always work
because the environment may not be plentiful enough. For instance, Advanced
Management Consulting may not have enough demand for its services to have two
offices. A related approach is to modify the resource pie. For instance, Advanced
Management Consulting could start a new service and offer information technology
(IT) consulting or digital marketing consulting in addition to its traditional business
consulting. In this case, the resource pie is modified in a way to support opening
offices both downtown and in the suburbs.
When the parties are able to invent new options that meet all their respective
needs they have created a bridge solution. For instance, Advanced Management
Consulting could decide to expand the number of partners in the firm and lease a
larger space downtown, with new office furniture for everyone and a prestigious street
address. Successful bridging requires a fundamental reformulation of the problem so
that the parties are not discussing positions but, rather, they are disclosing sufficient
information to discover their underlying interests and needs and then inventing
options that will satisfy those needs.26 Bridging solutions do not always remedy all
concerns. Emma may not enjoy the commute and Samantha may not be convinced
about growing the firm, but both have agreed that working together is important to
them, and they have worked to invent a solution that meets their most important
needs. If negotiators fundamentally commit themselves to a win–win negotiation,
bridging solutions are likely to be highly satisfactory to both sides.
Through cost cutting, one party achieves her objectives and the other’s costs
are minimized if she agrees to go along. For instance, Advanced Management
Consulting could decide to lease in the suburbs and provide Samantha with a travel
subsidy, a new company car, and a reserved parking space. In this case Emma gets her
preferred location, while Samantha’s costs for agreeing to the new office location are
reduced. Unlike nonspecific compensation, where the compensated party simply
receives something for agreeing, cost cutting is designed to minimize the other party’s
costs for agreeing to a specific solution. The technique is more sophisticated than
logrolling or nonspecific compensation because it requires a more intimate knowledge
of the other party’s real needs and preferences (the party’s interests, what really
matters to him, how his needs can be specifically met)
n Superordination solutions occur when “the differences in interest that gave
rise to the conflict are superseded or replaced by other interests.”27 For instance, after
extensive discussion about the office location Samantha may discover that she would
prefer to follow her dream of becoming an artist and become a silent partner in the
business. At this point, the office location negotiation stops and Emma chooses how
she would like to proceed in the new business model. A compromise solution that
would not further the interests of either Samantha or Emma would be to stay in their
current location and to maintain the status quo. Compromises are not considered to be
a good integrative strategy except for circumstances where parties are very entrenched
and it is unlikely that a more comprehensive agreement is possible. The successful
pursuit of these eight strategies requires a meaningful exchange of information
between the parties. The parties must either volunteer information or ask each other
questions that will generate sufficient information to reveal win–win options.
An innovative method for gathering ideas is to engage a professional
facilitator and use electronic brainstorming.31 The facilitator uses a series of
questions to guide input from participants who enter responses anonymously into a
networked device that aggregates and displays these entries to the group as a whole.
The facilitator may then ask additional probing questions. Electronic brainstorming
may be especially useful for integrative negotiations that involve multiple parties or
during preparation for integrative negotiations when there are disparate views within
one’s team (see Chapter 4 on preparation).
Our discussion of the two basic approaches to generating alternative solutions
—generating options to the problem as given and generating options by redefining the
problem—may give the impression that if negotiators simply invent enough different
options, they will find a solution to solve their problem rather easily. Although
identifying options sometimes leads to a solution, solutions are usually attained
through hard work and pursuit of several related processes: information exchange,
focusing on interests rather than positions, and firm flexibility.32 Information
exchange allows parties to maximize the amount of information available. Focusing
on interests allows parties to move beyond opening positions and demands to
determine what the parties really want—what needs truly must be satisfied. Finally,
firm flexibility allows parties to be firm with regard to what they want to achieve (i.e.,
interests) while remaining flexible on the means by which they achieve it. Firm
flexibility recognizes that negotiators have one or two fundamental interests or
principles, although a wide variety of positions, possible solutions, or secondary
issues may get drawn into the negotiations. Thus, among the many viable alternatives
that will satisfy a negotiator, the important ones directly address the top priorities.
