Negotiation – The MIT Mutual Gains Approach

A few months ago I completed the four-week MIT Mutual Gains Approach to Negotiation course along with some of my MIT Bootcamp alumni. https://xpro.mit.edu/courses/course-v1:xPRO+GNx/

Many of us (myself included) feel uncomfortable going into negotiations and expect it to go down much like when you barter at a flea market – one party starts low and the other starts high and you argue until both are equally uncomfortable and happy to part ways and not see each other again…ever.

It was great to get reacquainted with the Mutual gains approach (MGA) presented by Dr. Lawrence Susskind that I have come to know already partly through the book “Getting to Yes” by Book by Roger Fisher and William Ury.

I have made some observations for myself and wanted to share the 4 main principles that stood out for me. Although the principles are short and sweet, there is a lot more to say (some have written books!)

Unpack and integrate interests

When negotiating It is vital to understand where your counterpart is coming from and what their interests are. Show genuine interest and spend time unpacking both side’s interests to increase the number of options on the table, thus creating the potential for more value for both parties. 

It is helpful to explore interests outside of the perceived scope of the negotiation at hand. This can often lead to surprising insights and opportunities for mutual gains. Not only can this help you make the pie bigger before the value is divided, but it will give you insight into the other side’s situation and help you craft a deal where you can walk away with a good split in value.

Include constituent interest in your bargaining strategy

Using your back-table strategically can be a great source of leverage. If you have been mandated to make a call within specific parameters, it aids in creating an honest cap on the value distribution without getting into hard bargaining or taking an arbitrary position. 

On the flipside the lack of a back-table gives you the freedom to explore more options and test the zone of possible agreement (ZOPA) to reach a deal where value is distributed favorably. Be mindful of your counterpart’s back-table too – helping them write the victory story to bring back home will aid in building a long term relationship of trust and respect. 

Your overall strategy is boxed in by what you can and cannot put on the table.

Deal with uncertainty and prepare for surprises

When you approach the stage in a negotiation where value is distributed, be ready to justify your claims and also ask why the other party believes their claim is fair. The two sides will undoubtedly bring options of differing value to the table. The party that contributes to higher perceived value to the deal should also reap the benefits.

Discussing contingency measures will build trust and a mechanism for recourse if at any given time the deal would become unfair for one of the parties. Again, this establishes trust in a long term partnership.

It’s important that both parties are happy to settle on fair contingencies upfront as it is never a good idea to talk these through in the middle of a conflict.

Understand the value of long-term relationships

Building trust is the cornerstone of any mutually beneficial partnership. One could very easily lie or bluff about your position to get a better deal and push the other party into an unfair value distribution. 

The risk of being called out simply does not justify any potential gain. A break in trust will cause reputational damage to you as an individual as well as for your organisation long after you are gone. This is a sure way to diminish any hope of creating mutually beneficial deals in the future.

TLDR; MGA in a nutshell

1. MGA provides a blueprint for any negotiation (prepare, create value, distribute value, follow through and build relationships)
2. Help your partner meet their needs at the lowest cost to you. Keep a balance between empathy and assertiveness.
3. You MUST prepare! Clarify back-table concerns and know who you are dealing with and what they care about.
4. Start with the intention to create as much value as possible with potential trades and other non-monetary options.
5. Solidify your relationship during value distributions. Behave in a trustworthy way. Not necessarily candidly.
6. Do not lie or bluff. This does not mean you share everything.
7. Talk about potential problems and how to resolve them before you commit.

What are your personal Do’s and Don’ts when negotiating?

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