How you can improve your negotiation skills

Negotiation is a part of our daily lives. We often make choices by discussing and compromising with others. We do this when buying a house, negotiating a work contract, or deciding on a movie with a spouse.

What are negotiation skills

Negotiation is a way for two or more parties to communicate, aim to reach an agreement or resolve a conflict. It involves discussing interests, needs, and expectations to find a mutually acceptable solution. Negotiation often requires compromise, problem-solving, and good communication. The goal is to satisfy all parties.

There are four main types of negotiations: one-time, continuous, direct, and indirect. A one-time negotiation is a single interaction. Both parties aim to reach a deal without expecting future contact. An example is buying a car. Continuous negotiations happen when parties must maintain a strong relationship. This is common in business partnerships, supplier deals, and employee contracts. In direct negotiations, parties communicate face-to-face or via calls or video meetings. This allows for quick responses and a clear understanding. Indirect negotiations use a third party, like a mediator, to communicate when direct talks are hard or impossible.

Also, the key aspects of negotiation are issues, processes, and relationships. Issues are the goals and topics. The process is the steps and rules. Relationships are about building trust and bonds. Negotiations are considered a ‘mixed motive’ interaction that consists of competitiveness and cooperation. Balancing competitiveness and cooperativeness can be challenging.

Most importantly, negotiation involves choice. Negotiators constantly face choices throughout the negotiation process. Effective negotiation is important for success, understanding others, and resolving differences. It saves time and resources. It empowers people to collaborate and achieve their goals.

Why are negotiation skills important

Negotiation is a vital skill in life and work. It helps people and groups reach their goals while keeping good relationships. One of the interpersonal skills is negotiation, which is highly important in the workplace.

Negotiation skills are vital in life. They help people build relationships, resolve conflicts, and reach win-win outcomes.

Conflict resolution

Conflict resolution is about settling disputes, which aims to meet the needs of both sides and focus on their interests. A mix of approaches may be needed to reconcile the parties’ interests. A power-based approach, like litigation, can help. An interest-based approach, like negotiation, can also be used.

Conflicts can arise in both scenarios, either in a professional life or in a personal life. Your communication can greatly affect the negotiation. It can lead to good or bad outcomes. Developing strong communication and interpersonal skills is essential for effectively implementing negotiation processes and resolving disagreements. It helps find common ground. It avoids escalation and potential harm to relationships.

Building relationships

Negotiation is essential for creating and maintaining healthy relationships in all areas of life, but it is not about resolving disagreements. It also builds trust, understanding, and cooperation between individuals or groups and encourages open communication. People can then share their needs, thoughts, and feelings. The basis of every relationship is trust and mutual respect. Negotiation shows a desire to collaborate and understand each other. It builds trust and respect, which are essential for strong relationships.

Goal achievement

Achieving goals in negotiation is vital. It ensures both parties get a fair, satisfying outcome. When goals are clearly defined, they give direction to the negotiation process and help avoid confusion or wasted time. They also build cooperation and trust, easing future negotiations. By working towards common goals, both sides can find creative solutions. These will meet their needs and lead to better results. Negotiation success means achieving goals. It leads to win-win deals for all.

Creating win-win situations

A win-win outcome in negotiation is essential because it ensures both parties are satisfied with the agreement. This builds trust and strengthens relationships, making future negotiations easier and more productive. When both sides address their needs and interests, they create fairness and mutual respect. A win-win solution encourages collaboration and creative problem-solving, helping to find solutions that benefit everyone involved.

What are the typical negotiation styles

Negotiation styles are the different ways people approach discussions to reach their goals. Knowing these styles can help you. They can improve your habits. You can also adapt to different situations for better results. Here are some common negotiation styles:

Competing style

This style is all about winning. People using this approach focus on getting what they want, even if it means the other side loses. It is a powerful, authoritative approach. They use it in high-stakes situations, such as emergencies. However, it can harm relationships if used too often. For example, arguing for a higher salary without considering the company’s budget.

Collaborating style

In this style, the goal is to find a solution that makes everyone happy. It’s about working together, sharing ideas, and being creative to meet everyone’s needs. It builds trust and long-term relationships. But it takes more time and effort. For example, a team brainstorms to create a project plan that helps all departments.

Accommodating style

Accommodating means putting others' needs first to keep the peace. This style helps when you don't care much about the issue. But using it too often may make you feel taken advantage of. A real-life example is letting a friend choose the restaurant, even if you want to go somewhere else.