Negotiators need to be able to signal to the other side the positions on which they are
firm and the positions on which they are willing to be flexible.
The fourth stage in the integrative negotiation process is to evaluate the
alternatives generated during the previous phase and to select the best ones to
implement. When the challenge is a reasonably simple one, the evaluation and
selection steps may be effectively combined into a single step. For those
uncomfortable with the integrative process, though, we suggest a close adherence to a
series of distinct steps: definitions and standards, alternatives, evaluation, and
selection. Following these distinct steps is also a good idea for those managing
complex problems or a large number of alternative options. Negotiators will need to
weigh or rank-order each option against clear criteria. If no option or set of options
appears suitable and acceptable, this is a strong indication that the problem was not
clearly defined (return to definitions) or that the standards developed earlier are not
reasonable, relevant, and/or realistic (return to standards). Finally, the parties will
need to engage in some form of decision-making process in which they debate the
relative merits of each negotiator’s preferred options and come to agreement on the
best options. The selection of alternatives is the claiming-value stage of integrative
negotiations. Negotiators need to take care at this stage to ensure that the shift from
working together to define issues and possible solutions to choosing alternatives does
not harm the relationship.
Negotiators should agree to the criteria for evaluating potential integrative
solutions early in the process.36 Negotiators can use these criteria when they have to
narrow the choice of options to a single alternative— for example, one candidate for a
new job—or to select the option most likely to succeed. If the parties first debate
criteria and determine which ones are most important, they will be able to decide on
criteria independent of the consideration of any particular candidate or option. Then,
when they consider the individual candidates or options, they will pick the best one
based on these criteria, not on the individual preferences of one side or the other. If
the parties agree, they may revise their criteria later to improve their choice, but they
should do so only with the agreement of all negotiators. It is a good idea to check
criteria periodically and determine whether each negotiator places the same priority
on them as before.
People often find it hard to explain why they like what they like or dislike
what they dislike. When asked “Why do you like that?” the reply is often, “I don’t
know, I just do.” Moreover, negotiators gain little by pressing opponents to justify
themselves—doing so usually just makes them angry and defensive; they may feel
that a simple statement of preference is not viewed as sufficient. For example, if the
topic under negotiation is what to have for dinner, and one party states that she hates
clam chowder, no amount of persuasive effort is likely to induce her to eat clam
chowder. Yet personal preferences often have a deep-seated rationale—recall our
discussion of how interests, values, and needs underlie positions. Inquiries about the
other party’s preferences may be an effort to probe behind a position and identify
underlying interests and needs. If the other party responds defensively to a why
question, the negotiator should explain that the intent is to probe for possible
underlying interests that might facilitate a collaborative settlement rather than to
challenge one’s perspective.
Even though the parties may have completed the hardest part of the process—
generating a list of viable options—they may become upset if communication breaks
down, they feel their preferences are not being acknowledged, or the other side pushes
too hard for a particular option. If the parties become angry, they should take a break.
They should make their dissatisfaction known and openly discuss the reasons for it.
The parties should feel that they are back on an even emotional keel before continuing
to evaluate options. Finally, they should work as hard as possible to keep discussions
on the specifics of the proposals, not on the people advocating them. The parties
should depersonalize the discussion as much as possible so that the options for
settlement are not associated with the people who advocated them.
Factors That Facilitate Successful Integrative Negotiation
Successful integrative negotiation occurs when the parties are predisposed to
finding a mutually acceptable joint solution. Many factors contribute to a
predisposition toward problem solving and a willingness to work together for more
successful integrative negotiations. In this section, we review seven factors that
facilitate successful integrative negotiation: (1) the presence of a common goal, (2)
faith in one’s own problem-solving ability, (3) a belief in the validity of the other
party’s position, (4) the motivation and commitment to work together, (5) trust, (6)
clear and accurate communication, and (7) an understanding of the dynamics of
integrative negotiation.
