International Negotiations

The “Harvard Concept” describes a universally applicable negotiation method that follows the maxim of reaching agreements amicably without being defeated.

We negotiate every day in different situations, whether in job interviews, team meetings, among friends, or when buying and selling. We encounter negotiation on a regular basis and even a few rules can help us to negotiate more confidently and in a more goal-oriented manner.

One of the best known and most popular methods in English is the “Harvard Negotiation Method”. Known as the “Harvard Concept”, this method of specialized negotiation is considered one of the most effective techniques used by experts, graduates and students. It was developed in 1981 by professors Roger Fisher and William Ury at Harvard University as part of the ‘Harvard Negotiation Project’.

We have summarized and explained this method for you. In addition, there are helpful phrases for a negotiation in English, so that you can negotiate confidently and convincingly with international negotiating partners.

What is the Harvard Negotiation Method?

The core of the Harvard concept is that it overcomes the “classic” negotiation compromise and looks for solutions that are mutually beneficial. Typically, there are two different ways negotiations are conducted: the hard way or the soft way. The soft way is the more harmonious way, where the negotiator is willing to compromise. This avoids disputes and allows solutions to be found. However, this often results in a person being dissatisfied and upset. For people who use the hard method, winning is the priority. To achieve this goal, they are willing to exploit resources and ruin the relationship with the opponent.

The Harvard method of negotiation combines the hard and the soft approach and is therefore called: “the method of principled negotiation”. It can be used for any type of negotiation, regardless of the circumstances or purpose. A typical feature of the method is its focus on mutual benefit. In addition, decisions in disagreements are based on fair and objective principles that guide negotiations in a fair and professional manner. Principled negotiation usually provides a better way to reach good agreements.

However, before going further into this specific method, let’s look at what phases there are in negotiating in the first place:

The 6 phases of negotiation

1. Greeting and introduction of the conversation – establishing a common starting point.
2. Have your own position A justified (advantages/disadvantages).
3. Have your partner justify position B (advantages/disadvantages). Do not interrupt your partner – allow them to finish speaking.
4. Make counter-proposals, develop alternatives, facilitate partner withdrawal and secure intermediate results.
5. Result with closure, e.g. a contract.

The 4 principles of the Harvard Negotiation Method

1. Discuss factually

“Separate the people from the problem.” All participants in a negotiation are people with emotions and different ways of thinking, which can lead to communication difficulties or misunderstandings. It is important to isolate the “people problem” from the “substantive problem” and deal with it separately: separate the person and the problem, and do not focus on the counterpart, but on the goal.

2. Do not focus on positions, but on the interests and needs behind them

It is crucial to shift the focus to “interests” as opposed to “positions”. This is a key to opening up closed negotiating spaces. Classic haggling over positions is a lengthy process that leads to a stubborn battle of wills over whose value system is the “right” one, making it difficult for either side to give up their position in favour of a settlement.

Instead of concentrating on the expressed positions of one person, one should focus on satisfying the interests underlying those positions. Although the positions of two sides may be completely different, their interests can overlap and a reasonable agreement can be reached. Interests, unlike positions, are rather abstract – so it helps to look at the other side’s position from their point of view, or simply ask them about their interests at the beginning of the negotiation.

3. Develop win-win options that benefit both partners

When thinking about different options during a negotiation, there is often a lack of creativity. The pressure to find the one right solution makes it difficult to discover new options. Therefore, one should look for options that create mutual benefit, and try to avoid: making hasty judgements, searching for the “only” right solution, assuming the “cake” is limited, or expecting others to solve their problems themselves.

From this insight, one can derive approaches with which both parties can start brainstorming together.

4. Base the outcome on objective criteria

When the interests of each side are in conflict and each side defines what it will tolerate, one side must eventually give way. Basing the decision on objective and fair criteria – such as market value, comparable cases, scientific reports, expert opinions, costs, court decisions, or tradition – helps maintain a good relationship, since these criteria should be independent of anyone’s will and be legitimate and feasible.

It is also important to define the “best alternative to a negotiated agreement” (BATNA) – the best fallback option if no agreement is reached. Having a realistic alternative strengthens one’s negotiating position.

Before starting negotiations and applying these four principles, it helps to go through a process of analysis, planning and discussion: in the analysis phase, perceptions, feelings, communication issues, interests and possible criteria are collected; the planning phase focuses on overcoming the “people problems”, prioritising interests and defining options and criteria; and during the actual negotiation, both sides exchange interests directly, develop mutually beneficial options and use objective principles to resolve conflicts.

Helpful phrases for a negotiation in English

State your needs

• For us, the priorities are …
• Our main concern is …
• We think the best option would be …
• We’d prefer to see/have …
• We need … Can you do that?

Explore positions

• What exactly do you need?
• What do you have in mind?
• How would you feel about … ?
• How flexible can you be on … ?
• When you say … , what do you mean?
• Can you be more specific?
• Let me just check I understand you correctly.

