What is negotiation?

What is negotiation?

 ‘The process through which two or more parties who are in conflict over outcomes attempt to reach agreement. It is the constructive, positive alternative to haggling or arguing; it is aimed at building an agreement rather than winning a battle.

’ Pillutla, M. and Nicholson, N. (eds). (2004). Negotiation: how to make deals and reach agreement

When does negotiation occur? 

Negotiation can occur in any business situation, but people negotiate in everyday situations outside of the workplace. It occurs when there is more than one possible outcome from a situation in which two or more parties have an interest, but they have not yet determined what the outcome will be. For example, negotiation occurs between a buyer and seller in the purchase of a second hand car, or even between groups of friends when they decide which film to see at the cinema.

Business negotiations can include:

• producing deals with suppliers, partner businesses or customers
• inter-departmental or team discussions to determine aims, processes and resources
• management and staff discussions to discuss job priorities and workload
• discussions between management and trade unions, for example, rates of pay
• recruiting new people to the business, for example, interviews.

In a way, both business relationships and personal relationships are shaped through the process of negotiation. Success in both business life and personal life depends on having good negotiation skills. In practice, personal negotiations require essentially the same skills as business negotiations.