Ch 1 - I nt r oduct i on To Negot i at i ons

1. 1 - Descr i bi ng Negot i at i ons

1. 2 - Recogni zi ng Possi bl e Negot i at i on Out comes And
St yl es
1. 3 - Descr i bi ng At t i t udes That Lead To Successf ul
Negot i at i ons

1.1 Describing Negotiations
Negotiation Is Part of Life ( FAR 15. 402) . Negot i at i on i s a
par t of nor mal ever yday l i f e. I n f act , exper t s on t he
subj ect have sai d t hat l i f e, i t sel f , i s j ust one cont i nuous
negot i at i on.
St i l l , many peopl e f eel t hat t hey ar e not exper i enced
cont r act negot i at or s. Per haps t hey do not r eal i ze t hat
t her e ar e many t ypes of cont r act s. Not al l ar e compl ex
wr i t t en agr eement s. Most cont r act s ar e or al agr eement s
whi ch may or may not i nvol ve t he exchange of monet ar y
consi der at i on.
Wi t hout r eal i zi ng i t , you have pr obabl y been i nvol ved
i n a var i et y of cont r act negot i at i ons ever y day of your
l i f e. I n f act , we const ant l y bar gai n wi t h ot her peopl e t o
f ul f i l l bot h our monet ar y and non- monet ar y needs.
At wor k, you ar e pr obabl y i nvol ved i n cont i nui ng
negot i at i ons wi t h your super i or s, subor di nat es, and
cowor ker s concer ni ng a var i et y of per sonal and
pr of essi onal i ssues. They may be as mi nor as deci di ng
who wi l l make t he next pot of cof f ee or as maj or as
t he r at i ng on your annual per f or mance eval uat i on.
At home, you ar e pr obabl y i nvol ved i n cont i nui ng
negot i at i ons wi t h your f ami l y over a wi de var i et y of
i ssues. They may be as mi nor as t he t i me f or di nner or
as maj or as wher e you wi l l l i ve. A chi l d cr yi ng f or a
f avor i t e t oy can be a f or mi dabl e negot i at or .
You have l i kel y been i nvol ved i n numer ous negot i at i ons
t hat wi l l have a l ong- t er maf f ect on t he cour se of
your l i f e, i ncl udi ng:
o The t er ms of your cur r ent empl oyment ;
o An aut omobi l e pur chase cont r act or l ease
agr eement ; or
o Your home mor t gage or apar t ment r ent al agr eement .
I n f act , you must negot i at e f or most t hi ngs you want i n
l i f e. You can onl y avoi d negot i at i on i f you have no desi r e
f or anyt hi ng hel d or cont r ol l ed by someone el se. Regar dl ess
of your pr of essi on, ski l l as a negot i at or i s essent i al t o
your success. I n Gover nment cont r act i ng, t he ski l l i s
par t i cul ar l y i mpor t ant because your dai l y wor k r equi r es you
t o obt ai n suppl i es and ser vi ces f r omr esponsi bl e sour ces at
f ai r and r easonabl e pr i ces.
Description of Negotiation. Negot i at i on i s a pr ocess of
communi cat i on by whi ch t wo par t i es, each wi t h i t s own
vi ewpoi nt and obj ect i ves, at t empt t o r each a mut ual l y
sat i sf act or y r esul t on a mat t er of common concer n.
I n negot i at i on, a mut ual l y sat i sf act or y r esul t i s
vi t al , because even t hough t he par t i es may have opposi ng
i nt er est s t hey al so ar e dependent on each ot her . Labor and
management , f or exampl e, need each ot her t o pr oduce
pr oduct s ef f i ci ent l y and ef f ect i vel y. Li kewi se, buyer s and
sel l er s need each ot her t o t r ansact busi ness. Bot h si des
must be wi l l i ng t o l i ve wi t h t he r esul t .
Negot i at i on i s not one par t y di ct at i ng or i mposi ng
t er ms on anot her . When t hat happens, t he out come wi l l
r ar el y pr oduce mut ual sat i sf act i on. The r esul t can onl y be
mut ual l y sat i sf act or y i f bot h di f f er ences and common
i nt er est s ar e consi der ed.
To obt ai n agr eement , you must gener al l y sacr i f i ce or
yi el d somet hi ng i n or der t o get somet hi ng i n r et ur n. I n
ot her wor ds, you must gi ve t o get . But as l ong as t he
ant i ci pat ed benef i t i s gr eat er t han your sacr i f i ce, a
negot i at ed agr eement i s benef i ci al . The l i mi t on yi el di ng
i s r eached when one par t y bel i eves t hat concessi ons woul d
be mor e cost l y t han t he benef i t s of agr eement .
