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  • Archive for July, 2014

    Trust-Building in Negotiations: Key Points

    July 23rd, 2014  by  Asia-Pacific Global Research Group - Jasper Kim

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    How do you establish trust in negotiations?
     
    How to establish trust is the source of much attention in the negotiation field. This makes sense, since for many, negotiation success is largely driven by the level of trust established between the parties.
     
    A. Being Aware of Your Negotiation Trust Level

     
    The first step towards establishing trust is a keen understanding and awareness of the exact level of trust among the negotiation parties.
     
    Three Levels of Trust:
     
    According to Accordence, three levels of trust-related elements exist:
    1. Rapport: This represents the initial negotiation stage. It involves mostly superficial exchanges between the parties. Examples include shaking hands, exchanging contact details, and superficial level of information exchange. Here, no duty to the relationship exists.
    2. Reciprocity: This represents the mid-tier negotiation stage. It involves more substantive exchanges between the parties. Examples include a “give and take” in terms of information, and communication attempts seeking clarity regarding negotiation positions (“what” is being sought) and interests (“why” such positions are being sought). Here, a testing of the relationship occurs.
    3. Trust: This represents the upper-tier negotiation stage. It involves substantive exchanges between the parties. Such exchanges do not always need to be an equal quid pro quo. Even if a misunderstanding or good faith mistake occurs by one party, a benefit of the doubt is usually given by the counterparty. Here, both parties are working for the sustainable benefit of the working relationship.
     
    B. Establishing Trust Through the Likeness Theory:

     
    One such approach is the “likeness theory.” The likeness theory states what many of us may already instinctual believe to be true. That is, parties tend to trust others who are similar to themselves.
     
    This may seem obvious, but it has real potential upside in your negotiations. Beyond the superficial differences, seek specific (over general) similarities with your negotiation counterparties. Doing so, will help to accelerate and further trust. If not done, studies have shown that tendencies towards negative “biases” exist that may have the exact opposite of effect, that is,of acting as barriers to establishing trust. Such biases, according to the studies, include gender and racial stereotypes.
     
    Executive Summary:
     
    Keep in mind the three stages of trust. Awareness of which specific trust stage you and your negotiation team is in may help to determine your future negotiation strategies. Also have an expected value (EV) calculation in terms of the value of the counterparty relationship. If it is high, your aspirational negotiation stage should commensurately also be high. Thus, more effort and resources should be expended towards the relationship. Conversely, if it is low, then your aspirational negotiation stage should commensurately also be low. Thus, less effort and resources should be expended towards the relationship.

     
     
     
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