A Note on Negotiation

This is a compilation of lessons learnt and interesting questions I have from OIDD 2910 - Negotiations - at The Wharton School of the University of Pennsylvania.

Most Important Lessons

1. Involve the other party in the outcome - This is perhaps the most important lesson I have learnt throughout reading Fisher and Ury’s Getting to Yes as it can be applied to any situation involving multiple people. It is integral that when making a decision, even if you believe that you have the skills to come up with a solution yourself, it is much easier for others to accept ideas that they have had the opportunity to consider. This remains true even if they had no intention of make sweeping changes to your proposition.

2. Appeal to Authority - Whenever stating an opinion, it is always important to appeal to some form of accepted authority. This can be in the form of a qualification, research paper, law, expert etc.
   
   I was compelled by the idea of backing up points with an appeal to authority until I called my friend Nathan and he asked isn’t appeal to authority a logical fallacy? I realised that appeal to authority can be the most invalid argument you can pose if it is used incorrectly, yet extremely effective if introduced properly. When appealing to an authority, the logical fallacy comes from basing and proving an argument with the words of someone of power - for example, if I said that statement X is false because person Y said it is. Even if that person has great knowledge in that field, this is an invalid argument and disconnects both parties in the negotiation as it is impossible to disprove.
   
   Instead, when neither party can come up with a definitive answer to a problem, it is powerful to appeal to an accepted and established societal structure, such as the law states this and philosopher X wrote academic paper Y on this topic has very compelling arguments on the topic. The key difference is that instead of basing the argument on the mere words of a person, it should be based on their research and accepted evidence. In short, there is no need to rebuild every argument from the ground up - it is alright to borrow an established foundation and build upon that instead. Of course, if your foundation is contested, you have to be prepared to go one level deeper. The foundation should not be self-evident and you should have reasons for that foundation to exist if that comes into contention.
   
   Appealing to authority was also a point that I was very conflicted with because I felt like so many issues that are negotiated over do not have a definitive answer and it was just as easy to appeal to one expert stating one thing as it was to another that stated the exact opposite. However, I’ve realised that appealing to authority is more important in settling the problem itself as it can be a gateway to more objective evaluation.
   
   There is little time spent arguing over facts and much more emphasis on the people involved and the outcome. Most people argue over how to solve a problem or that the other person isn’t making a genuine attempt to remedy the situation. Because this often gets misconstrued with the problem itself, it can be extremely useful to settle the facts by backing them up with authority as this allows both parties to have a more logical and less emotional set of reasons for their side of the negotiation. Additionally, I have found it useful to ask questions and determine authority. In clearer terms, I think it is essential when asking for advice or accepting one’s opinion to ensure they are propagating accurate and valid information. Looking back at past arguments and strategising for future ones, I want to strengthen any point I make with evidence that it is a “good” opinion

3. Your team is often a fiercer adversary than the other team - Negotiating with a team is often like driving a car where every person has a steering wheel. It seems intuitive that when people with a common goal are paired together, they will reach consensus and strive to work with each other. Even when there are no ulterior motives involved, this isn’t the case. People can reach the exact same conclusion in different ways. Whereas you might want to go right now and left later, someone else might want to turn left now and then right at another point. Both decisions have an immediate divergence but lead to the same outcome. Two people can come up with the exact same solution to a problem but argue over who is correct because they believe the don’t spend enough time consolidating ideas and immediately decide that their solution is better.
   
   And who should be in charge? This links back to the above point about appealing to authority because how can one expect people to selflessly relinquish power and trust someone else when they are certain that their opinion is correct? By backing-up your decision and understanding who the best for the job is in an objective way, it is easier to set aside emotions and the urge to prove your point, and instead evaluate what leads to a good outcome.

4. Step away from positional bargaining - While bargaining over positions can be useful in very specific instances, most of the time it is much more effective to not employ positional bargaining for a wide variety of reasons. More specifically, positional bargaining closes channels for communication because once you state a position (I want to buy X for $Y), you are tied to that position and needlessly defend it when you could be using a more constructive approach to negotiate.

5. Do not reveal the terms of your BATNA (best alternative to negotiated agreement) - When arguing over the price of a car, if you reveal that you can buy the same car from another dealer for 15500, the other party will insist on only offering the car for 15499. This is because after you reveal the terms of your best alternative, you are tied to that position and are letting the other person know that you would be willing to accept that price if this negotiation breaks down.
   
   Instead, when revealing your best alternative, never reveal the terms of the deal. Let them know that you have another compelling offer but would like to work with them to consider a deal here. This does not tie you to any specific position and does not restrict channels of communication.

Questions I have

1. What is a “good” outcome? In the first few weeks of this course, I believed that the best outcome was to bargain for the lowest price or accept only the best circumstance given to you. That could be (and in my opinion usually is) a good outcome to most negotiations. However, there are so many additional factors to consider. When negotiating the price of a product is it always best to start off with an unreasonably low price? Many times, this shuts off communication and can lead to a worse outcome. There is also the working relationship with the other person to consider.
   
   Is maintaining your reputation/relationship with them worth anything to you and will that be compromised by being hard on the person? Is it better to be hard on the problem instead? What if it is situation with no room for compromise or something that is unfair but has no alternative? There are so many factors to consider when negotiating that I think people consider subconsciously but which deserve much more conscious and critical thought.

2. What is a “better” outcome? This is a question I thought I instantly knew the answer to - a better outcome is simply a good outcome with any additional value attached. However, after stepping away from solely bargaining for positions, it has become increasingly harder to find a “better” outcome. When making decisions objectively, getting the goal outcome seems like a good outcome, and the external outcomes (whether the partner is happy about the deal, whether there is additional value we both gained etc) seem like the “better” outcomes.

3. What am I doing here? When enrolling in this course, I had some resolute goals for what I wanted to learn and achieve. One of the big questions that has been brought up in class several times has been a question of our interests in attending this class and our broader education. Although this question was posed in a different context, I additionally thought of it as a means to question whether I am using the right way to achieve my future interests – and also to work out what my future goals are. This ties nicely back to negotiations as I have learned how important it is to identify both your and the other person’s interests and find the best way to achieve those. Sometimes we assume that there is only one good way to get to these interests but there can be many, so it is much more effective to be hard on the problem and understand each other’s interests before fighting over matters of less relevance.

Not completely related to this but if you want to learn more about the philosophy of conflict as analysed in literature, I wrote an essay on conflictual mimesis a few years ago which can be found here.