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Integrative and Distributive Bargaining
Editors’ Note: The distinction between integrative and distributive negotiation is one of the baseline innovations of our field’s modern development. Any number of other concepts simply cannot be understood until its lessons have been absorbed. Here, the author walks the reader through the all-important basics of this key element of understanding of negotiation: why “creating value” and “claiming” it represent competing goals; how these relate to the negotiator’s personality; how they affect the process as it unfolds—and how, in the end and despite obstacles, they must be integrated, if a good result is to be reached.
Dispute resolution literature divides approaches to negotiation into two major types: integrative bargaining and distributive bargaining. Scholars have referred to these two approaches, sometimes called different styles of negotiation behavior, by various terms over time. However, despite the terminology used, these two approaches are relatively consistent throughout the literature, and contrast with each other across several important dimensions: First is the overall goal for the negotiation approach regarding creating or claiming value; second is the different negotiation processes used to conduct the negotiation; third is the approach towards sharing information; fourth is the attitude towards the relationship with the other party.
The style of each negotiator affects the goals that are set, which in turn influences the processes used, which also determines the approach towards information and relationship (Menkel-Meadow 1984). Despite the characterization of these different approaches as distinct, and the seemingly stark contrast between them, it is important for skilled negotiators to recognize and appreciate both approaches to negotiation so that they may identify the different approaches used by negotiation counterparts—and use both approaches appropriately throughout their negotiations. [See NDR: Pappas, Strategic Listening]
A Note on Terminology
Integrative bargaining and distributive bargaining approaches have typically gone by many different names in the negotiation literature. Integrative bargaining was once characterized as a “cooperative” style, whereas distributive bargaining had historically been known as a “competitive” style (Williams 1983). However, with the advent of an increased focus on alternative dispute resolution by academics and the legal system, (Fisher et al. 2011; Menkel-Meadow 1984) and perhaps due to a change in the way the term “cooperative” was perceived by negotiators themselves (Schneider 2002), these labels have shifted over time. Integrative bargaining is alternatively known as “problem solving,” “win-win,” or “value creating” negotiation. Distributive bargaining is also described as “competitive,” “adversarial,” or “value claiming” negotiation. These more nuanced descriptors avoid the baggage that came with the common understanding of “cooperative” and “competitive” and help focus the discussion on the goals and behavior of negotiators who are using the different approaches, rather than simply stating a preference for competition or cooperation. [See also NDR: Abramson, Effective Style] These goals and behavior are discussed below.
Differences in Goals:
Creating v. Claiming Value in Negotiation
The goals of every negotiator vary based on the background of the negotiator and the negotiation in question (Menkel-Meadow 1984). However, we can broadly contrast integrative bargaining and distributive bargaining by the negotiator’s conception of their attitude towards value in negotiation. In every negotiation, all parties must feel that they are better off than if they were not to reach a deal. Negotiators in a bargaining situation are often advised to measure how much better off they are in contrast to their Best Alternative to Negotiated Agreement (BATNA), i.e. what they will do if agreement cannot be reached. They will measure this difference in terms of their own interests, which are the underlying reasons that motivate the parties to come to an agreement, whether those be...
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