Is “Lose-Lose” The Right Way To Conduct A Negotiation?

Is “Lose-Lose” The Right Way To Conduct A Negotiation?

Sometimes we have to lose something to gain a closer relationship
Sometimes we have to lose something to gain a closer relationship
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When we negotiate, it’s all about winning. Our goal is to use our negotiation styles and negotiating techniques to create a deal that the other side will agree with and which is a win for us. We can define a “win” in a lot of different ways: a lower price, a higher price, more time to deliver, delivery sooner then expected, etc. However, somewhat surprisingly, not all negotiations work out this way. Sometimes lose-lose is the way that you want to go.

It’s All About BATNA Power

When we negotiate, we take into the negotiations some basic assumptions about what it is going to take to reach an agreement with the other side of the table. We believe that we are going to have to reconcile each side’s different interests in the pursuit of dispute resolution. However, this assumption often assumes that a negotiated agreement will offers us a more desirable win-win negotiation scenario. However, this is where we may be wrong. Sometimes lose-lose outcomes are your BATNA (Best Alternative to a Negotiated Agreement) in mediation scenarios.

The people who study how we conduct our negotiations have reached some conclusions. They believe that when we are focused on attempting to create a win-win outcome from a negotiation, there is a very good chance that we’ll be able to do this at the expense of relationship building. Popular literature is filled with stories about people who each make a sacrifice in order to provide their partner with something. When they discover that the other has given something precious to them up in order to get a gift for them, instead of damaging the relationship, it causes the relationship to become deeper. This is something that we have the ability to accomplish in our negotiations.

How About If We Improve This Relationship?

Perhaps what all of us need to develop is a new way of looking at our negotiations. In the heat of the moment it can be all too easy to forget that every negotiation that we engage in may just be one of many that we’ll eventually have with the people that we are negotiating with. What this means is that what is even more important than the agreement that we may be able to reach during this negotiation is our long-term relationship with the other side. What this means for us in the short-run is that it may be in our best interest to forgo economic value in favor of improving our relationship with the other side.

The people who study how we negotiate have reached the conclusion that the variables that improve economic performance may actually harm bargaining relationships. Studies have been conducted where negotiators have been told that they are working for different companies. One company is focused on being a successful company and the other is focused on helping people. When the participants negotiated, the researchers discovered that those who worked for the company that valued people achieved less joint gain at the bargaining table than did those pairs working for the successful company. However, those in the successful company came to less equal negotiated agreements. Negotiators from the company who cared about people placed much greater value on their relationship with the other side than did the negotiators from the successful company.

So what does all of this mean for us? Researchers believe that what negotiators need to do is to shift their attention from negotiations in which they are focused on trying to create the most value. Instead they argue, what we should be doing is focusing on relationship building. This, of course, brings up a very important question: are the two goals truly incompatible? It turns out that the best route during a negotiation is to focus on creating strong relationships and using the openness and honesty that comes with a strong relationship to maximize mutual gains in negotiation scenarios.

What All Of This Means For You

We’ve all be taught that the reason that we engage in a principled negotiation is because the other side has something that we want. This means that our goal during a negotiation is to attempt to create a deal in which both parties can walk away believing that they got the most out of the talks. However, it turns out that we may be mistaken here. There are some cases in which perhaps a lose-lose result would be the best outcome for our negotiation.

The mistake that we may be making in our negotiations is that we view a win-win outcome as the only acceptable outcome. When we create a BATNA for our negotiation, what we need to realize that that perhaps a lose-lose outcome might be the best result for both parties. There will be times when a win-win outcome can only be gained at the expense of the relationship that we have with the other side. We need to keep in mind that every negotiation that we engage in is perhaps only one of many that we’ll have with the other side. What this means is that a short-term economic gain may not be as valuable as a longer-term relationship improvement. The variables that improve economic performance may actually harm bargaining relationships. This means that what we need to be doing is instead of focusing on creating value we need to be focusing on building relationships.

As negotiators we need to realize that every negotiation that we engage in has a desired outcome. All too often we believe that there is only one outcome that we need to achieve: win-win. However, it turns out that there is something more important than a deal that will come out of a negotiation: a better relationship with the other side. If it turns out that reaching a win-win deal with the other side would damage our relationship with them, then in this case we need to be satisfied with a lose-lose outcome and an improved relationship.

– Dr. Jim Anderson
Blue Elephant Consulting –
Your Source For Real World Negotiating Skills™

Question For You: Do you think that you should tell the other side that you are willing to settle for a lose-lose deal in order to improve your relationship with them?

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What We’ll Be Talking About Next Time

It eventually happens to all of us: you are in the middle of negotiation when you realized that things have become deadlocked. There are a lot of different ways that you may have found yourself in this situation such as after both sides have used their negotiation styles and negotiating techniques to exchange a series of offers and counteroffers. With each of you stuck in your very different positions, you can’t seem to find a solution that pleases you both. What’s a negotiator to do now?

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