Companies & Industries

The Madman Theory of Negotiations


Try this approach when you negotiate your next business deal: Start by being nice and cheerful, then flash some anger. Rinse and repeat as often as necessary, but always in that order. Never start with anger.

That will throw your opponents off balance, making them think you’re unpredictable, if not a bit unbalanced, and they’ll be more willing to make concessions because of the uncertainty that a deal will get done.

Being “unpredictable” or “emotionally inconsistent” in business negotiations gives you an edge, according to research published in the Journal of Experimental Social Psychology by Marwan Sinaceur, an assistant professor of organisational behaviour at INSEAD. But it’s all in how you begin.

It’s important that you don’t start with anger, Sinaceur’s research discovered. “There is a difference between expressing anger, then happiness then anger then happiness versus expressing happiness then anger, then happiness then anger,” writes Sinaceur in an article on the INSEAD website. “We found that the latter strategy is more effective in making others comply.”

What should you do when you’re facing a “madman” across the table? Sinaceur suggests taking a break to cool down. Think about your original objectives and set targets before starting again. Of course, keep in mind that your opponent may be using Sinaceur’s “madman” strategy to get a better deal.

Distinguishing between real and phony anger can be tough, so Sinaceur advises defusing the situation by “non-verbally acting in a way that shows (e.g., keeping silent, smiling) that you’re not impressed.” Of course, your opponent may just think you’re crazy.

Sager is director of special projects for Businessweek.com.

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