We talked about deadlines and credibility. I next want to talk about something related to that, which is power and threats. Power is one of the foundational features of every human relationship. Every human group throughout history, across cultures is characterized by a hierarchy. Some people have more power than others in every social group, at work, at home, with our friends. There's always a power dynamic. In negotiations, power is very important. Power shapes how we act and it shapes how we think. If people have low power, well, think about what options you have. Can we take somebody else's perspective? Can we make the negotiation visible? Can we build relationships? We want to focus on underlying interests and we want to appeal to norms. What's fair. Because everybody wants to be fair and we have low power, appealing to norms and standards may be our best bet. If we have high power in situation, we want to be careful not to throw it around because people can exhibit reactants. They don't like being forced into things. We'd like to focus on underlying interests. If we get stuck, we might refer to the power that we have and say, look, here's how things could happen, but I really want to address and segue way to the underlying interests. Here's what would make us both better off. We want to avoid appearing weak, but we want to focus on the key underlying interests and interest-based deal. Deals that address our interests where both parties feel like they had the voice and they were part of the effort of creating the deal. They're more likely to be committed to that deal rather than forcing somebody to take something. We want to listen to people even if we have power. If we have low power, we want to appeal to norms. If we have a high power, we want to shift to really focus on underlying interests and ultimately use that to reach a deal. Now, within this dynamic, if things aren't working, we may use threats or we may often be the target of threats in a negotiation. Now, threats are always hard on the relationship. It's not the thing you want to do lightly. People don't like being coerced and if they feel like they're threatened, they may rupture the relationship and walkaway. We want to be very careful. Threats are far more common in disputes. Recall, we talked about disputes versus opportunities. In disputes, threats are far more likely because the motions are so high. When we have linked BATNA's. Like a bad divorce, things aren't going well and we could lawyer up and go to court. We're all going down together, so our BATNA is getting worse together or strikes or lawsuits, were things we can go down a path with high emotion, poor communication, and we end up creating a cycle where we destroy a lot of value together. We want to be very careful about threats and figure out ways to stop that cycle so we don't lose value. Now, when should you ever use threats? Here are some ideas. If other party won't negotiate or if you want to signal that you're not going to be taken advantage of. Or if you feel like things are reached an impasse and there's no other way forward. Or recall the Reagan example with the air traffic controllers. Sometimes you want to set a precedent. Recall this is at the start of his presidency, it was costly to do, but it gave him credibility he cashed in on later. Where sometimes there are cases where it's useful. But you want to be very careful because it's so hard on the relationship. There's a framework, you want to think about, if you make a threat, is it credible? Are you willing to follow through? We still want to think about the underlying interests that people have. We want to think about saving face. If people back down, falling a threat, are they going to lose face? Is there a way to build a bridge for them to do things so they don't look like they're capitulated? Somebody might storm out of the room and you might issue a threat, "Hey, if you don't get back here, we're going to blow up this deal." Or you could do it in a face-saving way saying, "Look, why don't you go and think about it and when you're ready, just let me know, I'd love to continue this conversation." If you do issue a threat, you want to be very precise about what you're doing. It's this if then statement like, here's what's going to happen. You might like an exploding offer, say, "Hey, we really want you here, but it's so important for us to fill this position. If you don't respond within two weeks, we're going to have to make another offer so that we can move forward with our plans. But we really want you, so why don't you think about it and get back to us as soon as you can." If somebody is threatening you, you want to make sure you avoid this conflict spiral. Recognize that it's pushing a button that is this idea of reactants. We don't like being coerced, so we don't want to just get mad and react just falling reactants. But we do want to make sure that we're not conceding in a way that's going to reinforce some domineering relationship. We don't want to be bullied and we want to make sure that we're careful. One thing you do is consider ignoring the threat. I mentioned before the crisis negotiators, they call right before a deadline and talk through it. Most negotiators and studies of threats in negotiation, 70 percent of the time, in this one study they found that the threads go unreciprocated when they just ignore them. Sometimes we can ignore threats. Next, I want to think about what's the underlying concern? Are people just frustrated? Do they have some concern that they feel has been overlooked? Is there something that is important to them and they're issuing this threat, because they feel like they need to get attention. Do they really have a good outside option? Or are they bluffing? Is this credible? You want to think about it carefully and systematically to figure out if this is something you really need to attend to, or as I mentioned before, most of the time, we might just ignore it and move forward. Now, we could ask questions to inform our understanding. We could express concerns so people feel as if they're being heard. If there is a key concern, we're going to figure it out. When all else fails, you might deliver a counter threat to establish credibility. If you feel like you're being backed into a corner or the relationship imbalance isn't quite right. But what are the key ideas is to think about the power dynamic that you have. If you are in a low-power position, you do have fewer options. If you're in a high power position, then pushing back is a far more attractive and recommended course of action.
