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Focusing on Value Creation During Negotiations

Negotiations are often associated with being highly competitive. This can arise from thinking that a fixed value must be distributed. In the study of negotiation, this is referred to as the fixed pie bias. A collaborative approach towards negotiation can create many short-term and long-term benefits. Knowing how to steer your negotiating counterpart toward a more collaborative attitude is highly beneficial. 

The Benefits of Collaborating in Negotiations

There are many benefits of adopting a collaborative rather than competitive approach towards negotiations. These benefits include creating value, forming longstanding working relationships, and win-win solutions that both parties are happy with.

Creating Value Versus Claiming Value

A competitive approach generally involves claiming value while collaborative approaches focus on creating value. Creating value can increase the size of the pie being shared. By working together as a team, negotiators can create solutions that gear towards increasing profit margins and increasing work productivity. 

Forming Relationships

Relationships are necessary for professional life. Having access to a diverse pool of talent can open doors of opportunity. Having a strong professional network also provides a security net of support when dealing with occupational obstacles. 

Win-Win Solutions

Competitive negotiations often start with a winner-takes-all mentality. In this way, one party tries to dominate the other, seeking to claim as much value as possible. Collaborating in negotiations focuses on suggesting win-win solutions that leave both parties satisfied. You want to make sure the other party feels that they've gained something of value. 

To steer your upcoming negotiation in a collaborative direction, you'll need to be prepared for the fact that the other person may not be thinking the same way. As negotiations are often associated with competition, it's likely that the person with whom you'll be negotiating is already set in this default mode.

Be Receptive to the Other Parties Needs

Unless the other party feels that you're genuinely interested in helping them meet their goals, they're not likely to want to form a working relationship with you. After all, why should they?  It's up to you to answer that critical question, let them know how their goals can be achieved by working together, 

Take time before the negotiation to prepare some possible collaborative solutions to suggest to the other party. Even if you don't end up going with them in the end, suggesting contract plans that show you're interested in working together will set the right mood. It's mostly about the symbolic gesture that shows you're interested in collaborating and sharing resources to create value. 

Paraphrasing points that the other person has made ensures you're on the same page. Paraphrasing is used in psychology to make sure the other person feels like they're being understood. 

Presenting Your Contract

Make sure to put in your due diligence when preparing the contract. Presentation is very important and it says a lot about you and how you regard the deal. Be sure to convert a PDF to Word to have both file types on hand for convenience. 

Focusing on Creating Value

Swerving away from the limitations of competitive negotiations into the pool of opportunities of collaboration takes knowledge and work. Given the many benefits of working together, you can see why employing these collaborative tactics is beneficial.

If you're interested in topics like this, join your local chamber of commerce. 

 

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