Understanding Collaborative Negotiation and Sales Contracts

Understanding Collaborative Negotiation and Sales Contracts

Understanding Collaborative Negotiation and Sales Contracts

It's long been an entrenched assumption in much of the business world that negotiation is a zero-sum game, a winner-take-all contest that's about dominating the opposition to extract the best possible deal for your side. Many negotiators who were trained in this competitive paradigm absorbed its lessons right down to the specifics of volume (being louder is better) and posture (positioning and placing the body to look more dominant in the space available). This habit of thinking is still common enough that many of those trained to be competitive negotiators understandably struggle to imagine any other approach.

It is increasingly clear, however, that thinking through negotiation strategies for the modern business world requires awareness of alternatives to interactions based on dominance. And that's where competitive negotiation comes in.

The Win-Win Negotiation Strategy

Collaborative negotiation is also called interest-based or principled negotiation. Instead of attempting to dominate the counterparty, a collaborative approach seeks to work together with them to deliver value for everyone at the table. Essentially, it is a process whose objective is a win-win outcome.

Collaboration offers real benefits. Because it requires everyone to be open about what their interests are, it eliminates the step of working out an opponent's "position" and what they're really trying to gain. This reassures all parties of the fairness of the process.

Second, it builds trust. A competitive process that's about driving down the price of a sales contract with a vendor usually ends up simply being about that price and not the relationship behind it. Having productive relationships, however, is key to survival in a digitally transformed marketplace where no single business can keep up with the pace of innovation.

Third, collaboration makes for creativity. When both parties approach it in good faith, a collaborative approach makes it possible to find innovative solutions of mutual interest at the negotiating table that would otherwise have eluded them.

Implementing Collaborative Negotiation

The first step is to make sure your negotiating team is fully on board. Competitive negotiators can be nervous about the collaborative framework, experiencing it as "weakness." If confronted by the reality that a short-term "win" can cost more in the long term than it's worth, even the most habitually dominance-driven negotiator will be willing to at least give collaboration a shot.

It's also important to have a clear understanding of your interests so that you can communicate them. This involves knowing the difference between your needs and your wants and being prepared to keep reviewing the priorities driving your engagement as the negotiation unfolds. The process works best if everyone involved works to stay genuinely transparent about their interests.

Finally, the details of the contract presentation matter. How the sales contract provides mutual benefit needs to be clear to the counterparty and fully supported by the fine print. It's always a good idea to convert PDF to Word for adjusting any details before sending out the final version of the contract.

Resources for the Collaborative Negotiator

There's a lot to think about when embarking on a collaborative negotiation. It's always a good idea to network with and access the resources of your local business community so you can get further insights on how to engage in this process. Reach out to your local chamber of commerce today to network, find resources, and connect with entrepreneurs and business leaders.

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