The most desirable scenario of a negotiation is achieving a win-win state – in which neither party has reason to complain that they didn’t get a productive benefit out of the share that was discussed. This scenario, however, is very rare and results from “wishful thinking”. Luís Martins Simões describes two types of negotiations – Distributive and Integrative. The first, and more common ones, are also known as “one-issue” distributions. This is because they usually reflect negotiations of solely one unit of wealth – it can refer to price, money, shares, or anything that can only be divided by the negotiating parties. These kinds of distributions often end in a Lose-Lose or Win-Lose situations, because either one or all parties don’t get a satisfactory amount of quantity from their share.
As opposed to purely Distributive negotiations, Luís Martins Simões encourages a second type of negotiations: the Integrative. In an integrative negotiation, all parties seek a way to collaboratively increase the value on top of the wealth being divided. It’s an element of strategy in which all sides offer to create something with one another, so that the final share is sufficient enough to ensure a Win-Win scenario. In this sense, the added value could be something such as adding another unit of wealth to the negotiations, or discussing a term that could yield mid-to-long term benefits to a party. An example of this is the “bulk discount purchase” – if a buyer would seek a discount on a product, that sole discount would be negative to the seller since it’s money he would be losing. However, if the buyer agrees to buy multiple products at that same discount, then the various purchases would cover the seller’s costs of production, or even turn a profit. In this scenario, the buyer gets the discount he wanted, and the seller does not lose money, a Win-Win situation.
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