Whi l e negot i at i on i s of t en a pr ocess of mut ual
sacr i f i ce, i t shoul d al so be a pr ocess of f i ndi ng ways
wher eby bot h par t i es wi l l have t hei r i nt er est s opt i mi zed
under t he ci r cumst ances. Negot i at i ons shoul d not j ust be
ai med at how t o spl i t t he pi e. I nst ead t hey shoul d be ai med
at f i ndi ng opt i mal sol ut i ons - - ways t o make t he pi e l ar ger
f or al l concer ned. For exampl e, bot h par t i es benef i t when
negot i at or s f i nd t hat a change i n buyer r equi r ement s wi l l
enabl e t he sel l er t o del i ver a hi gher - qual i t y st andar d
pr oduct i nst ead of a speci al l y bui l t pr oduct . The sel l er
r eal i zes l ower r i sks or per haps mor e pr of i t f r omt he sal e
of a st andar d pr oduct . The buyer pays a l ower pr i ce f or a
pr oduct t hat meet s t he buyer ' s r eal needs.
Negotiated Contracts vs. Sealed Bidding ( FAR 14. 101( d) ,
15. 000, and FAR 52. 215- 1) . The Feder al Acqui si t i on
Regul at i on ( FAR) st at es t hat any cont r act awar ded usi ng
ot her t han seal ed bi ddi ng pr ocedur es i s consi der ed a
negot i at ed cont r act .
Pr ocedur es f or cont r act i ng by seal ed bi ddi ng r equi r e
t he Gover nment t o eval uat e bi ds wi t hout di scussi ons
and awar d t o t he r esponsi bl e bi dder whose bi d,
conf or mi ng t o t he i nvi t at i on f or bi ds, wi l l be most
advant ageous t o t he Gover nment consi der i ng onl y pr i ce
and pr i ce r el at ed f act or s. Negot i at i ons ar e not
per mi t t ed pr i or t o cont r act awar d.
Pr ocedur es f or cont r act i ng by negot i at i on per mi t
negot i at i ons pr i or t o cont r act awar d. However , a
sol i ci t at i on under pr ocedur es f or cont r act i ng by
negot i at i on may or may not act ual l y r equi r e
negot i at i ons. For exampl e, t he I nst r uct i ons t o
Of f er or s - - Compet i t i ve Acqui si t i on:
o St andar d pr ovi si on st at es t hat t he " Gover nment
i nt ends t o eval uat e pr oposal s and awar d wi t hout
di scussi ons. " When t hat pr ovi si on i s used, act ual
negot i at i ons ar e not per mi t t ed unl ess t he
cont r act i ng of f i cer det er mi nes i n wr i t i ng t hat
t hey ar e necessar y.
o Al t er nat e I , st at es t hat t he " Gover nment i nt ends
t o eval uat e pr oposal s and awar d a cont r act af t er
conduct i ng di scussi ons wi t h of f er or s whose
pr oposal s have been det er mi ned t o be wi t hi n t he
compet i t i ve r ange. " Her e negot i at i ons ar e
r equi r ed wi t h any of f er or ( s) i n t he compet i t i ve
r ange.
In Government contracting: ( FAR 15. 306( d) ) . Negot i at i ons
ar e exchanges, i n ei t her a compet i t i ve or sol e sour ce
envi r onment , bet ween t he Gover nment and of f er or s, t hat ar e
under t aken wi t h t he i nt ent of al l owi ng t he of f er or t o
r evi se i t s pr oposal . These negot i at i ons may i ncl ude
bar gai ni ng. Bar gai ni ng i ncl udes per suasi on, al t er at i on of
assumpt i ons and posi t i ons, gi ve- and- t ake, and may appl y t o
pr i ce, schedul e, t echni cal r equi r ement s, t ype of cont r act ,
or ot her t er ms of a pr oposed cont r act . When negot i at i ons
ar e conduct ed i n a compet i t i ve acqui si t i on, t hey t ake pl ace
af t er est abl i shment of t he compet i t i ve r ange and ar e cal l ed
di scussi ons.
The key wor d i n t hi s def i ni t i on i s " bar gai ni ng. " The
Gover nment ant i ci pat es t hat bar gai ni ng wi l l occur i n
compet i t i ve as wel l as noncompet i t i ve negot i at i ons.
Satisfactory Negotiation Results ( FAR 15. 101, 15. 402( a) ,
43. 103( a) , and 49. 201( a) ) . What i s a sat i sf act or y r esul t i n
a Gover nment cont r act negot i at i on? That depends on whet her
t he negot i at i on i s compet i t i ve or noncompet i t i ve and when
i t t akes pl ace i n t he cont r act i ng pr ocess.
Compet i t i ve di scussi ons may t ake pl ace ei t her bef or e
cont r act awar d or bef or e awar d of a t ask/ del i ver y
or der under an i ndef i ni t e- del i ver y i ndef i ni t e- quant i t y
cont r act . The di scussi ons wi t h each of f er or i n t he
compet i t i ve r ange shoul d be di r ect ed t o f aci l i t at i ng
pr epar at i on of a f i nal pr oposal r evi si on t hat wi l l
pr ovi de t he best val ue f or t he Gover nment , gi ven t he
awar d cr i t er i a, t he of f er or ' s pr oposal , and exi st i ng
const r ai nt s wi t hi n t he of f er or ' s or gani zat i on. Then
t he Gover nment can eval uat e t he avai l abl e pr oposal s t o
det er mi ne whi ch pr oposal of f er s t he over al l best
val ue.
