The dictionary defines the word "negotiation" as mutual discussion and arrangement of terms of a transaction or agreement. Negotiations are inherent to life. They begin soon after birth and continue throughout life. Negotiations are the platform we use to move shared and dissimilar interests to mutually satisfactory conclusions.

In the business world, negotiations obviously play an important role. They assist enterprises to accomplish day-to-day business tasks including resolving conflicts, forming associations, taking loans, making sales, purchasing materials, and an endless list of other ongoing issues which need agreements.

Though negotiations occur in different ways, the desired outcome can drive the negotiation strategy. Two more frequently used approaches to negotiating issues are distributive and integrative negotiations.

Distributive Negotiation

As the name suggests, distributive negotiation deals with the distribution of fixed resources such as machinery, money and real estate. Distributive negotiation is variously referred to as win-lose negotiation, claiming value, the fixed pie or zero sum bargaining. The underlying philosophy of this technique is allocation of resources.

Success of the distributive negotiation requires you to be clear about your goals. What is it that you want to achieve from the ensuing discussion? You also need to know your and others' "walk away values," the acceptance parameters that retain interest in the deal. In the absence of these parameters, participants typically walk out of the deal bringing communication, crucial for fruitful negotiations, to a complete halt.

Another key ingredient of a successful distributive negotiation is in-depth information about all disputants and their negotiation capabilities. A candidate with strong negotiation skills along with knowledge about opponents' weaknesses is sure to come out with a larger portion of the pie.

Distributive negotiation runs a high risk of being perceived as unfair because the strategy does not guarantee uniform distribution of materials to the parties involved. Consequently, the disputants who get more feel elated while other participants who get less may feel cheated at the end of distributive negotiations. The resultant breakdown of relationships during distributive negotiations oftentimes leaves a wake of irreparable relationships.

Due to its damaging effect, distributive negotiation has earned ample criticism. Some academicians are completely against the practice of distributive negotiation. Fisher, Patton and Ury in their book Getting to Yes, theorize that distributive negotiation is uncalled for in all situations. Instead, even under difficult circumstances the negotiating parties can, with some effort, come to conclusions beneficial to all involved.

Integrative Negotiation

Integrative negotiation, alternatively known as win-win negotiation or interest-based negotiation, addresses the goals of everyone involved. Its basic premise of benefiting all participants makes this strategy hugely popular. It aims at forming collaborations so enterprises can work together and reap benefits much higher than their profits from individual efforts.

Unlike distributive negotiation which calls for distribution of the pie, integrative negotiation enlarges the pie so everyone enjoys a bigger slice of the pie. Integrative negotiation is more difficult than the distributive style and may at times require creative out-of-the-box thinking. Ultimately, everyone participating in an integrative negotiation walks out feeling like a winner.

All members engaged in a negotiation may need the same entity but for different purposes. Without knowing the reason for wanting to acquire a specific element, unnecessary altercations can often result. Therefore, a clear understanding of the requirements and objectives of all disputants is key to coming up with solutions that satisfy everyone. Establishing who gets what and how much from the pie is another requirement for successful negotiations.

After assembling requirements of all the participants comes the collaborative task of determining solutions to address those needs. In this way, integrative negotiation makes everyone think about not only their own interest but also the benefit of others.
Because integrative negotiations create a win-win situation, everyone leaves satisfied without harboring ill feelings for anyone else in the group. Thus, integrative negotiations prove to be more constructive than distributive tactics. They often result in building successful long-term relationships.

Notice the difference in terminology used in both types of negotiations. While distributive negotiation refers to participants as "opponents," integrative negotiation deals in terms of "collaborators." The very nature of integrative negotiation is that of bringing together people and hence organizations.

An interesting aspect of the process of integrative negotiation is that it involves an element of distributive negotiations. You are still required to think about your own interests while coming up with a solution for others as well.

Integrative negotiation is not a one-way process. All the parties involved must also understand the need to cooperate and convert an otherwise adverse situation into a mutually profitable state of affairs. For this, all members participating in the discussion should make efforts to share as much information as is required to resolve the conflict.

Conclusion

Though pages and pages can be written discussing different aspects of distributive and integrative negotiations, the fact remains that these strategies cannot be implemented independently of each other. Every negotiation is part distributive and part integrative. In any negotiation, it is but natural for individuals to root for their interests. But paying attention to what others want is the only way of forming result-oriented collaborations, the basic requirement of joint-gains.

Information is key to a successful negotiation. List the requirements, goals and expectations of everyone involved. What is important to you may not be so critical to the other party making it easy for them to let go of it, and vice versa. Eventually, it requires concerted efforts on the part of all negotiators to reach a win/win decision.