How Can We Avoid Making Miscalculations In A Negotiation?

During a negotiation we don't want to underestimate ourselves
During a negotiation we don’t want to underestimate ourselves
Image Credit: Tamyka Bell

So, how is your next negotiation going to turn out? I think that we all go into a negotiation with an expectation of how things are going to proceed. However, could we be wrong? Could we be overconfident that something (good or bad) is going to happen? Could this impact how we go about negotiating? It turns out that we need to take some time and make sure that we don’t underestimate ourselves.

The Problem With Overconfidence

As negotiators we need to understand that over-precision doesn’t necessarily lead us to think we’re the best negotiator. Rather, it causes us to trust our initial instincts just a bit too much. This is especially true when we are involved in business negotiations. There will cases where we’re overconfident that we’ll perform worse than others. This tendency can be applied to almost all competitive situations including our negotiations.

Those negotiators who underestimate their ability to be competitive usually will choose to stay out of a negotiation. An example of this comes from research that shows that when a tight deadline is imposed on a negotiation, both sides routinely think the deadline will hurt them and benefit the other side. Although it’s true that time pressure may force you to concede more quickly, it turns out that the deadline will exert just as much pressure on the other side – a fact that many of us tend to forget.

The Problem With Overconfidence About Future Events

Of course, we can also be overconfident of our chances of “winning” a negotiation also. When we view a task as being “easy” or when your position seems strong, or when you are highly motivated to succeed, then you are likely to believe that you will best the other side. However, negotiators often fail to consider an additional crucial factor: how strong their position is in relation to the other side’s position. As a rule, negotiators will spend too much time thinking about their own strengths and weaknesses, and not spend enough time thinking about the other side’s bargaining position during a business negotiation.

Consequently, when both sides feel their case is strong, there is a very good chance that a protracted and painful negotiating battles are likely to occur. Consider how this can happen in legal disputes. Plaintiffs with a weak case are willing to settle, as are weak defendants. However, when both sides believe their cases are strong, they will refuse to settle and may wind up in court – ultimately a mistake for one of the sides.

What All Of This Means For You

I think that we can all agree that confidence is an important part of any negotiation. Negotiators know that if they want to be successful in their next negotiation, they need to enter into the negotiation with self-confidence. However, it turns out that this can be a two sided tool. If we have either too much confidence or the wrong type of confidence it may work against us during the negotiation. What can we do about our confidence problem?

Negotiators need to realize that our confidence may cause us to trust our initial instincts too much. This may cause us to believe that we’ll do poorly in the negotiation. We need to understand that pressures in a negotiation weight on the other side just as much as they do on us. It turns out that we may enter a negotiation with too much confidence. We need to understand how our position matches the other side’s position. If both sides believe that their position is strong, then a long negotiation may be the result.

There is no question that confidence is a key factor in making sure that your next negotiation will be a success. However, it turns out that we may believe too strongly that we will either not be successful or that we will be successful. Understanding that these are challenges that we are facing can allow us to adjust our approach to a negotiation. Having this knowledge can help us to be able to successfully reach a deal with the other side.

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

Question For You: If we don’t think that we’ll be successful in a negotiation, how can we adjust our level of confidence?

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What We’ll Be Talking About Next Time

Just exactly how committed to reaching a deal in your next negotiation are you? If you are like most of us, you really do want to have the result of all of your time and effort that you’ve spent on the negotiation be an eventual deal. There’s no problem feeling this way, but it is possible that we can take it too far. If we allow ourselves to become too committed to reaching a deal in a negotiation, it can start to affect our decision making abilities. We need to be aware of just how much we want that deal.