The Negotiator Magazine

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Bargainers should also be aware of the impact of "gain-loss framing." Persons offered a certain gain and the possibility of a greater gain or no gain tend to be risk averse. They prefer the sure gain to the possibility of nothing. Who Wants to be a Millionaire provides a perfect example. Once contestants get to $125,000 or $250,000, if they miss the next question, they fall back to $32,000. Unless contestants are quite sure they know the answer to the next question, they usually take the amount they have already earned and depart. On the other hand, individuals facing a certain loss and the possibility of a greater loss or no loss tend to be risk takers in an effort to avoid any loss. Assume that you are in a room with 100 people. You are told that everyone who goes out one door has to pay $100; four out of five people who go out another door have to pay nothing, but one out of five going out that door has to pay $500. Most people offered this choice elect to leave by the door where there is a four-in-five chance they will not have to pay anything despite the fact they have a 20% chance of being charged $500. When individuals prepare for bargaining encounters, they should formulate offers that will look like sure gains to their opponents. They may offer the other side money or something else of value that will cause most adversaries to become risk averse. What if they have to ask for something of value from the other side to resolve a controversy? They should try to make it seem that for what they are seeking the other side's problem will be resolved. If they seem to be offering the other side a sure loss, it might become risk taking to avoid any loss, but if they can induce the other party to think they will obtain a gain for their payment, they will become risk averse and look for a mutual accord.

Once negotiators have established their bottom lines, their aspiration levels, and their opening offers, they should take time to choreograph their impending interaction. How do they visualize moving from where they begin to where they hope to conclude their interaction? Do they plan to make several larger position changes or a number of smaller position changes? Which negotiation techniques do they anticipate using? The more they plan their impending interaction, the more they are likely to achieve their objectives. Bargainers who fail to plan adequately are likely to give in to their more prepared adversaries.

II. ESTABLISHMENT OF NEGOTIATOR IDENTITIES AND TONE FOR INTERACTION

Once people have thoroughly prepared for their bargaining encounters, they begin to interact with their counterparts. Americans tend to be impatient persons who don't like small talk. We like to get to the heart of the matter quickly and begin the exchange of items, forgetting the personal nature of the process. When people commence bargaining encounters, they are generally anxious, because they have no way of knowing whether their efforts will be successful. If they begin the substantive discussions in this frame of mind, their anxiety may adversely affect their relationship with the other side and undermine the actual discussions. To diminish this possibility, it is helpful for people beginning bargaining interactions to take the time to establish some rapport and create positive environments.

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