When the parties believe they are likely to benefit more from working together
than from competing or working separately, the situation offers greater potential for
successful integrative negotiation. Three types of goals—common, shared, and joint
—may facilitate the development of integrative agreements. A common goal is one
that all parties share equally, each one benefiting in a way that would not be possible
if they did not work together. A town government and an industrial manufacturing
plant may debate the amount of taxes the plant owes, but they are more likely to work
together if the common goal is to keep the plant open and employ half the town’s
workforce. A shared goal is one that both parties work toward but that benefits each
party differently. For example, partners can work together in a business but not divide
the profits equally. One may receive a larger share of the profit because he or she
contributed more experience or capital investment. Inherent in the idea of a shared
goal is that parties will work together to achieve some output that will be divided
among them. The same result can also come from cost cutting, by which the parties
can earn the same outcome as before by working together, but with less effort,
expense, or risk. This is often described as an “expandable pie” in contrast to a “fixed
pie” (see Chapter 6). A joint goal is one that involves individuals with different
personal goals agreeing to combine them in a collective effort. For example, people
joining a political campaign can have different goals: one wants to satisfy personal
ambition to hold public office, another wants to serve the community, and yet another
wants to benefit from policies that will be implemented under the new administration.
All will unite around the joint goal of helping the new administration get elected. The
key element of an integrative negotiation situation is the belief that all sides can
benefit. Whether the sides attain the same outcome or different outcomes, all sides
must believe that they will be better off by working in cooperation than by working
independently or competing.
Integrative negotiation requires negotiators to accept both their own and the
other’s attitudes, interests, and desires as valid.45 First, one must believe in the
validity of one’s own perspective—that what you believe is worth fighting for and
should not be compromised. Kemp and Smith found that negotiators who were firmer
about insisting that their own point of view become incorporated into the group
solution achieved more integrative agreements than those who were less firm.46 But
one must also accept the validity of the other party’s perspective. If one challenges the
other party’s views, he or she may become angry, defensive, and unproductive in the
problem-solving process. The purpose of integrative negotiation is not to question or
challenge the other’s viewpoint, but to incorporate it into the definition of the problem
and to attend to it as the parties search for mutually acceptable alternatives. In
addition, the other party’s views should be valued no less or more than the
negotiator’s own position and viewpoint. Kemp and Smith also found that parties who
were able to take the perspective of the other appeared to make better agreements than
those who were less able to do so. Believing in the validity of the other negotiator’s
perspective does not mean empathizing with the other party. In fact, there is evidence
that negotiators with high empathy for the other party may increase the size of the
joint outcomes but receive less of the larger pie than less empathic negotiators
For integrative negotiation to succeed, the parties must be motivated to
collaborate rather than to compete. They need to be committed to reaching a goal that
benefits both of them rather than to pursuing only their own ends. They should adopt
interpersonal styles that are more congenial than combative, more open and trusting
than evasive and defensive, more flexible (but firm) than stubborn (but yielding).
Specifically, they must be willing to make their own needs explicit, to identify
similarities, and to recognize and accept differences. They must also tolerate
uncertainties and unravel inconsistencies. It might appear that for successful
integrative negotiation to occur, each party should be just as interested in the
objectives and problems of the other as he is in his own—that each must assume
responsibility for the other’s needs and outcomes as well as for his own. This is an
incorrect interpretation; in fact, such behavior is more likely to be dysfunctional than
successful. Parties who are deeply committed to each other and each other’s welfare
often do not achieve the best solution.48 As close as the parties may feel to each
other, it is unlikely that they will completely understand each other’s needs,
objectives, and concerns, and thus they can fall into the trap of not meeting each
other’s objectives while thinking they are.49 While parties strongly committed to each
other are likely to yield more than they would otherwise, the result is that they may
arrive at a joint outcome that is less satisfactory than one they would have reached
had they remained firm in pursuing their own objectives. Parties in negotiation
maximize their outcomes when they assume a healthy, active self-interest in achieving
their own goals while also recognizing that they are in a collaborative, problem-
solving relationship.50 Maximizing outcomes may also be negatively correlated with
one party’s ability to punish the other part.
