The Psychology of Negotiation, Explained | Psychology Today

Source: Free-Photos, heblo, & Chickenonline/Pixabay (Modifications: Arash Emamzadeh)

Negotiation is a big part of life.

For instance, you negotiate with your boss for a higher salary or more fair distribution of the workload, with a car dealer or home seller for a better price, and—the most difficult of all—with your little one about eating broccoli.

Negotiations occur between businesses and political parties too, but, needless to say, these groups are represented by individuals. For example, the “Iran Nuclear Deal” resulted from a series of intense negotiations between representatives of Iran, the US, the UK, Russia, Germany, France, and China.

Similarly, Trump’s economic sanctions on Iran and his strategy of maximum pressure—which may have included the killing of Major Suleimani and potential cooperation with Israel in the killing of nuclear scientist Fakhrizadeh in November—was supposedly intended to force Iran’s representatives to come to the negotiating table.

In early 2020, when tensions between Iran and the US were running high, Trump tweeted, “Iran never won a war, but never lost a negotiation!” Is that true? Is it possible to win every negotiation? In today’s post, I look at the psychology of negotiation.

What is negotiation?

What does negotiation mean? Negotiation refers to discussions between parties who have opposing (but also some shared) preferences and interests, for the goal of reaching an agreement on important issues. Negotiation is, therefore, a “joint decision making process involving interactive communication” (p. 1080).¹

To negotiate is to choose the path of communication (not violence or war) to reach an agreement and get what you want.

When faced with interpersonal conflict, we may, depending on our conflict management style, choose one of five approaches to negotiation (see Figure 1):²

1. Competition or domination of the other side (I win, you lose).
2. Avoidance (you and I both lose).
3. Accommodating or obliging the other (I lose, you win).
4. Collaboration or integration (you win and I win).
5. Compromise (we both win some and lose some).

Source: Arash Emamzadeh (adapted from Rahim, 1983)

We are more likely to choose accommodation and collaboration when we value a relationship highly; we choose avoidance and competition when we do not.

When a situation has an “integrative potential,” meaning it has the potential for win-win, both sides are more likely to work together and engage in problem-solving. Compared to compromise, win-win agreements are typically “longer lasting and more beneficial for the relationship between the parties” (p. 536).³

The success of negotiations depends on numerous factors: the interests of the parties, legitimacy and fairness of the proposal, presence and promotion of trust-building relationships, the existence of other options that satisfy both parties’ interests, good alternatives (if negotiations fall through), the strength of each side’s commitment to the agreement, and the nature of the communication itself—whether one chooses to “threaten or acquiesce, brainstorm jointly or make firm demands, make silent assumptions about interests or ask questions to probe them more deeply.”

How to negotiate?

So, how can we increase the likelihood that we negotiate successfully?

Research on the psychology of negotiation has uncovered some important principles. According to Fisher and Ury, a successful negotiation occurs when we focus on interests, problems, produce many options, and utilize objective criteria:

1. Concentrate on interests, not positions: Positional bargaining is inefficient, contributes to each side becoming overly committed to their initial position, and often results in anger and resentment. The real issues are often related not to positions but to the conflicts “between each side’s needs, desires, concerns, and fears” (p. 40).⁴ For instance, a complex conflict between you and a real estate developer next door might really be about your need for quiet and the developer’s need for money.

2. Concentrate on the problem, not on people: When you focus on finding a solution to the problem, not defeating your opponent, egos are less likely to get in the way. But in situations where you do need to focus on people, do try to appreciate and value their input, see them as partners (not opponents), respect their autonomy and status, and be mindful of the roles they (and you) are playing in the negotiations.⁵

3. Explore a variety of options: Since making decisions in the presence of your opponent or searching for only one (perfect) solution hampers creativity, set aside some time to come up with a variety of mutually beneficial solutions before working on reaching an agreement.⁴

4. Use objective criteria: To prevent a negotiator from getting advantageous results by simply being very stubborn, make sure the final agreement reflects an objective standard that does not depend only on the will of the parties.⁴

As can be seen, the above method, called principled negotiation, is not particularly concerned with positional bargaining (e.g., hard bargaining and soft bargaining) or with the nature of the relationship between negotiators (e.g., trust vs. distrust, friendship vs. hostility). Instead, principled negotiation encourages the participants to see themselves as collaborating problem-solvers who are trying to pick solutions from many mutually beneficial options.

Concluding thoughts

In Trump: The Art of the Deal—his second favorite book, after the Bible—Trump claims he loves to make deals and is very good at it. But Trump appears to be a win-lose negotiator, and so far his aggressive tactics have failed to bring Iran to the negotiating table and may have made things worse. Biden may have better chances.

Regardless, when the stakes have been high (e.g., the Cuban Missile Crisis), negotiating successfully has made a world of difference. As Fredrik Stanton writes, “Every successful negotiation is a…confirmation that conflict is not an inevitable outcome of a clash of interests.”⁶

The same is true in non-political negotiations. You do not need to ignore your interests in order to avoid a high-conflict relationship. You simply need to learn how to negotiate successfully and put your knowledge into practice.