‘You can win even when your chips are down’: Harvard professor Deepak Malhotra

It may work better if you understand the rules of negotiations -- and then apply them to your advantage. According to Harvard professor Deepak Malhotra, who is writing a book on negotiation strategies, even a ‘weaker’ side can ‘win’ by thinking through the negotiation process: “The history of negotiations tell us that it is possible to win even when your chips are down,” he said.

Prof Malhotra was addressing the NASSCOM Leadership Summit in Mumbai this week. He started his talk by recounting how, early in the last century, the campaign manager for US President Theodore Roosevelt managed to avoid a crisis by understanding the negotiation process. When the campaign manager realized that millions of brochures had been printed using an ‘unauthorized’ picture of Roosevelt, and that the photographer could potentially sue Roosevelt for heavy damages, he cheekily sent a simple telegram to the photographer that read: ‘Excellent opportunity available for photographers to get their picture of Roosevelt published in the official campaign document. How much will you pay for this opportunity?’ The photographer actually offered some money to get this picture published! The campaign manager has pulled off a miracle.

So what lesson do we learn from this story? “Never reveal your weakness to the other party when you begin negotiation,” is Prof Malhotra advised.

According to him, the key to succeeding in a negotiation is to ‘change the momentum’ and focus on the ‘best case scenario’ rather than the ‘worst case scenario’. “By understanding and focusing on the potential upside and not just the downside, one can manage to turn the tables,” he said. His other advice was to identify and leverage the ‘distinct value preposition’ that a company or a person offers. This needs to be communicated to the other party at the start of the process.

Towards the end of his speech, Prof Malhotra shared another surprising but effective tactic. “Sometimes, by accepting and communicating that your are weak, you can win the deal. The trick is to show the other party how much they can lose in future, if you lose their support today,” he said. He narrated a story in this regard. After the World War, the small nation of Romania was able to persuade the large and mighty Allied Forces to extend its international boundaries. Romania pointed out that unless it became bigger in size, Russia would overrun it, thereby putting the Allies into jeopardy. The Allied Forces accepted the weakness of Romania and doubled its size!

Deepak Malhotra is an Assistant Professor in the Negotiations, Organizations, and Markets Unit at Harvard Business School. He teaches Negotiations in the MBA program and in a wide variety of executive programs. His research focuses on negotiation strategy, trust development, international and ethnic dispute resolution, and competitive escalation, and has been published in top journals. He is currently writing a book on Negotiation with his colleague, Prof. Max Bazerman.

MBAUniverese.com spoke to Prof Malhotra on the sidelines of the NASSCOM summit.