Adapted from “Why You Should Make More Than One Offer,” first published in the Negotiation newsletter.
Effective negotiators seek opportunities to create value. By making tradeoffs across issues, parties can obtain greater value on the issues that are most important to them. But how can you be sure you’re making the right offer?
In a past issue of Negotiation, Victoria Husted Medvec and Adam D. Galinsky of Northwestern University argued that, in negotiations involving many issues, you can create a great deal of value by making multiple equivalent simultaneous offers, or MESOs. This strategy entails identifying several proposals that you value equally and presenting them to the other side. For example, you might realize that you are equally willing to accept any of these employment packages: $80,000 per year with two weeks’ vacation and 30% travel, $75,000 per year with three weeks’ vacation and 25% travel, or $65,000 per year with four weeks’ vacation and 5% travel. By making multiple offers, the theory goes, you appear more flexible, collect information about the other side’s preferences based on which offer she likes best, and increase the odds of reaching agreement.
Until recently, the value of MESOs was based on logic rather than on empirical results. Medvec and Galinsky teamed with Geoffrey Leonardelli of the University of Toronto and Aletha Claussen-Schulz to show that making MESOs creates several benefits. Across four studies, they proved that this strategy does, in fact, help create value for negotiators. In addition, making MESOs helps the offering party claim more value by more efficiently meeting the needs of the other side. Finally, while the offering party succeeds at both claiming and creating value, the other side perceives him as more flexible and accommodating. The only cost of the strategy is that it requires thorough preparation prior to the negotiation.
The evidence is in: making multiple offers simultaneously is an effective negotiation strategy—one used far too infrequently.
