Negotiation Myths

    “Your gender matters,” “never make the first offer,” and “attorneys are invariably deal-killers” are three common negotiating myths. To start with the most controversial one:

1) Gender

     An on-going popular research subject in these days of political correctness is the role of gender in negotiations. "Men are superior negotiators because they are logically consistent and more assertive." "Women are superior negotiators because they are better listeners and more cooperative." Whichever position you prefer, there is good news. An overwhelming body of empirical evidence supports it!

    How can that be? The trick, as any professor worth his salt knows, lies in correctly stating the null hypothesis and properly designing the ANOVA for the "theory building empirical research" to arrive at the desired result. Selective citation with a soupcon of P.O. ("preventive obfuscation" or "prevarication by omission") makes for a convincing presentation of the viewpoint of choice. So as not to offend too many current dedicated evangelists of either persuasion, an antiquated example, a good 35 years out of date, is deliberately selected.

    In The Social Psychology of Bargaining and Negotiation, Academic Press, 1975 the authors Bert R. Brown and Jeffrey Z. Rubin list 47 negotiation studies about cooperative versus competitive (i.e. win/win vs. win/lose) behavior between men and women. A total of 20 studies clearly demonstrates that men behave more cooperatively than women. A total of 27 studies clearly demonstrates that women behave more cooperatively than men. Quod erat demonstrandum!

    Common sense is that gender is just one of a great many cultural and social variables, and one which may well be irrelevant. To give an admittedly extreme case in point: She is single and a six foot kick-boxing champion out of the garment district in New York city, a former CPA and now much feared “devours raw meat she snatches our of alligators´ jaws” litigator – and hates everything about the company with which she is negotiating. He is a plump five-foot kindergarten teacher out of rural India, who meekly submitted to an arranged marriage with a woman he fears and detests, is a nervous pacifist and picky vegetarian, has no clue about accounting, and greatly admires and respects the company with which he is negotiating. Just about the least important information about these two is their gender.

2) First offers

    Another common myth is that one should never make the first offer or first concession, for instance “to get things moving along here.” This admonition may not even be half right. It does, in fact, seem reasonable advice to follow in a “win-lose” negotiation. However even here the empirical evidence does not clearly support this claim. Two studies showing a lack of correlation between who makes the first offer and the outcome are discussed by R. Bastress and J. Harbaugh, Interviewing, Counseling, and Negotiating, Little, Brown, 1990, p. 493 and by Thompson, L., The Mind and Heart of the Negotiator, Prentice Hall, 1998, p. 31.

    In contrast, in a collaborative win/win or problem solving negotiation, there is nothing wrong with being the first to make a carefully considered first move. “If you were able to deliver JIT, that would cut our production costs significantly – giving us some room on the price we would be willing to pay.” (A first concession – on price.) “If we were able to eliminate the risks from a sole source contract, let us look at the benefits that could accrue to both parties.” (A first suggestion.) “What if we were to agree to cross-market your new line of turbocharged Widgets? How could that effect the terms and conditions for this contract?” (And so on.) .

    Nevertheless, Chester L. Karrass, the researcher with real authority in this area, beginning with a doctoral thesis on negotiation and continuing thereafter with excellent books and a negotiation training business, does caution against major first concessions. Let us let him have the last word on this issue:

    "I discovered something in my experiments that may someday save you a lot of money. I found that people who made the first concessions on an important issue ended by doing poorly. It was as though they were on the defensive from the start. . . 

    Do we dare extrapolate from an experiment to real life? I believe that we can, but must be careful. My advice in a business negotiation is to feel free (after holding off for awhile) to make the first concession on minor points. . .(but not on major issues)."¹  

3) Deal killing attorneys 

    More than one frustrated CEO has been known to say to his counterpart across the conference table: “This is getting nowhere. First, let us get all the attorneys out of here. Then the two of us close it, here and now, or we kill it and stop wasting everybody’s time.” That kind of incident and the myth of the obstructive, nitpicking attorney are grounded in the attorney’s legal education.

    The law is a much more rigorous, intellectually demanding course of study than business administration or management science. However the law and its teaching are based on an adversarial system: the prosecutor versus the accused, the plaintiff versus the defendant. Attorneys have three (in the U.S.) to five or more (in Europe) years of education in “how to fight” - to litigate, and perhaps one course, if that, in “how to cooperate” - to negotiate.

    However when attorneys actually practice law, a great many cases are settled out of court. In other words, they are negotiated. Professor Gerald Williams of Brigham Young University did a study in the 1990s about the negotiating styles of attorneys. He asked attorneys 1) how they viewed their colleagues´ styles (adversarial or cooperative) and 2) how effective their colleagues were as negotiators.²

    One quarter of the attorneys were viewed as adversarial by their peers. Of these, three quarters were not deemed effective, and a full third of them as particularly ineffective! Professor Andrea Kupfer Schneider conducted a similar study 2000/2002 in which over half of the adversarial negotiators were deemed ineffective by their peers.³

    In contrast, of the attorneys considered cooperative by their peers, less than five percent were deemed ineffective. Of course the objective outcomes may not concur with the peer review. Be that as it may, the majority of the attorneys participating in the two studies favored a collaborative approach to negotiation (as opposed to the actual battle of litigation). That many prominent negotiating researchers and trainers were educated as lawyers is no accident.