This week we look more at negotations. We examined Chapter 11 of Industrial Relations in Ireland.
What is Negotiation?
Negotiation is the process by which we search for terms to obtain what we want from someone who, in turn, wants something from us. It is fundamentally an act of exchange. To be a successful negotiator, you must be prepared to take the other party’s needs into account to some degree, rather than simply trying to persuade them to see things your way.
Strategic Styles in Negotiation
Negotiators generally choose a strategy based on two concerns: how much they care about their own outcome and how much they care about the relationship with the other party.
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Avoidance: Deciding not to negotiate at all. This is used if the issue is trivial or if the costs of negotiating outweigh the potential gains.
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Accommodation: Prioritising the other party’s needs over your own. This is often used to build “social capital” or preserve a long-term partnership.
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Competition: A “win-lose” approach where you focus solely on your own gains, often used when the relationship is not a priority.
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Collaboration: A “win-win” approach where both parties work together to find a solution that satisfies everyone’s needs.
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Compromise: Finding a middle ground where both sides give up something to reach an agreement.
Two Core Types of Bargaining
Distributive Bargaining (The “Fixed Pie”)
This is a competitive style usually used for single issues like pay. It is based on:
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Target Points: What you ideally want to get.
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Resistance Points: Your “bottom line”—the point at which you will walk away from the table.
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The Settlement Range: The area where your bottom line and the other party’s bottom line overlap.
Integrative Bargaining (The “Expanded Pie”)
This style looks at multiple issues to find “mutual gains.” Instead of arguing over positions (what you want), you look at interests (why you want it). By understanding the “why,” parties can often find creative solutions that benefit both sides.
The Role of Trust
A common misconception is that you must trust the other party to negotiate with them. In industrial relations, it is often more effective to “proceed independent of trust.” This means using objective protections—such as clear written contracts, staged implementation, or third-party oversight—to ensure the agreement is honoured regardless of how the parties feel about each other.
The Negotiation Process
Negotiation is often a ritualised “game” that follows three specific stages:
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Preparation: This is the most important stage. You must identify your needs, your fallback positions, and gather as much information as possible about the other side.
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The Bargaining Phase: The actual “searching” process, which typically has a beginning (setting the scene), a middle (exploring options), and an end (closing the deal).
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Post-Negotiation: Ensuring the agreement is implemented correctly and maintaining the relationship for future dealings.
Essential reading: Wallace-et-al-Chapter-11