1: “If you approach a negotiation thinking that the other guy thinks like you, you’re wrong,” Chris Voss writes in his book Never Split the Difference.
“That’s not empathy; that’s projection.”
Chris is the FBI’s former chief hostage negotiator. He has also taught business negotiation in MBA programs at USC and Georgetown. During the third week of his negotiations class, he has his students play what he calls the “Ultimate Game.”
Students are split into pairs. One is a “proposer.” The other is an “accepter.”
Each proposer is given $10. They are instructed to offer the acceptor a round number of dollars. “If the accepter agrees, he or she receives what’s been offered and the proposer gets the rest,” Chris writes.
“If the accepter refuses the offer, though, they both get nothing and the $10 goes back to me.”
2: The Ultimate Game reveals several truths:
First, “almost without exception, whatever selection anyone makes, they find themselves in a minority,” he notes. “No matter whether they chose $6/$4, $5/$5, $7/$3 $8/$2, etc,. they look around and are inevitably surprised to find no split was chosen far more than any other.”
Professor Voss then delivers a message the students don’t like to hear: “The reasoning each and every student used was 100 percent irrational and emotional.”
“What?” the students say. “I made a rational decision.”
Chris then asks: “How could they all be using reason if so many have made different offers?”
Which is the point.
Next, “For you accepters who turned down $1, since when is getting $0 better than getting $1? Did the rules of finance suddenly change?”
And, finally, why didn’t all the proposers offer $1? Isn’t that the “rational” offer? Because it is unrejectable by the accepter. Isn’t a guaranteed $1 better than the possibility of $0?
“Anyone who made any offer other than $1 made an emotional choice,” Chris tells the class.
3: Which challenges each student’s belief that we are all “rational” actors.
“None of us are,” Chris writes. “We’re all irrational, all emotional.
The big lesson?
“Emotion is a necessary element to decision-making that we ignore at our own peril,” he notes.
Negotiation isn’t a rational game. And neither is life.
We are all emotional beings.
More tomorrow!
______________________
Reflection: How do I typically approach a negotiation? Do I believe negotiation should be a rational process?
Action: Discuss with my spouse, a friend, or a colleague.
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