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Use your imagination in negotiation; If you have no alternative

Study guide




It is a common belief that negotiators need alternatives to win the negotiation. Negotiation alternatives, by creating a sense of security, allow the negotiator to negotiate proposals ambitiously, reach a desired conclusion, and leave the negotiating table whenever he wishes. In most cases, however, negotiators have no alternative. For example, according to a study by GMAC, most mid-level UMBI graduates receive only one job offer. In other words, these people have to negotiate for an existing job offer while they have no other choice. If you do not have an alternative in negotiation, by imagining an alternative option, you can go a step further and bring the result closer to what you want. be with us. In this article we want to talk about using imagination in negotiation.

imaginary power

Having alternatives or alternatives will increase your sense of power in the negotiation; With alternatives, you can consider the best and worst options as a reference and define the negotiation framework. Asked if imagining alternatives could be as helpful as having real alternatives, seven studies were conducted on more than 2,500 UMBI graduates, online participants and professionals. The main hypothesis in these studies was that the idea of ​​having an attractive alternative provides the negotiator with a point of reference and encourages him to raise his level of demand and expectation from the other party to the negotiation.

In one of these studies, from 306 The online participant was asked to sell a second-hand CD to a hypothetical online buyer. Participants were divided into three groups: some were told that another buyer had offered $ 8 to buy the CD (highest bid); The second group had no other offer (alternative); The third group was asked to imagine that they had a very good offer, which they should explain before participating in the negotiation of the terms of this hypothetical offer, the feeling that knowledge would give them that proposal, and how this proposal would affect the impending negotiation. . According to the research hypothesis, finally, the third group, compared to the second group, which had no alternative, offered a higher price to sell the CD to the buyer in the first offer; $ 11.2 vs. $ 8.56.

Not surprisingly, the final price in the third group negotiation was lower than the final price in the first group negotiation, which really had a better offer.

In another study, 300 participants were asked to negotiate the price of a mug face-to-face to see if an imaginary alternative could lead to a more lucrative final deal. In this study, participants were divided into three groups. The first group with real alternative, the second group without alternative and the third group with imaginary alternative. In order to motivate the negotiators and encourage them to negotiate ambitiously, the participants were told that the money from the sale of the glass would go to them.

Negotiations took place in two rounds. In the first round, participants were told that the price of a mug is usually between 3 and 10 euros. The alternative was the first group selling glasses for 8 euros. The third group had to choose their alternative mentally and they were not offered a certain price for the imaginary alternative. Participants in the second group or control group were not given any real alternatives or instructions for imagining the imaginary alternative. In the second round, all participants had to negotiate. The results showed that the negotiators with the imaginary alternative expected a higher price in the negotiation and sold the mug $ 1 more expensive compared to the control group. Their performance in this negotiation was as good as the first group (with a real alternative).

These studies show that the mental simulation of imaginary alternatives helps to reinforce your desires and improve the final outcome of the negotiation. An imaginary alternative can mean thinking of something as attractive and realistic as an offer before you sit down at a negotiating table (for example, to sell a product or get a job opportunity).

Alternatives must be calculated and good

As discussed, the idea of ​​having an alternative can have a positive effect on the outcome of the negotiation, but you need to consider a few things before using this technique. Other studies show that in some situations, the idea of ​​having an alternative not only does not lead to a good result, which may have the opposite effect. The type of simulated alternative is very important in the mind. When negotiators were asked to imagine an undesirable alternative to an attractive alternative, their performance was very poor; Because it reduced the motivation of the negotiators. The idea of ​​an undesirable alternative by lowering the negotiator’s expectation level may lead to a failure in the negotiation.

In addition, the circumstances of the individual who has to imagine the alternative affect the final outcome of the negotiation. In a simulated job negotiation, a group of UMB students participated in the role of employer and volunteer. One or both negotiators were given instructions on alternative mental simulation, and it was decided that one of the parties would submit the first negotiation proposal. Evidence suggests that alternative mental simulation has a positive effect when the negotiator with the imaginary alternative makes the first offer and the other party is not aware of the mental simulation; So the idea of ​​an attractive alternative is effective when you make the first offer and you are the only one who uses this strategy in the negotiation.

In a final study, it was found that when it is difficult to conform to the positions and demands of the negotiators, the idea of ​​having alternatives does not lead to agreement. For example, when the price range of the parties does not overlap, alternative mental simulation is not used. In this study, some people, as sellers of a restaurant, offered prices that the buyer could not afford. In such a situation, the negotiating parties can unveil some common positions by offering a series of concessions (such as a job guarantee). In these situations, an aggressive approach and unreasonable proposals resulting from the idea of ​​an alternative reduce the negotiators’ willingness to accept the offer and bring the negotiation to a standstill.

Although having strong alternatives is important for a successful negotiation, in many negotiations there are no alternatives. Studies show that mental simulation of an attractive but realistic alternative can largely compensate for this shortcoming. The key to this technique is to think of a good offer in mind, make the first offer if possible, and consider your common positions with the negotiating party.

Source

hbr

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Use your imagination in negotiation; If you have no alternative

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