For most people, the thought of entering a tense negotiation is enough to create panic. Luckily, there are some straightforward rules anyone can benefit from.
Victoria Husted Medvec, professor at Northwestern’s Kellogg School of Management and CEO of negotiation firm Medvec & Associates, spoke opposite Pattie Sellers, a cofounder of the Most Powerful Women franchise, at the Fortune Most Powerful Women Summit in California this week about the biggest mistake people tend to make while negotiating—and how to avoid it.
The best skill of the best negotiator, Medvec went on, is their ability to reduce the egocentric bias. The biggest misstep, she said, is a negotiator’s tendency to focus on himself or herself rather than the needs of the other side.
“It leads to tremendous problems,” Medvec said. “When I have this focus on myself, not the other side, I don’t put the right issues on the table, because I don’t think about addressing their needs. I don’t think about differentiating myself to address their needs. I don’t set ambitious goals, because I’m thinking about what I need to have, not ‘What is the weakness of their alternatives?’”
When a negotiator isn’t considering the needs of the other side first and foremost, they’re failing to create a good story, Medvec said. “When I don’t think about [the other side], I don’t think about the fact that if I give them options, they will feel like they’re in control. I don’t use the right strategy if I’m focused on myself.”
If there’s one bottom-line takeaway, she told the audience, “one thing that will absolutely help to reduce fear is to reduce your egocentric bias: Focus on them, not yourself, and you will always excel in negotiation.”
Kill them with options
In any negotiation, Medvec said, it’s key to go in with (at least) three options on the table.
These distinct options each offer similar value to the person you’re negotiating with. “And they’re three options that you’re relatively indifferent between, but that the other side will not be [indifferent], because it addresses their needs, their challenges, their short-term and long-term abilities,” Medvec explained.
This array of options is key to success because it makes the other side think you’re “flexible and cooperative,” she said. “It’s going to make them feel better. They’re going to be happy. They’re going to like you.”
The strategy is called multiple equivalent simultaneous offers (or MESO) negotiation. The idea is creating enough optionality that both sides of the table can get a good amount of what they want in the deal—and also appreciate the flexibility of the person making the offer, leading to a lower likelihood of dragged-out decisions or hasty ultimatums.