Business Negotiation December 12, 2014

Your Assumptions are Probably Wrong

Making assumptions about the other party and their negotiating position is a natural part of the bargaining process. We make assumptions before negotiations take place and revise them as new information is discovered along the way. Unfortunately, the very assumptions made to guide our actions at the table lead us astray because they are all too often incorrect.

The trouble with assumptions is that they are as likely to be wrong as right. What is in the mind and domain of the other person is hard to know. For us to forecast future trends, costs and problems is extremely difficult. Knowing what the other will do if confronted with deadlock is at best an educated guess. There is much we cannot know when assumptions are made about those we oppose and their future actions or behaviors under pressure. They themselves may not know.

Yet, whatever the issues at stake, assumptions must be made. We have to ask ourselves questions like, “Am I asking for enough (or too much) and why?” and, “What will the other side do in response to what I say or do?” and, “What can they live with, what’s their bottom line?”

Time is a factor in negotiation. Assumptions must be made about time pressures facing the other party and how these pressures will affect their choices and decisions in dealing with us.

Negotiating effectively demands not only that assumptions be made, but also that they be tested in the light of what is learned at the table or elsewhere. How can we best do so?

We do so by creating ‘negotiating space.’ We leave room for talk and bargaining. We leave time for explanations to be provided by both parties for everything they demand and offer. We give in slowly and in small increments. We ask for something in return for offering concessions and learn from the other side’s response. We explore by exchanging information to get a better picture of what they want and what they really need. We talk directly to them, both on and off the record, to discover what we need to know in testing our assumptions.

Our assumptions are like anchors. If they are wrong, and we believe them, they will hold us back from reality. If we test them carefully they can guide us to fair and reasonable agreements.