Ahhh, “win-win” - perhaps the most overused, and least meaningful, phrase in the world of negotiating.

In the vast majority of personal and commercial negotiations, undertaken in the context of a long term relationship, you should preferably leave the other side feeling happy, or at least comfortable enough with the outcome that they’ll implement the deal without coercion. This is both the right thing to do, and good commercial practice - agreements should be sustainable, and your reputation lasts a lot longer than the deal.

But the real world, with its pervasive financial pressures, also presents subtleties, exceptions and trade-offs. Leaving the other party “happy”, as opposed to merely comfortable implies that you’ve left money on the table.

If you’re buying a fridge from a large national retailer, you’re probably not in it for their shareholders (even if you own shares!). Of course you should be personally friendly and professional, because you don’t want the experience to be unpleasant for the salesperson – however few would argue that taking a firm (or even aggressive) position on pricing in that circumstance would be unethical.

Win-win doesn’t always apply. In an extreme example, a hostage negotiator will not be overly concerned that the hostage-taker leaves the negotiation happy; in fact it may be quite important to ensure the opposite, to minimize repeat or copycat behavior in future.

Many of us have faced commercial negotiators whose behavior seems to border on hostage taking, and it rarely makes sense to reward behavior that you are trying to prevent. When you’re “negotiating with a terrorist” – an individual who clearly doesn’t have your interests at heart (or isn’t behaving ethically), it may make sense to punish their behavior by threatening a commercial sanction (something they want to avoid), or by going around them, or by denying them the deal so they see that their behaviors won’t deliver them a good result. In other words, win-lose.

In this situation, though, there are a few things to consider before you pull the trigger:

• If you suspect them of telling lies, be inquisitive and get them talking about specific facts, numbers and the basis for their statements. In most cases, if they’re bluffing, keep them talking and the truth will reveal itself;
• Don’t assume that this person’s behavior is necessarily the way others in their organization behave. If you are negotiating a contract with their organization, rather than with them personally, sometimes carefully calling out unethical behavior to their colleagues is more effective than you approaching it head-on as a personal moral crusade;
• If you decide that an aggressive response or a commercial threat is appropriate, don’t spend a lot of time there – extended arguments are a waste of time. Remember than the leverage comes from the threat and its consequences, not from how long and hard you bang the table and froth at the mouth;
• Don’t threaten with a gun full of blanks. If you aren’t prepared to follow through on a threat, you probably shouldn’t make it – few things reduce your negotiating power faster than having your bluff called, while you slink back to your corner like the Boy Who Cried Wolf.

This article is part of a longer whitepaper on Negotiation & Ethics by Simon Letchford. Read more here.