Another precondition for high-quality integrative negotiation is clear and
accurate communication. First, negotiators must be willing to share information about
themselves.58 They must be willing to reveal what they want and, more important,
must be willing to state why they want it in specific, concrete terms, avoiding
generalities and ambiguities. Second, negotiators must understand communication. At
a minimum, they must understand the meaning they each attach to their statements;
hopefully, the parties each interpret the basic facts in the same way, but if they don’t
then they should reconcile them. Other members of the negotiating team can
frequently identify ambiguities and breakdowns in communication. If someone on a
bargaining team makes a confusing statement, others can address it and try to clarify
it. When one person on the other side does not grasp a difficult point, someone else
from the same side will often be able to find the words or illustrations to bring out the
meaning. Mutual understanding is the responsibility of both sides. The communicator
must be willing to test whether the other side has received the message that was
intended. Similarly, the listener must engage in active listening, testing to make sure
that what he or she received and understood is the message that the sender intended.
Goals—The Focus That Drives a Negotiation Strategy
Almost every popular book on negotiation devotes at least one or two chapters
to planning;1 indeed, there are books that are wholly devoted to how to plan and
prepare effectively.2 Yet there is scant empirical evidence on the impact of carefully
planning one’s negotiation process. One study of successful negotiators by Rackham
suggested that in the planning process, skilled negotiators (compared with “average”
negotiators) (1) explored a wider range of options for action; (2) worked harder to
find common ground with the other party; (3) spent more time considering the long-
term implications of the issues; and (4)Lwere significantly more likely to set upper and
lower limits, or the boundaries of a “range” of acceptable settlements.3 While these
findings appear reasonable and logical, the profession needs more hard research
evidence to confirm the effectiveness of the strategy and planning process described
in this chapter. Our discussion of strategy and planning begins by exploring the broad
process of strategy development, starting with defining the negotiator’s goals and
objectives. We then move to developing a strategy to address the issues and achieve
one’s goals. Finally, we address the typical stages and phases of an evolving
negotiation and how different issues and goals will affect the planning process. Figure
4.1 shows how these elements are related. Although this model suggests that the
relationships between these elements are linear— that is, goals lead to strategy leads
to planning—in fact, many parties often begin midway
The first step in developing and executing a negotiation strategy is to
determine one’s goals. Negotiators must anticipate what goals they want to achieve in
a negotiation and focus on how to achieve those goals. As noted in Chapter 1,
negotiators may consider substantive goals (e.g., money or a specific outcome),
intangible goals (e.g., winning, beating the other party, or getting a settlement at any
cost), and procedural goals (e.g., shaping the agenda or simply having a voice at the
table). Effective preparation requires a thorough, thoughtful approach to these goals;
negotiators should specify their goals and objectives clearly. This includes listing all
goals they wish to achieve in the negotiation, determining the priority among these
goals, identifying potential multigoal packages, and evaluating possible trade-offs
among multiple goals.
Goals can also be intangible or procedural. In the car purchase example,
intangible goals might include enhancing reputation among one’s friends by owning
and driving a slick sports car; maintaining an image as a shrewd, pennywise
negotiator; or paying a higher price to ensure convenient, reliable transportation. In
other negotiations, intangible goals might include maintaining a reputation as a tough
but principled negotiator, establishing a precedent for future negotiations, or
conducting the negotiations in a manner that is fair to all sides and assures each party
fair treatment. (Refer back to Chapter 1 for further discussion of intangible goals.)
Procedural goals might be to make sure that the seller makes at least two concessions
from his opening price, to believe that he is negotiating “seriously.” Which of these
many criteria should we use? The answer depends on you: your specific objectives
and your priorities among multiple goals. Trade-offs will be inevitable and can cloud
your perspective while negotiating, which is why you have to start by defining what
you wanted to achieve right up front.
