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Effective Negotiation Training Can Illustrate That Losing Can Be More Effective Than Succeeding
We are not particularly fond of losing. Everyone really likes a success and it is essential for us all to be on the winning side. As a matter of fact, it is essential for individuals to be on the winning side that research demonstrates that on average we have a pretty an insightful method to overcoming likely risks.
In an area of study referred to as Prospect Theory, Kahneman and Tversky looked into the apparent anomalies and contradictions in individual conduct. They identified that research individuals when offered an option introduced in one way might present risk-averse behaviour but when given fundamentally the same solution formulated in another way the same research subjects might display risk seeking methods.
An important result of the study done by Kahneman and Tversky is that they found that people's behaviour towards threats related to prospective gains are often very unlike their behaviour towards risks associated with probable deficits.
For instance, when people are given an option between getting $1000 with confidence or getting a 50% chance of getting $2500, they may well select the guaranteed $1000 rather than the uncertain possibility of getting $2500 even though the mathematical expectation of the uncertain option is $2500. This is a completely sensible mindset that is described as risk aversion.
But Kahneman and Tversky also found that the same individuals when presented with a definite loss of $1000 as opposed to a 50% chance of no loss or a definite loss of $2500 do usually select the risky alternative. This is called risk seeking behaviour.
Exactly what it implies for you in terms of your business negotiation or negotiation training is the fact that it is recommended that you show your counterparts the things they stand to lose when they do not move the way that you are recommending. It is definitely a good idea to notify your counterparts the things they stand to acquire by moving in your direction but the strength of your stance will likely be improved if you could increase the benefits the particular things that they are going to fall short on if they do not move in your direction.
This kind of loss framing is strongest when it is coupled with the Scarcity concept of influence which states that we assign much more worth to those things that are less obtainable. We should thereby concentrate on those things that are specifically associated with our own suggestions and in addition to pointing out the advantages associated with going in our direction we should also point out the particular, unique things that our counterpart may stand to forfeit when they don't move in our direction.
Making use of negotiation skills such as loss framing to your benefit is a sure way that you can use the concept of losing to support you to succeed.
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