Noncompet i t i ve negot i at i ons can t ake pl ace ei t her
bef or e or af t er awar d. I n noncompet i t i ve negot i at i ons
f or :
o Awar d of a new cont r act or a t ask/ del i ver y or der
under an exi st i ng i ndef i ni t e- del i ver y i ndef i ni t e-
quant i t y cont r act , t he sat i sf act or y r esul t i s a
cont r act or or der t hat pr ovi des f or t he pur chase
of t he r equi r ed suppl i es or ser vi ces f r oma
r esponsi bl e sour ce at a f ai r and r easonabl e
pr i ce.
o A bi l at er al cont r act modi f i cat i on, t he
sat i sf act or y r esul t i s a cont r act modi f i cat i on
t hat r ef l ect s t he agr eement of t he par t i es about
any modi f i cat i on of cont r act t er ms, i ncl udi ng any
necessar y equi t abl e adj ust ment r el at ed t o t he
modi f i cat i on.
o A f i xed- pr i ce t er mi nat i on f or conveni ence
set t l ement , t he sat i sf act or y r esul t i s a
set t l ement t hat f ai r l y compensat es t he cont r act or
f or t he wor k done and t he pr epar at i ons made f or
t he t er mi nat ed por t i ons of t he cont r act ,
i ncl udi ng a r easonabl e al l owance f or pr of i t .
The Other Party in Government Contract Negotiation. I n
pr eawar d Gover nment cont r act negot i at i ons, a pot ent i al
r eci pi ent of t he Gover nment cont r act i s nor mal l y r ef er r ed
t o as an " of f er or . " I n post - awar d si t uat i ons, t he
cont r act or may st i l l be consi der ed an of f er or , because t he
negot i at i on cent er s on t he of f er submi t t ed by t he
cont r act or . However , most cont r act i ng pr of essi onal s use t he
t er mcont r act or af t er cont r act awar d. I t woul d be
par t i cul ar l y conf usi ng t o r ef er t o a f i r msubmi t t i ng a
cont r act t er mi nat i on pr oposal as an of f er or .
To avoi d conf usi on, t hi s t ext wi l l consi st ent l y use t he
t er m" cont r act or " i n r ef er r i ng t o t he non- Gover nment par t y
i n a Gover nment cont r act negot i at i on.
Negotiation Success. A successf ul negot i at i on i s a pr oduct
of many f act or s. Fact or s t hat cont r i but e t o success i n any
negot i at i on al ways i ncl ude:
The specific circumstances surrounding each
negotiation. Thi s may be vi ewed as t he bar gai ni ng
l ever age avai l abl e t o each par t y i nvol ved. For
exampl e, t he ci r cumst ances of t en f avor t he cont r act or
when t he Gover nment i s bar gai ni ng f or a hi gh- demand
pr oduct i n shor t suppl y. Si mi l ar l y, t he ci r cumst ances
wi l l gener al l y f avor t he Gover nment when sever al f i r ms
ar e vyi ng t o pr ovi de a pr oduct onl y demanded by t he
Gover nment .
The skill of the negotiators. Hi ghl y ski l l ed
negot i at or s wi l l have a gr eat er pr obabi l i t y of
negot i at i on success t han negot i at or s who do not have
t he r equi si t e ski l l s. Good negot i at or s can of t en
obt ai n f avor abl e deal s under adver se ci r cumst ances.
Conver sel y, negot i at or s wi t h poor bar gai ni ng ski l l s
somet i mes f ai l t o obt ai n sat i sf act or y agr eement s even
when t he ci r cumst ances f avor t hei r bar gai ni ng
posi t i on.
The motivation and fairness of each party. The gr eat er
t he mot i vat i on and f ai r ness on each par t y, t he mor e
l i kel y i t i s t hat t he negot i at i ons wi l l end wi t h a
sat i sf act or y agr eement .
o Successf ul out comes ar e mor e l i kel y when one or
bot h par t i es ar e wi l l i ng t o make f ai r
concessi ons.
o The l i kel i hood of successf ul negot i at i on
decr eases when ei t her par t y i s poor l y mot i vat ed
or unf ai r . Achi evi ng negot i at i on success becomes
par t i cul ar l y di f f i cul t when one par t y i s
unwi l l i ng t o compr omi se or show any f l exi bi l i t y.
Negotiator Abilities. The best negot i at or s exhi bi t t he
abi l i t y t o:
Plan carefully. Pl anni ng begi ns wi t h r equi r ement
devel opment and cont i nues t hr ough negot i at i on. I t
i ncl udes mar ket r esear ch, sol i ci t at i on pr epar at i on,
and pr oposal eval uat i on. You must know t he pr oduct ,
, and your al t er nat i ves. t he r ul es of negot i at i on
Gain management support. Management suppor t i s vi t al
t o your success as a negot i at or . I f cont r act or
per sonnel know t hat management does not suppor t your
obj ect i ves, t he cont r act or ' s negot i at or s may si mpl y
t ol er at e you unt i l t hey can escal at e t he negot i at i on
t o management .
