Effective Negotiation Training Can Demonstrate That Losing Can Be Better Than Winning

People are not specially fond of losing. Everyone loves a winner and it is essential for us all to be on the winning side. As a matter of fact, it is so important for people to be on the winning side that research tells us that typically we have an incredibly a fascinating approach to dealing with likely risks.

In an area of research called Prospect Theory, Kahneman and Tversky investigated the likely flaws and contradictions in individual habits. They found that research individuals when offered a choice prepared in one way might display cautious conduct but when given essentially the same choice formulated in another way the same research subjects might display risk seeking behaviour.

A key result of the research performed by Kahneman and Tversky is that they identified that people's behaviour towards risks associated with prospective gains can be very different from their attitudes when it comes to risks connected with probable losses.

For example, when people are given a choice between getting $1000 with certainty or having a 50% chance for getting $2500, they will often well select the certain $1000 in preference to the uncertain possibility of getting $2500 even though the mathematical expectation of the uncertain option is $2500. This is a perfectly reasonable attitude that is referred to as risk aversion.

But Kahneman and Tversky also identified that the same individuals when confronted with a certain loss of $1000 as opposed to a 50% chance of no loss or a certain loss of $2500 do often choose the risky option. This is referred to as risk seeking behaviour.

Exactly what this means for you in the context of your business negotiation or negotiation training is the fact that it is a good idea to tell your counterparts what they bear to do away with when they do not move in the direction that you are suggesting. It is definitely a good idea to tell your counterparts what they stand to gain by shifting in your direction but the power of your reason will be enhanced if you could increase the benefits the specific things that they will lose out on if they do not shift in your direction.

This type of loss framing is strongest if it is combined with the Scarcity concept of influence which states that we associate more value to those things which are significantly less obtainable. We should therefore focus on those things that are specifically associated with our own arguments and in addition to pointing out the benefits associated with moving in our direction we should always also explain the particular, unique things that our counterpart might stand to lose when they don't move in our direction.

Using negotiation skills such as loss framing to your advantage is one way which you could apply the concept of losing to support you to win.

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