James Comey, Hillary Clinton, and offers in negotiation

Last week, many of us watched as FBI director James Comey detailed the FBI’s investigation into Hilary Clinton’s email practices, then recommended against criminal charges. Many of us continued to watch as he was criticized from both sides of the aisle—in an unusually intense grilling by the House, for example. Although such a politically-fraught statement was sure to make one side angry, this statement seemed to make everyone angry—the left for its critique of Clinton’s behavior and the right for its recommendation not to charge.

Why would that be? Well, I’m not the FBI director, and I do understand why the person who is felt compelled to give an especially detailed statement. But I am a negotiation professor. As such, I believe that three negotiation principles can help to explain the universal sigh following Comey’s statement. They all originate in the idea that his explanation resembles a negotiator’s attempt to engage in persuasion, and his recommendation about criminal charges resembles a first offer (albeit one that everyone had to accept). If you buy that analogy, then negotiation research would suggest three problems with this approach:

  1. The arguments didn’t clearly support the conclusion: Perhaps the most basic principle of persuasion and offers in negotiation is that that the persuasion has to logically support the offer. The most consistent criticism of Comey’s statement was that the explanation implied that charges were coming. But then they didn’t. This created an uncomfortable inconsistency between the two—a “gap,” as Democratic Representative Elijiah Cummings put it.
  2. It was easy to generate counterarguments. Negotiation research has suggested that attempts to couple persuasion and offers backfire when the person who receives them can easily generate counterarguments. In that case, the research suggests that an offer without much persuasion may work better. I think it’s fair to say that Republicans didn’t have a hard time generating counterarguments, meaning that the simple, traditional, “here’s our recommendation” approach may have worked proven more compelling.
  3. The persuasion preceded the offer: Some intriguing and emerging research by negotiation scholars Nazli Bhatia and Robin Pinkley suggests that an offer followed by persuasion has a stronger influence on the listener than persuasion followed by an offer. The reason? The former approach leads the listener to start justifying the offer in their own minds. Unfortunately, Comey’s statement followed the latter pattern, the bulk of the presentation focusing on persuasion and the “offer” coming only at the end.

Again, who am I to second-guess the FBI director? No one, but I do believe that these three negotiation principles may help to explain the reaction he received. The lesson for the rest of us? If we’re going to make an offer and persuade someone to accept it, we’d better make sure to do it in that order, with the persuasion supporting the offer, and only when we’re confident that obvious counterarguments won’t pop to mind.

Trump’s curious opening offers

As anyone following politics is well-aware, Donald Trump has made a habit of staking out aggressive negotiating positions. Whether it’s insisting that Mexico will foot the entire cost of a wall or suggesting that he might entertain nuclear retaliation against ISIS, Trump seems unafraid of making the first offer, and making it aggressively.

In that sense, he’s following the advice in one of my earlier posts, as aggressive first offers can often make life more negotiable. And I’m sure it’s because he carefully studied that post.

Yet, Trump has also made a habit of coupling his first offers with other, more curious and less comprehensible tactics. In this post, I’d like to highlight what they are, advising you to stay away from them if you’re using the first offer to make life negotiable:

  1. Calling it a tactic. Aggressive anchors work, in part, because they convince the other side you mean business—that you might actually have a plan to strong-arm the Mexicans or nuke the Islamic State. But that’s only when you avoid suggesting you don’t. Shortly after making each of the first offers above, Trump labeled them negotiating tactics, implying that he didn’t really mean what he said. For example, he followed the nuclear comment by saying: “at a minimum, I want them to think maybe we would.” If you’re going to make a first offer, say it like you mean it and don’t call it a tactic. Otherwise, you look weaker than if you hadn’t made the first offer in the first place.
  2. Waffling. Trump has the habit of staking out an aggressive position on one talk show, saying the opposite on the next talk show, then going back to the initial position on the third talk show. For some humorous examples, see this Washington Post article. As I’ve said in a previous post, there’s nothing inherently wrong with changing your mind when the situation demands. But reversing most of the aggressive positions you take when nothing has changed suggests confusion, at best. If you’re going to make a first offer, don’t make the second offer; and if you do, don’t make it the opposite of the first offer.
  3. Overshooting. As I’ve said before, the best first offers are aggressive but realistic; they are not outrageous, as outrageous offers just drive the other side away. So when you offer to simultaneously deport 11 million illegal immigrants, that probably doesn’t convince your potential negotiating partners in Congress you’re serious. It makes them laugh (or cry). If you’re going to make a first offer, try to make one that the other side finds just slightly unacceptable, not completely unbelievable.

