Compromising Negotiation — 3 Powerful Strategies + Examples

What exactly goes through your mind when you hear about the compromising negotiation style? Is it about negotiating while trying to get a better deal between you and your opponent? At most times, people assume that the compromising style is all about making promises or concessions.

The concessions part is half-true, but we will get more into that later on.

Before you read the whole article, I have created a free-to-download negotiation-style template. It’s a PDF file that can help you assess your main negotiation style.

Whatis Compromise?

In negotiation, compromise is a basic negotiation process in which both parties will give up something that they want for them to get something else that they want more.

Compromise often happens in win-lose scenarios when there is a fixed pie that needs to be divided in which way the other party wins and the other one loses.

In this situation, neither side gets what they really want. However, the parties make concessions to reach an acceptable agreement.

Compromising Negotiation Style– What is it?

The compromising negotiation style is one of several negotiation styles that focuses on striking a balanced deal between you and your opponent. In simple terms, it is a negotiation tactic where no one has the upper hand in the end; both you and the other party simply agree to meet in the middle. No one wins and no one loses.

Sounds boring, yes? Well, there will always be negotiations where sometimes, pushing for something too much or too less are both bad for you. And the same thing can also happen to your opponent. Therefore, it is also a good idea for both parties to simply gain an understanding right in between one another.

Thus, this negotiation style is quite opposite to two other negotiation styles; the collaboration negotiation style (where it’s a win-win situation for you and the other party) and the usual hardball distributive negotiation style (where you are out to win at all cost against the other party).

And that’s why, dear negotiators and procurement managers, is the reason why it’s called the compromising negotiation style.

Compromising Negotiation Strategies to Apply Yourself

Strategy 1 – Be quick and decisive

When using the compromising negotiation style, you need to be quick in determining what the middle ground is. When you’ve recognized what it is, wait until there is no longer an option of negotiating further.

If the outcome of the negotiation is going to be a lose-lose situation, you need to be decisive in putting the middle ground right in front of you and your opponent. Place your card on the table and be quick in delivering it as well.

Example:

Louise is having a hard time trying to win an argument with her co-workers. The company wants to have a get-together and her proposal is an out-of-town beach party. However, her co-workers are budget conscious and would prefer to do some local activities instead.

While running her hand on a local tourism app, she sees a local beach that is just a few meters away from the office.

Louise: “Okay, I just saw a local beach in town and it’s not too far away from our office. Since everyone wants to save money, I think this is the best place for us to hold our get-together party. Does anyone have other ideas?”

Strategy 2 – When decided on the middle ground, reaffirm it via voice and paper again for everyone to agree on.

Once you and the other party have agreed on the compromise, always make sure to reaffirm it again both on voice and on paper so that everyone present during the negotiation is aware of what transpired and what both parties have agreed upon.

This way, both parties understand what was agreed upon and that later negotiations can be held again without wasting anyone’s time.

For any documentation, make sure to send everyone a copy of it.

Example:

Tony and his associates decided on a compromise of selling their product for half the price at twice the agreed-upon number by the opposing party.

Tony: “Again, let me reaffirm that my associates and I agree on selling our products for half the price but we will sell at twice the agreed amount. The details can also be seen on paper here, which I will be sending to each one of you after the meeting.”

Strategy 3 – Always decide on the next negotiation after building the compromise.

Because of the nature of how compromise is almost in any case needed to end negotiations and close deals, always assume that the end is only temporary and that neither party is ever fully satisfied with the outcome. Thus, always decide on when the next negotiation will be after building the compromise itself.

This also holds true if one of the members of the negotiating table is not present at the moment.

Even if the other party makes no mention of another upcoming negotiation, it is always a good practice to be ready for anything. This will also give the other party an idea as to when to expect another call from you if you are not fully satisfied with the compromise.

Examples of Compromising Negotiation Style

The following are some of the examples of compromising style in negotiation:

1. Earn Out Agreement

In the world of business sales, it’s not uncommon for the person selling a company and the person buying it to have different ideas about how much it’s worth. When they can’t agree on a price, they sometimes use a strategy called an “earn out.”

Here’s how it works: Let’s say someone wants to sell their business for $6 million, but the potential buyer thinks it’s only worth $4 million. To meet in the middle, they come up with an earn-out arrangement. In this setup, the buyer agrees to pay $4 million upfront, and then the remaining $2 million gets paid later, like after a year. But, here’s the catch: the extra $2 million will only be paid if the business performs well and achieves specific goals during that time.

So, it’s kind of like a compromise. The seller gets some money right away, which is closer to what the buyer thinks the business is worth. And then, if the business does really well after the sale, the seller might get the extra $2 million, making the total closer to what they originally wanted.

This earn-out is a way for both the seller and the buyer to find middle ground when they can’t agree on the price. The buyer doesn’t have to put up all the money upfront, and the seller still has a chance to get the full amount they hoped for if things go well. It’s like saying, “Okay, we’ll do it your way for now, but if things turn out better than expected, then I get what I wanted too.” It’s a bit of a give-and-take to make a deal happen.

2. Paris Climate Agreement

The Paris Climate Agreement served as a good illustration of an effective compromise negotiation, where various nations address the challenges brought by climate change and how they can stop it.

Here is why the agreement is a good example of a compromise negotiation:

• Fair shares: Countries agreed to do their part based on how much they had contributed to causing the problem. This way, everyone took responsibility, but it wasn’t too hard for anyone.

• Personal Plans: Instead of having one strict rule for everyone, each country decided what they could do to help. This was fair because different countries have different needs.

• Big Goal, Step by Step: They all decided on a big goal: to keep the Earth’s temperature from going up too much. It’s like agreeing on a limit to how hot things can get. This goal made everyone work together.

• Helping Each Other: Rich countries said they would help poorer countries with money and knowledge to fight climate change. This was like sharing resources to make sure everyone could contribute.

• Checking and Learning: Countries promised to check on each other’s progress and share their efforts. This way, they could learn from each other and make sure they were doing what they said they would.

3. My Experience in Using Compromising Negotiation Style

Negotiation styles are a very important variable to master to achieve great deal results. Your ultimate deal will be determined by how skilled you are as a negotiator. The more skilled you are in using different styles, the more the other party will be drawn to settle close to your ideal outcome and closer to their limit.

Your selection of negotiation style should depend on your personality and the results of your earlier research on the styles that will probably be used by your negotiating counterpart. Getting to recognize the different negotiation styles will help you to negotiate way more efficiently! It’s important to know how and when to use particular styles to get more of what you want from the negotiation.

“In my time as a Procurement Manager, I had to deal with 1500 different products delivered by 70 suppliers every year. Suppliers were traditionally better equipped; most account managers that I had been dealing with, only had to focus on one customer and thus the negotiator: me. This led to what I call, the knowledge gap. They had way more time to prepare for negotiations. Most of them kept detailed notes on my negotiation style, likes and dislikes, interests, family details, and so on. In general, they were in a better position to choose the most appropriate style to approach me in the upcoming negotiation. My advantage, on the other hand, was the fact that I was negotiating all day & year: that experience leveraged the knowledge gap mostly: I practiced a full year with changing styles & using tactics. This helped me to have one important skill in any negotiation: I was not predictable.”

Do you also want to learn to apply effective tactics yourself and become unpredictable? There are a large number of styles & tactics that you can use in negotiations! In our Certificate Program, we will teach you when which styles to use and in what way you should use them to your advantage!

Want to check out more negotiation case studies? We actually created an overview with 13 inspiring real-life negotiation examples.