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Is win-win a useless concept for negotiators?

April 30, 2014

Spend Matters has reviewed a book by Professor Andrew Cox in which he challenges whether win-win is a useful or achievable concept for negotiators. Without being specific as to why they take this view, the Spend Matters’ author concludes that ‘win-win is possible in some situations’ and then makes a call for planning, compromise and ‘mutually advantageous concessions’.

The perspective of negotiation and its purpose shown by this debate seems to me far too narrow – and is perhaps more a commentary on the value perspectives of the Procurement function than a useful analysis of the benefits that come from effective negotiation. I have personally experienced many ‘win-win’ negotiations, but they are not based on the narrow parameters of price and risk allocation. They concentrate on business goals and objectives and how, together, the parties can generate a creative solution that may ultimately surpass the initial expectations that either had.

Of course every organization struggles with consistent win-win relationships and much depends on the ability to be creative. This is impacted by issues such as culture, the inclusiveness of the negotiation team, the timing of engagement and readiness to be open-minded. In the feed-back I receive, much of the win-win problem results from the narrow perspectives and objectives of Sales and Procurement – one driven by closing the deal as fast as possible, the other by being able to claim ‘savings’. Of course in this environment compromise and concessions become the only real currency and win-win is an illusion.

As many commercial experts will tell you, if you want to achieve high value from negotiation, it is often best to make sure that Sales and Procurement are kept out of the discussion. So maybe Professor Cox’s real point is that the measures and objectives used by many Procurement organizations are the antithesis of win-win – and on this I would agree. They need to change.

  1. Dale Teeters permalink

    Win-Win is achievable – but who are the negotiators and what are they negotiating? I believe today the win-win concept is an essential part of a true partnership. From my executive experience it is the business leaders who are willing to accept risk for innovative new technology or materials and they understand the potential rewards and payoffs of these win-win agreements with suppliers / partners. If you’re talking about standard products or commodities, sales and procurement have standardized terms and conditions and often only negotiate price, specification, or some other minor term – in this case it’s more of a take it or leave it situation where the buyer is in control. The playing field has to be leveled to scarce or custom items where more negotiation takes place for real win-win to occur. .
    Dale Teeters

  2. My viewpoint: Win-win is real. Our work on at the University of Tennessee studied real companies – with real “win-win” deals and it has led to 4 books on the concept of Vested Outsourcing – including one co-authored with the brilliantly talented Katherine Kawamoto from IACCM! There are progressive organizations and individuals out there…and only by educating people with the news skills they need will they be able to succeed. And of course – if people can’t or won’t change….then it is up to executives to well – physically change the people and get different people with the right mindset in to replace those junkyard dogs!

  3. Kate
    You are certainly right that the evidence is out there and it seems to me that anyone who considers themselves to be ‘a negotiator’ has a professional duty to learn and apply the practices that lead to higher value results.

  4. Tristan Dehaan permalink

    There is a lot of assumptions here and saying Procurement should be kept from the table is a misconception. Not every team or roles are carried out in the same manner. The important aspect is your personality execution or put another way, being the true ‘Trusted Advisor’. If you don’t know the concept I am more than happy to explain further. There is always a win/win result, its just the ratio always is different but if people come away feeling cheated then the relationship will be short lived. So if you are playing a long game, its more important to share the win.

  5. Robert Berry permalink

    As with many general concepts, how you define the objective of “win-win”, to paraphrase President Clinton, “depends on what is [winning] is”. For fans of game theory and those familiar with the prisoner’s dilemma, the very definition of winning is key to the strategy of how to accomplish that goal. As this particular game illustrates, if you are going to gamble on taking advantage of our counter-party, you have to be prepared to lose more than you win. And if you adopt that strategy, you will find out that your opportunity to exploit your counter-party’s trust is limited by time; people who are taken advantage of develop counter-strategies which tend to balance out the score. This approach channels resources into unproductive, defensive conduct. Eventually you must lose as more than you win (assuming roughly equal leverage). Even if you have leverage, you will tend to select for those counter-parties who must eventually become unsuccessful. You cannot “loose” in a negotiation and make up the difference on volume, as the saying goes.

    My definition of win-win is that the parties get more than they would if they “lost”, but less than they would if they “win”. What makes win-win a much more productive strategy is that it allocates resources (time and effort) to exploring what wins are more important to your counter-party than you, and to trade those for things that are more important to you. If the parties can learn to trust the good faith of each other to seek that outcome, negotiations can progress along mutually productive lines; ie. “win-win”.

    I have not read this book, so I may misunderstand the premise, but in my view, the very essence of negotiation is the principle of mutual respect of each party’s desired outcome. To the extent that I can give you what you want, and what is most important to you, and in return get concessions on issues that are important to me, and maybe not so important to you, then we have a basis for succeeding at a “win-win” outcome.

    Rob Berry-Esq.

  6. Not having read the book, I am not sure of the author’s intent. My view is that win-win means that both sides (seller and buyer) must gain something of mutual advantage and value. Sometimes you win more and sometimes you win less; however, it must be within the range of your objectives or you walk-away. This is the reason negotiators bargain, haggle, compromise, and collaborate in a give and take atmosphere. In the end, one may get more than the other. The wider the gulf of disagreement, the less the chance for satisfaction by either ingratiating party. During the negotiating process each side shares and/or ration the process based on their objectives.

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