In a negotiation, you create value and “expand the pie” by trading what is of little value to you for what has great value to your negotiating partners, and vice versa.  The more goals that each party had indentified, the easier it is to create value in a negotiation.    

 Be sure not to limit yourselves to one goal.  You want to avoid leaving value on the table by not recognizing opportunities to create value.

 Obstacles to Expanding the Pie

There are some common errors that prevent parties to a negotiation from successfully “expanding the pie”.  Here are a few to be aware of: 

  1. Premature judgment – we have all been in a a brainstorming session that was thwarted by negative comments that stifled creative problem solving.  Handle this rush to premature judgment in a negotiation setting the same way you do in a brainstorming setting: remind the group that right now you are just generating ideas, and there are no bad ideas. 
  2. Searching for a single answer – again, don’t limit yourself to one goal.  Focusing on positions, not interests, is usually the problem when you find yourself with one possible solution.
  3. Thinking that solving their problem is “their problem” – ff you aren’t thinking about what the other side needs, then you are compromising, not negotiating.  You are expecting them to give up something, and they will expect the same of you.  Your best plan is considering their needs and engaging in joint problem solving. 
  4. Assumption of a fixed pie – Giving up before getting creative

 

Techniques for Expanding the Pie:

Here are some actions you can take to try to create value in a negotiation. 

  1. Build Trust and Share Information – you can build trust with the other negotiation parties by being trustworthy.  The easiest way to demonstrate trustworthiness in a new relationship is simply to do what you say you will do.  And demonstrate the value of sharing information by modeling the way you want information to be shared with you.
  2. Identify Shared Interests – leverage the interest that you have in common as the basis for your agreement.
  3. Dovetail Differing Interests – we assume that different wants are what causes problems in a negotiation, but a good agreement is possible because we want different things.  For example, if I want to buy a house and you want to sell a house, we have the possibility of making an agreement. 
  4. Unbundle the Issues – If there is only one issue, then you are compromising.  It takes an collection of issues to expand the pie
  5. Invent Agreements of Different Strengths – if you can make a final agreement, than create “lighter” agreements.  For example, If you can’t agree on substance, try to agree on procedure.  If you can’t make permanent agreement, try to make provisional agreement
  6. Separate Inventing from Deciding – make sure that these are separate activities to avoid premature judgment. 
  7. Make Package Deals, not Single-Issue Offers – this is an easy concept for Project Managers to grasp.  Think of the Triple Constraint and how time, cost and scope are negotiated together, not singly.  Negotiating each issue separately does not allow you to make trade-offs between issues 
  8. Make Multiple Offers Simultaneously – present the other party(ies) with two or more offers that are of equal value to you and ask for their preference.  This is helpful when you can’t get a feel for their interests. 
  9. Look through the Eyes of Different Experts – this is a great way to create value in a negotiation and can be really useful when negotiating with external customers.  Think about the interests of the people you are representing, not just your team or group, but your entire organization, and try to identify interests they have that may be met through the negotiation.   Also, think about what you your experts can offer to the other party in a negotiation. 

  In my next blog, we’ll talk about how to identify your alternatives and preparing for a negotiation.