Negotiating your next deal: It’s OK to, literally, sweat it

December 5, 2007, 5:00 AM UTC
Fortune

We negotiate nearly every day. While the term “negotiation” often brings to mind larger-stake deals, such as the purchase of a new home or car, more often these negotiations are smaller and involve project deadlines at work or divvying up of household responsibilities.

Many of us, myself included, can’t stand negotiations whether big or small — so much so that it comes as a surprise that others actually relish each chance they get to negotiate.

Regardless of which camp you’re in, most of us can relate to the feeling of pounding hearts and sweaty palms when we negotiate. Do these visceral responses – also known as physiological arousal – hurt or help us?

Most people (and existing research) consider sweating it to be detrimental; that the key to negotiating is to stay calm and collected. However, that’s misleading, according to what I found in my research with Jared R. Curhan, which was recently published in Psychological Science. We found that sweaty palms and pounding hearts aren’t inherently a bad thing. The effect really depends on your pre-existing attitudes toward negotiation and whether you interpret these physiological responses as a sign of nervousness or excitement.

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We conducted two studies to explore the effects of arousal on negotiation outcomes: In the first, we measured individuals’ prior attitudes toward negotiation. Several weeks later, these same individuals participated in an experiment in which they negotiated over the price of a used car while walking on a treadmill. Unbeknownst to the participants, we manipulated their heart rate through the speed of the treadmill, which was set by an experimenter.

Among those with negative attitudes toward negotiating, participants who walked at a faster pace – or experienced high arousal – reported lower satisfaction with their negotiations. They interpreted their heightened heart rate as an indicator of nervousness, which in turn, harmed their negotiating experience. By contrast, those who walked at a slower pace reported higher satisfaction.

Yet, we found the reverse among those with positive attitudes toward negotiating. Participants assigned to walk at a faster pace reported greater satisfaction with the negotiation compared to those assigned to walk at a slower pace. Those who enjoy negotiating seem to interpret increased heart rate as an indicator of excitement such that heightened arousal boosts their experience.

In the second study, we wanted to see if this pattern also extends to economic performance. This time, we let some participants walk continuously while negotiating on their cell phones to increase their heart rate, whereas others stayed seated for their negotiations. Both groups conducted a mock employment negotiation over the phone.

Consistent with our findings from the first study, individuals who dread negotiating felt less satisfied when they experienced heightened arousal (triggered by walking) compared to when they remained seated. They also achieved lower economic outcomes. In contrast, individuals who enjoy negotiating felt more satisfied with the negotiation when walking throughout, and also performed better when aroused compared to when seated.

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The lesson from these studies is that the conventional wisdom isn’t always so wise. If you dread negotiating, you’re probably best served trying to stay calm in your negotiations in order to minimize such visceral responses. On the other hand, if you look forward to negotiating, you might want to actively attempt to raise your heart rate beforehand.

Although these studies were limited to negotiation, it’s worthwhile to consider if the same lessons might apply to other contexts such as public speaking, test performance, or competitive sports. Whether we interpret our physiological arousal as nervousness or excitement might depend on our prior attitudes toward the task at hand. If it’s something we dread, then making an effort to maintain our composure might be valuable.

But if it’s a task we enjoy, it might be better to get pumped up!

Dr. Ashley D. Brown worked on this research as a PhD student at the MIT Sloan School of Management with Prof. Jared R. Curhan. Brown is now a research associate in the Psychology Department at Stanford University.