12 Important Negotiation Skills (With Definition and Tips)
Negotiation is a dialogue where two or more sides work together to reach an agreeable solution for all involved. It might result in a formal agreement, like a contract, or a less formal understanding, like a verbal agreement. Understanding how negotiations work and what skills are needed may help you receive a solution beneficial to you.
In this article, we discuss negotiation, 12 skills needed for success, tips and related resources and 10 careers that use negotiation skills.
What is negotiation?
Negotiation is a discussion to settle disputes and reach agreements between two or more sides. Negotiation is a “give and take” process resulting in a compromise where each side makes a concession for the benefit of everyone involved.
There are many situations where you may need to be a negotiator. You might be involved in negotiating a job offer, asking for a raise, rallying for a budget increase, buying or selling property or closing a sale with a customer. They all call for negotiating skills if you want to be successful.
Read more: Understanding the Process of Negotiation
12 important negotiation skills
Here are several key negotiation skills that may be helpful in your career:
Essential communication skills include identifying nonverbal cues and verbal skills to express yourself engagingly. Skilled negotiators can change their communication styles to meet the listener’s needs. By establishing clear communication, you can avoid misunderstandings that could prevent you from reaching a compromise.
2. Active listening
Active listening skills are also crucial for understanding another person’s opinion in negotiation. Unlike passive listening, which is hearing a speaker without retaining their message, active listening ensures you engage and later recall specific details without needing information repeated.
3. Emotional intelligence
Emotional intelligence is the ability to control your emotions and recognize others’ feelings. Being conscious of the emotional dynamics during negotiation can help you stay calm and focused on the core issues. If you’re unsatisfied with the current negotiation, ask for a break so you and the other party can return with refreshed perspectives.
4. Expectation management
Just as you should enter a negotiation with a clear goal, the other side also likely has its own defined expectations. If you believe you might not be able to agree to each other’s terms, you could try adjusting your expectations. Skilled expectation management involves maintaining a balance between being a firm negotiator and a collaborative one.
Some negotiations can take a long time to complete, occasionally involving renegotiation and counteroffers. Rather than seeking a quick conclusion, negotiators often practice patience to properly assess a situation and reach the best decision for their clients.
Adaptability is vital for successful negotiation. Each negotiation is unique, and the situation may change from one day to the next. For example, an involved party may change their demands abruptly. While it’s challenging to plan for every possible situation, a good negotiator can adapt quickly and determine a new plan if needed.
The ability to influence others is an important negotiation skill. It can help you define why your proposed solution benefits all parties and encourage others to support your point of view. In addition to being persuasive, negotiators should be assertive when necessary. Assertiveness allows you to express your opinions while respecting the other side’s perspectives.
Negotiation requires planning to help you determine what you want and how the terms will be fulfilled. You should consider the best possible outcome, your least acceptable offer and what you will do if an agreement isn’t reached. Preparing, planning and thinking ahead is crucial to a successful negotiation. The best negotiators enter a discussion with at least one backup plan, but often more. Consider all possible outcomes, and be prepared for each of these scenarios. This is the “best alternative to a negotiated agreement” (BATNA) for negotiators.
Integrity, or having strong ethical and moral principles, is an essential skill for negotiations. Being thoughtful, respectful and honest allows the other side to trust what you say. As a negotiator, you should be able to follow through on commitments. To demonstrate trustworthiness, avoid over-promising.
10. Rapport building
The ability to build rapport lets you establish relationships with others where both sides feel supported and understood. Building a rapport requires communicating your goals and understanding the other side’s wants and needs. Rapport helps ease tensions, promotes collaboration and increases the likelihood of reaching an agreement. To build rapport, showing respect and using active listening skills are critical.
Negotiation requires problem-solving to see the problem and find a solution. If a price is too high, how can it be lowered? If a resource is in short supply, what can be done to increase it? Finding unique solutions to problems may be the determining factor in compromise.
Good negotiators can act decisively during a negotiation. It may be necessary to agree to a compromise during a bargaining arrangement. You need to be able to react decisively. Keep in mind that your decisions may have lasting effects on yourself or your company. It is important to think through your options carefully without overthinking your decision. Going back and forth between your options without a clear answer might bring unnecessary stress.
6 tips for successful negotiations
Consider these tips to help you prepare for negotiation talks:
1. Do your research
Before entering into negotiation talks, evaluate all sides and consider their goals. It can also be helpful to research the person you are negotiating with. Understand the limitations of the negotiator. Do they have the ability to give you what you want? Understanding these limitations can help you strategize.
Related: What Is a Competitive Analysis?
2. Know your priorities
Negotiations often require each side to compromise. Determine what is most important and what you are willing to settle for in its place. Setting your priorities ahead of time can help you evaluate what you refuse to give up and where you’re willing to budge. If you are the negotiator, be clear about what both sides offer and what they need from each other.
3. Consider the opposition
Consider the potential opposition to your negotiations. Do you think your manager will object to a pay increase because of declining sales? Will you be denied a higher starting salary for a position because your requested rate is above the average range? Write down all the potential oppositions and then gather the information you can use to argue your case.
4. Keep communications open
Be consistent about presenting your goals, objectives and expectations to reduce the risk of confusion. Use effective communication skills, including verbal responses and nonverbal cues. Strive for mutually beneficial solutions, but be prepared to compromise.
