The Harvard Negotiation PON’s recent blog raises an interesting issue: in a negotiation should you set a goal? In “The Anchoring Effect and How It Can Impact Your Negotiation”, it answers “yes”.
Noting that the “anchoring effect is a cognitive bias that describes the common human tendency to rely too heavily on the first piece of information offered (“the anchor”) when making decisions” (Id.), the blog notes that one must also consider setting the goal. While anchoring is a good start to every negotiation because it sets expectations and sets the “floor”, setting the goal will impact the result.
This was shown in some goal setting research. Negotiation scholars Deborah Zetik and Alice Stuhlmacher of DePaul University found that when the negotiators set a specific challenging goal, “…they consistently outperformed those who had set lower goals or vague goals.” (Id.) When there is a reward attached to attaining the goal, the participants improved their performance. (Id.)
While setting ambitious goals is laudable, it does have its slippery slope. Failure to attain the goal can affect “…your satisfaction with the overall outcome.” (Id.) One research study revealed that where participants set very ambitious goals and did not achieve them, they were not satisfied with the goals they did attain even though such goals were still ambitious by any objective measure. (Id.)
Another concern is the danger in publicly announcing your goal. By doing so, you limit your flexibility to the point of having to choose between impasse and an unattractive alternative, not to mention the embarrassment of having to back track from your commitment. (Id.)
A third concern is that setting laudable or unrealistic goals may lead to “…undesirable behaviors such as cheating.” (Id.) Studies have shown that when people are unable to reach their goals, they are more likely to act unethically. Using deception or other means, they will obtain that goal or least claim that they did. A good example is the Wells Fargo employees who opened fictitious accounts to meet the targets set for them by their employer.
But… in the end, it is always better to set goals in a negotiation rather than to simply “wing it.” Simply keep them realistic. Studies have shown that by doing so, you will most likely end up with a better outcome than otherwise.
… Just something to think about.
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