TY - JOUR

T1 - When control does not pay off: The dilemma between trade-off opportunities and budget restrictions in B2B negotiations

AU - Mann, Michel

AU - Warsitzka, Marco

AU - Zhang, Hong

AU - Hüffmeier, Joachim

AU - Trötschel, Roman

N1 - Special Issue: Lessons for Practice: Extensions to Current Negotiation Theory and Research. Copyright and Copying© 2022 the International Association for Conflict Management. Rights are held to the Creative Commons Attribution Noncommercial International 4.0 (CC BY NC 4.0) license.

PY - 2022/4/6

Y1 - 2022/4/6

N2 - Practitioners in business-to-business (B2B) organizations often report difficulties to reach mutually beneficial outcomes in their buyer-seller negotiations—a finding that contrasts with researchers’ expectations based on the favorable preconditions B2B negotiations provide. In this conceptual article, we argue that this researcher-practitioner gap is due to a structural dilemma: On the one hand, B2B negotiations offer specific trade-off opportunities across multiple dimensions (i.e., issues, time periods, markets, and business partners). On the other hand, rigid financial budgets resulting from management control systems constrain negotiators’ necessary flexibility to exploit these opportunities. We propose that negotiators translate financial budgets into negotiation limits. Depending on the structure of these budgets, negotiators set one superordinate limit or multiple subordinate limits, which either maximize or restrain their ability to realize tradeoffs. We outline future-research opportunities for extending the negotiation literature by investigating multidimensional tradeoffs and different types of limits. We conclude with recommendations on how B2B negotiators can overcome their dilemma.

AB - Practitioners in business-to-business (B2B) organizations often report difficulties to reach mutually beneficial outcomes in their buyer-seller negotiations—a finding that contrasts with researchers’ expectations based on the favorable preconditions B2B negotiations provide. In this conceptual article, we argue that this researcher-practitioner gap is due to a structural dilemma: On the one hand, B2B negotiations offer specific trade-off opportunities across multiple dimensions (i.e., issues, time periods, markets, and business partners). On the other hand, rigid financial budgets resulting from management control systems constrain negotiators’ necessary flexibility to exploit these opportunities. We propose that negotiators translate financial budgets into negotiation limits. Depending on the structure of these budgets, negotiators set one superordinate limit or multiple subordinate limits, which either maximize or restrain their ability to realize tradeoffs. We outline future-research opportunities for extending the negotiation literature by investigating multidimensional tradeoffs and different types of limits. We conclude with recommendations on how B2B negotiators can overcome their dilemma.

KW - Management studies

KW - Business planning

KW - Budgeting

KW - Negotiation

KW - B2B

KW - Psychology

KW - Integrative negotiation

KW - Limits

KW - Outcome potential

KW - Tradeoffs

UR - http://www.scopus.com/inward/record.url?scp=85142058813&partnerID=8YFLogxK

U2 - 10.34891/20220406-431

DO - 10.34891/20220406-431

M3 - Journal articles

VL - 15

SP - 240

EP - 263

JO - Negotiation and Conflict Management Research

JF - Negotiation and Conflict Management Research

SN - 1750-4708

IS - 4

ER -