By adopting this principle, most people can be much better negotiators. The word “envelope” refers to a set of limitations within which a system can perform effectively. The Envelope of Negotiation is the set of limitations within with the negotiator believes a given issue can be negotiated effectively. It consists of the: Opening, Target and Bottom Line positions that are selected for that issue.
Setting an Envelope
Setting an Envelope for each anticipated issue is the one thing a good negotiator must do before they negotiate. At the left edge is the issue’s opening position. Offers that are more assertive than this tend to be excessive. At the opposite edge is the bottom line, the absolute minimum the negotiator can accept on the issue.
If the other side is unwilling or unable to agree to this, the negotiator must deadlock on the issue (and, necessarily, on the entire negotiation). In between the opening and the bottom line is the target for the issue, the result the negotiator would like to achieve. The target is what is considered by the negotiator to be a realistic, reasonable outcome on that point. Although an issue’s target must be between its opening and its bottom line, it needn’t be (and usually isn’t) equidistant from them. All points within the Envelope represent outcomes that are acceptable to the negotiator on that issue.
The negotiator’s counterpart probably has his or her own Envelope (or something like it) for the issue. If the two Envelopes don’t overlap, agreement isn’t possible. If they do, the goal is to work out an advantageous deal.
Do Envelopes Overlap?
The negotiator begins by offering the opening position set by the Envelope for the issue. He then moderates his stance on the issue with a series of concessions that moves him towards his target. Hopefully the other side will agree to a resolution of the issue at or around the target (something that won’t be possible unless their bottom line on the issue equals or exceeds the negotiator’s target). If not, the negotiator will continue to make concessions, moving below his target toward his bottom line.
If necessary, he will go all the way to his bottom line on the issue (but not actually reaching it until the deadline). If the other side’s bottom line on the issue doesn’t equal or exceed his, only deadlock—on the issue and the whole negotiation—is possible. If the counterpart’s bottom line on the issue equals or exceeds the negotiator’s, he must resolve the issue (although deadlocks on other issues may still torpedo the larger negotiation).
Size of The Envelope
The relative bargaining strength or weakness of the parties determines the size of their respective Envelopes. When the negotiator hears that somebody is “bargaining from a position of strength” (or weakness), what’s really be discussed is the size of their Envelope(s). As a general rule, the stronger party has the smaller Envelope on an issue. The stronger party has more (and more attractive (alternatives than the weaker party, and will resort to those alternatives (deadlock) sooner, instead of making generous concessions. The weaker party has fewer (or no) alternative, is more desperate, and is willing to make relatively greater concessions, if necessary to reach agreement.
Jacqueline Trovato - Jackie is a published writer with over twenty five years of experience in marketing communications and public relations for the Department ...
