Negotiating Fairly

Have you ever wanted to negotiate and the offer you receive right out of the gate is so outlandish you feeling like walking away immediately? Maybe it’s your romantic partner making demands that seem unreasonable or perhaps it’s a business offer that leaves a bitter taste in your mouth. Next time this happens, don’t walk away. Instead, try a different approach.

Let me explain. We are exquisitely capable of detecting inequality and when it happens we dislike it intensely. You can read about why fairness is important in this blogpost. For now, trust me. It matters, a lot. We receive constant messages about how the ability to negotiate and compromise central to successful business ventures and personal relationships. Some call it an art. The “art” part comes in being good at it, knowing when to do it, being fair, and not holding grudges after you’ve done it. The problem? No one teaches us how to do this successfully. That makes for a tall order when, by its very human definition, compromise means that each party must first let go of something in order to reach an agreeable resolution. No wonder no one likes to do it! You might be saying by now, well yes, that is what it means. But if that were true, there is no “art” to it at all. Try to get as much as you can by asking for more than what you really want, that way during “negotiation” you lose the least. This is hardly a fair approach, but it is the most common one is matters of business and by extension, the heart.

Source: USFWS CC BY 2.0

Hermit crabs think about negotiation differently. First, what do hermit crabs negotiate about? Real estate. An individual hermit crab may be in a house (shell) that is too big while another one may be in one that is too small. Empty shells are hard to come by, and everyone needs one, so what’s a hermit crab to do? Tap another friendly hermit crab on the “shoulder” and see if he or she wants to trade. But here’s the catch. There can be no forced exchange and no one offers an exchange that would take them further away from the size he or she authentically needs, so both crabs end the exchange with a shell that is equal to or better than what they had when they started. That is a negotiation that allows for mutual gains rather than mutual loss.

A key point is that there is a common agenda. There is no conflict of interest for the crabs and the goal is similar for both parties (a better shell). A few takeaways from this example include, 1) decide whether to compromise in the first place, 2) establish common goals, and 3) be honest about what you need. Needs and wants are very different. Because we are sensitive to fairness, we may become less willing to compromise if we suspect that what is being asked for is not what is truly needed by the other party. If you’re the one approaching negotiation from the often-advised standpoint of “ask for way more than what you really need so you get what you deserve”, you might want to re-think your strategy.

I recently went through this in a business exchange. I asked for something I needed that was not being used another, the equivalent of an empty hermit crab shell being hoarded by another crab who didn’t need it or want it. Instead of giving it to me for free, it was offered, not only for an outrageous sum, but one that was objectively disproportionate to its value. I was tempted to end all dealings immediately and never again enter into a business arrangement with the party in question. Instead, I decided to test out the hermit crab approach. I followed the steps outlined above. First, I determined I was willing to pay something. Next, I established common positive goals. Then, I objectively calculated the monetary value. Finally, I presented my offer. Mind you, I was fully prepared to walk away. I was not willing to acquire my “shell” at any cost. Much to my surprise and delight, a fair exchange occurred.

Let’s take another example. This is one aspect of many romantic relationships that is rife with tension and conflict: negotiating household chores. One of the reasons this may be a contentious topic for some couples is because, regardless of whether both people work or one person stays home, one person may perceive an inequality in the division of household labor. This could be because of different definitions of what constitutes “household” labor (for example, is childcare included?) or because of the difficultylevel of different tasks varies. But all things being equal, there still may be a need for negotiation.

Source: Ian Kirk CC BY 2.0

If you were a long-tailed bushtit you would face a similar dilemma. Why? Like us, each individual would prefer if the other did the majority of the work, but that wouldn’t be fair and no long-tailed bushtit is going to go along with that. So how do they successfully negotiate household chores? Each one gives as much as the other and if either fails to live up to their share there are consequences. The nest doesn’t get built, the eggs won’t be incubated, and the chicks won’t survive. Since most long-tailed bushtits manage to build their nest, lay their eggs, and fledge their young, clearly the majority successfully negotiate or walk (or fly) away from partners that don’t cooperate. But there is a subtler message here. They, like the hermit crabs, have no trouble compromising (giving equally, even though they’d rather give less), because there is no conflict of interest and the goals are similar for both parties. This means that the more agreement with regard to objectives, the less conflict experienced when negotiating and compromising, and the better the outcome for both parties.

The same kind of harmony we see in hermit crabs and bushtits works for human relationships and business dealings. I want to make one last point. We have the added complication of being afraid of where we stand if we compromise, even if it’s about something we care very little about. Have you ever dug in your heels and stuck to your guns all to make sure you didn’t lose ground in future negotiations? In such cases, it’s easy to see how negotiations become less about the particular issue and more about perceived power. But power, and the abuse thereof, is characteristic of despotic interactions not cooperative ones. It is far more productive to approach interactions from the standpoint of good intentions, honesty, fairness, and cooperation. It not only builds nests, but also goodwill for future interactions.