Negotiation Skills in Project Management

Regardless of whether it is over a dinner plan or a million-dollar business deal, individuals are often required to negotiate through plans and decisions. This is in order to reach a satisfactory conclusion to the discussion undertaken with others who differ in opinion. Through negotiation, a mutual understanding or agreement can be achieved where the parties involved have negotiation is most effective when all involved individuals get the opportunity to feel that they have gained something from the negotiation and that a compromise has been achieved. The outcome of a negotiation is unpredictable and could result in either a win-win situation, a win-lose situation, or a lose-lose situation among the individuals taking part in the negotiation.

Importance of Negotiation Skills

Having the ability to master the art of negotiation requires the acquisition of a number of negotiation skills, both on the one hand and on the other. Communication is the key skill, is not as simple as it sounds as a clear conveyance of a viewpoint, especially argumentative in nature, depends on other vital skills. Skills such as emotional intelligence, and active listening play a big role in communication. In order to maintain rationality and focus on the goal, the negotiator must also possess qualities like patience, expectation management, adaptability, persuasion, and integrity. Albeit intimidating in nature, negotiation is a skill that can be acquired through learning and improved through practice.

Why is Negotiation Required within Project Management?

Why is negotiation required within project management? A project always involves new requirements, people, perspectives, a new set of expertise, challenges, and new and multiple combinations of all the aforementioned variants. Consequently, differences in priorities, solutions and plans are inevitable in a project. At the same time, the successful delivery of a project demands all its stakeholders to share an equal understanding of the requirements and solutions. And in order to surmount the risks of clashes of interests and prolongation of project results, negotiation is indispensable. It plays a cardinal role in providing clarity, settling conflicts, identifying opportunities and creative options, and finding the perfect solution.

Often, the negotiations during a project are carried out by one or more key people involved in the project: project managers, team members, stakeholders, clients, and sponsors. It is one of the most important skills a project manager should possess along with communication and leadership. Project managers are often required to negotiate in events such as −

  • Dealing with suppliers of goods and tools that are necessary to ensure the project's successful completion

  • Working with a potential investor on a new project

  • Seeking support from stakeholders for a major change in the project which is being pursued

In order to get consent for new ideas or changes from all the interested parties, and concerned individuals, most project managers are required to explain the reasons for the change in the right way and negotiate through any difference in opinion.

Common Types of Negotiations Project Manager Encounters

  • Resource Negotiations - resource negotiations occur when there is a shortage of resources such as time, people or money that needs to be overcome to complete the project successfully. These types of negotiations are usually difficult because scarce resources are in short supply and there is often tension between the departments involved over who should have these limited resources. It is often necessary to use diplomacy in these situations to ensure that both parties can come to an agreement that is satisfactory to everyone.

  • Budget Negotiations - budget negotiations take place when changes to the original budget are required to ensure that the project can be completed on time, within budget, and according to the original specifications. It is sometimes necessary to make significant changes to the initial budget if it is not possible to complete the project without additional resources. It is important to plan carefully for these negotiations to ensure that changes to the budget are fair for everyone involved in the project and that you come up with a solution that meets the needs of the project as well as the needs of the stakeholders.

  • Quality Negotiations - quality negotiations are quite common on complex projects that involve multiple stakeholders with different priorities. These negotiations involve assigning responsibility for specific tasks to different team members and agreeing on how the quality of the final product or service will be measured and maintained throughout the project. The effectiveness of these negotiations will depend on how well you are able to communicate with your team members and other stakeholders and establish a set of guidelines that everyone will follow.

  • Scheduling Negotiations - scheduling negotiations often arise when there are delays to the project timeline due to unforeseen events or other issues that are beyond the control of the team. In order to reach a successful conclusion to these negotiations, all parties must work together to find a way to resolve these issues as quickly as possible without compromising on the quality of the work or the timeline for completion.

  • Bargaining - negotiation can occur at any stage in project management but is most often used when the project is not progressing as planned or there are disagreements between the different parties involved. As a project manager, you will need to make decisions about a number of different issues over the course of the project including resource allocation, budgeting, timescales, and quality management.

How Can You Incorporate Negotiation into Your Project Management Approach?

Negotiation is a recurring requirement throughout the course of the project and the likelihood of succeeding in it depends significantly on the amount of preparation done before the need arises. Always do enough research on the concerned topic and invest time in planning. Building and maintaining a rapport with stakeholders and colleagues across the organization is an added advantage when it comes to negotiation. Strong problem-solving and decision-making competence will also help you become a better negotiator. As proposed by Yadvinder Rana, dynamic approaches – preparation, process, power perception, and player’s perspective function systems that can help understand the art of negotiation.


From initiation to closing, negotiation remains a prerequisite in order to facilitate the progress of the project. Hence it is highly necessary that the negotiator understands the priorities before participating in the settlement. Negotiation can be tiring at times but it is also important to know to keep open communication and consider the opposition rather than staying uncompromising. At the same time, it is also productive and sensible to know when to stop. And just like any other skill, practice is what will help you become a better negotiator. It is also important to remember that negotiation within project management should always be in the best interest of the project and its deliverables.

Updated on: 02-Feb-2023


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