Negotiating in Networks: Unleashing the Power of Options

Suppliers in business markets are faced with a relatively small number of significant customers with which they must negotiate about numerous issues surrounding complex offerings. Each of these negotiations does not take place in isolation. Each is part of a complex and continuing relationship between the companies and each affects and is affected by the other relationships and negotiations of the companies in the surrounding network. This paper moves beyond the tradition of examining dyadic processes in negotiation to investigate negotiations in networks of organisations, as a way of contributing to an understanding of customer behaviour. This is based on the idea that a network view can provide a more complete understanding of negotiations and conversely, that an understanding of the process of negotiations can improve our understanding of networks. Adopting this alternate perspective provides a new intellectual lens that allows managers to "unleash the power of options" inherent in networks of organisations. Instead of providing prescriptions for deal making, we draw from the research experience of the IMP group to develop a description that explores and explains some aspects of the practice of inter-organisational negotiations.