---
id: "concept-internal-side-deals"
type: "concept"
source_timestamps: ["§ What Makes for an Effective Deal Review Process?", "§ Don't Rely on Reactive Deal Reviews"]
tags: ["internal-negotiation", "compensation", "coalition-building"]
related: ["concept-deal-value-board", "concept-alignment-problem", "concept-lowest-common-denominator-deals"]
definition: "Internal agreements that compensate specific departments or stakeholders for localized losses or costs incurred by an enterprise-wide deal, preventing internal vetoes."
confidence: "high"
sources: ["ecosystem"]
sourceVaultSlug: "hbr-seg-ecosystem"
originDay: 11
articleStem: "hbr-nm-103-big-companies-negotiate-deals"
sourceUrl: "https://hbr.org/2026/01/why-big-companies-struggle-to-negotiate-great-deals"
sourceTitle: "Why Big Companies Struggle to Negotiate Great Deals"
---
# Internal Side Deals

**Internal side deals** are mechanisms to compensate internal 'losers' — specific departments, regions, or service lines that would suffer negative implications or bear disproportionate costs from a proposed enterprise deal.

The article's illustration: in a **global outsourcing contract**, one region might be expected to make significant up-front compliance investments despite playing a small role in the rollout. Without internal compensation, that region could veto the deal. A [[concept-deal-value-board]] facilitates the side deal by covering those localized up-front costs out of the overall deal proceeds.

This principle — borrowed explicitly from **global treaty negotiations** — frees frontline negotiators to strike external deals that are optimal for the enterprise as a whole, breaking the [[concept-lowest-common-denominator-deals|lowest-common-denominator]] pattern that the [[concept-alignment-problem]] otherwise produces.

**Enrichment / confidence:** Directly maps to well-studied constructs of **issue linkage and side payments** in international-relations negotiation and to coalition-building / organizational-politics research (Kotter, Pfeffer). The article renames rather than invents the mechanism; support is conceptual and case-based.


## Related across articles
- [[action-provide-extraordinary-partner-support]]
- [[concept-bridge-builders]]