If you are the negotiator, ensure there are guidelines for the discussion and that both sides stick to them. Get agreements in writing.
5. Know when to walk away
One of the hardest parts of negotiation is knowing when to walk away. It is important to enter all negotiations recognizing that you may not be able to agree. Once you realize no further compromises can be made and terms can’t be reached, it’s probably time to discontinue talks.
6. Keep your timeline in mind
A timeline can significantly impact your position of power in the negotiation. If one or both sides are rushing to reach a decision, one may give up too much and regret their actions. For example, if you’re trying to get a new job quickly, you may take a position with lower pay or compromise too much on benefits. In this case, you may find yourself unsatisfied with your decision long-term.
10 careers that use negotiation skills
Here are 10 careers that often use negotiation to achieve beneficial goals. Click on the salary links for current salary information from Indeed or the United States Bureau of Labor Statistics (BLS).
National average salary: $43,849 per year
Primary duties: A community organizer helps lead local residents in projects designed to improve the community. For example, if a specific issue impacts a local neighborhood, a community organizer might work to gather those affected to fix the issue. Within this role, the community organizer may need to negotiate or debate with representatives from the government or businesses to work towards a solution.
National average salary: $51,303 per year
Primary duties: One of the primary responsibilities of a lawyer is to argue a case on behalf of their client. Lawyers debate with one another, negotiating to secure the best possible outcome for their clients. They use the circumstances of the case and past legal precedents to make their arguments. For example, a defense lawyer may debate a prosecutor over the innocence of their client who was accused of a crime.
Related: Learn About Being a Lawyer
National average salary: $53,793 per year
Primary duties: Salespeople work to sell a product or service on behalf of their employer. This can sometimes involve some negotiation, as the salesperson works to convince the prospect to make a purchase. The salesperson highlights the product's benefits while answering any concerns the prospective buyer may have.
National average salary: $72,339 per year
Primary duties: Right-of-way agents usually work to procure land for governments or large organizations. Oil or gas companies often employ them to negotiate mining rights on land they don’t yet own. Many right-of-way agents specialize in some particular topic of land rights, such as aerospace and defense, utilities and transportation. An agent’s specialty may influence what clients they work for.
National average salary: $75,885 per year
Primary duties: An agent or business manager works on behalf of an artist or entertainer. They help the artist, such as an actor or writer, find new work and negotiate contracts. Often, the agent negotiates with the project producers to secure better pay or conditions for their client. For example, an agent may debate with a producer about why their client deserves a certain salary based on their past performances.
National average salary: $84,910 per year
Primary duties: Negotiators work with clients in various industries and situations. For example, a negotiator may help law enforcement agencies resolve a hostage or crisis. Other types of negotiator roles, such as a contract negotiator, may help resolve contract disputes and ensure all parties follow the terms of an agreed-upon contract. A mediator, another type of negotiator, works as a neutral professional when hearing both sides of an argument, such as in the case of a divorce, to help people involved achieve a successful resolution.
National average salary: $87,686 per year
Primary duties: A diplomat represents a state, country or government entity when conducting business with other states or countries. Diplomats often travel and live abroad as a representative of their home country. They usually work in politics, lawmaking, foreign relations and business to promote peace, good relations or trade and commerce with companies or individuals in another country. They may negotiate treaties, arrange for the importation or exportation of products or resolve conflict between governments.
National average salary: $88,387 per year
Primary duties: A human resources (HR) director handles hiring and managing employees for their employer. For example, they may be in charge of recruiting and hiring new employees, managing payroll, conducting introductory training seminars, boosting employee morale and implementing team-building initiatives. An HR director acts as a liaison between executives and lower-level employees to satisfy both sides' concerns. If a concern or conflict arises, they may employ their conflict resolution skills to ensure a peaceful resolution.
Related: Learn About Being an HR Director
National average salary:$104,280 per year, according to the BLS
Primary duties: A medical and health services manager oversees a medical facility's staff and operations. This may involve negotiating and developing internal policies in compliance with government regulations, evaluating strategies for improving the quality of health care services at their facility, recruiting or training new employees and monitoring departmental budgets.
Read more: Learn About Being a Health Administrator
National average salary: $108,319 per year
Primary duties: Real estate agents help clients buy or sell a home, private property or commercial property. They market listings, show properties to prospective buyers and coordinate with brokers and financial real estate professionals to get clients approved for a home. They often facilitate negotiations between buyers and sellers.
For more information about negotiations, consider these additional Indeed resources:
Explore more articles
- What Is a Competitive Market? (Definition and How It Works)
- How To Write an Address: A Complete Guide
- How To View HTML Source Code Using Different Browsers
- What Are the Functions of Accounting?
- 6 Advantages and 5 Disadvantages of Internal Recruitment
- A Guide to Small Talk: 4 Tips and 45 Conversation Starters
- Interpersonal Conflict: Types and How To Resolve Them
- 10 Business Strategy Examples (And Why It Helps To Have One)
- 5 Steps for Managing Attrition and Why It's Important
- Research Objectives: Definition and How To Write Them
- Nominal Wage vs. Real Wage: What’s the Difference?
- How To Calculate Percentile in 4 Steps (Plus Examples)