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November 24, 2015

The Difference between Settling and Compromising in Corporate Negotiations

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Settling for something less than what we think we deserve can feel like giving up. Compromise, on the other hand, leaves us feeling like we’ve taken something away from a deal. The question then, is what is the difference between compromising and settling? Is one better than the other? Should both be avoided? How can businesses win through compromise? Once you know the difference, you can answer questions like this and make your negotiations more successful.

The Difference between Compromising and Settling 

Whether a negotiation feels like you’ve settled or like you’ve reached a compromise may depend on the way decisions were reached, rather than on the actual outcome. The language for each implies that two or more parties will commit to something, namely, upholding the decision that is reached.

Settling, however, does not imply negotiation. Instead, settling usually involves a unilateral decision. In other words, a person selling his or her house may be settling for an asking price when he or she knows the home is actually worth more. A teacher given a specific curriculum to follow may have to settle in certain areas because he or she did not design that curriculum. The principal or other administrator decided this was what would be used, and the teacher needs to abide by that decision.

In contrast, compromise implies negotiation. Both parties have to “surrender” to some extent, but at the same time, both get some of what they want. Compromise involves the objective understanding of how much you and other people are worth. It also involves agreement to a plan that will benefit all involved parties instead of a unilateral decision that will benefit only some people at the table.

Why You Don’t Want to Settle 

Settling is generally seen as negative for many reasons. As mentioned, it gives involved parties less freedom. Additionally, settling can mean secrecy. This doesn’t always mean making agreements behind closed doors. Sometimes it simply means omitting information for someone else’s benefit. For instance, your friends usually don’t know that you settled for seeing the movie they want to see – but that you will hate – because you didn’t speak up. Your supervisor may not know that you settled for less time off because something in her body language or tone intimidated you.

Settling often leads to dissatisfaction, which can fester and become anger. To avoid this, you need to know how to make effective compromises.

Compromising Effectively 

Once you know you’ll have to compromise, step back and analyze what the other person or people are telling you. What is their greatest need right now? For example, you might be asking for a raise at a time when your company is financially strapped. Ask yourself if there is a way to be satisfied with less money than you expected, while still getting more. Perhaps instead of a 10% raise, you could ask for 5%. Maybe your supervisor could give you a small consulting fee or overtime pay instead of a permanent raise for the work you already do.

If you need to know more about compromising and how to do it effectively, our negotiation training can help you.

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