The Elements of Negotiation

ELEMENT 35Emotions, Stress, and Personal Chemistry

In negotiations, we often think of ourselves as rational beings, engaging in predictable behaviors. However, the reality is that negotiations are a psychological game where rational and predictable behaviors are mixed with unknown and irrational behaviors. You can change your behavior, but you cannot change your counterpart. By understanding yourself better, you understand your counterpart better, and you get a chance to adapt to the situation.

Negotiations aim to satisfy different types of needs—both material and psychological. Material needs are often synonymous with a company's needs, measured and expressed in monetary terms, market shares, product features, and delivery reliability. At a superficial glance, negotiations revolve around these material needs. However, psychological needs are equally important and significantly impact individual negotiators, often more than most of us would admit. These are the negotiators' own needs, including:

• Self-actualization: Achieving budget goals, conquering new markets, trying new technology, and the freedom to follow your own path.
• Social needs: Gaining respect, appreciation, and being liked by others. This can be achieved by meeting material goals, appearing as a winner (which may mean the counterpart loses), reaching an agreement with two winners, showing competence, making friends at the negotiation table, or not losing face.
• Security: Avoiding technical and commercial risks in ...