Based on hundreds of real-world cases and experimental findings, the Mutual Gains Approach to negotiation (MGA) lays out four steps for negotiating better outcomes while protecting relationships and reputation. The vast majority of negotiations, this model holds, involve parties with more than one concern and more than one issue that an agreement might address. The model improves the chances of creating an agreement superior to existing alternatives.
MGA is not the same as “Win-Win” (the idea that all parties must, or will, feel delighted at the end of the negotiation). It does not focus on just being nice. Rather, it emphasizes careful analysis and good process management. The four steps in the model are:
Prepare by understanding interests and alternatives. More specifically, estimate your BATNA and how other parties see theirs (BATNA stands for “Best Alternative to a Negotiated Agreement”). Having a good alternative to agreement increases your power at the table. At the same time, work to understand your own side’s interests as well as the interests of the other parties.
Good negotiators listen for the interests behind positions or the demands that are made. For instance, “I won’t pay more than ninety thousand” is a position, but the interest behind the position might include limiting the size of the down payment; avoiding a product or service that could prove unreliable; or finding favorable interest rates attached to future payments. The party might also fail to articulate other non-financial interests that are nonetheless important.
Create value by inventing without committing. Based on the interests uncovered or shared, parties should declare a period of “inventing without committing” during which they advance options by asking “what if?” By floating different options and “packages”—bundles of options across issues—parties can discover additional interests, create options that had not previously been imagined, and generate opportunities for joint gain by trading across issues they value differently.
Divide value fairly. At some point in a negotiation, parties have to decide on a final agreement. The more value they have created, the easier this will be, but research suggests that parties default easily into positional bargaining when they try to finalize agreements. Parties should divide value by finding objective criteria that all can use to justify their “fair share” of the value created. By figuring out how to guide difficult allocation decisions, parties at the negotiating table can also help the groups they represent to understand why the final package is not only supportable, but fundamentally “fair.” This makes agreements more stable, it increases the chances of effective implementation, and it protects relationships.
Imagine future challenges and the solutions needed to follow through on agreements. Parties near the end of difficult negotiations—or those who will hand off the agreement to others for implementation—often forget to strengthen the agreement by imagining what could derail it or produce future conflicts. While it’s difficult to focus on the future, it’s wise to include specific provisions in the final document that focus on monitoring the status of commitments; communicating regularly; resolving conflicts or confusions that arise; aligning incentives and resources with the commitments required; and helping other parties who may become a de facto part of implementing the agreement. Including these provisions makes the agreement more robust and greatly assists those who will have to live by it.