I’m not a billionaire, nor on the cusp of becoming president. So, let me be measured in my critique and admit that there may be a method to his maneuvers, insofar as they make him look unpredictable. But if you’re planning to make the first offer, I wouldn’t necessarily suggest you adopt his approach. Instead, make a confident, consistent, realistic first offer that the other side will probably take seriously.

Negotiations across cultures: To make or not to make the first offer?

Every day, most of us interact with several people from unfamiliar cultures. In many of our cross-cultural interactions, our inclination is to tread carefully, lest we commit an unwitting cultural faux pas. In a word, many of us act tentatively across cultures.

In general, that’s a good thing, reflecting a genuine desire to avoid offense and the correct intuition that cultures extensively differ. But what about when we negotiate with a cross-cultural counterpart? Should we bargain tentatively too? Our cross-cultural negotiations will be more negotiable if we don’t.

To see why, recall one of my previous posts, which generally advised you to make the first offer in a negotiation if you can. By doing that, I argued, you can direct your counterpart’s attention to your own goals rather than theirs. As a result, they will use the first offer to estimate the value of the commodity being negotiated, and their subsequent offers will look very much like your first offer. Many years of research have supported this so-called “first offer effect,” attributing it to the basic hardwiring of our brains and showing, for example, that the person who moves first does better.

But what about when you negotiate across cultures? Should you still make the first offer or should you follow the inclination to be tentative? It turns out that the previous research on the first offer effect had come almost entirely from Western cultures, so some colleagues and I recently conducted new research to find out. Recognizing that people from different cultures differ in several ways, many of which are relevant to negotiation, we predicted that they wouldn’t differ in the fundamental hardwiring of their brains. From Baltimore to Beijing, we expected the first mover to walk away from negotiations happy.

Almost uniformly, they did. Across two studies, the first offer effect still emerged in a prototypical East Asian culture: Thailand. In addition, the effect emerged in negotiations among individuals representing 32 cultures and all continents except Antarctica. Regardless of culture, then, making the first offer produced advantageous outcomes, and failing to make the first offer produced a problem.

The bottom line? Being tentative is probably a good antidote to cultural offense, but it’s also a recipe for getting hammered in cross-cultural negotiations. Though you may convey your cultural sensitivity, waiting for an offer is also likely to put you in a perilous position.

With that said, here’s an important reminder before applying this advice: making the first offer doesn’t mean making the first offer right away. In fact, in many cultures (especially Latin American and East Asian), it’s vitally important to build a strong relationship before anyone makes an offer. (Future posts will discuss this and other things that actually do differ across cultures). So the point is not to start making offers the second you meet a cross-cultural counterpart. The point is that it’s worth trying to make an offer before they do, whatever their culture.

Have you ever made the first offer in a cross-cultural negotiation? Or felt uncomfortable doing that?

My toddler STILL won’t eat their dinner! Timing your first offer

One of my first posts tackled one of the most intractable problems: convincing a toddler to eat dinner. In brief, it suggested making the first offer: approaching the toddler before dinner and offering a cookie if they eventually eat their meal. Not waiting for the meltdown and offering several cookies out of desperation.

