In the global world of mergers and acquisitions, buyers and sellers share a common goal - to finalise a deal. Negotiations, a critical and inevitable activity that takes place during deal making is not about getting everything you want, but about finding out what both parties want. Cross-cultural diversity, globalisation and changes in today’s business environment can complicate high-risk and high-stake business negotiations. While many scholars have disseminated insightful inferences on effective negotiation strategies through publications in academic and practitioner journals, the purpose of this blog is to share ideas and shed light on certain negotiation behaviours that can contribute to business success but are often overlooked.
Let’s take a look at some of the major mergers and acquisitions of 2017:
• Apple’s acquisition of Shazam;
• Verizon’s acquisition of Yahoo;
• Cisco’s acquisition of SD-Wan Viptela, Broadsoft and AppDynamics;
• Intels’s acquisition of Mobileye;
• Michael Kors’ acquisition of Jimmy Choo; and
• Coach’s acquisition of Kate Spade.
Being able to identify, evaluate and exploit potential synergies to elevate margins and expand successfully resulted in positive outcomes for these companies. While careful preparation and planning are prerequisites for success in any business negotiation, incorporating strategies that build trust and facilitate information exchange at the negotiation table becomes vital in yielding maximum joint gain.
So, what strategies can contribute to success in business negotiations?
For example, can rhetorical comments, threats, ultimatum speeches and other deceptive and distributive strategies used by President Donald Trump help achieve better outcomes and snap better deals? Or, does a typical negotiation scenario entail striking a deal that everyone can work with? If it’s yes to the latter, how do negotiators achieve this?
John F. Kennedy once stated “You cannot negotiate with people who say what’s mine is mine and what’s yours is negotiable.” Corroborating on this thought, let’s navigate and shed light on behavioural strategies that can play a mediating role in high-stake negotiations. Most often businesses tend to focus on the content of the interactions more than the relational aspects of the negotiation process. To elaborate, expressing a level of empathy at the negotiations table, active listening such as paraphrasing and acknowledging, creating a level of rapport with the other party, the art of mimicry and other integrative strategies can foster trust and capitalise on differing beliefs to create long-term relationships and value-driven collaborations. Have you tried any of these in your business interactions? Let me know what you think.
I conclude by recommending two books that are based on projects undertaken at Harvard. ‘Getting to yes,’ a book by Fisher and Ury is a must-read as it provides basic and straightforward negotiation strategies that can help readers understand how to use integrative techniques efficiently to achieve mutual-gains. Another book I recommend is ‘Difficult Conversations,’ a step-by-step, user-friendly guide on how to improve your communication skills and manage difficult situations successfully and with less stress.
Dr Cheryl Dowie is a lecturer in Business and Management studies at the University of Aberdeen. Her current research investigates negotiation strategies and techniques that facilitate long-term, value-driven collaborations. Besides this, Cheryl’s other research interests include cross-cultural interactions, conflict management and decision-making in teams. Prior to taking up her academic position, she worked for seven years as a consultant for Hewlett Packard, IBM and Accenture in India and the US.