Class Takeaways — The Art of Negotiation
Five lessons in five minutes: Professor Michele Gelfand shares what it takes to make a win-win deal.
From the conference room to the kitchen and everywhere in between, there are countless situations where our wants and needs butt up against other people’s. Yet instead of viewing negotiations as a competition where we must fight to get our way, we can adopt strategies for more collaborative dealmaking where everybody wins.
In her course, Negotiations, Professor Michele Gelfand teaches the principles of successful negotiations. In this short video, she shares some tools you can use the next time you approach a negotiation.
Michele Gelfand: Hi, I am Michele Gelfand. I’m a professor of organizational behavior at the Stanford Graduate School of Business. One of my favorite classes to teach at the GSB is negotiation. Even though negotiations are pervasive, research shows that we often leave value at the table. I have five key takeaways from my class on negotiation to share with you today.
Preparation is a vital part of the negotiation process, yet many people fail to properly analyze their own and other’s perspectives prior to discussions. I recommend that you create an issue chart and spend time thinking through your own interests and goals, your priorities, your alternatives, and your strengths and your weaknesses, and then do the same for your partner.
The more complete the information you have about yourself and your partner, the more control you’ll have over your actions, reactions during the process, and the better able you’ll be to craft great agreements. If you don’t prepare, you’re putting yourself at a disadvantage and like you’ll leave value at the table. As you negotiate, ask questions to try to fill in gaps in the information you have and test the assumptions that you made.
Metaphors are a basic mechanism through which humans conceptualize experience, including negotiations. Metaphors are more than linguistic devices, they can help or hinder negotiations. Yet we’re often completely unaware of the metaphors guiding us at the negotiation table. Is this an individual or a team sport, a battle, a dance, a date, a puzzle, a visit to the dentist or a necessary evil. Metaphors guide our goals or behavioral scripts and the criteria we use to evaluate the success of the negotiation, but a lot of time our metaphors are not well-matched to the situation.
A relationship metaphor, for example, is not well-matched to a distributive single issue task. On the other hand, a game or battle metaphor is not well-matched to an integrative negotiation. Think more clearly about your metaphors and you’ll be a better negotiator. The best negotiators also cultivate a shared, constructive metaphor to guide the process, a problem-solving metaphor like solving a puzzle or playing on the same team. In other words, negotiate the negotiation. Generate a shared metaphor to guide the process and it will be more productive.
Research has shown that negotiators often assume that their interests are diametrically opposed to their counterparts. Although some issues might be win-lose, many negotiations have an integrative structure wherein there could be differences in priorities individuals have on the issues that could be traded off. For example, imagine that my husband and I are trying to plan a vacation. I want to go to the spa at the beach, whereas he wants to go to a cabin in the mountains.
At first glance, it seems like we’re going to go on different vacations, but through further discussion, we discover that my priority is the spa and the location is a lower priority, whereas he prioritizes the mountains and the accommodations are a lower priority. By trading off on low priority issues and going to a spa on the mountains, we each get our priorities. When negotiating, think outside the box. The best negotiators are very creative.
Disputes or rejected claims are inevitable, but there is a way to manage them effectively. Research finds that people tend to reciprocate negative behaviors like threats to a much greater extent than positive strategies, causing conflicts to escalate rapidly. In an unproductive negotiation, people use a lot of threats and appeals to their rights and don’t focus as much on their underlying interests. In an effective system, people focus a lot on interests and use very few appeals to power and rights. Always aim at getting back to your interests, even in the face of threats and power strategies from others. If others are using rights and power strategies, a mixed communication strategy that combines a threat with a cooperative communication and appeal to interests will help you better manage disputes.
In today’s global interdependent world, we are bound to be negotiating across cultural boundaries, but people often assume that what works in their own culture works everywhere. They mistakenly think that it’s technical competence and general intelligence that are needed to be an effective negotiator, but in a global negotiation, it’s cultural intelligence that’s key to mastering the deal. Cultural differences, if not properly managed, can derail merges and acquisitions, expatriate assignments and damage our global capital. High CQ is also critical for managing global teams, being an effective global leader and managing complex cross-cultural networks.
Beyond IQ or even EQ, research shows that if you cultivate cultural intelligence, the desire and ability to interact across cultures, you’ll be in a much better position to develop high-quality agreements anywhere around the world. Ciao.
My kids think that it’s fun to make fun of me, that I like to create win-win agreements all the time. “Really, mom, do we have to always create win-win agreements and can’t we just split the difference?” They have a point. Sometimes we don’t have enough time or things are not important to you, you don’t need to create a win-win agreement. You can just split the difference, but they do make fun of me being a little bit obsessed with win-win agreements.
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