Ask specific questions

• What sort of quantity are you thinking of?
• What kind of timescale are we looking at?
• What sort of figure are we talking about?
• What kind of guarantee can you give us?
• We’ve been quoted a price of … Can you match that?

Suggest alternatives

• Alternatively, …
• Can I suggest another way of moving forward?
• There are a couple of alternatives we’d like to put forward.
• Perhaps you would like to try the product on a trial basis?

Bargain

• If you (do that), we’ll/we can (do this).
• OK, we’d be prepared to (do that), but only if you (did this).
• We could accept that, but only on one condition.
• Would you be willing to accept a compromise?

Accept an offer

• OK, we can agree to that.
• That sounds reasonable.
• I think that should be possible.

Refuse an offer

• I’m not sure about that.
• That’s not really a viable option for us.
• That would be very difficult for us because …
• I’m sorry, we can’t accept that.

Summarize

• Let’s just take a moment to review what we’ve discussed.
• Can we just go through/go over what we’ve agreed so far?

Play for time

• I’d like some time to think about it.
• I think that’s as far as we can go at this stage.
• I don’t have the authority to make that decision by myself.

Close the deal

• If you can … , we can close the deal today.
• I’m ready to sign today if you can …
• If we agree to … , are you happy with the other points?
• That’s it, then. I think we have a deal.
• So, if you’d just like to sign here.

How to overcome cultural differences and problems in negotiations?

Differences in culture complicate business negotiations and relationships in many ways.

First, they can cause communication problems. If a Japanese supplier, for example, responds to a proposal with “That is difficult”, one may wrongly assume that the door for further discussion is still open. In fact, a supplier from a culture that avoids confrontation may be giving an indirect “no”.

Second, cultural differences make it harder to understand each other’s behaviour. Americans, for example, may see hiring relatives in a business as a dubious favour, while for Lebanese colleagues, hiring relatives is a natural way to attract trustworthy and loyal employees.

Third, culture influences the shape and content of the business itself. For example, when McDonald’s first franchised in Thailand, it insisted on strict adherence to its traditional American menu. Later, under pressure from its Thai franchise, it allowed the sale of a traditional noodle dish – and sales increased. Since cultural differences often require adapting products, management systems and personnel practices abroad, it is necessary to stay open to proposals for change during negotiations.

Culture can also influence people’s behaviour and interaction at the negotiating table. In some countries, like Spain, the main goal of negotiators is to get a signed contract, while in other cultures, including India, negotiators may concentrate on building an effective long-term relationship.

Before heading to the next international negotiation, here are some simple rules for dealing with cultural differences in international negotiations and transactions:

• Homework: Get information about the culture! Reading and talking to people from the country can teach you a lot – and negotiating partners themselves are often a welcome source of information about their own culture.
• Respect cultural differences! Inexperienced negotiators tend to belittle unfamiliar cultural practices. It is better to understand the value system at work and have a problem-solving conversation about any difficulties that unfamiliar customs may bring.
• Be aware of how others perceive your “foreign” culture! Try to be aware of how your own behaviour, attitudes, norms and values appear to your negotiating partner.
• Find ways to close the culture gap! Cultural differences create a gap between negotiating partners, so ways to close this gap should be sought constantly – starting with defining common ground, such as a shared experience, interest or goal.

Etiquette tips for business travellers: How to avoid blunders in other countries

Different countries, different customs – this saying is especially important for business travellers abroad. If you know the customs of a country, you can protect yourself from misunderstandings and putting your foot in your mouth. Here are a few examples:

• Asia: Do not blow your nose at the table and look your counterpart in the eyes as little as possible – both are considered absolutely rude.
• China: The present for the host plays a big role. The packaging is particularly important, and the gift is unwrapped later. Avoid sensitive topics such as the country’s politics.
• South America: There is a different understanding of time, especially when inviting people home – if you are invited for dinner at 8 p.m., it would be very impolite to show up before 9 p.m.
• Russia: Status counts for a lot here, for example an expensive watch or elaborate make-up for women – in Russia, more is more.
• England: Exactly the opposite is true in England, where it is all about understatement – meetings are conservative and less is more.
• United Arab Emirates: There are usually middlemen in business negotiations, since both parties need to save face. In Dubai, a coffee is always the sign that a meeting is over.
• USA: It is very important to hold back on private statements – even a simple compliment like “your assistant is very nice” can be misunderstood.
• Russia: If you invite Russian guests to your home, don’t be afraid to buy in bulk – the rule is that there should always be food left over.

7 Business Etiquette Tips for Austria

• Address every Austrian by their full title – even if it is very, very long.
• In German, use the polite form of address with your business partners (Sie).
• Make your appreciation clear.
• Score points with German punctuality, but leave the control mania at home.
• Loosen up and be open to intermediate solutions.
• A meeting in a café is still a meeting.
• Go networking on the golf course, in the forest – or on the dance floor.