When you start a negotiation, you're looking for a solution to a problem. Whether you're talking to a client, a vendor, or someone else, a negotiation is meant to find a compromise. In many cases, those compromises are simply splitting the difference between what you need and what the other party needs. That approach doesn't necessarily provide an answer that either of you are happy with, though.
But what if you could find a solution that provided benefits for everyone involved? What if you could finish a negotiation with a win-win solution? If you start with the goal of a mutually beneficial solution in mind and use an approach meant to get you to that point, it is possible for a negotiation to end with both parties happy.
The Advocate's Approach
The traditional approach to negotiation is sometimes referred to as the advocate's approach: one negotiator advocates for an interested party and tries to get the best possible deal for that party. For an advocate, a successful negotiation is one where the negotiator was able to drive the other party to the edge of walking away from the table, without quite pushing them over.
Only one side can win in a negotiation like this. Furthermore, if you take the role of the advocate and you push too hard, you run the risk of winding up with no deal at all. Starting in the 1960s with the Harvard Negotiation Project, it has become increasingly important to find negotiation strategies that were more effective, such as the creative approach.
The Creative Approach
Rather than starting from the idea that there could only be one winner in a negotiation, the creative approach begins with a goal of finding a mutually beneficial solution through negotiation.
Mitchell Goozé is the former president of four different divisions of Teledyne, the author of three business books, and has been training buyers and sellers on how to negotiate for over fifteen years. He points to the importance of taking the creative approach.
"In win-win negotiation you have to try to understand what is important to the other side. If they do not value things you value and vice-versa, it is tough to find a good solution. Most people think compromise is a good solution. However, compromise is really lose-lose. It asks each side to give up something they want in exchange for the other side doing likewise. This is lose-lose. Win-win comes from each side getting something they want. That can only work if you truly understand what the other side really wants, and it is not mutually exclusive from what you want. And it is unlikely that they will tell you what you need to know, so you have hard work to figure it out."
Laying the Groundwork for a Creative Solution
Preparing for a negotiation in which you take the advocate's stance can be as simple as knowing what the best case scenario for your company is when you walk into the negotiation. When you're looking for a creative solution, however, it's important to lay a foundation that will help you find the best possible result for both parties.
"The most important aspect of any negotiation is in the preparation. Most people are not prepared and think they can 'wing it,'" says Goozé. "Do not plan to 'wing it.' Take notes so you know and remember what has been going on. Work on small things first and save the bigger items for later when you are more comfortable that you know the other side. Recognize that there are many, many negotiating tactics that can be used and learn to see them for what they are. Lastly, if the other side is not focused on win-win, make sure you protect yourself."
Throughout the negotiation process, it's crucial to keep communication open. While neither you nor the people you're negotiating with may be able to share every last detail of why you feel a particular point is important, the more you can discuss what works and doesn't work about the different options on the table, the more likely you are to wind up with a set of final terms that is worthwhile for both businesses.
Explaining as much of your reasoning for preferring one option over another can help both sides work together to find other solutions that meet the same criteria, as well as giving you the opportunity to prioritize that point in the negotiations in exchange for flexibility on one of the points the other party has made a priority.
Keeping the Negotiation Even
If you're working to find a creative solution to your negotiation, you're in big trouble if the other party chooses to take the advocate's approach. If only one side is working towards an equitable answer, it's too easy for the other side to push through terms that aren't exactly mutually beneficial.
Goozé advises negotiators to keep a close eye on how the negotiation proceeds and take steps to protect yourself in the event of a problem.
"You must not lose track of whose side you are on. You must maintain a focus on making sure you get what you need. That does not suggest you have to destroy the other side, but if you focus only on their needs, who is going to watch out for yours?"
It can be very difficult to reach a creative solution if the other parties involved in the negotiation are focused on getting what they see as the best deal, without considering your side of the matter. It may not be possible to put a creative solution into place, although it's still worth a try: if you can convince them of the benefits of a more equitable solution that you present, you may be able to win them over. Otherwise, you may be forced into a position where you have to take on the advocate's role yourself.