Effective Negotiation Training Can Illustrate That Losing Can Be Better Than Winning

People are not particularly fond of losing. Everybody loves a success and it is important for us all to be on the winning side. In fact, it is so important for individuals to be on the winning side that research demonstrates that typically we have a pretty a fascinating approach to overcoming potential threats.

In an area of research known as Prospect Theory, Kahneman and Tversky investigated the likely anomalies and contradictions in human behaviour. They identified that research subjects when presented a choice introduced in one way might display cautious behaviour but when offered essentially the same solution formulated in a different way the same research subjects might exhibit risk seeking behaviour.

An important result of the study performed by Kahneman and Tversky is that they discovered that people's attitudes towards risks related to potential benefits can be very unlike their attitudes when it comes to risks associated with potential losses.

For instance, when subjects are presented a choice between getting $1000 with confidence or having a 50% chance for getting $2500, they may well choose the certain $1000 rather than the uncertain chance of getting $2500 even though the analytical expectation of the uncertain option is $2500. This is a perfectly sensible attitude that is referred to as risk aversion.

But Kahneman and Tversky also discovered that the same people when confronted with a definite loss of $1000 versus a 50% possibility of no loss or a certain loss of $2500 do frequently choose the risky option. This is known as risk seeking behaviour.

What this means for you in terms of your business negotiation or negotiation training is that it is really a good idea to explain to your counterparts what they bear to lose if they do not move in the direction that you are recommending. It is always best if you tell your counterparts the things they stand to acquire by shifting in your direction but the strength of your reason will be improved if you could add to the advantages the specific things that they are going to lose out on if they do not shift in your direction.

This kind of loss framing is most powerful if it is coupled with the Scarcity principle of influence that states that we associate much more value to those things which are less available. We should therefore concentrate on those things that are uniquely relevant to our own arguments and in addition to pointing out the advantages associated with moving in our direction we should always also mention the specific, unique things that our counterpart might stand to forfeit if they do not move in our direction.

Using negotiation skills such as loss framing to your benefit is a sure way which you could use the concept of losing to assist you to win.

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