Simple and direct goals can often be attained in a single negotiation session
and with a simple negotiating strategy. As a result, we often limit our view on the
impact of pursuing short-term goals, particularly when the impact is long term. This
short-term thinking affects our choice of strategy; in developing and framing our
goals, we may ignore the present or future relationship with the other party in favor of
a simplistic concern for achieving only the substantive outcome. As only one
example, suppose your beloved aging grandmother decides she is too old to drive and
asks you whether you want to buy her car. She says she knows nothing about cars and
simply wants to sell it to you because she trusts you to take care of it. You buy it, and
then realize that while it was a great deal, it is a huge gas guzzler that is costing you
way too much a week in gas money. You realize your actual goal was “a fuel-efficient
affordable car,” not just “any affordable car.” Other negotiation goals—particularly
ones that are more difficult or require a substantial change in the other party’s attitude
—may require you to develop a long-range plan for goal attainment. In these cases,
progress will be made incrementally, and it may depend on establishing a strong
relationship with the other party
Strategy versus Tactics
How are strategy and tactics related? Although the line between strategy and
tactics may seem fuzzy, one major difference is that of scale, perspective, or
immediacy (Quinn, 1991). Tactics are short-term, adaptive moves designed to enact
or pursue broad (or higher-level) strategies, which in turn provide stability, continuity,
and direction for tactical behaviors. For example, your negotiation strategy might be
integrative, designed to build and maintain a productive relationship with the other
party while using a joint problem-solving approach to the issues. In pursuing this
strategy, appropriate tactics include describing your interests, using open-ended
questions and active listening to understand the others’ interests, and inventing
options for mutual gain. Tactics are subordinate to strategy; they are structured,
directed, and driven by strategic considerations. In Chapters 2 and 3, we outlined the
strategies of distributive bargaining and integrative negotiation, along with the
associated tactics that are likely to accompany each strategy.
Competition and collaboration were described extensively in the previous two
chapters. Competition is described throughout this book as distributive or win–lose
bargaining and collaboration as integrative or win–win negotiation. Accommodation
is as much a win–lose strategy as competition, although it has a decidedly different
image—it involves an imbalance of outcomes, but in the opposite direction (“I lose,
you win” as opposed to “I win, you lose”).
An accommodative strategy may be appropriate when the negotiator considers
the relationship outcome more important than the substantive outcome. In other
words, the negotiator wants to let the other win, keep the other happy, or not endanger
the relationship by pushing hard to achieve some goal on the substantive issues. This
strategy is often used when the primary goal of the exchange is to build or strengthen
the relationship (or the other party) and the negotiator is willing to sacrifice the
outcome just to benefit the other party. An accommodative strategy may also be
necessary if the negotiator expects the relationship to extend past a single negotiation
episode.
The idea is that if “I lose and you win” this time, over multiple negotiations in
the relationship the win–lose accounts will balance. In any long-term social
relationship, it is probably healthy for one negotiator or the other to accept a
suboptimal outcome in a given negotiation while expecting reciprocal accommodation
(tit for tat) from the other negotiator in the future.4 Such reciprocity has been called
the glue that holds social groups together.5 A negotiator in a long-term relationship
with another party should be encouraged to consider accommodative moves early in
the relationship building process—both to build trust with the other party as well as to
be able to ask for “reciprocity” on those accommodations as the relationship develops.
The Planning Process
We discussed the importance of negotiation goals in Chapter 1 and again at
the beginning of this chapter. We pointed out that goals can be substantive (tangible),
psychological (intangible), or procedural (how we get to agreement). Goals can have
both direct and indirect effects on the choice of strategy. Knowing one’s goal is
absolutely the first and most important step in developing a strategy and executing a
negotiation.
The number of issues in a negotiation, together with the relationship between
the negotiator and the other party, are often the primary determinant of whether one
uses a distributive or integrative strategy. Single-issue negotiations tend to dictate
distributive negotiations because the only real negotiation issue is the price or
“distribution” of that issue. In contrast, multiple-issue negotiations lend themselves
more to integrative negotiations because parties can use processes such as logrolling
to create issue “packages” that are mutually beneficial. A simple representation of this
is presented in Figure 4.2. The vertical axis represents increasingly valuable outcomes
for the buyer, and the horizontal axis represents increasingly valuable payoffs to the
seller. In a one-issue negotiation, each party is striving to realize as much value for
herself or himself as possible.
