Is there such thing as luck in negotiation?
Imagine that you have just negotiated a great deal on a house – and rightly so, given how deftly you managed the process from start to finish. You diligently studied the local real estate market and uncovered the seller’s motives for listing her property. You even created mutual gain by allowing the seller to stay in the house after closing, as you’ll be leaving for a long vacation then anyway. And, to top it off, your timing was impeccable: the day after papers were signed, another potential buyer showed up who was willing to pay much more than you did.
Hats off to you! But here’s an unsettling question: Did you succeed because you were smart or merely because you were lucky?
Luck in negotiation, both good and bad, often looms. It’s rarely acknowledged by practitioners or studied by scholars in the field, but we ignore it at our peril. By its very nature, luck can’t be controlled, but it can be intelligently managed, beginning with how we think about it.
Build powerful negotiation skills and become a better dealmaker and leader. Download our FREE special report, Negotiation Skills: Negotiation Strategies and Negotiation Techniques to Help You Become a Better Negotiator, from the Program on Negotiation at Harvard Law School.
Research shows that having good luck is not strictly random. Being in the right place at the right time is necessary, but capitalizing on latent opportunities also requires the right outlook.
British psychologist Richard Wiseman identified people who described themselves either as lucky or unlucky. On one end of the spectrum were respondents who reported windfall after windfall landing in their laps. At the opposite end were others who had suffered woe after woe. Wiseman gave both groups a battery of standard psychological tests and discovered that those who rated themselves lucky were significantly more extroverted, relaxed, and open to new experience. “The way they think and behave makes them far more likely than others to create, notice, and act upon chance opportunities,” Wiseman concludes.
Are you the kind of person who chats up other shoppers in a checkout line? If so, you’re probably amplifying your good luck. Most of your casual encounters may only entail small talk, but it’s possible you’ll learn that your newfound acquaintance is expanding her business and looking for someone with your skill set. The more such conversations you have, the better your odds of forging beneficial relationships.
In negotiation, believing ourselves to be lucky (or not) can be a self-fulfilling prophecy. Picture a salesperson frustrated by a customer who’s skeptical about whether a new service will work as well as claimed. If the person believes himself to be unlucky, he may walk away, grumbling about having been given a bad list of prospects. Another salesperson, convinced that luck is on her side, will strive harder to make the sale, maybe by proposing a guarantee or a performance bonus. Closing the sale reinforces her confidence that even in apparent stalemates, she can find the seeds of agreement if she’s persistent. And going forward, she’ll expect more good luck to bloom.
Frank Barrett, who teaches organizational behavior at the Naval Postgraduate School, stresses the benefits of having what he and others call an “appreciative mindset,” especially in challenging circumstances. He doesn’t mean appreciation in the sense of liking or gratitude, but rather an understanding and acceptance of one’s current situation. As Barrett puts it, having this type of mindset means “saying yes to the mess.” For negotiators, it means playing whatever cards we’re holding as best we can, rather than fretting about the fact that we don’t have a fistful of aces.
Have you ever had luck in negotiation?
Adapted from “Feeling Lucky? Chance and Negotiation,” by Michael Wheeler (professor, Harvard Business School), first published in the Negotiation newsletter, September 2010.
- How Chaos at the Bargaining Table Can Help Negotiators Reach Agreement
- Are you afraid of commitment?
- Negotiation Books: A Negotiation Reading List for 2017
- Integrative Bargaining Examples: Expanding the Pie – Integrative versus Distributive Bargaining Negotiation Strategies
- 5 Win-Win Negotiation Strategies