Why Interest-Based Negotiation Will Get You What You Really Want

Negotiation is part of life. Whether we're talking about something as grandiose as healthcare or as personal as buying a car, we often spend the vast majority of the negotiation process haggling over the numbers. This is often a bad way to look at it, says Dan Shapiro. And he should know: he's head of the Harvard International Negotiation Project and knows an awful lot about getting two opposing sides to see eye to eye. So what's the best way to do so? Perhaps talking about why each party wants what they want and negotiating from there. When polarized debates come to a head over "use vs them" mentalities, looking at it from this angle—i.e. the nuts and bolts of a position and less so the end result—can humanize each side to the other.
Dan Shapiro's latest book is Negotiating the Nonnegotiable: How to Resolve Your Most Emotionally Charged Conflicts.
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Transcript: So the classic approach to negotiation is positional bargaining. In positional bargaining I have a position, you have a position, and we each haggle over those positions.
Now the rules to positional bargaining are very clear: You start with an extreme demand but not so extreme that the other side thinks that you’re crazy or bluffing. You can concede stubbornly, and you demonstrate a greater willingness in the other side to walk away from the negotiation table.
So you go to the car dealer. You want to buy a Corvette. The car salesperson says, “$80,000 take it or leave it.”
You say “80? I’ll tell you what: 40, take it or leave it.”
And you start arguing and haggling, crossing your arms. Threatening to leave. An hour later the car salesperson brings that number down to 70. You’ve gone up to 50. You each then demonstrate a greater willingness to walk away from the negotiation table. You say, “You know what? There’s actually another Corvette dealer down the street. Maybe I’ll just go there.”
And the car dealer says, “Well, you know what. You see all these people standing in line here. They all want to buy this Corvette.” You each threaten to walk. But if you don’t walk you might end up typically somewhere in the middle of those two other numbers: 40, 80, you might end up around 60.
However, this probably isn’t the best agreement that you could have come to. All this is doing is arguing over one single factor: a number. And that’s the problem of positional bargaining, is that I might have a lot of other interests at stake but none of them are getting shared within this very strict form of positional bargaining.
There’s another form of negotiation that at the Harvard Negotiation Project some of my colleagues have developed, we call it “Interest Based” negotiation. The idea here is let’s not argue over positions, let’s argue over underlying interests.
“Why do you want the car?”
“Well I want the car because I have three kids, three boys. I want a safe car. I don’t really care about the sunroof. I don’t need to look that cool, you know. But I want a car that’s not that expensive. I want one that’s energy efficient. And these are all of my interests.”
Now the car dealer has his or her own interests. If I ask you right now on camera what day do you think I bought my most recent car— Literally what day—you should know. It was December 31 right at the end of the year, because I knew one of the interests of the car dealer in my area was they needed to get these cars off the lot for the next year’s cars. They were more likely to go lower because they had other interests at stake. So interest based negotiation says don’t just focus on the positions, what you say you want; focus on the underlying interests. And this is just as true in contemporary society. Whether it’s a business example – two people arguing over a contract. Don’t just focus on the positions, focus on the underlying interests. When it comes to policy in the United States or elsewhere you say “This is your position on healthcare. I say this is mine.” Let’s not argue over the positions. What are the underlying interests? Why is that policy the one you want. Then you can extract so much more value when you focus on the level of underlying interests.