As I said there and will reiterate here: getting a toddler to eat is not easy, but it’s negotiable! To make it negotiable, though, is to understand an important distinction in the advice originally provided: making the first offer does not mean making an offer first thing. It just means making an offer before your wily counterpart (in this case your toddler) does. As I said in the first post: “it’s generally a good idea to make the first offer—that is, to make an offer before the other side does.”

This distinction is subtle enough that it merits its own post. To see why, imagine that you implemented the initial advice by offering the toddler a cookie before they even approached the table. Specifically, you said: “Little Billy dearest, if you sit down at the table right now, finish your entire plate of broccoli, and don’t get up until you’ve done that, you can have one chocolate chip cookie. If you don’t sit down, don’t eat all of your broccoli, or get up from the table before eating all of your broccoli, you don’t get any cookies.” That’s a good first offer: it’s clear, it’s specific, and it preempts any possible protests by Billy dearest.

But it may also be premature. What happens if Billy sits down promptly, starts eating earnestly, but stops eating halfway through the broccoli? “Billy dearest,” you say, “remember what I said: You have to eat that whole plate of broccoli without getting up in order to get your cookie.”

“But mommy / daddy,” Billy protests, “I have to go POTTY!”

Now you’re in a jam. On the one hand, this is exactly the kind of bowel self-awareness you’ve been pining for. On the other, you made it perfectly clear that Billy would not get a cookie if he got up. Let him go potty and you reinforce his bowel self-awareness, but you also undermine your credibility and undercut your offer. If he’s anything like my toddler, he will suddenly find the need to go potty anytime he doesn’t want to eat something—then demand the cookie.

What happened here? You followed my advice and made a very respectable first offer. But you made it before fully understanding Billy’s situation. That is, you made an offer first thing, not just before Billy did. Had you asked Billy, prior to the offer, “Billy, do you have to go potty before dinner?”, chances are this particular jam could’ve been avoided.

So the general point is this: when negotiating with toddlers or anyone else, it’s best to understand everything you can about their situation—and make sure they understand all the critical aspects of your situation—before anyone makes an offer. Then and only then do you want to make a first offer, meaning the first offer that anyone makes in the negotiation. It’s not a risk-free strategy, but in matters of human interaction, those are few and far between.

How you ever made an offer too soon?

Three Keys to a Killer First Offer

Most of us own something we don’t really want. Maybe we’re riding the train and no longer need a car. Maybe we’re moving and can’t haul the couch. Maybe our fancy bike eliminated the need for a Schwinn.

Opportunities to sell are everywhere. But how to pick a price? I’ve previously suggested setting your first offer as a function of your target. But if you’re like most people, you’re still not sure EXACTLY what figure to propose.

Selecting the number for your first offer is tough. But it’s negotiable! In this post, I’ll offer three strategies that can help you home in on a killer first offer.

For the purpose of this post, imagine that you’re moving into a furnished apartment across the country, thus eliminating the need for your beloved couch “Bessie.” Imagine, further, that your cat hasn’t destroyed your beloved couch, as he has mine. Finally, imagine that $750 is the aggressive yet attainable figure that you have chosen as your target.

That’s all fine and well. But now that you’re standing in front of a prospective buyer, nervously extolling Bessie’s virtues, you’re still not sure exactly what number to offer. Here are three strategies for selecting a figure:

