A Professor Explains How to Negotiate
Adam Galinsky is (deep breath) the Morris and Alice Kaplan Professor of Ethics and Decision in Management at the Kellogg School of Management at Northwestern University.
What this means is that Adam Galinsky, for a living, thinks about negotiating. How people negotiate; how they negotiate well; how they negotiate poorly. Adam Galinsky is very, very good at knowing what he wants, what other people want and how to get what other people want to be the same thing as what he wants. He’s sort of a conversational ninja, and the conference room is his dojo.
It only seemed proper to have Professor Galinsky share some of his thoughts about the art and science of negotiation, and he graciously agreed to put some thoughts on paper (or pixels) for us. Or was it that we realized it was in our best interest to give him the opportunity? Damn you, Galinsky! You win again!
1. Planning is the key to success. Truly understand your underlying interests. Often times we get caught up with our stand or position, but these are only proxies for our interests–and those matter most. It’s important to remember that many positions can satisfy the same underlying interest. Make a scoring system if you are dealing with more than one issue: compare different deals and make quick assessment of trade-offs and concessions.
2. Go in with power. Power comes from 2 main sources in negotiation: alternatives and information. So work on getting good alternatives (so you are less dependent on this negotiation to meet your needs) and finding out as much information about the other side (what are their alternatives, time pressures, etc.). Research shows that negotiators with better alternatives and more information get better outcomes.
3. Be a good perspective-taker and detective: Try and understand their underlying interests. This doesn’t mean being overly sympathetic. In fact, my research shows that perspective-takers get better individual and joint outcomes, but empathizers do worse on both counts. They key is to not only do your research before the negotiation but to ask lots of questions during the negotiation.
4. If you don’t ask for something you can’t get it. Focus on your target price, your ideal outcome. So be aggressive with your first offer: Negotiation norms dictate you can’t make a second offer that is more aggressive than your first offer
5. Make the first offer. Numerous scientific studies show that making the first offer leads to better outcomes. You anchor the negotiation in your favor. The only time you should not make the first offer is when the other side has way more information than you do (but you should not be in that position because you’ve already gathered information). Make your first offer as extreme as possible but without embarrassing yourself in front of a trusted party.
6. Don’t forget the other side’s satisfaction. A satisfied opponent will be more likely to fulfill the terms of agreement and less likely to seek revenge. A satisfied opponent also increases your power by giving you a potential alternative in the future and by helping your reputation (i.e. more people will want to negotiate with you).
6a. You can make the other side feel satisfied in a number of ways. The easiest thing to do is be humble when the deal is reached. And making aggressive first offers can help here. A nonaggressive first offer leaves you with two unappealing options: make tiny concessions or be obstinate. One of the best predictors of negotiator satisfaction with an outcome is the number and size of the concessions extracted from an opponent. By making an aggressive first offer you give your opponent the opportunity to “extract” concessions from you: not only will you get a better outcome, but you’ll also increase the other side’s satisfaction!
Also don’t immediately accept an opponent’s first offer, because my own research shows that the person making the offer is likely to be filled with regret. Even if you like your opponent’s first offer, you should demand concessions! You’ll achieve a better outcome the other side will have higher satisfaction.
“The whole goal here,” Adam explained to us, “is to trade away your low-priority desires for your high-priority desires. Ideally, you find someone whose low-priority desires are your high-priority ones. That would be perfect, but that almost never happens. So the trick is to make the other person give you exactly what you want, and then make them feel really good about it.”
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1 comment:
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