9.3 Avoiding Mistakes in Negotiations
Learning Objective
3. Use decision-making frameworks to avoid mistakes in negotiations.
Preparation and planning are key to avoiding common negotiation mistakes, but even the most experienced negotiator can make them. Perceptual bias and poor decisions account for most of them. Let’s look at a few examples:
Examples
- Winner’s curse. This is when a negotiator makes a high offer quickly, and it’s accepted just as quickly, making the negotiator feel as though he is being cheated. Lack of information and expertise are chief among the issues that cause this mistake.
- Mythical fixed pie. The negotiator assumes that what’s good for the other side is bad for his side. For instance, imagine two parties that want an orange. If a negotiator makes the mythical fixed pie mistake, he divides that orange in half and gives each party a piece. He’s let competitiveness get in the way of coming up with a creative solution, and if he’d listened, he’d have understood that one party wanted the meat of the orange and the other wanted the rind.
- Overconfidence. The negotiator puts too much stock in his ability to be correct and thus uses high anchors for his initial offers and adjustments. His lack of information and distorted self-perception will cost him a fairly negotiated deal.
- Irrational escalation of commitment. This is when the negotiator continues a course of action long after it’s been proven to be the wrong choice. Causes of this include an insatiable need to win and ego, and it shows a lack of commitment to actually arriving at a fair deal.
Again, preparation and planning can help a negotiator avoid these issues, but practice is another way to get better at avoiding mistakes!
“Issues in Negotiation” from Organizational Behavior and Human Relations by Freedom Learning Group. Provided by Lumen Learning and shared under a Creative Commons Attribution license unless otherwise noted.
