Understanding the Role of Electronic Negotiating in Your Business

It’s been over 20 years since businesses have adopted electronic communications and-accordingly, electronic negotiating has become very attractive and accessible. However, the convenience afforded by instant messengers and email make it easy to respond to an issue quickly but removes the personal interaction we had through a phone call or in person. It can be argued that the heavy reliance on email has increased efficiency, but can also be problematic. One of the challenges we have when we get away from face-to-face communication is how messages can become open to interpretation. 

The biggest problem with using email in business communications is that you can’t see nor hear the other person. There’s no context, no tone of voice, and no visible or audible reactions, so we’re unable to adjust our message and tone to match that of the other person. Studies have shown that we can negatively impact communication if we fail to use any one of the five modes of communication: words, tone of voice, touch, posture, and facial expressions. 

Professor Kathleen Valley of the Harvard Business School studied the effects of E-Negotiating and how people behave. She came up with three major conclusions:

Conclusion One:

The first was that the impersonal nature of the medium lead to a great deal of exaggeration during e-negotiations. Furthermore, people tend to believe the exaggerations because “it’s in writing.”

Conclusion Two:

People tend to be more aggressive and less likely to compromise. According to Dr. Valley: “The norm in face-to-face negotiation is something we call the ‘openness script’—your instinct is to share information. What we see as the norm in email, by contrast, is something we call the ‘haggling script’—you hold information much closer to the chest.”

She adds that people are “less willing to get involved in the kind of give-and-take that’s normal in more personal communications.”

And finally: “When the interaction is purely electronic, people are more willing to escalate conflict—to get downright rude even.”

Conclusion Three:

The third conclusion dealt with the outcomes. Because of its format email easily lends itself to demands and positions rather than emphasizing mutual interests. From the study, “When people meet face-to-face, the most frequent outcome is a mutually beneficial agreement. When people talk over the phone, the most frequent outcome is that one party takes a greater share of the profits; it’s asymmetric. With email, the most common outcome is an impasse. We found that more than 50% of email negotiations end in impasse; only 19% end that way in face-to-face negotiations.”

Regardless of its issues, email is here to stay. It’s an integral part of our lives and can’t be ignored. With that in mind, here are six essential guidelines to use when you negotiate via email:

  • If at all possible, have a face-to-face meeting beforehand. Or, at the very least, a teleconference. This form of contact will give you a chance to begin establishing some level of rapport with the other party while being able to observe reactions, styles, and personalities. 
  • Attempt to build a climate-of-agreement, rather than concentrating on the areas of disagreement, focus, initially, on your common-ground areas. Spend a good deal of your preparation time brainstorming a list of things about which you are in agreement and refer to them in the email.
  • Don’t be afraid to raise your concerns about e-negotiating. “Sometimes, it’s difficult to articulate my position this way adequately, and I want to make sure I’m getting my point across.”
  • Let them know that you’re confident you can reach a mutually beneficial arrangement that will satisfy the needs and desires of you both.
  • If you seem to be getting stuck and you’re spinning your wheels, schedule a teleconference or a face-to-face meeting. This warmer mode of communication is an excellent way to get the negotiation back on track and to get ideas flowing again.
  • Finally, add a personal touch to connect with the other party subconsciously. See if you can find out some of their interests via social media, then periodically send articles or URL’s they might find interesting. Please use caution with this approach; don’t overdo it.

In addition to the guidelines mentioned above, there are a few other quick and polite points to consider:

  • By keeping the email concise, it will show you respect their time.
  • Use numbered lists or bullets whenever possible.
  • Put your contact information in the footer. The shorter, the better.
  • Be mindful of the number of individuals you CC. Keep it as low as possible.

While bargaining via email might be more convenient, it ultimately needs to be evaluated through the lens of practical realities. If the negotiation can be resolved with emails or phone calls (or a combination of both), that might be the way forward. But, if the value of the deal is high enough, the costs of travel and the participants time for a face-to-face should be given serious consideration.