Effectively apply bargaining techniques. Good
negot i at or s ar e capabl e of empl oyi ng bar gai ni ng
t echni ques whi ch f aci l i t at e negot i at i on success.
Communicate effectively. Good negot i at or s:
o Sel l ot her s on t hei r bar gai ni ng posi t i on by
speaki ng i n an ar t i cul at e, conf i dent , and
busi nessl i ke manner .
o Di sagr ee wi t h ot her s i n a cor di al and non-
ar gument at i ve manner .
o Li st en ef f ect i vel y. Many ot her wi se good
negot i at or s begi n t o concent r at e on t hei r answer
al most as soon as t he ot her par t y begi ns
speaki ng. As a r esul t , t hey mi ss t he t r ue meani ng
of t he communi cat i on.
Tolerate conflict while searching for agreement. Most
cont r act negot i at i ons i nvol ve some conf l i ct . Af t er
al l , no t wo peopl e on ear t h agr ee on ever yt hi ng al l
t he t i me. Negot i at or s who:
o Can agr ee t o di sagr ee i n a pol i t e and r espect f ul
manner wi l l be abl e t o sear ch f or ways t o achi eve
a mut ual l y sat i sf act or y out come.
o Wi l l gi ve anyt hi ng t o avoi d conf l i ct ar e of t en
not abl e t o secur e sat i sf act or y r esul t s f or t hei r
si de.
o Who di spl ay a t endency f or ar gui ng wi l l i ncr ease
t he conf l i ct and make a sat i sf act or y out come al l
t he mor e di f f i cul t t o at t ai n.
Project honesty. Good negot i at or s ar e honest and t hey
make ot her s bel i eve t hat t hey ar e honest . Secur i ng
t r ust i s vi t al t o secur i ng a mut ual l y sat i sf act or y
out come. Concessi ons ar e di f f i cul t t o obt ai n when
ot her do not t r ust you.
Foster team cooperation. Al l member s of t he
negot i at i on t eammay not agr ee on ever y i ssue.
Di sagr eement s must be r esol ved i n a manner t hat
f ost er s t eamcooper at i on and t he appear ance of t eam
uni t y dur i ng cont r act negot i at i ons.
Apply good business judgment. Good negot i at or s ar e
abl e t o eval uat e ever y change i n a negot i at i ng
posi t i on based on i t s over al l ef f ect on at t ai ni ng a
mut ual l y sat i sf act or y r esul t .

1.2 Recognizing Possible Negotiation Outcomes And Styles
Negotiation Outcomes. I n gener al , t her e ar e t hr ee possi bl e
out comes t o ever y negot i at i on. These out comes ar e known as
" wi n/ wi n, " " wi n/ l ose, " and " l ose/ l ose. " Any negot i at i on can
concei vabl y r esul t i n any of t hese out comes, but di f f er ent
negot i at i on st yl es can make one or t he anot her mor e l i kel y.
Win/Win Outcomes ( FAR 15. 101, 15. 402( a) , 43. 103( a) , and
49. 201( a) . A wi n/ wi n out come ( al so known as a bot h- wi n
out come) occur s when bot h si des achi eve l ong- t er m
sat i sf act i on wi t h negot i at i on r esul t s. Negot i at i ons
emphasi ze devel opi ng a mut ual l y benef i ci al agr eement . For
exampl e, awar di ng a cont r act at a f ai r and r easonabl e pr i ce
i s i n t he best i nt er est of bot h t he cont r act or and t he
Gover nment .
Commer ci al busi nesses ar e emphasi zi ng wi n/ wi n
negot i at i ons because of t he i ncr easi ng i mpor t ance of l ong-
t er mbusi ness r el at i onshi ps. Each si de has a vest ed
i nt er est i n mut ual l ong- t er msat i sf act i on. Any shor t - t er m
advant age achi eved by wr i ngi ng out ever y l ast concessi on i s
usual l y not as i mpor t ant a l ong- l ast i ng busi ness
r el at i onshi p.
Ther e ar e sever al i mpor t ant r easons why Gover nment
negot i at or s shoul d al so st r i ve f or wi n/ wi n out comes.
FAR gui del i nes emphasi ze a mut ual l y sat i sf act or y
r esul t by usi ng negot i at i on gui del i nes such as best
val ue, f ai r and r easonabl e pr i ce, equi t abl e
adj ust ment , and f ai r compensat i on f or wor k per f or med.
These gui del i nes emphasi ze t hat t he Gover nment shoul d
not wi n at t he expense ( or l oss) of t he cont r act or .
The Gover nment has a vest ed i nt er est i n t he l ong- t er m
cont r act or success and sur vi val .
o Wel l - st ocked good- qual i t y suppl i er s pr ovi di ng
goods and ser vi ces at r easonabl e pr i ces ar e
essent i al t o Gover nment oper at i ons.
o Cont r act or success enhances compet i t i on by
encour agi ng mor e f i r ms t o do busi ness wi t h t he
Gover nment , and i ncr eased compet i t i on r educes
cont r act pr i ces and i mpr oves qual i t y.
