Whether we realize it or not, most people on earth engage in negotiation almost every day. At work, we negotiate job offers, ask for raises and promotions, make a case for budget increases, seek approval to launch a new project or initiative, and sell to customers and candidates. We purchase cars and houses in our personal lives, decide where to go for dinner with friends, solve conflicts with our significant other, and attempt to agree on a reasonable bedtime with our children.
Without a solid grasp of effectively navigating negotiations, it becomes more challenging to communicate and attain one’s life and career goals. Conversely, enhancing your negotiation skills can lead to nearly limitless benefits and opportunities. By actively developing and honing your negotiation abilities, you prepare to optimize the outcomes with which both parties leave the bargaining table.
What are negotiation skills?
Negotiation skills are the qualities and approaches that allow two or more parties to work together to reach an agreeable solution for all involved.
Negotiations are a type of conversation used to bridge the gap between often-conflicting wants and needs of two or more parties. It is a process of “give and take” where each side must make some sort of concession to benefit the other, or ideally, for everyone involved. Therefore, several key soft skills and approaches play an important role in negotiating effectively.
The specific skills required generally depend on the skills and approaches of your counterpart, the negotiation environment, and your desired result. They boil down to in-demand soft skills like effective communication, active listening, planning and preparation, persuasion, strategic thinking, and cooperation. Grasping and mastering these skills leads to a higher chance of successful negotiation outcomes.
What is a successful negotiation?
A successful negotiation is when two or more parties can openly discuss an issue (or a set of topics) and land on a mutually agreeable solution.
Ideally, both parties should behave in a professional and courteous manner to create a safe space for a constructive conversation. Effective negotiations help us build stronger relationships, deliver long-lasting solutions, and avoid future conflicts related to the relationship and issues. The best negotiations arise when you can make concessions of little value to you while giving up something of higher value to the other party.
Acting respectfully and keeping goodwill top of mind is imperative, regardless of the differences in interests between both sides. A successful negotiation leaves all parties feeling satisfied with the outcome and ready and willing to do business or negotiate with each other again down the line.
What are the five basic skills of negotiating?
To drive equitable and agreeable outcomes at work and in your personal life, you must first master the five basic negotiation skills. It is paramount that you do your homework, attempt to make the first offer (and ask for what you want), ask good questions, and listen carefully throughout the negotiation process. It’s also vital that you always aim for a win-win solution and remain patient and willing to walk away.
1. Do your homework.
Before walking into any negotiation, it is always helpful and necessary to do your homework. You must understand the situation completely, have a clear sense of what’s at stake for both parties and run through all possible scenarios and outcomes. Make sure to research and think through all of your options before entering into the discussion. Ask yourself questions like what are my needs? What pressures do I feel? What options do I have? Then ask yourself the same questions about the other party. The more information you have about yourself and your counterpart in the negotiation, the better your chances for success.
2. Make the first offer.
Believe it or not, making the first offer can drastically affect the negotiation to follow and the negotiation’s outcome. Seizing control of the bargaining table and asking for what you want upfront in a calm and non-confrontational way can help you steer the discussion toward your wants and needs.
Research shows that, however arbitrary, the first number mentioned in a negotiation is hugely influential. When the seller sets the opening offer, final prices tend to be higher, while prices tend to be lower when the buyer sets the opening offer. This tactic is rooted in a behavioral psychology concept known as anchoring bias. Anchoring bias is a cognitive bias that causes us to rely too heavily on the first piece of information we are presented with about a specific topic. We then interpret newer information in the context of and from the reference point of our anchor instead of viewing it objectively. So, you should take advantage of this by making the first offer
3. Ask good questions & listen carefully.
Asking thoughtful, open-ended questions and carefully listening to the responses is a great way to arm yourself with more ammo in a negotiation conversation. It rarely works in your favor when you’re doing all of the talking, asking simple “yes” or “no” questions, or leading the other party to a specific response. On the other hand, when you ask neutral, open-ended questions, are comfortable with silence, and actively listen, you pressure the other party to respond, often leading them to divulge valuable information that can help your case. Aim to spend roughly two-thirds of your time listening and one-third of your time talking. Asking questions and effectively listening will equip you with more information. It will build trust and understanding, make the other party feel heard, and is also likely to lead them to reciprocate your excellent listening skills. You may even rethink your original position and arrive at a better alternative for both sides!
4. Aim for a win-win solution.
Instead of thinking only about what the other party can offer you, you should also consider what you can provide to them. Remember to look at the situation from the other side’s perspective. If you help the other party feel satisfied, they will be much more inclined to help satisfy your needs.