Avoiding style

Avoiding means staying away from the conflict altogether. This style might delay or skip the discussion. It can work for small issues or when emotions are high. But avoiding big problems can cause them to grow worse over time. For instance, ignoring a coworker’s rude comment instead of addressing it.

Compromising style

This style finds a middle ground. Both sides give up some of what they want to reach an agreement. It’s practical and quick but doesn’t always leave everyone completely satisfied. For example, splitting the cost of repairs with a landlord after a dispute is practical.

How to get better at negotiation in 8 steps

A successful negotiation ensures a fair deal for everyone involved. It relies on common sense and mutual trust and requires confidence between the parties. But what defines a successful negotiation? All participants expressed satisfaction with the outcome. Negotiation holds greater significance than we often acknowledge.

1. Prepare

Preparation is the foundation of any successful negotiation. Before discussing, understand your goals and those of the other party. Know your limits and boundaries. Be cautious about what you can compromise on. Also, collect all the necessary information. Preparation also includes researching the other party’s needs and goals. This will help you enter the negotiation with confidence.

2. Discuss

The next step is to start a conversation. At this stage, the goal is to open the dialogue and clarify the issues. Now is the time to ensure both parties understand each other’s concerns. This is a healthy discussion. So, please be calm and respectful. It will help us negotiate and create a cooperative atmosphere.

3. Signal

The third step is about signalling. It will show your readiness to engage and collaborate. By signalling, you show your flexibility and openness to finding a solution. This step is to show your willingness to negotiate. You can do this with body language or verbal signals. It helps to create a positive atmosphere where both sides feel that a fair deal is possible.

4. Propose

Once the discussion starts, it’s time to make your proposal. Explain your offer in detail. Show how it meets both parties’ needs. Be straightforward and honest, showing how everyone will benefit. This will help the other party understand your offer and allow more discussion.

5. Package

The step’s name makes it clear. At this stage, they have offered several options, not one proposal. Submitting many proposals raises the chances of a mutually satisfying deal. Packaging offers more flexibility. It helps to reach a compromise without sacrificing vital concerns.

6. Bargain

Bargaining is the heart of negotiation. Both parties will adjust and compromise to reach an agreement. Participants exchange offers and counteroffers in an in-and-out activity. The goal is to balance both parties’ needs. We want a deal that satisfies and benefits both.

7. Close

Once both sides agree on the terms, closing the deal is time. Negotiators call this process “closing.” This step involves finalising the agreement. Both parties must confirm and understand the terms and reach a complete agreement on the details before moving forward. Closing ensures that both sides commit to the agreed-upon outcome.

8. Agree

The final step is to formalise the agreement. Depending on the situation, this can be done with a verbal commitment or a written contract. Some countries, such as Finland, have valid oral contracts. However, it is wise to make the agreement in written form. Both parties should confirm that they understand and agree to the terms. This step finalises the negotiation and completes the process.

Key strategies you can use to improve your negotiation skills

Negotiation is an important skill in both personal and professional life. Better negotiation skills can help you get better results. This applies to resolving conflicts, making business deals, and discussing your salary. Emotional intelligence plays a crucial role in any negotiation and is used when entering negotiations. Here are some key strategies to enhance your negotiation skills:

Set clear goals

Know your goals and your best options if talks fail. (BATNA: Best Alternative to a Negotiated Agreement.)

Research thoroughly

Understand the other party’s interests, needs, and limitations.

Practise active listening

Focus on what others say. It builds trust and understanding.

Communicate effectively

Use clear, respectful, and assertive language.

Be flexible

Adapt to new information and perspectives during the negotiation.

Develop emotional intelligence

Recognise and manage your emotions and others to create a positive dynamic.

Negotiation is a fundamental skill that impacts every aspect of life. Mastering negotiation, communication, and practice can help individuals better achieve their goals. It can also build stronger relationships and handle tough situations with greater confidence.

About the authors

Darja is a Behavioural Scientist and Customer Success Manager. She holds a Master’s in Social Sciences from the University of Helsinki, specialising in business anthropology and organisational psychology. She is also working on service and product development.

Pooja specialises in developing content that enhances leadership skills and promotes effective team management. With a strong focus on personal growth and organisational success, she’s passionate about exploring strategies that empower leaders to inspire, motivate, and guide their teams toward achieving common goals.