Episode 148 – Are You Winning the Negotiation Game

When Steve asked Kurt how he was doing before the show started, he did not expect that Kurt would tell him that he just got done dealing with a bear in his backyard. Well, he didn’t deal with it…animal control did. But we’re proud that Kurt didn’t scream like a little girl when it happened! Here’s a picture:

Kurt and Steve also give some sound advice that was once also given by the leading salesman of a Northeastern mid-size paper supply company. The advice is timeless and will echo through the ages.

After an unusual amount of banter, Kurt and Steve decide to get into something that matters: negotiation. Clients and customers expect to play the game. So what do you do if there is no game to play?

It is a natural tendency for us to take in information and interpret it in a manner that will best serve our personal wants and needs. We do not always do this consciously. What’s more, the converse is also true in that we often pass over information that is critical to understanding the other side, particularly when the other side is in conflict with us. We naturally enhance our own position while vilifying the opposition’s. The result is that perceptions and beliefs are based on information that is highly inaccurate and exaggerated. Especially striking examples of this oppositional bias are seen in the Israelis and Palestinians or the Catholics and Protestants in Northern Ireland.

A famous Harvard study involved giving some executives insider information about one company’s plans to acquire another. The executives were randomly assigned to role play the part of either the buyer or the seller. Unbeknownst to them, the information given to each side was identical. After analyzing the information, the executives each had to give their private assessment of the company’s fair value (as opposed to how they might present that value in negotiations). Not surprisingly, the executives playing the part of “seller” gave values that were more than double those offered by those who were playing the role of “buyers.” Interestingly, the results were driven by what would best serve the party in her/his randomly assigned role.

It is to be expected that each negotiating side will bring its own biases to the table. Simply knowing that these biases exist will help those involved in negotiation to not be caught off guard. Put yourself in the other side’s shoes and think of what their most powerful case could be. This empathizing tactic always sheds light on new thoughts and ideas that you might not have thought of otherwise. Lastly, it will never hurt you to seek the input of an uninvolved third party.