We’ve all shared a meal with a negotiating counterpart at one point or another, whether a business lunch, a working dinner, or sandwiches in a conference room. What are the advantages and potential pitfalls of combining food and drink with negotiation? Here, we offer business negotiation solutions for those who are trying to decide whether to eat, drink, and be merry with their negotiating partners.
Docks Around the Clock
Current negotiations in the news can offer some insight into whether eating is beneficial to the process of business negotiation. Take New York governor Andrew Cuomo, who has a taxpayer-funded office in Albany and another one in Midtown Manhattan. But if you manage to arrange a meeting with Cuomo, there seems to be a good a chance it will take place at Docks Oyster Bar & Seafood Grill, a restaurant just downstairs from the governor’s Manhattan office.
“Docks is pretty much like being in the governor’s office, but with vodka,” former Cuomo adviser Howard Glaser told the Wall Street Journal. Cuomo, who was reelected for his third term as governor in 2018, has met at Docks with New York City mayor Bill de Blasio to discuss control of city schools; with union leaders to hammer out a new contract for train workers; and with many other New York power brokers, the Journal reports. Cuomo’s aides and state legislators also meet regularly at the restaurant. The governor’s reelection campaign spent more than $5,000 at Docks in 2017.
“Restaurants are neutral turf,” former New York State assemblyman Jack McEneny told the Journal. “You can talk about sports, the weather, and then say, ‘By the way, what’s happening with such and such bill?’ It’s not as awkward as going to the guy’s office.”
A restaurant can be neutral negotiating territory, as in the case of negotiators choosing an unfamiliar lunch spot midway between their offices. But when you’re in a powerful position, expecting someone to travel to you to metaphorically “kiss the ring” highlights your powerful differential and potentially puts the other party in a one-down position. That might not be a bad idea when you’re going to be tussling over limited resources, but it could hold you back from finding opportunities to collaborate.
Moving away from business negotiations in the news, does breaking bread also break down barriers between negotiators? In one experiment, Babson College professor Lakshmi Balachandra found that pairs of MBA students who engaged in a negotiation simulation created 12% more joint profit when they ate together at a restaurant and 11% more joint profit when they ate together in a business conference room as compared to pairs who negotiated in a conference room without food.
Balachandra theorizes that biological factors may be at play. When we eat, our glucose levels spike, which enhances brain function: Our self-control improves, and we’re less prejudiced and aggressive as a result. So there’s a biological argument to be made for eating during, or at least before, negotiating.
The way in which food is served may matter as well. When pairs of negotiators were given food to share, such as chips and salsa, they were better at creating value during a negotiation simulation that was framed as a competition as compared to pairs who were given individual portions of food, Stanford Graduate School of Business professor Margaret Neale and University of Virginia professor Peter Belmi found. Sharing food may foster much-needed cooperation among competitors, the results suggest.
Drinks and Discretion
When passing plates, would a round of drinks further grease the wheels? If you’re trying to stay sharp, even mild inebriation can create a host of barriers to creative dealmaking: simplistic thinking, overconfidence, strong emotions, and even aggressive behavior. In addition, whether for personal, religious, or other reasons, some counterparts may be offended by the notion of consuming alcohol while doing business. If you do imbibe during a negotiation, limit the time frame of your talks, and be sure food and water are available.
Finally, when negotiating in a public place, such as a restaurant, privacy can be a concern, especially in corporate negotiation. A discreet staff and a private dining room help keep sensitive conversations under wraps. In general, though, if you want your talks to stay quiet, it’s probably best to meet in private.
The bottom line? The relaxed, social atmosphere of a restaurant can help negotiators build rapport and even prompt conflict resolution success stories, but there are pitfalls to such business negotiation solutions. Perhaps the best idea is to get to know one another over a friendly meal, move to an office when it’s time to discuss substance, and share another meal if talks get contentious.
What other business negotiation solutions have you found to be useful?