  • Be aggressive, not outrageous: If you’re confident that $750 is aggressive yet reasonable, a first offer in the $775-$825 range would probably work well. A first offer in the $1275-$1325 range would not, as research clearly shows that first offers far outside the realm of reason don’t lead to good deals. They lead the other party to bolt before you can say “Bessie.” So offer something somewhat above your target, but don’t offer something outrageous.
  • Be precise, not round: If you’re considering a first offer of $800, consider a first offer of $807 instead. Why? Other interesting research shows that precise first offers are more persuasive than round first offers because they suggest that you’ve done your homework. $800 sounds like a dream; $807 sounds like a carefully researched and clearly justified calculation. But don’t overdo it. Don’t offer $807.34, as the same authors have suggested that you then sound like a slimy salesperson. So try to be moderately precise, then extoll Bessie’s virtues when your counterpart probes the underlying calculations.
  • Be exact, not wishy-washy: If you’re considering a first offer of $807, say “$807.” Don’t say “about $807,” and don’t say “between $787 and $807.” Your goal is to give your first offer the aura of legitimacy and finality. If you say “about,” the other party hears an opportunity to negotiate. If you say a range, the other party hears the part of the range they like—$787—and your hopes of $807 are gone forever. So do your homework, understand through and through why your beloved Bessie might be worth your first offer (whatever it is). Then advance that offer with confidence, as if it’s the only obvious number that any reasonable purveyor of used couches named Bessie would offer.

These three tips still won’t give you an EXACT answer about what number to offer. In matters of human behavior, exact answers are few and far between. But hopefully they do offer a useful yardstick for calibrating your figure and advancing a first offer with confidence.

What do you think of these strategies?

Getting them out the door on time: How to make the first offer

If you’re anything like me, you have a need (even a compulsion) to be on time. But if you’re uncannily like me, you’re frequently frustrated by a friend or family member who, when accompanying you to your appointments, sees no particular difference between 10:30 and 11:00. The nerve!

How can you possibly convince them to get out the door on time? With the right strategy, it’s negotiable.

In this post, I’ll talk about a simple technique for departing on schedule. And when I say simple, I mean REALLY simple. Let me anticipate the possible critiques by being clear: this post contains a distinct lack of rocket science; indeed, you might already use the technique I’ll describe. So why describe it at all? Because it highlights a principle you must understand to succeed in any negotiation, including this one: HOW to make the first offer.

You may recall that a previous post on toddlers advised you to make the first offer. That’s all fine and well until you go about implementing this advice, at which point you’ll find that you still need to know what to say. What kind of offer should you make (first)?

To discuss this issue, in general and in the context of lateness, imagine that you have an important meeting at 11:00 am. You hope to leave home at 10:30, but you absolutely NEED to leave by 10:45. Accompanying you to this important meeting is a perennially-late family member; let’s call him Joe. Looking up from his dilly-dallying around 10:00, Joe asks you what time you want to leave. This is a golden opportunity to make the first offer! But what time to say? Please pick your favorite:

  • 10:15
  • 10:30
  • No later than 10:45

Let’s meander to the best answer by thinking about this situation in the terms already discussed on this blog. Your goal (target) is to leave at 10:30; your bottom line (reservation price) is 10:45. What happens if you ask Joe to be ready no later than 10:45? Dilly-dallying as he still is at 10:00, and perennially-late as you know him to be, you’ll be lucky to get out the door by 11:00. So don’t make a first offer that’s equivalent to your bottom line.

But what about your goal – what if you ask Joe to be ready at 10:30? Well, that’s better than stating your bottom line, but what time will Joe actually be ready? If he sticks to his bad habits, chances are he will show up at the front door about 10:45, allowing you to get out said door at the VERY last moment you can. Unless you like the feeling of mounting anxiety, mixed with simmering irritation, 10:30’s not a very good option either.

So the best answer is probably 10:15 – a number slightly more aggressive than your goal. What happens if you say 10:15? Joe hopefully drops his dilly-dallying right away and finds his way upstairs to get ready, then out the door by 10:30. Voila! You’ve achieved your goal of 10:30.

But won’t Joe get offended by such an aggressive first offer? Well, if you read the post on negotiating with the cable company, you know that targets are optimistic numbers, not ridiculous numbers. In other words, when you set a target (e.g., 10:30), you pick a number that is achievable in addition to hopeful. Thus, when Joe hears 10:15, he may look at you with surprise. But he’s unlikely to glare at you in anger because he knows that 10:15 is in the same zip code as the reasonable 10:30.

