Negotiation, in all its forms, is often compared to a strategic game of chess. Each move should be calculated, deliberate, and most importantly, credible. One common tactic employed in negotiations is the use of sanctions – threats or promises to enforce certain actions or consequences.
A Procurement Director from a private hospital group was growing increasingly frustrated after their requests for pricing concessions were continually rebuffed. In a final attempt to achieve traction, they threatened reshelving the supplier's drug.
The sales rep paused, then proceeded to probe at the authenticity of this sanction.
“Thanks for letting me know, can you advise - are the Doctors aware of this?” “What do they think about this?”
“Will this just be for new patients or also existing? If existing, what is your strategy for managing side effects?”
It then became apparent that this was a sanction the Procurement Director wouldn’t go through with and highlights why empty sanctions should be avoided.
Let's explore some of these reasons why an empty sanction is not a good negotiation tactic:
- The "Boy Who Cried Wolf" Syndrome: Remember Aesop's fable about the boy who cried wolf? Empty sanctions can have the same effect. If you make a threat and don't follow through, your credibility takes a nosedive. Future negotiations will become a challenging terrain to navigate because your counterpart will doubt your words. Keep your promises or avoid making sanctions if you can't back them up.
- Loss of Leverage: Sanctions are a tool to gain leverage and influence your counterpart. However, when you fail to follow through, not only do you lose your immediate negotiating power, but you also relinquish your future potential to bring your counterpart to the negotiation table. Inconsistent use of sanctions weakens your position over time.
- Damage to Relationships: Negotiation isn't just about the deal; it's also about building and maintaining relationships. Empty threats can damage trust and rapport with your counterpart resulting in a less collaborative vibe and a decline in information flow ultimately compromising outcomes.
- Reputation Matters: Making empty sanctions raises ethical questions. Deception and dishonesty have no place in honest and fair negotiations. It's not only a matter of reputation but also a question of personal integrity. Be a principled negotiator, and the long-term benefits will outweigh any short-term gain.
In the world of negotiation, empty sanctions might seem like a tempting shortcut, but they often lead to a dead-end road. Honesty, credibility, and strategic thinking are the keys to successful negotiations.
So, next time you're tempted to bluff your way through a negotiation, remember the timeless wisdom: "Honesty is the best policy." Your reputation, relationships, and long-term success will thank you for it.