If the buyer dominates, she or he will receive an outcome high on the buyer’s
axis, which will not be advantageous to the seller (e.g., point A); if the seller
dominates, she or he will receive an outcome high on the seller’s axis, but not
advantageous to the buyer (e.g., point B). If they are equally strong, the best they can
possibly do is some point along a line between points A and B (e.g., point C). Any
point along the A–C–B line represents a possible solution to the singleissue
negotiation. However, multiple issues may allow the parties to “create value” by
finding solutions that improve the outcomes for both parties. The choice of whether to
pursue a claiming value or creating value strategy is described as the “negotiator’s
dilemma.”10 Single-issue negotiations and the absence of a long-term relationship
with the other party are the strongest drivers of claiming-value (distributive)
strategies; multiple-issue negotiations and the importance of a long-term relationship
with the other party are the strongest drivers of creating-value (integrative) strategies.
Before considering ways to manage the list of issues, a word of caution is
necessary. Note that we have used a simple, traditional example here—the purchase
of a house. Many negotiations will differ markedly from this example because a
traditional agreement or contract is not the issue. In addition, many negotiations are
not based on quantitatively defined issues like the price of a house. In these situations,
defining the key issues may be much more complex and elusive. For example,
suppose a manager gets signals from his boss that his performance is not up to par, yet
whenever he tries to confront the boss to obtain a realistic performance appraisal, the
boss won’t talk directly about the problem (which raises the manager’s anxiety even
further).
Although the conflict in this situation is evident, the “issues” are elusive. The
central issue for the employee is the performance appraisal and why the boss won’t
give it. Maybe the boss is uncomfortable with the performance appraisal process or
has a problem confronting other people about poor performance. Perhaps the boss is
so preoccupied with her own job security that she doesn’t even realize the impact she
is having on the manager. In a situation like this one, where the issues are important
but somewhat elusive, the manager needs to be clear about both what the issue is (in
this case, getting a clear performance evaluation and getting the boss to talk about it)
and how to initiate a productive discussion.
The next step in planning is to assemble all the issues that have been defined
into a comprehensive list. The combination of lists from each side in the negotiation
determines the bargaining mix (see Chapter 2). In generating a list of issues,
negotiators may feel that they put too much on the table at once or raise too many
issues. This may happen if the parties do not talk frequently or if they have lots of
business to transact. As we noted in step 2, however, introducing a long list of issues
into a negotiation can make success more, rather than less, likely—provided that all
the issues are real. Large bargaining mixes allow many possible components and
arrangements for settlement, thus increasing the likelihood that a particular “package”
of components will meet both parties’ needs and therefore lead to a successful
settlement. At the same time, large bargaining mixes can lengthen negotiations
because they present so many possible combinations of issues to consider, and
combining and evaluating all these mixes can make valuing the deal very complex.
Priorities can be set in a number of ways. One simple way is for the negotiator
to rank-order the issues by asking, “What is most important?” “What is second most
important?” and “What is least important?” An even simpler process is to group
issues into categories of high, medium, or low importance. When the negotiator
represents a constituency, it is important to involve that group in setting priorities.
Priorities can be set for both interests and more specific issues. A third, more precise
method is to award a total of 100 points to the total package of issues and then to
divide the points among the issues in proportion to each issue’s relative importance. If
the negotiator has confidence in the relative weighting of points across the issues, then
trading off and “packaging” possible settlements together becomes more
systematic.11 It is also important to set priorities (and possibly assign points) for both
tangible and intangible issues. Intangible issues are often difficult to discuss and rank-
order, yet if they remain subjective and not quantified, negotiators may
overemphasize or underemphasize them. It is easy to push such issues aside in favor
of concrete, specific, numerical issues—and negotiators must be careful not to let the
“hard bargaining” over numbers drive out more ephemeral discussion of intangible
issues and interests.