So the general principle is this: When you make a first offer, and make it you often should, don’t choose a number that’s equivalent to your reservation price or goal. Choose a number that’s slightly more aggressive than your goal, which is hopeful but achievable. By doing so, you leave yourself room to actually reach your goal. Without doing so, your goal will almost certainly go unmet.

Do you have a perennially-late friend or family member? Have you tried this technique?

Doing your fair share in the workplace: How to respond to someone else’s first offer

At some point or another, by choice or by assignment, most of us will start a work project with someone we don’t really know. Having launched such a project, a perennial question quickly blooms: “Who will do what?”

Making sure you do your fair share—no more, no less—is far from easy. But it’s negotiable!

For the purpose of today’s example, suppose you work in an organization (it doesn’t really matter what kind), and your boss has asked you to complete a big, difficult, time-consuming project (again, it doesn’t really matter what kind) with a peer named Sally from another part of the organization. You’ve just met Sally, exchanged some pleasantries, and scoped out the project. Now, the perennial question is blooming, the crickets are chirping, and both of you are looking at each other deciding whether to make a suggestion.

If you read the previous post on toddlers, you already know that the best response is probably to offer a suggestion in the form of a first offer. But you won’t always have that luxury. At least some Sallies will move first. Today’s post will discuss what to do if you have to move second—that is, how to respond to a first offer, particularly if:

  1. It sounds really good, or
  2. It sounds really bad.

So what do you think? What if Sally proposes a division of labor that seems embarrassingly easy for you and uncomfortably hard for her to accomplish? Stupid question, right? Shouldn’t you just say “absolutely” and call it a day?

Not so fast. My coauthor Adam Galinsky and his colleagues have shown that immediately accepting an advantageous offer is not such a good strategy. Why? Well, put yourself in Sallie’s shoes. What does she think if you—with a gleaming smile, even before the words have entirely left her mouth—enthusiastically agree to her division of labor on this big, difficult, time-consuming project? She thinks: “&$%#@*.” A bit more scientifically, she has what’s called a counterfactual thought: “I must’ve really made a stupid offer if you were so happy about it and eager to accept it.” Amazingly, Galinsky and colleagues’ research shows that you can not only make Sally happier by negotiating with her (and thus allotting even more work to her); you can also do better for yourself.

Now, please don’t get carried away with this strategy. If you think Sally actually made a mistake in her proposal, you should instead try to correct it. You still have to work with her, and you still work in the same organization after all. Or, if you think it would be greedy and unethical to push her harder, then don’t—just make it look like you’re putting up a fight. But, whatever you do, the research suggests that it’s a bad idea to accept someone’s advantageous offer gleefully and rapidly.

Now on to #2: What if Sally proposes a division of labor that seems uncomfortably difficult for you and embarrassingly easy for her? Well, here, your intuition may be a slightly better guide. The best advice I can offer is a two-step process:

  1.  Chuckle or laugh, making a not-necessarily-funny joke to cut through the tension. In the summer, for example, I often joke that the owner of the building where the negotiation is unfolding must have forgotten to pay an electricity bill, as “It’s getting warm in here.” Not particularly funny, but effective for signaling the inappropriateness of the offer.
  2. Make the exact same offer you were going to make if you were able to make it first. Seriously, try to actually ignore the offer that was just made, attaching your own original offer to the end of the corny joke. Only by ignoring their first offer can you have any psychological hope of avoiding its influence.

Bottom line: when you get a first offer, whatever it is, don’t just say yes. Whether your Sally gives you an offer you love or an offer you hate, keep talking to her—knowing that you can do better or at least make her happier. Don’t get carried away and don’t take advantage of hapless Sallies. If she’s really made a mistake, tell her so and move forward under the auspices of honesty. But whatever you do, avoid the temptation to call it a day immediately after Sally speaks. That will only make Sally feel hapless, and hapless-feeling Sallies are not good—for her, you, or the project.

Have you ever made an offer that was accepted too quickly?