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Best Practices for Bargaining, Win-Win Negotiating and Reptiles at the Bargaining Table
Humans still carry a few leftovers from their evolutionary past. One of them sits at the top of their spinal column: the brain of a reptile. It's just like the brain of an alligator or lizard, and it's the source of people's most primitive instincts, emotions, and behavior. Over millions of years the uniquely human brain that would give man kind music, quantum physics, and creme brulee evolved around - but didn't replace - the human reptilian brain.
Man's Lizard Brain
Most of the time, the modern human brain with its reason, logic, and proportionality, runs the show. But when the lizard brain is aroused, it instantly takes control. And that's when things get ugly.
It's aroused whenever people lose face-when they're embarrassed, humiliated, lied to, insulted, betrayed, cheated, or treated unfairly. Unfortunately, the lizard brain's portfolio of responses to a loss of face is limited to one thing: revenge. And forget about proportionality. In lizard-think, the tiniest offense can warrant the most appalling retaliation, which makes the other side lose face, lights up their lizard brain, and compels them to retaliate. Things quickly spiral out of control.
Win-Win Negotiating
So what does this have to do with win-win negotiating? The victim of a win-lose negotiation doesn't just lose the transaction, they lose face. A win-lose negotiation instantly transforms both sides: the loser into a revenge-seeking beast, the winner into a target.
Win-win negotiating is the only way to pursue, conclude, and maintain successful agreements. Any serious discussion of win-lose negotiating is ridiculous nonsense, for at least two reasons. First, the other side won't let it happen. They're not stupid, and they're not likely to sit still and play victim. Not for long, anyway. Second, even if a person somehow managed to do it, they wouldn't get away with it. The other side wouldn't rest until they found a way to get even. In the end, everybody would lose.
Everyone is trying to maximize their results. Win-lose negotiators try to maximize them immediately (in the present transaction) without regard to the consequences. Win-win negotiators try to maximize them over the long run by doing reasonably well in a boatload of transactions with counterparts who feel they did reasonably well, too.
These two approaches yield profoundly different results. Win-win negotiators consistently outperform win-lose negotiators. In the very shortest of runs, win-lose negotiators sometimes appear to outdo win-win negotiators, but only because their results, while attractive, are incomplete. By the time vanquished counterparts finish settling accounts, the sad, lose-lose truth will be clear.
Win-win negotiating puts severe limits on a deal's allowable lopsidedness. The larger the disparity, the more difficult it becomes for the "loser" to view the deal as a success. Eventually, the imbalance becomes so great that they can no longer deny the obvious, face-losing truth: they got whipped.
One-Shot Deals
There's only one situation where win-win negotiating isn't required: a one-shot deal. If the person will never be dealing with the other side again, they can't retaliate. In such a case (from a purely economic perspective) win-win negotiating isn't just unnecessary, it's positively wasteful. Bargain as aggressively as possible. Car deals? Hose 'em. House deals? Hose 'em. Buying or selling something through a private-party classified ad? Hose 'em.
Only the smallest fraction of negotiations are one-shot deals. Cars, houses, and the odd classified-ad deal are pretty much it. In the other 99.99% (the everyday deals where real or potential relationships are at stake), win-lose negotiating is out of the question.
Giving Out Concessions
How does someone do win-win? Give the other side concessions. Most people feel good when they get concessions. They give them bragging rights. They're unmistakable proof of a successful hunt. They drag them back to their corporate den and celebrate them with the negotiating equivalent of an end-zone dance.
How does someone give concessions without giving away the ranch in process? By doing the two most important things negotiators do. First: by getting something in return (trading concessions, not just giving them away). Second: by doing the old negotiating two-step-opening with an assertive offer, and then, as the talks progress, deliberately dropping back to the real target.
Start High, Drop Back
The little maneuver (start assertively high, then drop back) is a central feature of win-win negotiating. But this seems like such an inefficient way to come to terms-why start high only to drop back to a "fairer" position? Why not just tell it like it is with a firm, fair initial offer and skip all the rest? Because, the other side needs this to save face.
It seems that a firm, fair reasonable offer, seeking what is only truly needed with no fluff added, is a logical and honest thing to propose. From the counterpart's viewpoint, the offer doesn't look firm, fair, and reasonable at all. Instead, it looks inflexible, self-righteous, and pigheaded. The other side neither knows nor cares that the offer was pared to the bone before it was made. They know only that nothing they say or do is having even the slightest influence on what they thought was an offer but with each passing second looks more like...an ultimatum!
Who knew they would think this fair, un-inflated offer would be perceived as an ultimatum? Thanks to the "firm, fair" gambit, the discussions now have only two possible outcomes and they are both terrible: unconditional acceptance of the first offer (and loss of face) by the other side, or deadlock. So much for telling it like it is.
The Theatrics of Negotiation
If that start high-drop-back routine feels a bit theatrical, it's no accident. Theater permeates negotiation. Bargaining is like a ritualized kabuki play in which the negotiators are both actors and audience. It would all be so much easier if people could just state their needs without embellishment and be answered with dispassionate logic. The elaborate pas-d-deux of negotiating is a frustratingly inefficient, roundabout, sometimes tortuous process.
But it's what humans do. They do it because it fulfills some deep human need to make a difference, to have control, to be competent, to do well. Like it or not, everyone is wired for the melodrama of negotiation.
