Business Negotiation October 7, 2014

You Have More Power Than You Think-Part Two

We at KARRASS have tested the “You have more power than you think” hypothesis many times at practice negotiations conducted at programs worldwide. We do it by providing each attendee with a private information fact sheet prior to negotiation. This sheet includes their strengths and weaknesses as well as facts related to the other’s power position. Then, during the practice negotiation, the parties bargain to reach agreement.

Outcomes are posted for all to see. A critique and discussion follows that almost always reveals that most participants dwell on their own weaknesses and pay less attention to their strengths. They focus on what the other can do to them if they fail to agree rather than the reverse. As a result of this negative thinking, participants tend to take an opening position by asking for less than they might otherwise. After the critique discussions end, participants are always surprised that they dwelled so much on their weaknesses rather than focusing on their strengths.

From now on, when you prepare for any negotiation make a list of your strengths and what you believe to be the other person’s limitations. Before your next negotiation, review the six principles of power that follow to open your mind to aspects of power that might easily be overlooked.

First, the exercise of power always involves cost and risk. Those with power who are unable or unwilling to incur cost or risk abdicate their strength.

Second, power may be real or only apparent or assumed. Organization charts rarely determine where the real power lies. Those with power unwilling to exercise their strength do not have power unless you assume they will use it. For example, someone in a higher position has the power to punish a subordinate. If the superior has no intention of punishing the subordinate, then that power is for all practical purposes nullified. On the other hand if the subordinate believes he will be punished, that source of power remains intact.

Third, power changes over time. The balance of power moves as the balance of contributions and benefits between the parties changes. Good negotiators compensate for such changes in the balance of power by incorporating such changes into their agreements to keep them from failing over time. If one party to a negotiation has little power at the start of a project they may have considerably more as the project moves along and their work or expertise becomes essential.

Fourth, the ends of power cannot be separated from means. Good and lasting relationships cannot be built from manipulative tactics. Fifth, power is always limited. Its range depends upon the specific situation, the general economy, the government or such structural matters as policies, company regulations, ethical standards and present or future consequences, whether known or assumed.

Sixth, power is always relative. Rarely, if ever, does one side enjoy complete power over the other. Understanding the sources of power and making the most of them will add credibility to our position and confidence in your assertions.