Turn Vicious Cycles Into Virtuous Ones

By — on / Business Negotiations

Adapted from “The High Cost of Low Trust,” by Keith G. Allred, first published in Negotiation newsletter.

For decades, Hormel Foods and its employees enjoyed one of the most cooperative and productive labor-management relationships in the processed foods industry. But beginning in the late 1970s, when Hormel pushed for wage concessions, the company’s relationship with its workforce began to deteriorate, especially at the plant in Austin, Minn., the quiet “company town” where Hormel was founded.

By the time the labor contract with the local union was up for renegotiation in 1985, each side in the Austin dispute had decided to take an aggressive approach, convinced of the other side’s hostility and unreasonableness. Contract negotiations concluded in 1986 only after a bitter nine-month employee strike and after the vast majority of unionized employees had been fired, forced to take early retirement, or placed on recall lists. In the process, neighbors in Austin turned against one another, and the fabric of the community was torn to shreds.

Such stories of relationships gone bad are unfortunately common in the business world. In negotiation, as in the business world at large, relationships are key. Those that become contentious and suspicious are liable to result in frustrating and costly outcomes. By contrast, relationships that are cooperative and trusting tend to foster negotiation success.
How do suspicion and retaliation—or, by contrast, trust and cooperation—become embedded in a relationship? Decades of social science research confirm the strength of the norm of reciprocity—the human tendency to respond to the actions of others with similar actions. If we’re treated with respect and cooperation, we tend to respond with respect and cooperation. What’s more, a single round of action followed by a reciprocal response can work itself into an ongoing cycle.

Vicious cycles frequently grow out of the widespread human tendency to take an exaggerated view of others’ perceived hostility or unreasonable behavior. This exaggeration leads us to reciprocate with negative behavior of our own. Our own hostility creates a self-fulfilling prophecy—the other side is likely to respond negatively in return. Taking this genuinely hostile response as confirmation of our earlier perceptions, we fail to recognize that our own actions created exactly what we feared.

What about virtuous cycles? Research by Keith G. Allred found that a particularly powerful trigger of virtuous relationships is fairness perceptions. Researchers have long understood the importance of people’s perceptions of the fairness of a negotiation outcome. More recently, it’s been discovered that we also attend closely to whether the negotiation process was itself fair. We tend to judge a negotiation to have been fair when we ourselves had ample opportunity to voice our point of view. Our sense of fairness increases the more we sense that the other side has genuinely considered our perspective.

How can you distinguish your misperceptions of hostility from genuine ill will? Before assuming ill intent, look for extenuating circumstances that might provide an alternative explanation. Better yet, ask the other party to explain her behavior.

Discover step-by-step techniques for avoiding common business negotiation pitfalls when you download a copy of the FREE special report, Business Negotiation Strategies: How to Negotiate Better Business Deals, from the Program on Negotiation at Harvard Law School.

Related Article: Predicting Your Response to Conflict

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