More than one negotiator has received a rude shock when his or her
constituency has rejected a settlement because it ignored the intangibles or dealt with
them suboptimally in the final agreement. Finally, negotiators may also wish to
specify a bargaining range for each issue in the mix. Thus, not only would a “best
possible” and “minimally acceptable” package be specified, but also a target and
minimally acceptable level would be specified for each issue in the mix. Sometimes,
assigning points to each issue, based on the issue’s relative importance to the others,
can help a negotiator “keep score” as various elements of the bargaining mix are
assembled.
After defining the issues, the negotiator must proceed to define the underlying
interests and needs. As we discussed in Chapter 2, positions—an opening bid or a
target point—are what a negotiator wants. Interests are why she wants them. A target
point of $200,000 for a condo would be a position; this is what the negotiator hopes to
pay. The underlying interest would be “to pay a fair market price, and one I can
afford, for that two-bedroom condominium.” Interests may also be based on the
intangibles of negotiation—including principles or standards to which the parties wish
to adhere, the informal norms by which they will negotiate, and the benchmarks they
will use to guide them toward a settlement—to achieve a fair or reasonable deal or to
get the negotiation concluded quickly.
Wallihan offers several excellent examples that help highlight why getting at
interests may be essential to understanding another side’s position.13 In one case, a
union negotiated for a lower wage than management was actually willing to offer; in
that case, the union was actually trying to hold wages down so management would
not be tempted to contract with nonunion crews. In a second case, a buyer asked a
building contractor to quote a higher bid, just so the builder would have an incentive
to complete the job well and on time. From the point of view of “positions,” having
buyers ask for a higher bid or unions ask for a lower wage would be seen as irrational;
however, from an interests perspective, the requests make eminently good sense.
What will happen if the other party refuses to accept some proposed items for
the agenda or states issues in such a way that they are unacceptable? Good preparation
requires that you establish two clear points: your alternatives if this deal can not be
successfully completed, and your limits—i.e. the least acceptable offer from the other
that you will still agree to sign. Alternatives (i.e., best alternatives to this negotiated
agreement, or BATNAs) are other agreements negotiators could achieve and still meet
their needs. Alternatives are very important in both distributive and integrative
processes because they define whether the current outcome is better than another
possibility (with a different negotiating partner). In any situation, the better the
alternatives, the more power you have because you can walk away from the current
negotiation and still know that your needs and interests can be met (see also Chapters
2, 3, and 8). In the house-purchase example, the more a buyer has researched the real
estate market and understands what other comparable houses are available, the more
she knows that she can walk away from this specific deal and still have acceptable
housing choices.
Setting resistance points as a part of planning is critical. Most of us have been
involved in buying situations in which the item we wanted wasn’t available, but we
allowed ourselves to be talked into a more expensive model. Moreover, some
competitive situations generate intense pressures to escalate the price you have to pay.
For example, in an auction, if there is a bidding war with another person, one may pay
more than was planned before the auction. Gamblers, analogously, may encounter a
losing streak and end up losing more money than they had planned because they did
not set a resistance point. Clear resistance points help keep people from agreeing to
deals that they later realize weren’t very smart.
Earlier in this section, we discussed the importance of assigning priorities to
one’s own goals and objectives. Gathering information about the other party is also a
critical step in preparing for negotiation. Learning the other’s issues, preferences,
priorities, interests, alternatives and constraints is almost as important as determining
one’s own. If negotiators have not had the opportunity to meet with people from the
other side, then they should find a way to understand the negotiation from the other
party’s perspective or to gather information to learn about their issues, interests, and
priorities. Negotiators might call the other party and speak to them prior to the formal
meeting or try to take their perspective and anticipate what they might want. It may
also be possible to speak to others who know the other party or to people who have
been in their situation before. The goal is to understand how they are approaching the
negotiation and what they are likely to want. By comparing this assessment against
your own, one can begin to define areas where there may be strong conflict (both
parties have a high priority for the same thing), simple trade-offs (both parties want
the same group of things but in differing priorities), or no conflict at all (both parties
want very different things and both can easily have their objectives and interests met).
