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Has Your Halo Slipped?

Keith Stacey
Has Your Halo Slipped In Negotiations

Negotiations can be divided into two broad categories: one-off transactions and long-term commitments. If it is the latter, then a key question to consider is whether the strategy adopted preserves or enhances the existing relationship.


Banking a short-term gain at the expense of the relationship, could mean that any gains are quickly lost. While the subject matter and the issues negotiated will not specifically mention ‘the relationship’ - it is ever present. Our personal credibility is on display in every negotiation and there are numerous ways to describe it; personal brand or reputation. If you combine these elements, it is the halo effect.


The ‘halo effect’ is a powerful mechanism to enhance your reputation. Of course, it means a favourable impression about one aspect of a person, product or company is transferred to other aspects. A common example is if someone is good-looking, then we assume other desirable characteristics also exist such as intelligence and being trustworthy. It also applies to skills where an excellent tax accountant is then seen as a source of good investment advice. If they have skills in both areas, then their reputation and income are both enhanced.


However, much care needs to be taken to ensure that the ‘halo effect’ does not exceed the level of competence in an unrelated area. When the effect works well, the relationship between the parties become one of client and trusted advisor. As the late David Maister points out in his book, The Trusted Advisor, the relationship eventually broadens to areas unrelated to the initial field of expertise. Examples include questions about where to send children to school or which clubs to join.


Some organisations, because of the rigour of their recruitment processes, often create halos for their employees. A person who has served in an SAS regiment carries an aura of resourcefulness and courage for the rest of their life. Some large consulting companies and merchant banks often provide a seamless transition to the C-suite for former employees. Or as someone once said to me: ‘Once an Admiral always an Admiral.’ Where the employer confers the halo, there is always the risk that any loss of reputation by the company immediately loosens the halo of all their employees. It is sobering to recall that the executives at Enron were described “as the smartest guys in the room” before the company’s collapse and the prosecution of senior executives.


The reason for ‘the halo effect’ is the desire for human beings to take shortcuts in making decisions. Faced with uncertainty and complexity, the rational looks for a quick way of making a decision without laborious analysis. These shortcuts are called heuristics or cognitive biases.


The way to develop a personal halo in negotiations, is to develop a valuable skill and demonstrate the skill in practice. Obviously choosing a narrow area of specialisation could be a means of accelerating this process. Too broad an area makes the development of expertise a decade long task. So, start narrow and build out from that secure base. Of course, you can personally claim superior expertise, however this may not be seen as credible. One way to speed up the process is to get your colleagues to attest to your expertise. Colleagues working together will be more credible if they talk up their colleague, rather than themselves.


If you manage to develop a halo in negotiations, it can easily slip if you over-promise and underdeliver, or claim expertise where there is none. It takes courage to admit that you do not know something, or to refer to another’s expertise when required. You can protect your halo by developing a guiding principle that you will only accept briefs where you can add value for the client.


And remember, halos require polishing and should never be taken for granted. A philosophy of mutual gain in negotiations, will burnish your halo and improve the shared outcome.

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