Wi n/ wi n negot i at or s of t en achi eve bet t er out comes. A
negot i at or i s l ess l i kel y t o be gi vi ng and t r ust i ng
when t he ot her negot i at or di spl ays sel f i shness and
mi st r ust . The genui ne concer n demonst r at ed by wi n/ wi n
negot i at or s i s f r equent l y r eci pr ocat ed by t he ot her
par t y.
Wi n/ wi n negot i at i ons ar e t ypi cal l y much l ess
conf r ont at i onal and t end t o f ost er bet t er l ong- t er m
r el at i onshi ps.
Wi n/ wi n negot i at i ons ar e char act er i zed by much hi gher
l evel s of t r ust and cooper at i on whi ch f aci l i t at e t he
negot i at i on pr ocess.
Win/Lose Outcomes. When a negot i at i on r esul t s i n a wi n/ l ose
out come, one si de i s per cei ved as havi ng done si gni f i cant l y
bet t er at t he expense of t he ot her . Thi s t ype of
negot i at i on t ends t o be hi ghl y compet i t i ve, wi t h a l ar ge
degr ee of mi st r ust on bot h si des.
I n commer ci al busi ness, wi n/ l ose out comes of t en occur
when t he negot i at or s do not ant i ci pat e addi t i onal busi ness
beyond t he i ni t i al t r ansact i on. Ther e i s no mot i vat i on t o
ensur e l ong- t er msat i sf act i on f or t he ot her si de. Exampl es
of wi n/ l ose out comes abound i n ever yday l i f e, such as
pr i vat e home and aut o sal es wher e t he negot i at or s gener al l y
do not ant i ci pat e addi t i onal negot i at i ons wi t h t he ot her
par t y.
Bot h si des of t en f eel t hat t hey ar e t he l oser s i n a
wi n/ l ose negot i at i on because of t he compet i t i veness
and mi st r ust t hat char act er i zed t he negot i at i on.
The l osi ng si de mi ght f eel good at t he concl usi on of
t he wi n/ l ose negot i at i on because of t hei r i mmedi at e
per cept i on t hat t hey obt ai ned t he best deal possi bl e
under t he ci r cumst ances.
I n t he l ong r un, t he l osi ng par t y of t en r egr et s t he
agr eement af t er di scover i ng t hat t he deal was not a
good one af t er al l .
The l osi ng par t y becomes even mor e mi st r ust f ul of t he
ot her par t y and r el uct ant t o cont i nue any sor t of
busi ness r el at i onshi p.
I n a monopsony si t uat i on, wher e t he Gover nment i s t he
onl y buyer , t he Gover nment coul d achi eve many shor t - t er m
wi ns t o t he det r i ment of cont r act or s by di ct at i ng cont r act
t er ms. But wi n/ l ose out comes may have t he f ol l owi ng
negat i ve l ong- t er mconsequences:
Suppl i er s on t he l osi ng end of wi n/ l ose negot i at i ons
may be f or ced out of busi ness.
Hi gh- qual i t y suppl i er s may no l onger be wi l l i ng t o do
busi ness wi t h t he Gover nment .
Cont r act s wi t h t he r emai ni ng suppl i er s may have a
gr eat er r i sk of poor - qual i t y or over pr i ced
del i ver abl es.
Lose/Lose Outcomes. When t her e i s a deadl ock, t he
negot i at i ng out come i s known as a l ose/ l ose out come. A
deadl ock occur s when f i nal agr eement cannot be obt ai ned.
Si nce bot h par t i es had a st ake i n a successf ul out come of
t he negot i at i on ( or t hey woul d not have been negot i at i ng i n
t he f i r st pl ace) , bot h si des l ose when negot i at i ons
st al emat e and deadl ock occur s.
The cont r act or si de may l ose mor e t han j ust t he pr of i t
pr oj ect ed f or t he l ost Gover nment cont r act .
Any cont r i but i on i ncome ( i . e. , t he di f f er ence bet ween
r evenue and var i abl e cost ) t hat coul d have been used
t o hel p absor b cont r act or f i xed cost s may be l ost . As
a r esul t , al l f i xed cost s must be absor bed by t he
ot her busi ness of t he f i r m. The r esul t i ng cost
i ncr eases f or t hose i t ems may r educe company pr of i t s
and may even cont r i but e t o over al l company l osses.
The di r ect l abor associ at ed wi t h t he pr oposed cont r act
may no l onger be needed by t he cont r act or . As a
r esul t , t he cont r act or may be f or ced t o l ay of f
empl oyees. A l ay- of f may af f ect l abor management
r el at i ons. I t may al so i ncr ease di r ect l abor cost s f or
ot her cont r act s, because l ay- of f s t ypi cal l y af f ect
l ower - pai d empl oyees f i r st .
