It’s Thursday night, and you’ve just finished a hard 12-hour workday. It’s been stressful, and you just want to have a relaxing dinner and catch up on some reading and sleep.
Unfortunately, your spouse wants you to meet your new neighbors tonight and then attend a play you really don’t want to see.
So begins one of the most difficult negotiations many of us face on a daily basis. Negotiating with loved ones and/or with long-term business partners and friends can pose some of our most challenging negotiations.
Certainly, this dynamic requires strategies quite different thannegotiations between strangers over the price, for example, of an allegedly rare artifact in a Middle Eastern market.
What are these different negotiation strategies, and when and where should we apply them?
Let’s first examine the “spousal” negotiation over what to do Thursday night. The tired and stressed spouse should use a problem-solving strategy – one characterized by tactics focused on building trust, strengthening relationships and promoting an atmosphere in which the parties will be able to work together in search of a mutually satisfactory solution to the problem.
This strategy will be most effective when used in situations – such as Thursday night – involving long-term and valued relationships, a large number of related interests, and the potential to generate creative options to satisfy parties’ mutual interests.
So, how do you actually engage in a problem-solving strategy?
• Openly and honestly share information with your counter party about the true issues and fundamental interests involved. (The spouse, for instance, might share his/her feelings about meeting their neighbors and going to the theater).
• Find out about the other individual’s interests and strength of feelings about the issues.
• Explore reasonable, principled options that might satisfy both parties’ interests. In this case, the spouse might agree to meet the neighbors and see the show if it’s really important to his/her spouse, but will suggest it might be more enjoyable for all if it was rescheduled for Tuesday.
• Focus on independent standards and/or procedures to explain the inherent fairness of your suggested solution. The spouse in the sample here might invoke the principle of reciprocity by noting that last week a similar situation occurred and he/she then compromised.
Using this approach in other contexts, however, will be quite ineffective.
Let’s return to the Middle Eastern market, or to a situation where you’re negotiating to purchase a used Honda from a private out-of -town seller.
Here, you likely don’t care about a future relationship with the seller, it’s a zero-sum situation since one dollar more for the seller is one dollar less for you, and there’s practically no potential for creatively generating options to satisfy mutual interests.
In these circumstances – effectively the opposite end of the negotiation spectrum from problem solving – you should use a competitive strategy. That would be one where you should try to undermine the other negotiator’s confidence in his/her bargaining position and try to strengthen his/her perception of your bargaining position.
Be quite limited in the amount and type of information you share – don’t tell the Middle East seller you’re a wealthy businessman from Phoenix. Propose highly aggressive initial offers. Be very reluctant to concede and only do so when given a rationale for it.
Exercise your leverage if you have a good alternative, such as many other similar used Honda Accords advertised for sale.
One of our biggest challenges in negotiating revolves around determining what strategy to use in what circumstances.
If our tired and stressed spouse comes home, plops down on the couch, grabs a beer, flips on the TV, and says that he’s/she’s in for the night, I’d suggest this competitive strategy will be unsuccessful in the long-run – for both parties.
And if you tell the used Honda seller you’ve been unsuccessfully looking for this make, style, year and color car for six months, you’re going to pay more than necessary for it.
The lesson? Use a situation-specific approach to your negotiations. A one-size-fits-all strategy just won’t effectively accomplish your goals.
Published July 28, 2000 The Business Journal