In a 2014 trial, U.S. prosecutors accused Jesse Litvak, a former bond trader for Jefferies & Co., of using hardball tactics in negotiation to defraud investors in his trades of mortgage-backed securities amid the 2008 financial crisis. At the trial, former customers of Litvak’s testified that lies and misrepresentation are common in bond negotiations, according to Bloomberg News. One customer admitted to lying to Litvak about how much he valued a bond. Another stated that encouraging a negotiating counterpart to believe something false is a common hardball strategy in his business.
Lying is one of many common hardball tactics that negotiators face at the bargaining table. Others include “take it or leave it” offers, bluffs, threats, warnings, and personal insults. Experts from the Program on Negotiation at Harvard Law School have outlined several strategies that can help you defuse hardball tactics in negotiation and foster a more collaborative mindset.
Prepare for Hardball Tactics
Hardball negotiation tactics narrow our perceptions, according to Harvard Law School Senior Fellow Robert Bordone. Feeling trapped by an unappealing offer or a threat, we typically identify only a few responses: Give in to unreasonable demands, reciprocate with our own hardball tactics, or exit the negotiation.
Planning how you’ll respond to hardball strategies lessens the odds of having a strong emotional reaction that will heighten conflict. Bordone advises asking ourselves the following questions before important negotiations:
- What might they say that would knock me off balance?
- What might I say in response?
- If I lose my cool, what will I do to regain my balance?
Diagnose Hardball Strategies
Thinking about how your counterpart might challenge you sets you up to diagnose hardball strategies rather than simply reacting to them. Begin your diagnosis by considering your assumptions about the hardball tactic. For instance, you might conclude that counterparts are simply difficult people. But what if they work in an industry where “shading the truth” is the norm? What if their company rewards them based solely on price? What if they are under stress and having trouble focusing?
Clearly, someone might resort to hardball strategies for many reasons. By drawing out information, you can identify a range of responses beyond retaliating, backing down, or walking away.
Reframing Hardball Strategies in Negotiation
Hardball strategies often reflect a focus on positions, not interests. A budget director who tells a department head that they won’t accept less than an across-the-board 5% budget cut this quarter is stating a clear position, but their interests remain murky.
Identifying interests in a negotiation is crucial to identifying new sources of value to be divided. How can you convince a hard bargainer to move toward a deeper consideration of interests?
Begin by treating hardball strategies as important sources of information, writes William Ury in his book Getting Past No: Negotiating in Difficult Situations. Here are five of Ury’s strategies for persuading a counterpart to share valuable information:
- Ask “Why?” questions. Open-ended questions such as “Why is it especially important that we cut our budget by 5% this quarter?” display an interest in your counterpart’s concerns that can deepen the conversation.
- Ask “Why not?” Asking questions such as “Why don’t we cut the marketing budget instead?” may prompt your counterpart to detail their concerns (such as the likely effect on sales).
- Ask “What if?” Engage the other party in a brainstorming session by posing questions such as this: “What if I could help you convince the CEO that my department’s new initiative will save the company well over 5% this quarter?”
- Ask for advice. You can often disarm a hard bargainer simply by asking for guidance. If you need an administrator’s approval for an exception to company policy, for example, ask how they would recommend you proceed. They are likely to be flattered by the request and offer helpful ideas.
- Ask “What makes that fair?” If the other party’s position strikes you as unreasonable, Ury suggests saying something such as this: “You must have good reasons for thinking that’s a fair solution. I’d like to hear them.” Then mention any fairness standards that you consider to be more relevant, such as market practice or past precedent.
Naming the Game
Sometimes a negotiator will be so attached to hardball strategies that you need to confront them directly. Naming a hardball tactic shows that it is transparent and thus less effective than they might think, explain Deborah M. Kolb and Judith Williams in their book Everyday Negotiation: Navigating the Hidden Agendas in Bargaining.
Kolb and Williams tell the story of Gloria, a media executive who had a difficult time reaching a literary agent on the phone to discuss TV rights for one of his writer’s books. To her shock, when she finally got through, he started attacking her competence. Gloria kept her cool and said, “Obviously, you are having a bad day. Why don’t I get back to you?”
Several days later, Gloria learned that the agent’s attack had been a stalling tactic: He didn’t have the TV rights yet and, in a panic, went on the offensive. She was right to disengage until another day.
What other advice do you have for defusing hardball strategies in negotiation?