Karina Collis

HOW SETTING HIGH GOALS CAN BOTH HELP (AND HURT)
YOUR NEGOTIATIONS

By Karina Collis, January 2021

Negotiations: they are often perceived as a nerve-racking business practice for many individuals and therefor highly avoided. In fact, less than 40% of employees attempt negotiation for a higher salary at some point in their career.

Still, negotiation is part of the everyday job for some employees, including when one must negotiate with potential clients or companies in completing a business deal. In these negotiations, the most widespread technique used is setting high goals. After all, if a client believes a cost is too high, he or she will aim lower until both parties are satisfied. But what if setting a high goal in a negotiation can actually be detrimental rather than beneficial?

Numerous studies were done by university professors and researchers on the correlation of high goals and successful negotiations. They all came to the same conclusion: a negotiation should be a balancing act between meeting high goals and developing good relationships with others. Furthermore, finding this balance can seem more difficult for women in the workplace. Common societal gender expectations that men should remain challenging and dominant in negotiations and women should appear more agreeable still often govern the workplace (i.e., men are 10% more likely to initiate negotiations than women).

Fortunately, there are a few ways to find this balance, regardless of gender expectations:

Two overlapping circles, one with blue colour, the second one showing a gyroscope

Reaping the Rewards of Setting High Goals

Firstly, what are the advantages of setting high goals during a negotiation? By setting up higher goals you increase the chances of achieving higher results, because you will never get what you haven't asked for. Essentially, when individuals set high goals for themselves, they are willing to put in the work to get what they want and, as a result, often come out with much higher rewards than those who aim low and go in with low expectations. This idea is often seen in negotiations when it comes to settling on a better price for the negotiator. Still, it can also be applied to other aspects of an individual's work, including seeking promotions, bonuses and time off.

The Potential Downsides to Setting High Goals

At the same time, high goals may come with both short and long-term risks, including those that may initially be unexpected. A 2013 study done by researchers Lei Lai, Hannah Riley Bowles and Linda Babcock, delved into the unforeseen disadvantages of entering a negotiation with high goals. In the researchers' experiment using high-goal and low-goal negotiation tactics with students, the team found the following:
Setting high goals may lead to resentment by the other party in a negotiation
Those who set high goals may come off as unlikeable
Other parties are less likely to work with clients who had high goals long-term
Individuals who walk into a negotiation with high ambitions, laying them out plainly and who end up succeeding, may not come off as cooperative or likable to clients. While the deal may go through, clients may be less willing to work with those with high goals in the long run, as they could be seen as having 'gotten away' with a good deal that only benefited themselves and not the clients.

How to Balance High Goals and Business Relationships

So, if setting high goals benefits negotiators but can risk the potential of securing long-term business relationships, how can one find the perfect balance?

There is some advice that can help:
1
Make your counterparty feel good about the deal.
2
If your high offer is accepted, don't show your overexcitement and continue negotiations.
3
Balance positive and negative to sound reasonable and not too sweet or too negative.
Negotiations should always feel as if both sides benefited from the act, and not just one side (even if one party got a better deal in the end). Therefore, the best way to enter a negotiation with high goals and have the clients feel as if they won is to continue to remain humble, appreciative and ensure that the negotiation was a completely equal process.

If a negotiator makes a high offer and the other party quickly accepts, the negotiator should continue for a while longer to give the impression that the negotiator has not lost in the deal. On the other hand, if the negotiation continues for a while and the clients eventually accept a certain price with the negotiator seeming overly satisfied, they may see this as off-putting and unfair. Therefore, negotiators should never show any overly-prideful expressions as not to diminish the possibility of return.

Lastly, good news during a negotiation should be spread out throughout the process, with any potential bad news given at once. If clients hear several benefits or positives to a deal, they feel as if they are getting way more out of the deal as time progresses. Alternatively, if bad news is given over several different times in a negotiation, clients may feel worse and worse as the negotiation goes on.

Negotiation and the Balancing Act for Women

Still, the downsides of setting high goals in a negotiation have the potential to affect women more than men. Women historically have been viewed as having seen less authoritative roles in the workplace, with women who have taken on an authoritative stance seen as difficult, cold or unpleasant to work with. Fortunately, the 21st century has paved the way for more equality in the workplace, and therefore, women have garnered more leadership roles that have diminished these stereotypes. Therefore, women should use these same tactics mentioned above as men to achieve the top results while stabilizing good relationships with clients - making negotiation for women more successful.
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