Principled negotiation is an interest-based approach to negotiation that focuses primarily on conflict management and conflict resolution. Principled negotiation uses an integrative approach to finding a mutually shared outcome. This approach is primarily used by mediation practitioners and academics, although there is some attempt to apply this approach to commercial or business negotiations.
This negotiation approach is closely related to and often a synonym with the phrase “win-win,” meaning that both parties have reached an agreement in consideration of both sides’ interests. In other words, the deal or agreement cannot be improved any further as both parties are happy with the outcome.
To understand the idea of principled negotiation, we look into the work of two Harvard men: Roger Fisher and William Ury. In their book, “Getting to Yes: Negotiating Agreement Without Giving In,” they explain a good negotiation is more than just getting to a “yes.” When you go into an agreement with another party, the ideal outcome is for both sides to be satisfied and have their expectations met. Maintaining a good ongoing relationship is more important than a single negotiation.
Examples of Principled Negotiation
Fisher and Ury broke down their process or recipe for success regarding principled negotiation into four essential elements:
- Separate the people from the problem – people can become personally attached to their side of the issue so a deviation from their belief can feel like a personal attack. Separate your emotions and ego from the issues and try to understand each other’s side so you can find a middle ground.
- Focus on interests, not positions – When you deal with people’s underlying interests, it’s more difficult to compromise. Try to understand why the other party feels so strongly about these interests and explain your interests as clearly as possible. Figure out what interests you share and be open to ideas that can lead to a mutual agreement.
- Provide options for mutual gain – Don’t be so quick to settle on the first agreement without considering alternatives. There might not be a single answer. Work on brainstorming and inventing multiple options in order to understand what interests both parties so it’s easier to decide on the best solution.
- Use objective criteria – We all have our beliefs and facts that we abide by and make decisions based on. Attacking each other’s “facts” is inefficient and can lead to unproductive arguments. Instead, use a third party or independent standard to settle differences. For example, laws, expert opinions, scientific research, etc.
These elements come together to create a mutually beneficial agreement and build a strong relationship between the two parties. Let’s say Zack is looking to sell his house to the buyer Lisa. Lisa looks up the comps in the neighborhood Zack’s house is located in. She is shocked to see his house is priced above what seems to be the value of similar homes in the area. After both parties have a discussion, Zack explains how he worked tirelessly to turn the house into his dream home with custom work and features. Due to relocation, he must turn around and sell. Lisa explains money is tight with work hours being cut and her family has spent months looking for the perfect home. Zack’s home hits all her needs.
Lisa understands Zack deserves a higher price for his hard work and moving expenses. Zack understands Lisa’s money situation is tight and will need some sort of help to make the purchase a possibility. Zack drops the price slightly, enough where he still receives fair compensation for the custom work and provides Lisa with a work opportunity by connecting her with someone in need of her services. Lisa agrees to pay the slightly above average price. They both leave with a mutually beneficial agreement and great relationship.
