Navigating the complexity of negotiations involves balancing contrasting principles: cooperation and competition, both pivotal in their own right. The dynamic tension between these principles can often pose a “negotiator’s dilemma”. Can this equilibrium be managed? Yes, indeed, through an innovative strategy called Multiple Equivalent Simultaneous Offers (MESOs).
Two schools of thought dominate the negotiation arena: the “Value Creators” view negotiation as a harmonious venture aiming for mutual gain through transparent exchange of information and creative problem solving. In stark contrast, the “Value Claimers” approach negotiation as a contest, focusing on outperforming the other party by employing tactics such as highballing, minimal concessions, tight-lipped information sharing, and at times resorting to intimidation.
Though these perspectives might appear conflicting, negotiation experts suggest that an effective negotiator embraces both these perspectives. The trick lies in creating abundant value and assertively claiming a proportionate share. The challenge then emerges when negotiators are not naturally proficient at both.
The negotiator’s dilemma arises when there’s a struggle between the cooperative and competitive aspects of negotiation. This is evident when deciding whether to share sensitive information about interests and priorities. While revealing such information could lead to value creation, it could also leave you vulnerable to exploitation. Conversely, withholding this information could result in missed opportunities or a stalemate.
So how do we overcome this quandary of creating value without exposure to risk and claiming value without straining relationships? This is where the concept of MESOs comes into play.
The initial offer in any negotiation can often trigger destructive competition. Counteroffers tend to lean towards the direction of the first offer, regardless of its fairness or arbitrariness. The counterparty often devalues the first offer, leading to either aggressive counteroffers or abandonment of the negotiation table. To mitigate this, MESOs provide a solution – presenting two or more equally valued package offers for the counterpart to choose from. This strategy communicates goodwill, avoids unnecessary sacrifices, and more often than not, results in a more favorable outcome compared to a single offer scenario.
Let’s take the example of a hiring manager proposing a job offer to a candidate. Instead of presenting a single package or negotiating individual components, the manager could present three equally valued packages, allowing the candidate to choose, thus introducing flexibility and facilitating a mutually beneficial agreement.
However, while making MESOs, it’s crucial to be wary of overwhelming the counterpart with too many options, potentially nullifying the benefits of MESOs.
There are also additional strategies to navigate the negotiator’s dilemma:
- Engage a neutral third party like a mediator to facilitate information exchange and reduce potential exploitation.
- Develop a single negotiating text, allowing for draft reviews and revisions until a consensus is reached.
- Consider a post-settlement settlement, which opens up space for further improvements after the initial agreement, fostering creative thinking and reducing competitive tension.
To conclude, understanding and effectively leveraging MESOs can significantly enhance your negotiation outcomes while managing the inherent dilemmas and balancing the trade-off between competition and cooperation.
