Negotiations never come down to price

In courses we frequently get questions along the lines of “What do you do in negotiations where it just comes down to price?”

The answer is that negotiations never come down to price.

Today’s blog is available at INSEAD Knowledge.

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Stop talking to improve communication

Sometimes we talk too much and communicate too little. This is particularly the case in heated exchanges that are fuelled by high emotions, risks, stakes or high levels of uncertainty. Parties become so focused on telling their story that they forget that the purpose of communication is to improve understanding.

So next time you find yourself in a heated dispute with a close friend, family member, loved, business partner or your enemy – see if you can try the following, somewhat different, but very powerful technique:

  1. Sit next to each other, side-by-side.
  2. Open a new document in the word processor on your computer or tablet.
  3. Then let the other person write everything they want to say.
  4. Then… and only then do you go through and make your comments… in writing.
  5. Rinse and repeat steps 3 and 4 until you find agreement.

I used this approach in a very difficult and heated conversation in the last week. After just two cycles both parties agreed and the emotions completely dissipated? How is this possible?

Here’s are a few explanations:

  • First of all, how often do we – in arguments – get to finish everything we want to say before interrupted? Rarely? Never? Much of the escalation in conflict is directly related to the frustration of not feeling understood. So letting the other party finish talking will go a long way to preventing conflict.
  • Do our words ever come out wrong and we just wish we could stop them mid-air? But by that time it is already too late and we unintentionally created or fuelled the conflict further? Letting the each party carefully choose his or her words on the computer means we remove this unnecessary pollution before it can cause any damage.
  • And who can relate to the urge to interrupt and correct the other party when they say something you disagree with? Our urgency is driven by our fear that a failure to argue now might signal agreement! By instead leaving the words there on the screen in front of you means you have all the time in the world to go back to, and counter each point – if you so desire.
  • And how hard is it to clarify misunderstandings in the heat of battle? “What I meant to say was…” It’s difficult! But on the screen you just have to write “Aha, I see you understood this as X. What I really meant was Y!”
  • And in the argument our main focus is the point(s) of disagreement, so 100% of our focus is on disagreement. What we fail to acknowledge is that we actually do agree on a lot! By instead highlighting all the words in the document that are in agreement we realise just how much agreement there is, and just how small the disagreement is in contrast.
  • Similarly in arguments we often repeat ourselves because we don’t feel understood. On the document we can simplify the interaction by agreeing to delete duplicates. Nothing will be ignored, as everything will be commented on.
  • And of course, in very heated interactions we occasionally 🙂 say things that we know are not true, e.g. exaggerations like “You always do this!”. Again, on the screen it is easy to comment “Hmm… would you agree that sometimes be more fair and accurate than always
  • Finally, when the other person tells you the words, then he or she is the problem. But when you sit side-by-side, looking at the screen together you are collaborators working on a problem; to clean up the words on screen and find agreement. It is now longer “you vs. me” but rather “us vs. the limitations of communication”.

Using this process we successfully removed all pollution, reframed all unconstructive language to be constructive, clarified all assumptions/emotions/perceptions, removed all lies/exaggerations, marked all areas of agreement, removed repetition, and in the end there was simply nothing left to disagree on.

Which is consistent with the negotiation premise that over 90% of all disagreement is merely caused by a lack of understanding due to inadequate communication.

Afterwards I asked the other party how they felt about this process. They smiled, nodded and said: “I liked it! And I really felt that I could be more honest this way.”

Fear in intractable negotiations

In the book we briefly refer to a couple of intractable negotiations (e.g. abortion, climate change, gun control). The purpose is not to take a stand on the issues (we let others do that), but rather to illustrate what techniques might be applied to move both polarised parties in each of these negotiations towards agreement.

One of the techniques described in the book is chunking, where we break a large issue into smaller pieces (see it applied to gun control in this earlier post). This process often results in several pieces that parties find trivial to agree on. This enables progress, and fewer issues remain to be resolved. Whether or not this process results in agreement on all issues is immaterial. The point is that we are much better off than before, when we were deadlocked arguing “yes” or “no” for the giant topic of gun control.

Consistent with the technique of chunking, the Obama administration yesterday announced measures aimed at limiting access to firearms for the mentally ill. Agreement on this piece would benefit everyone and would not negatively affect gun advocates in any material way. Logically we might then expect agreement on the issue.

But we haven’t yet accounted for another important element; fear. Specifically fear of the slippery slope. Gun advocates may fear that agreeing on this option now somehow sets a process in motion that could result in them losing all rights to guns in the future. In other words, that agreeing to anything might mean they have to agree to everything. And when fear is an element in the negotiation, it often trumps everything else.

As negotiators, when we identify fear we also seek to address it. While for the affected person fear is merely a feeling, negotiators know that fear is caused by unmet needs. Often the unmet need is the perceived lack of certainty. People will fear the worst-case scenario because they don’t perceive adequate assurances that the worst-case scenario won’t happen.

So that’s one additional thing that gun advocates need here; assurances that their perceived worst-case scenario won’t happen.

“Yeah, but there’s just one problem…”

You make a proposal, you suggest and option or a solution…. And the first thing you hear is “Yeah, but there’s a problem…”

Oh no, not a PROBLEM! How can we possibly overcome a PROBLEM? Everything we’ve hoped for is ruined. We’re doomed!

Ok, I might be exaggerating here 😉 But the fact of the matter is that some of us are predisposed to focusing on the worst possible outcome – we’re on constant lookout for signs that we won’t get what we want. So when the other party raises a problem we instantly take that to confirm our worst fears. We extrapolate that to mean the deal is lost, that we won’t get what we want, and that we should cut our losses and walk away. And upon reflection we’ll get angry with ourselves for being so stupid to hope that anything good could ever happen to us.

In Negotiation Evolved – the book – we emphasise a situational approach, where we encourage you to acquire the skills that are most relevant for you, and most relevant in the current context. We think it is time to evolve past a one-size-fits all approach when it comes to negotiation and influence. And specifically, today’s insight will only be relevant for some of you – but perhaps very relevant.

For those readers who recognise themselves in the scenario above – I have a simple but powerful suggestion. How often in life is there only ONE problem between you and the outcomes you want to achieve? Might just ONE problem actually be good news…? Let’s try it out:

Other party: “Yeah, but there’s just one problem with doing what you propose…”

Negotiator: “That is fantastic news! I can’t tell you how relieved I am that we just have ONE problem. I was mentally prepared to have to work through a dozen, so one problem will be a walk in the park!