Winning strategies for team negotiations

By Kandarp Mehta and Guido Stein

Negotiating as a team may seem more complex, but research shows that teams generally negotiate better, creating greater value and achieving better results than going it alone.

Moreover, research led by Northwestern University’s Leigh Thompson shows that even when an individual negotiates opposite a team, the results end up better for the individual as well as for the team, with both sides perceiving joint gains.

What makes team negotiation so effective?

• First, having multiple perspectives leads to better information and better analysis.
• Second, teams can deploy a broader range of negotiating tactics, such as playing good cop/bad cop, which a solo negotiator would find more difficult to do on their own.

However, team negotiations are not without their challenges. Here are the main ones and some tips to overcome them.

Challenge 1: Lack of coordination

Within teams, interpersonal and task-related conflicts may arise, which can undermine the ability of the team to negotiate as a cohesive unit.

To prevent this, it is important to select team members carefully, bearing in mind they will need to work well together. While diversity can be a strength, you need to ensure there is sufficient camaraderie and trust among team members to hold that diversity together. Especially when there is a lot of functional diversity represented on the team, the objectives must be clear and everyone’s priorities aligned, so that the team doesn’t negotiate with conflicting goals in mind.

Challenge 2: Poor control of the process

Another problem with team negotiations is that they can wander off track, wasting a lot of time in the process.

To avoid this, it helps to assign specific topics and roles to each member, so discussions don’t turn into a free-for-all as everyone chips in with more information. Appointing a leader to manage the process will keep everyone working in sync.

Challenge 3: The need for collective preparation

Because preparation has to be done at the team level and not just at the individual level, it requires a great deal of synchronized planning. A good practice is to allow time for each team member to prepare individually according to their role assignment, and then everyone comes back together for group discussion to clarify the items that need to be prepared as a team.

Challenge 4: The need for caucuses

A caucus is when the team takes a break from the negotiation to consult together privately on points of the negotiation. The more complex the negotiation, the more often the team might need to ask for a recess in order to discuss unforeseen issues that require further consultation before returning to the negotiating table.

However, a caucus need not disrupt progress. Breaks are good for reassessing or redefining the negotiating strategy. That said, it’s best to inform everyone in advance that the team will be taking breaks throughout the negotiation, so that no one is caught off guard when they happen.

Also, when a break is called, the points agreed up until that point should be summarized and a clear time limit set, so the negotiation can pick up where it left off, and the momentum is maintained.

Challenge 5: Conflicts and tensions

Disagreements will inevitably occur, especially during the course of tense negotiations. Again, this is why establishing clear and agreed-upon processes — including a conflict-resolution process — will help maintain team unity when conflicts arise.

A well-timed break can also help the team to regroup and return to the negotiating table as a cohesive unit. As stated previously, a good leader — someone who is respected by the team as having legitimate authority — will be able to step in and take control when necessary. This will keep everyone focused on the big picture.

A team negotiation may require more preparation, but with the right strategies, as described above, the outcome can be all the greater.

SOURCE: “Negotiating in a Team” (NEGN-2-E), a technical note by Kandarp Mehta and Guido Stein, is available from IESE Publishing.