When a deadl ock occur s, t he Gover nment si de al so
suf f er s a consi der abl e l oss because t he desi r ed suppl y or
ser vi ce of t en cannot be pr ocur ed i n a t i mel y manner . Thi s
i s par t i cul ar l y t r ue when t he Gover nment i s negot i at i ng
wi t h a si ngl e f i r munder an except i on t o f ul l and open
compet i t i on. When deadl ock occur s wi t h a sol e sour ce
cont r act or , t he uni que pr oduct or ser vi ce cannot be
obt ai ned.
FAR 15. 405( d) . Somet i mes, avoi di ng a deadl ock i s ver y
di f f i cul t when t he ot her par t y i s unf ai r or uncompr omi si ng.
The Gover nment must deci de on t he bet t er al t er nat i ve:
deadl ocki ng or bei ng on t he l osi ng end of a wi n/ l ose
out come. Consi der abl e ef f or t shoul d be made t o avoi d a
deadl ock because t he Gover nment si de wi l l suf f er a l oss
whenever one occur s.
I f t he cont r act or i nsi st s on an unr easonabl e pr i ce or
demands an unr easonabl e pr of i t / f ee, take all authorized
actions to resolve the deadlock. Det er mi ne t he f easi bi l i t y
of devel opi ng an al t er nat i ve sour ce. Consi der ot her
avai l abl e al t er nat i ves ( e. g. , del ayi ng t he cont r act ,
r evi si ng r equi r ement s, or Gover nment per f or mance) . I f t he
cont r act i ng of f i cer cannot r esol ve t he deadl ock, t he
cont r act act i on must be r ef er r ed t o hi gher - l evel
management . Management i nvol vement assur es a uni f i ed
Gover nment appr oach t o r esol vi ng or accept i ng t he deadl ock.
Win/Win Negotiation Style. The wi n/ wi n negot i at i on st yl e i s
t o negot i at e based on t he mer i t s of t he si t uat i on t o obt ai n
a sat i sf act or y r esul t . Gener al l y, you wi l l f i nd t hat
wi n/ wi n negot i at or s:
Attack the problem not each other. The di f f er ences
bet ween t he t wo si des ar e a mut ual pr obl em. I n a
wi n/ wi n negot i at i on, di scussi ons cent er on i dent i f yi ng
and r esol vi ng t hese di f f er ences, not at t acki ng t he
messenger . Negat i ve per sonal comment s can add not hi ng
t o at t ai ni ng a mut ual l y sat i sf act or y r esul t . I deal l y,
negot i at or s shoul d t hi nk of t hemsel ves as wor ki ng
si de- by- si de t o r esol ve di f f er ences i n a cor di al and
busi nessl i ke manner .
Focus on long-term satisfaction and common interests.
Many negot i at or s become so i nvol ved wi t h t hei r
obj ect i ves i n a par t i cul ar negot i at i on t hat t hey l ose
si ght of t he bot t oml i ne - - l ong- t er msat i sf act i on.
Wi nni ng a par t i cul ar poi nt i n a negot i at i on may mean
l osi ng a chance t o achi eve a mut ual l y sat i sf act or y
r esul t .
Consider available alternatives. Your sol ut i on may not
be t he onl y r i ght sol ut i on t o a par t i cul ar poi nt i n
t he negot i at i on. The same may be t r ue of t he
cont r act or ' s posi t i on. At t empt t o i dent i f y ot her
sol ut i ons f or consi der at i on. The f i nal sol ut i on may
not be any bet t er t han t he or i gi nal sol ut i on of f er ed
by one si de or t he ot her . However , i t i s per cei ved as
bet t er , because i t was r eached t hr ough mut ual
cooper at i on.
Base results on objective standards whenever possible.
Negot i at or s ar e mor e l i kel y t o be sat i sf i ed wi t h a
par t i cul ar r esul t , when i t i s based on an obj ect i ve
st andar d. Do not r ef use t o compr omi se si mpl y because
" t hat ' s t he audi t or ' s r ecommendat i on. " What was t he
st andar d used by t he audi t or i n devel opi ng t hat
r ecommendat i on? Ther e may be many st andar ds t o
consi der i ncl udi ng:
o Hi st or i cal exper i ence;
o I ndust r y pr act i ce; or
o Pr oj ect i ons devel oped usi ng quant i t at i ve
anal ysi s.
Focus on positive tactics to resolve differences. Do
not r el y on decept i ve behavi or or bar gai ni ng pl oys.
Tr i cki ng anot her negot i at or may wi n an appar ent l y
f avor abl e r esul t , but t he r esul t s dur i ng cont r act
per f or mance or i n t he next negot i at i on may be
devast at i ng.
Emphasize the importance of a win/win result. Remai n
posi t i ve dur i ng and af t er t he negot i at i on. Never gl oat
about wi nni ng t he negot i at i on, even as a j oke.
o The per cept i on of t he r esul t by each si de
det er mi nes whet her an out come i s wi n/ wi n or
wi n/ l ose. I n ot her wor ds, t he same cont r act ual
r esul t coul d be vi ewed as bei ng ei t her wi n/ wi n or
wi n/ l ose dependi ng on t he eyes of t he behol der .
