Negotiator Dilemma in The Negotiation

Last week i have met a friend who are Director in one of MNC company. It has been a long time ago since we met for the last time. At beginning it was a light converse with some joke, and sharing about our recent activity, but our discussion is getting serious when he share about his recent negotiation failure. Fail means he is unable to reach his objectives, and practically give in with all the demand made by the other parties. He said that it's such big negotiation, and by this failure he has lost the income opportunity more than $ 10,000,000 for next 5 years.

Having intense discussion, i found that he has made such what common negotiator failure. He fail to prepare his negotiation. It's not the first time that i found people come to the negotiation table without enough preparation. They just assume if the negotiation is as easy as like Persuading people. Preparation in the negotiation is very critical. Even though people has prepare their negotiation well enough, i can frequently found that they as negotiator still has something left in their mind that cause dilemmas. What are the question? Here's the summary of the question that make Negotiator Dilemma in the Negotiation

1. Information Disclosure

What information should I share, when and why?

2. Who goes first?

If I let them make the first proposal they might offer me more than I was expecting but what if it's worse, or much worse?

3. Where do I pitch?

If I go extreme, I'll have plenty of wriggle room and I might structure their expectations as to where the deal will be done but, what if I'm so unrealistic I get shown the door?

4. Do I change my mind?

If my strategy is not working or my objectives aren't realistic enough, do I change or recalibrate them? If I do will they see that as a sign of weakness and come after me?

5. Losing the argument.

If they've got a good argument, do I try to argue fruitlessly against it or do I accept their point and make a concession?

6. Assumptions.

If I don't know should I assume? If I do I could get it horribly wrong, if I don't I'll never make a decision.

7. Do I ask for what I want?

If I do they might not give it to me but if I don't they're going to have to guess.

8. Should I give them what they want?

If I do they might not give me what I want but if I don't then why would they give me what I have been looking for.

9. When do I stop?

If I go too soon I might miss an opportunity, if I leave it too late I'll risk unravelling the deal and having to start again.

10. Should I threaten a sanction?

If I do it may raise the temperature and destabilise the negotiation. If I don't, I may be losing power.


This is the best way to face the Dilemma

1. Information can be a power in the negotiation. During the preparation stage we have to determine what information we can share at the beginning, or we can diclose at the middle of the negotiation. If we think by sharing the information in the beginning can drive the negotiation result close to us, then we should do it. But if don't think so, then we have to keep it. We'll share those valuable information in case of there's some important information that we need but don't share yet, and we use those valuable information as part of concession to get the information we need

2. I always recommend for each people to go first in the negotiation. By doing so, then you'll propose something that are closer to your intend position. This technique also push the other parties to response at your first proposal. If we wait for other to make the first pitch, then you should expect to have a worse than you're expected. BUT even i strongly recommend the people to put the first pitch, there's one condition that you have to wait for the other to make the proposal. The condition is when there's some one that make a complaints.

3. Sometimes in Indonesia business, it's very common for the people to pitch at least 2 times of their intend position to get more flexibility. But in the negotiation it's not a good idea. Why? Because when you pitch 2 times of your intend position than your counter proposal is jump to be lower than the first proposal. So the other parties will expect that your counter proposal is jump lower and lower each time. So what should i do? I strongly recommend, put your first pitch within the maximum limit of the bargaining area (if you know it already) or pitch within your intend position. Not more than that

4. In the negotiation unpredictable information that we never expect is really happen. If we consider the new information given by the other parties made our objectives unrealistic, then we have to change it instead of push on our original objectives. As the objectives of the negotiation is not put one side as the winner, but instead we are looking for win-win alternatives deal. Change of objectives is not sign of weaker but it's sign of we can collaborate and have good intention to resolve the conflicts.

5. Good argument sometimes can be very good if that works. There's a good way in responding a good argument. If we think that the argument is correct and make sense, don't just agree on it. Find some wish list or condition that you can create to agree with their argument. More over don't argue with them as it will lead another arguments and waste your time.

6. Good negotiator is test an assumption. During preparation some times we'll face there're information we can't find. If that's the case, assumption is very helpful to prepare for the negotiation. BUT, during negotiation don't use the assumption in making proposal. The assumption must be test first whether it is correct or not. Pitching proposal based on assumption can broke the trust atmosphere in the negotiation which is very critical.

7. One of the mistake usually made by the negotiator is being vague on their demand. Having vague demand, very difficult for us to know what's exactly the issue and the needs. It's very important that in the negotiation we are specific with our demand or with the information to be given

8. Basic negotiation concept is to know exactly what's they want and try to give them what they want. But do we have to give them what they want for free? NO, in the negotiation always put in a mind of GIVE WHAT THEY WANT ON YOUR TERM. Always find specific condition/term that you can agree upon their demand. The higher the demand, the higher the price you can ask for.

9. It's very important in the negotiation not to be Greedy. So you need to know when is the best time to close the deal. But when is the best time? It's when you have reach your objectives, and you already have some wish list that have been agreed with them

10. Sanction can be very powerful negotiation power. If incentives don't work in the negotiation, then you should to consider about sanction to increase your negotiation power

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About the author

Handito is highly talented and well experienced Top Level Management person who has background career in operation for some Forbes 500 companies, big 4 consulting, and also being part of Executive Management Level with a lot of exposure on strategy development & execution, business development, commercial negotiation and operational improvement . He is certified of Business Management, Black Belt Six Sigma and Lean Manufacturing Expert with experience more than 10 years in hands on and manage Business and Improvement Project in various function from HR, Manufacture, Sales, Finance, Supply Chain, and Safety and deliver million dollar business impact

Area of expertise : Business Development,  Negotiation, Strategic Planning and Execution, Operational Improvement