Aim High, Improve Negotiation Results

WHAT TYPES OF GOALS do you set for yourself when

preparing for a negotiation? Your answer to this question

could very well be affecting your outcomes.

Consider contract talks between the Major League

Baseball club owners (MLB) and the Major League Baseball

Players Association (MLBPA) throughout the 1990s.

Again and again, attempts to hammer out labor agreements

led to acrimony, distrust,

and strikes--until MLB negotiator

Rob Manfred set a specific,

challenging goal for the

association. "Our goal," Manfred

stated in a 2002 interview

reported by ESPN.com,"remains

to get an agreement before any

days are lost" to a work stoppage.

This goal led the MLB to change some of its negotiation

practices, such as building stronger relationships by

having in-house staff conduct talks rather than outside

counsel. These steps paid off. In 2002, for the first time in

30 years, the MLB reached a deal without losing a single

day to a work stoppage.

As the MLB learned, goals can powerfully influence the

negotiation process and outcomes. Hundreds of studies

have found that people who set specific, challenging

goals--such as "reach a deal without a work stoppage"--

outperform those who set modest or vague goals such as

"I'll do my best." In this article, I'll explain why setting

specific, challenging goals works and show you how to set

such goals for yourself.

Why it pays to aim high

Goal setting affects performance. In a review of goalsetting

research, scholars Deborah Zetik and Alice

Stuhlmacher of DePaul University found that when

negotiators set specific, challenging goals, they consistently

outperform those who set lower or vague goals. Interestingly,

this link is equally true of self-generated goals (when

you say to yourself, "I'm going to finish that report by Friday")

and other-generated goals (when your boss declares,

"I want that report from you by Friday"). Perhaps not

surprisingly, performance improves when negotiators are

given rewards for reaching a goal, such as a $10,000 bonus

for billing 2,000 hours. Even an unrewarded goal, however,

such as running five miles today, boosts performance.

Why are specific, challenging goals better than modest,

vague ones? First, because negotiators who set specific,

challenging goals exert more effort and work more persistently

than do those with modest or vague goals.When you

visualize and commit to a goal,

you'll also be better positioned

to anticipate the actions you

need to take to attain it. In

short, goal setting both motivates

and guides behavior.

Suppose you're planning the

purchase of an industrial property.

Setting the ambitious goal

of acquiring the property for $6 million could prepare you

to anticipate the sequence of concessions needed to arrive at

that price.As a result, you may consider your opening position

more carefully than if you entered talks merely aiming

to do your best.

Setting an appropriate goal

It's time to set a challenging, specific goal for your upcoming

negotiation. But how challenging and how specific

should it be?

When setting a goal, begin by seeking out relevant

benchmarks and records. In some settings, such as the purchase

of a condominium in a large building, comparable

figures--recent sales of similar properties--are readily

available. In others, you can find information about your

counterpart's reservation price--the point at which he

would be indifferent between a deal and no deal--by

researching a department's purchasing budget or the

invoice price of a new car, for example.

Once you've identified the relevant data, it's time to set a

specific goal.Researchers have found that negotiators typically

do best when they set a goal between the 85th and

90th percentiles of historic performance. A sales manager

might consider setting goals for her sales team that fall

between the 85th and 90th percentiles of past performers.

What about negotiations in which the issues are

4 Negotiation