4.4 Overcoming Impasses in Distributive Bargaining

Negotiation impasses can derail even the most promising deals. Understanding the causes, from incompatible goals to power imbalances, is crucial. By recognizing these roadblocks, negotiators can employ strategies to break deadlocks and keep talks moving forward.

When faced with an impasse, it's essential to weigh the costs and benefits of walking away. While withdrawal may preserve your BATNA, it can also lead to missed opportunities. Developing strong contingency plans and alternatives gives you leverage and confidence to navigate tough situations.

Overcoming Impasses in Distributive Bargaining

Causes of distributive negotiation impasses

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• Incompatible positions or goals arise when parties have drastically different target points (ideal outcomes) or reservation points (bottom lines) creating a large gap between their desired outcomes
• Zero-sum mindset leads parties to believe that one party's gain is directly proportional to the other's loss resulting in a win-lose approach that hinders collaboration and compromise
• Ineffective communication occurs when parties lack active listening skills and fail to understand the other party's perspective instead focusing on stating their own positions rather than exploring underlying interests
• Emotional barriers such as ego involvement and the need to "win" at all costs can cloud judgment and escalate conflicts while a lack of trust between parties hinders open and honest dialogue
• Structural barriers including deadline pressures (looming expiration dates) or time constraints (limited negotiation windows) can create a sense of urgency that leads to hasty decisions and missed opportunities for value creation
• Power imbalances between parties (large corporation vs small startup) can lead the more powerful party to adopt a competitive approach and the less powerful party to feel pressured to accept unfavorable terms

Strategies for breaking deadlocks

• Reframe the negotiation by shifting focus from positions (stated demands) to underlying interests and needs (motivations behind positions) to identify shared goals and areas of common ground
• Engage in active listening and empathy by seeking to understand the other party's perspective and concerns acknowledging and validating their feelings and experiences to build rapport and trust
• Generate creative options through brainstorming potential solutions that address both parties' interests using "what if" scenarios (hypothetical proposals) to explore alternative approaches without committing to them
• Use objective criteria such as fair standards (industry benchmarks) or market value (comparable prices) to guide the negotiation and appeal to principles (ethical norms) to justify offers and concessions
• Take breaks or caucuses to allow time for parties to regroup and reassess their strategies using breaks to de-escalate emotions (cool off periods) and refocus on problem-solving rather than positional bargaining

Costs vs benefits of negotiation withdrawal

• Short-term costs include lost time and resources invested in the negotiation process (travel expenses, legal fees) and potential damage to the relationship with the other party (strained communication, reduced trust)
• Long-term costs involve missed opportunities for future collaboration or deals (joint ventures, strategic partnerships) and reputational harm within the industry or market (perceived as difficult to work with)
• Short-term benefits include avoiding an unfavorable agreement that does not meet your needs (below reservation point) and preserving your BATNA (best alternative to a negotiated agreement) to pursue alternative options
• Long-term benefits involve maintaining your integrity and credibility as a negotiator (consistent with principles) and signaling to others that you will not accept suboptimal agreements (setting precedent for future negotiations)

Contingency plans and BATNA development

• Identify your BATNA by determining your best course of action if no agreement is reached (pursuing another client, developing product internally) and assess the value and feasibility of alternative options
• Strengthen your BATNA by taking steps to improve the attractiveness of your alternative options (enhancing features, reducing costs) and investing in developing new relationships or opportunities (networking, market research)
• Use your BATNA as leverage by communicating your willingness to walk away if necessary (conveying a strong alternative) and demonstrating that you have viable alternatives to the current negotiation (providing evidence of other options)
• Assess the other party's BATNA by gathering information about their alternative options and constraints (financial pressures, time sensitivity) to inform your negotiation strategy and offers (targeting their interests, applying pressure)
• Develop contingency plans by anticipating potential obstacles or challenges that may arise (changing regulations, competitor actions) and creating plans for addressing these scenarios and maintaining momentum (adapting tactics, proposing tradeoffs)