January 6, 2024

Making Careful Concessions

In most negotiations, both sides move from their original positions. Each side compromises by making some concessions to reach an agreement. Careful concessions help guide you towards a mutually satisfying agreement. Here are a few things I try to keep in mind when making concessions:

1. Never give a concession without obtaining one in return. Don't give concessions away free or without serious discussion. A concession granted too easily does not contribute to the other party's satisfaction nearly as much as one that they struggle to obtain.
2. Concessions that are poorly made can serve to further separate the parties rather than bring them together. A concession may serve to raise the aspiration level of the other party if it is interpreted as a signal of your weakness. How a concession is made is as important as the value of the concession.
3. Never lose track of how many concessions you have made. The overall number is important and can provide bargaining leverage. Keep a written record of your concessions.
4. Flexibility is like money in a checking account. Do not use up your "bank account of flexibility." Every concession should bring you closer to some goal. If you use up all of your potential concessions your bank account is down to zero and deadlock is harder to avoid.
5. Don't feel constrained to stick with a concession on a specific issue. The whole agreement is more important than individual issues. Indicate to the other party that all concessions you give are tentative and based on a satisfactory overall agreement (i.e. "tie a string"). Some people tend to stick to interim concessions when they should not. They fear that their integrity may be questioned if they retreat from concessions they have made. Such rigidity can be costly.