Negotiation Strategies and Examples

Here are practical strategies, grounded in collaboration techniques, to help Product Owners manage both internal and external negotiations effectively.

Use BATNA. One popular negotiating strategy is BATNA (Best Alternative to a Negotiated Agreement). This is a backup plan if all negotiations fail.
Example: If a Product Owner cannot get approval for the desired budget for a major feature, their BATNA might be a minimum version of the feature that still delivers value but requires less effort and budget.

Aim for a win-win approach. A win-win approach aims to create a solution where all parties feel they have gained something valuable. 
Example: A Product Owner negotiating with the rest of a Scrum Team over the complexity of implementing a new feature discovers that Developers are concerned about technical debt. A Product Owner proposes a win-win solution: the team will prioritize a simpler version of the feature that satisfies user needs while investing some time in the Sprints to address some of the technical debt.

Ask open-ended questions.  Start your questions with Why? When” How? For what reason? What? Instead of closed-ended questions, which result in Yes or No. This creates opportunity for reflection and discussion. 
Example: Instead of asking, “Do you need this feature by next month?” ask, “What impact would having this feature sooner have on your team?”

Active listening. Give your full attention, paraphrase, and ask follow-up questions to show that you value and understand the other person’s perspective. 
Example: A conversation to deepen someone’s understanding might sound like this: “Can you tell me more about why this feature feels so critical right now?”. After listening, paraphrase to confirm your understanding, “So, it sounds like this feature is tied to retaining existing customers and staying competitive, did I understand that correctly?”

Anchor. Anchoring involves setting the first offer or suggestion, which acts as a reference point that influences the rest of the negotiation. 
Example: When negotiating the budget for a new product feature with the finance team, a Product Owner anchors the conversation by starting with, “Based on our market research and projected impact, we need an initial investment of $150,000 to maximize our go-to-market potential.” A Product Owner sets initial figures at the starting point and shapes the discussion around a concrete budget expectation. This approach makes it easier to negotiate adjustments and keeping the investment level within a favorable range.