The Elements of Negotiation

ELEMENT 51Testing Limits with Respect

In negotiations, pushing boundaries is essential, yet it must be done with respect to avoid alienating the other party. Seemingly straightforward statements can be perceived as aggressive, jeopardizing the relationship.

In order to make progress in generating NegoEconomics (see Element 20) and identify additional values, it is essential for you as a negotiator to test limits. But do it without becoming threatening.

Consider an incident involving Swedish efforts to sell JAS-Gripen jets to Finland. Elisabeth Rehn, former Finnish defense minister, recounts in her memoirs a conversation with Swedish executive Peter Wallenberg. Wallenberg implied that if Finland didn't buy the jets, the Wallenberg conglomerate might pull out of Finland, potentially leading to job losses. Rehn was offended, and when the media asked Wallenberg about this, he suggested there might have been a misunderstanding, questioning the effectiveness of threats in negotiation.

This raises two points: Did Wallenberg view his statement as a threat? And, who is responsible for misunderstandings in communication?

The Carrot vs. the Stick Approach

Resorting to threats can backfire, intensifying the other party's defenses. Imagine if Wallenberg had instead highlighted the benefits of choosing JAS-Gripen, suggesting potential job growth in Finland. This positive approach could have been more effective.

Effective negotiation methods include these:

• Time pressure: Negotiating with ...