Rather than a fixed pie, think of it as expanding. Rather than a distributive negotiation, think of it as integrative. Negotiators who have a win-lose mindset often alienate and frustrate their counterparts. In contrast, those who strive for win-win outcomes open doors, discover new opportunities, and come to creative solutions where both sides have their primary interests met. However, you shouldn’t surrender to all of their demands. You should identify issues that the other party cares deeply about that you value less and offer to concede in exchange for a compromise in return on a highly valued topic.
5. Be patient & willing to walk away.
Rome wasn’t built in a day. Make sure to take your time and not rush when negotiating. Most negotiations aren’t easy, and you’ll often face resistance at first, so it is essential not to give in too quickly. If you remain patient and hold firm in your goals, you pressure the other party to concede because they begin to believe that you aren’t under the same pressure they might be facing to make a deal. When you recognize and act like you have other alternatives, it puts you in control. This ties into the concept of BATNA, or your Best Alternative to a Negotiated Agreement. Suppose you come to the bargaining table knowing your BATNA and are comfortable and willing to walk away to take a different deal (or no deal at all). In that case, you position yourself firmly in the driver’s seat and can approach the situation with confidence. When you aren’t desperate, you have nothing to lose, and the other party will sense your strength and resolve.
How can I improve my negotiation skills?
Like many professional skill sets and aspects of life, you can quickly improve your negotiation skills through preparation and practice.
How do you practice? It's an exercise of self-reflection. What are you willing to compromise? Do you have a solid foundation for your argument? Are you asking for reasonable and realistic scenarios? What are the best and worst-case scenarios? What is your BATNA in the context of the situation at hand? How might the other party respond?
The best way to improve is simply through repetition and experience. You can find all sorts of mock or simulation negotiation scenarios online that you can practice with a friend or family member in a low-stress setting. You can utilize the skills outlined above in your day-to-day life. For example, you can push yourself out of your comfort zone and propose a new idea to your boss at work that you may have been putting off. You can keep these tactics and approaches in mind the next time your kid doesn’t want to eat their vegetables. Maybe you’ll be prepared to throw in an extra chicken nugget in exchange for those leafy greens and an early bedtime. Give it a shot!
Photo by Andrea Piacquadio
What are the 5 negotiation challenges?
Not every negotiation will go smoothly, and certain complications may come up, potentially derailing the possibility of a conclusion in your favor. Being prepared for complex and challenging obstacles is essential.
1. Deadlock
Sometimes, negotiations will reach a sticking point, unable for either side to make any progress. Overcoming deadlock often requires a fresh perspective. Reconsider everyone’s perspectives, and look at all of the issues being discussed. Start with less critical issues and look for compromises there, then see if there can be any shifts made on the larger issues at hand. If there is still no movement being made, consider a mediator who can help facilitate negotiations.
2. Anchoring bias
As you read earlier, the first offer is highly influential in the outcome of the negotiation, this is because of anchoring bias. Because people often rely too heavily on the first piece of information they receive on a topic, even if it isn’t necessarily accurate, it can result in a blocker for negotiation.
If you’re struggling to make any moves from the first offer, consider challenging that initial offer, even if you’re the one who made it. Have whoever made the initial offer justify their position and explain the value behind the proposal. This can help you understand whether the starting point makes sense and determine what makes sense as the next move.
3. Miscommunication
Poor communication can lead to misunderstandings and breakdowns in negotiations. The best way to prevent this is to focus on active listening and asking clarifying questions as needed. Ensure both parties stay on the same page by summarizing key points and seeking confirmation.
4. Ego and pride
Ego and pride are often big blockers in successful negotiations. If one party is too attached to “winning,” it can slow the negotiation process. Overcoming pride and understanding that success in negotiation is not about being the dominating party but is about reaching a fair and favorable agreement for both sides.
5. Lack of preparation
You’ve taken the first step by understanding the basics of communication, but you also need to do some research on your situation. Understand the needs of both parties, research the data behind your ask, learn the data behind their ask, and come prepared with data for your counterpoints. This will allow you to go in confident, knowing you have the facts to back up your argument, and can help you stay flexible during the negotiation process.
Negotiations can feel daunting and overwhelming while you're in the midst of it, but going in prepared to negotiate is the best way to ensure negotiations end on a positive note for everyone involved.
Main photo by Polina Zimmerman
This article has been updated and was originally published on March 21, 2022.