For exampl e, a $700, 000 cont r act pr i ce coul d be
consi der ed a wi n/ wi n or wi n/ l ose out come
dependi ng on how t he cont r act or vi ews t hat pr i ce.
o The negot i at or ' s behavi or dur i ng and af t er
negot i at i on i s of t en t he pr i mar y i nf l uence on t he
ot her si de' s per cept i on.
o Regar dl ess of t he negot i at i on r esul t , t he
cont r act or i s mor e l i kel y t o per cei ve a wi n/ wi n
out come when t he Gover nment negot i at or exhi bi t s
wi n/ wi n behavi or .
o The cont r act or i s mor e l i kel y t o per cei ve a
wi n/ l ose r esul t when t he Gover nment si de appear s
t o have a wi n/ l ose at t i t ude.
o You shoul d exhi bi t a wi n/ wi n at t i t ude bef or e,
dur i ng, and af t er negot i at i on.
Win/Lose Negotiation Style. The wi n/ l ose negot i at i on st yl e
i s t o negot i at e based on power and usi ng t hat power t o
f or ce one negot i at or ' s wi l l on t he ot her . That power coul d
be r eal or onl y per cei ved by t he ot her negot i at or .
Gener al l y, wi n/ l ose negot i at or s t end t o:
Use deceptive negotiation tactics to increase or
emphasize their relative power in the negotiation.
These decept i ve t act i cs may wor k, but once i dent i f i ed
by anot her negot i at or , t hei r use can act ual l y
j eopar di ze t he possi bi l i t y of a mut ual l y sat i sf act or y
r esul t . Sever al of t he mor e commonl y used t act i cs wi l l
be descr i bed l at er i n t hi s t ext .
Focus on negotiating positions rather than long-term
satisfaction. Focusi ng on t he l egi t i macy of a si ngl e
posi t i on ( r at her t han t he r easons f or di f f er ences
bet ween posi t i ons) emphasi zes di sagr eement r at her t han
agr eement .
Be argumentative. Focusi ng on posi t i ons l eads t o
ar gument s over whose posi t i on i s bet t er , i nst ead of
how t o r each agr eement .
Show reluctance to make any meaningful concessions.
Focusi ng on posi t i ons al so makes t hemunwi l l i ng t o
make meani ngf ul concessi ons. Any concessi on mi ght l ead
t o quest i ons about t he l egi t i macy of t hei r posi t i on.
Such quest i ons may weaken t hei r act ual or per cei ved
power i n t he negot i at i on.
Be highly competitive and mistrustful of other
negotiators. They do not shar e i nf or mat i on unl ess i t
i s absol ut el y necessar y. Al t er nat i vel y, t hey may t r y
t o hi de r el evant i nf or mat i on by over l oadi ng t he ot her
negot i at or wi t h i r r el evant i nf or mat i on.
Spectrum of Negotiation Styles. Negot i at i on st yl es ar e
r ar el y pur e wi n/ wi n or wi n/ l ose. I nst ead, t hey cover a wi de
spect r umbet ween t he t wo ext r emes. You shoul d st r i ve f or a
pur e wi n/ wi n st yl e, but many negot i at or s exhi bi t a
combi nat i on of wi n/ wi n and wi n/ l ose t r ai t s dur i ng t he
cour se of a negot i at i on.
For exampl e, mi l dl y decept i ve behavi or i s somet i mes
exhi bi t ed by even t he best wi n/ wi n negot i at or s. The use of
some wi n/ l ose t r ai t s may even be j ust i f i ed, par t i cul ar l y
when deal i ng wi t h a wi n/ l ose negot i at or . Si mi l ar l y,
wi n/ l ose negot i at or s of t en exhi bi t some wi n/ wi n t r ai t s even
t hough t hi s behavi or may onl y be i nt er mi t t ent or a pl oy t o
decei ve t he ot her negot i at or .
The f i gur e bel ow depi ct s t he r ange of negot i at i on
st yl es wi t h wi n/ wi n and wi n/ l ose at opposi t e ends of t he
r ange. Whi l e t he spect r umof st yl es r anges f r om100 per cent
wi n/ wi n t o 100 per cent wi n/ l ose, t he over whel mi ng maj or i t y
of negot i at or s have a st yl e t hat f al l s somewher e bet ween
t he t wo ext r emes.
Wi n/ Wi n
100%90%80%70%60%50%40%30%20%
10%0%
<- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
- - - - - - - - - - - - - - - - - - - - - - >
0%10%20%30%40%50%60%70%80%90%
100%
Wi n/ Lose

No negot i at i on st yl e or combi nat i on of st yl es assur es a
wi n/ wi n out come. I n f act , f ol l owi ng a par t i cul ar st yl e does
not even guar ant ee t hat ot her s wi l l per cei ve t hat you ar e
f ol l owi ng t hat st yl e. Behavi or t hat i s 60 per cent wi n/ wi n
and 40 per cent wi n/ l ose may be per cei ved as wi n/ l ose by t he
cont r act or and may even r esul t i n deadl ock. Li kewi se, t her e
i s al ways a possi bi l i t y t hat a negot i at i ng st yl e t hat i s 30
per cent wi n/ wi n and 70 per cent wi n/ l ose may be per cei ved as
wi n/ wi n by t he cont r act or .
