How You Can Avoid Being Exploited In Negotiations
Marty Latz - June 3, 2005 The Business Journal
Do nice negotiators tend to finish last -- or "lose" more often -- in their
negotiations?
And if so, how can they protect themselves from this tendency and be
more effective?
This is a central dilemma for many nice negotiators. When faced with
an aggressive and competitive negotiator, should they try to compete
back or use their naturally more cooperative approach?
Let me start by dispelling the myth that a cooperative approach leads
to losing more often in all their negotiations. In fact, a more
cooperative approach will often be more effective than a no-holdsbarred competitive approach.
This especially is true over the long term in:
1. Negotiations between parties who want a future relationship. For
instance, between family members and/or business partners.
2. In situations involving non-zero-sum issues, where more for one
side is not necessarily less for the other, and where a creative
approach will help both sides expand the pie.
Time for caution
However, there is a type of negotiation in which the cooperative
approach often will put the user on the losing end of a win-lose deal.
And it will be win-lose, not win-win.
What negotiations are those and what can cooperative negotiators do
to avoid being exploited?
Overall, naturally cooperative negotiators need to be especially wary in
situations in which:
1. Their counterparts don't really care about a future relationship
between the parties. For example, if you are buying a used car and the
salesperson appears to be your friend, but really starts playing good
cop/bad cop or using pressure tactics like imposing short deadlines.
2. Zero-sum issues dominate the agenda. When your counterpart is
selling his company, wants to retire on the proceeds, and only cares
about maximizing his all-cash sale price.
3. Their counterparts adopt an aggressive adversarial approach to the
negotiation and view it through a win-lose/competitive mindset.
In these situations, what should cooperative negotiators do?
Initially evaluate the situation and determine if your more naturally
cooperative approach -- if reciprocated by your counterpart -- would
more effectively lead to your satisfying your goals.
Factors to consider include:
1. The value of your future relationship. The stronger the future
relationship between the parties, the more a cooperative approach will
be effective.
2. The number of issues. The more issues on the table, the more a
cooperative approach will be effective.
3. The zero-sum nature of the issues. The more zero-sum the issues,
the less effective a cooperative approach.
Reach into your toolkit
Based on these factors, if you determine a more cooperative approach
works better but your counterpart appears competitive, reach into
your negotiation toolkit and consider how you might get your
counterpart to be more cooperative.
Tactics to consider, as discussed in William Ury's book "Getting Past
No: Negotiating Your Way from Confrontation to Cooperation," include:
1. Stepping into their shoes, finding out why they are so competitive,
and then taking action to defuse it.
2. Pointing out why it makes sense for them to be cooperative.
3. Educating them to the long-term negative consequences of their
approach.
Of course, if you can't get them to cooperate and/or you determine
that a cooperative approach will be ineffective in that situation and
there is some future relationship, use the following tactics:
1. Reciprocate their competitive -- and cooperative -- moves.
If they refuse to share strategic information, you refuse to share
strategic information. If they make an extreme offer or concession,
respond in kind.
But also respond cooperatively if they start to cooperate.
In addition, respond proportionately and don't overreact. Otherwise,
you might permanently poison your potential to achieve your longterm goal.
Overall, illustrate to your counterparts the positive and negative
consequences of their behavior. By consistently using this tit-for-tat
approach, researchers have found that parties will maximize their
individual and total gain.
2. Occasionally extend a peace offering.
Studies also have found that you should occasionally extend a peace
offering just in case you misread your counterpart's moves and the
negotiation degenerated into a cycle of retaliatory moves, helping no
one.
Of course, don't walk too far out on the plank. Just extend a little
peace offering every third move or so and see if they reciprocate.
3. Consider using an agent.
Finally, some nice negotiators are just too personally uncomfortable
with any competitive tactics, including using tit-for-tat.
If you fall in this category, which is just fine, don't divert too far from
your comfort zone. In those circumstances, consider hiring an agent or
asking a friend to negotiate for you.
Otherwise, if you're the nice guy or gal, you may just finish last.