A few days ago I was speaking with a colleague who is dedicated to negotiating everything that has to do with lease contracts for different companies. She provides these services in an outsourced manner, that is, companies hire her to negotiate on their behalf. And he told me that he had a lot of work because companies – actually the people who work in these companies – like negotiating less and less.
The negotiation phase, which is the subject of this fourth article in the series, is, without a doubt, the main reason why many professionals and companies express their suspicion of negotiation. This phase is the conflict.
What does conflict in negotiation consist of?
Conflict is an inevitable phase in any negotiation, since without conflict there is no negotiation, since we would be either facing an agreement or facing a total disconnection between the parties. In order to make a correct conflict management We must keep in mind that this arises from the needs, desires and concerns of the negotiators, and not from the positions they maintain. Conflict usually occurs as a consequence of the statements made by each negotiator when establishing their positions, and is indifferent to whether both negotiators adopt a position of collaboration or confrontation (to know the difference between these two basic negotiation strategies, I recommend that you read the first article in this series titled “The triangle of effective negotiation: Strategy, tactics and communication”. That is, the determining factor is how the other interprets our position and we that of the other. And if we are also able to assume that the conflict is “just” a problem, and manage it as such, we will have four different tactics at our disposal to manage it. We can divide these tactics into two different groups depending on whether our strategy is cooperation or confrontation. The four tactics are:
- Tactics related to cooperation strategy:
- Problem solving.
- Problem resolution.
- Tactics related to confrontation strategy:
- Creating problems.
- Problem maintenance.
Although the name of each tactic is enough to understand how they work, in this article we are not going to delve into them, but rather we will analyze them when appropriate.
Effective cost, value of the risk assumed and expected benefits in the negotiation
One point that we are going to pay attention to is that every conflict is determined by the perception that the negotiator has of the relationship between the effective cost of that, the value of the risk assumed and the possible benefits that can be obtained.
Most professional negotiators approach any negotiation with a couple of issues in mind that determine the limits within which it is acceptable. Therefore, as long as the benefits expected to be achieved – by maintaining the conflict – occur within these limits, the possibilities of resisting making concessions increase. These are:
- He LOA (Level of aspiration either Suction level): is the maximum offer to which the negotiator aspires and which is normally expressed in his initial positions.
- He MNS (Minimum necessary share either resistance point): is the limit up to which one is willing to give in in a negotiation, since, from this point onwards, breaking up is preferred to continuing to make concessions.
According to the studies by Holmes and Throop, depending on the position that negotiators adopt regarding their LOA and MNS, the results can be more or less predictable:
- Negotiators with low LOA and low MNS typically achieve worse results.
- A high LOA that manifests itself in a high initial demand usually obtains better results.
- A high MNS and a high LOA has similar results to a high MNS and a low LOA. In these cases, the high LOA does not influence the negotiator's resistance to making concessions regarding a low LOA.
- Low LOA and high MNS usually achieve better results than low LOA and low MNS.
How to measure the effective cost?
The effective cost of any conflict must be measured with the greatest possible precision, since The paradox may arise that the benefits achieved are lower than the costs assumed. In such a way that, although we have “won the negotiation”, we lose to stubborn reality.
The effective cost is not only determined by the direct expenses (economic, material, temporal, emotional, etc.) that have to be invested to maintain the conflict, but also by the indirect expenses (present and future) and even by the lost profits ( tangible and intangible). So, we have to be very thorough when assessing the investment we must make when we decide to maintain the conflict.
The perception of the value of conflict
Another element to take into account in this phase is the value of the conflict. The perception of the value of the conflict will be determined by the different elements that influence the negotiation, that is, who and to what extent will suffer or benefit from the consequences of the conflict, agreement or breakup.
When the value of the conflict is greater for one negotiator than for another, the one who feels that he can receive a greater benefit will be the one who will press the negotiation. While it is more likely that those who perceive that their loss will be greater will be the ones who will most easily make concessions.
The conflict is a time phase of any negotiation, which must inevitably evolve either towards an agreement, through concessions by one or both parties, or towards a breakdown, normally a consequence of a poorly managed conflict escalation. In short, it is absolutely impossible to be a great negotiator if you do not master this phase of the negotiation; which requires preparation, temper, creativity and strategic vision.