As we indicated earlier , understanding our own goals is the first step in
planning a negotiation. Similarly, we should make an effort to understand or
anticipate the other party’s goals. Asking the other party to discuss their goals (either
at the table or before negotiations begin), or gathering data about the other party prior
to negotiations, are two common ways to gather this data. Most importantly, we
should attempt to understand whether the other party has the same goals as we do. We
commonly assume that the other party’s goals are the same as ours and, therefore, that
we will be in a “head-to-head” negotiation about who will achieve that goal.
Discovering that the other may have a different goal may be the first, and most
important, step to determining whether the different goals are sufficiently compatible
that we can invent a solution by which both parties achieve their goals.
The more information we can gather about the other through initial research
the better. Which data are most relevant will depend on the issues and likely elements
in the bargaining mix. An analysis of the other party’s business history or previous
negotiations, successful and otherwise, might provide useful clues. Financial data
about the other party might be obtained through channels such as Internet searches,
financial statements, company records, stock reports, interviews and court documents,
or legal judgments. We might investigate the other party’s inventories. Sometimes we
can learn a great deal simply by visiting the other party or speaking to his or her
friends and peers. Another way to learn is to ask questions of people who have done
business with the other party. The more the negotiator can get even a general sense of
how much the other is capable of addressing and meeting the party’s issues or needs,
and of what issues they will bring to the bargaining table, the better we can predict
how the process is likely to unfold.
After negotiators have defined the issues, assembled a tentative agenda, and
consulted others as appropriate and necessary, the next step is to define two other key
points: the specific target point, where one realistically expects to achieve a
settlement, and the opening bid, representing the best deal one can hope to achieve.
Similarly, there are numerous ways to set an initial asking price. An opening bid may
be the best possible outcome, an ideal solution, something even better than was
achieved last time. It is easy to get overly confident, however, and to set an opening
that is so unrealistic that the other party immediately laughs, gets angry, or walks
away before responding. While openings are usually formulated around a “best
possible” settlement, it is also easy to inflate them to the point where they become
self-defeating because they are too unrealistic in the eyes of the other negotiator or
observers with a more realistic perspective. See Box 4.2 for some helpful advice on
the setting of an opening bid.
When people are negotiating for themselves—for example, buying a used
mountain bicycle or exercise machine—they can determine the bargaining mix on
their own. But when people negotiate in a professional context, there may be more
than two parties. First, there may be more than two negotiators at the table. Multiple
parties at the table often lead to coalitions of negotiators who align with each other in
order to win the negotiation.15 Second, negotiators also have “constituents”—bosses,
superiors who make the final decision, or other parties who will evaluate and critique
the solution achieved. Moreover, there may be observers of the negotiation who also
watch and critique the negotiation. When one has a constituent or observer, other
issues arise, such as who conducts the negotiation, who can participate in the
negotiation, and who has the ultimate power to affirm negotiated agreements. Finally,
negotiation occurs in a context of rules—a social system of laws, customs, common
business practices, cultural norms, and political cross-pressures.
Considering these questions is important to the progress of the negotiation
process. A negotiator bargaining on behalf of others (a company, union, department,
club, family, etc.) must consult with them so that their concerns and priorities are
included in the mix. In the house-buying illustration used earlier, let’s assume that one
member of a couple is doing the negotiating, and the other can’t attend the meeting. If
that person fails to consider his partner’s concerns about the condition in which the
house is left, or their children’s wish that the move not occur during the school year,
then the negotiated resolution may be rejected by the constituents. A negotiator who is
representing a constituency is accountable to that constituency and must include their
wishes in proposals—subsequently either fulfilling those wishes for them through
negotiation or explaining why their desires were not met. When negotiating for a large
constituency, such as an entire company or a union or a community, the process of
consulting with the constituency can be elaborate and exhaustive. Once you have
thoroughly worked your way through the previous planning steps, the last step is to
think through the execution of your plan. There are two major components to consider
here: how you will present and frame the issues and interests and how you should
structure the process by which this information is presented.
