The Psychology Behind Successful Negotiations

The Psychology Behind Successful Negotiations

Negotiation is a complicated process but it requires an understanding of how humans behave and their ways of communication. Finding the bearer of bad news and subsequently obtaining information is one of the challenges in developing the right strategy. Effective negotiators achieve outcomes by tapping into rapport and empathetic skills; motivational techniques in active listening; reciprocity; and cognitive biases.

These strategies, known as framing and anchoring, can, in some cases, have an immense influence on a deal’s outcome. Experienced negotiators know how to exploit these tricks – using framing and anchoring techniques that lead to ‘take it or leave it’ deals that are favourable to them.


Self-awareness is one of the most important psychological assets for good negotiators. It helps them to understand influences on their emotions and how emotions shape decision making; they also know what they do best and what are their blind spots – thus increasing their chance of good bargaining outcomes.

Another crucial trait to the self view is an awareness of others, including their emotions and motivations; this can help negotiators better understand how to avoid cognitive biases, such as how to avoid anchor points. Self-aware negotiators are more likely to notice their behaviour in action – how others will potentially interpret behaviours such as signalling scarcity, or signalling authority, or signalling consistency.

Social awareness

Social awareness is also an important quality to master for negotiators, especially reading your own emotions as well as knowing when to steer the conversation a different way. Practising the craft to scan for emotional cues and react accordingly are crucial to effective business negotiation.

Socially aware people are able to pick up on the subtle feelings of those around them, and tend to form deeper and richer interactions with colleagues and clients. A high socially aware sales leader might notice the unsaid in a buyer’s literature review call, whether it’s some excitement or concerns; an inherently social verbaliser also understands differences in culture and how to build rapport that’s based on mutual understanding across a range of cultures.

Relationship management

As earlier mentioned, building good rapport with both parties is key to successful negotiations. Trust has to be earned by ensuring that open communication is enabled, giving you the opportunity to discover both parties’ true interests and needs as well as having active listening skills (nudging parties toward questioning, among other things). This opens the possibility for you to formulate a strategy that can assure optimal results, and making sure that you keep cognition biases such as anchoring and emotional contagion in the back of your mind is crucial when negotiating properly.

Attention must be paid to perception management while the negotiation is still playing out, because those who see a situation as positive sum are more likely to collaborate while those who see it as zero-sum are more likely to take a conflictual approach.


A key psychological skill in negotiation is to ‘put yourself in the other person’s shoes’, to see the situation from their perspective. This process growing comprehension of what triggers the other person’s interests and motivations; it also enables you to communicate more effectively.

Being a good ‘active listener’ by posing questions, repeating or rephrasing and signalling your attention shows that you’re committed to understanding the other side’s perspective and can help defuse tension during negotiations by helping to develop relationships with other negotiators.

Perception management consists of tricks to improve search or memory, or to shape expectations. But in the context of negotiations, perception management is basically how we think about what’s out there (in reality or in the other party’s mind), what this means for the party who thinks it, and what it means for the other – strategies that can range from anchoring to helping to overcome cognitive biases.

Cognitive biases

Cognitive biases are cognitive heuristics. One is negativity bias, an urge to evaluate negative inputs as having a higher worth; another is time-saving bias, which tends to underestimate how much time something might save, or cost in losing time; there is also zero-sum bias, the (false) idea that any gain means someone else will lose something.

For example, negotiators with open personalities might be more creative in their approach to negotiation; conscientious, detail-oriented negotiators might tend to do more and better preparation and create better, more balanced deals to bring to the table.


A final strategy you might use is to watch for the anchoring effect, a cognitive bias by which individuals give far too much weight to whatever information comes first – say, a first salary offer during job negotiations, which might cause them to offer you more.

Push back against this with counterfactual data to make your position more persuasive. And more importantly, learn about the other party’s positions, motivations and other interests such that your arguments will be more persuasive – empathy training or listening techniques can help you to achieve this goal – this way you will overcome bias more effectively and come to an agreement where both sides get the same amount of their interests satisfied.

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