Whi l e t he pr opor t i on of wi n/ wi n behavi or needed t o
pr oduce a wi n/ wi n out come var i es by negot i at i on and i s
never cer t ai n, t he pr obabi l i t y of a wi n/ wi n out come
t ypi cal l y i ncr eases i n pr opor t i on t o t he wi n/ wi n behavi or
exhi bi t ed by t he negot i at or s. Conver sel y, t he pr obabi l i t y
of ei t her a wi n/ l ose or l ose/ l ose out come i ncr eases i n
pr opor t i on t o t he wi n/ l ose behavi or exhi bi t ed by t he
negot i at or s.
Negotiation Style Comparison. The f ol l owi ng t abl e compar es
wi n/ wi n and wi n/ l ose negot i at i on st yl es:
Characteristic Win/Win Style Win/Lose Style
Negot i at i on
Goal
Obt ai n a r esul t
t hat i s
sat i sf act or y t o
bot h si des,
i ncl udi ng a f ai r
and r easonabl e
pr i ce.
Obt ai n t he best
possi bl e deal f or
your si de
r egar dl ess of
consequences t o
t he ot her si de.
Focus Sol ve mut ual
pr obl ems.
Def eat t he ot her
par t y.
Envi r onment Cooper at i on and
t r ust
Mi st r ust and
gamesmanshi p
Negot i at i on
Char act er i st i cs
Negot i at or s
at t ack t he
pr obl emnot
each ot her
Focus on
l ong- t er m
sat i sf act i on
Avai l abl e
al t er nat i ves
consi der ed
Resul t s based
on obj ect i ve
st andar ds
Focus on
posi t i ve
t act i cs t o
r esol ve
di f f er ences
Emphasi s on a
wi n/ wi n
r esul t .
Tact i cs
desi gned t o
i ncr ease or
emphasi ze
r el at i ve
power .
Focus on
negot i at i ng
posi t i ons
r at her t han
l ong- t er m
sat i sf act i on.
Ar gument at i ve
Rel uct ance t o
make any
meani ngf ul
concessi ons
Hi ghl y
compet i t i ve

1.3 Describing Attitudes That Lead To Successful
Negotiations
Overriding Negotiation Themes. Gover nment negot i at or s
shoul d al ways keep i n mi nd t he f ol l owi ng basi c at t i t udes
when negot i at i ng Gover nment cont r act s:
Thi nk wi n/ wi n;
Sel l your posi t i on;
Wi n r esul t s not ar gument s;
Ever yt hi ng i s negot i abl e; and
Make i t happen.
Think Win/Win. A wi n/ wi n out come i s t he par amount obj ect i ve
i n a Gover nment cont r act negot i at i on. Consequent l y, you
shoul d consci ousl y di spl ay a wi n/ wi n at t i t ude and
negot i at i ng st yl e t hr oughout t he negot i at i on pr ocess. Use
wi n/ wi n negot i at i on t act i cs and avoi d t act i cs t hat mi ght
l ead t he cont r act or t o per cei ve t hat you ar e usi ng a
wi n/ l ose st yl e.
Sell Your Position. Dur i ng negot i at i ons, you ar e act i ng as
an agent of t he Gover nment t r yi ng t o sel l your posi t i ons t o
t he cont r act or ' s t eam. Accor di ngl y, you shoul d st r i ve t o be
per suasi ve whi l e bei ng r espect f ul and pol i t e. I n
negot i at i ons as i n ot her f or ms of sal es, i t i s easi er t o
sel l a pr oduct when t he pr ospect i ve cust omer l i kes and
r espect s you.
Win Results Not Arguments. Tr yi ng t o wi n t he ar gument i s
t oo of t en a si gn of a wi n/ l ose negot i at i on. When
ar gument at i ve behavi or char act er i zes negot i at i ons, one or
bot h si des ar e l i kel y t o per cei ve a wi n/ l ose out come even
when t he f i nal out come coul d ot her wi se appear bal anced and
f ai r . Remember t hat per suasi on i s not onl y a mat t er of
l ogi c and cont ent , but al so si gni f i cant l y depends on t he
manner of pr esent at i on.
Everything Is Negotiable. No negot i at i on posi t i on i s sacr ed
and of f l i mi t s i f i t pr event s t he mor e i mpor t ant goal of a
mut ual l y sat i sf act or y out come. Consequent l y, you must
al ways be pr epar ed and wi l l i ng t o negot i at e al l i ssues.
Make It Happen. To achi eve l ong- t er msat i sf act i on, you may
need t o di spl ay cr eat i vi t y, i ni t i at i ve, and even cour age.
Your goal i s a mut ual l y sat i sf act or y out come. Fi nd a way t o
make i t happen.