NEGOTIATION, THE CASE OF THE PRISONERS' DILEMMA AND THE POWER OF EFFECTIVE COMMUNICATION  

In  this August '14 edition of  NEGOTIATION STRATEGIES  we apply lessons from the classic game theory "Prisoners' Dilemma" case to our own negotiations, and show that effective communication is paramount to optimal outcomes. 

For your reading convenience, we also distill this into a brief lessons learned at the end of the column.

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With Best Wishes 

Sincerely,

Raphael Lapin

Ganavia and Gezlique have been arrested for robbing the Mamonia Savings Bank and placed in separate isolation cells. Both care much more about their personal freedom than about the welfare of their accomplice. A clever prosecutor makes the following offer to each. "You may choose to confess or remain silent. If you confess and your accomplice remains silent I will drop all charges against you and use your testimony to ensure that your accomplice does serious time. Likewise, if your accomplice confesses while you remain silent, they will go free while you do the time. If you both confess I get two convictions, but I'll see to it that you both get early parole. If you both remain silent, I'll have to settle for token sentences on firearms possession charges. If you wish to confess, you must leave a note with the jailer before my return tomorrow morning."

The "dilemma" faced by the prisoners is, that whatever the other does, each is better off confessing than remaining silent. But the outcome obtained when both confess is worse for each than the outcome they would have obtained had both remained silent. 

This dilemma is created by the fact that neither prisoner can communicate with the other, and therefore there is no trust or strategy of collaboration. This leads to a sub-optimal outcome of both being convicted and sentenced to a long time in prison whereas had they been able to communicate, build trust and devise a strategy of collaboration they could have both received far lighter sentences.

Oddly, in our  own negotiations, even though we can communicate, build trust and collaborate we often don't, and therefore perceive ourselves in a similar dilemma. We see our negotiations as a zero-sum game and don't seek to create value through collaboration and cooperation. This phenomenon, is just like the prisoners' dilemma, which also leads to sub-optimal outcomes and leaves significant value on the table.

The key then, to transforming a prisoners' dilemma situation to an effective negotiation with optimal outcomes is to take advantage of the fact that, unlike the classic prisoners' dilemma case,  we can communicate with our counterparts, build trust and collaborate.  In fact, we can distill this even further by positing that it is indeed only through highly effective communication that we build  trust and collaboration.

My mentor, the late Roger Fisher (Williston Professor of Law at Harvard Law School, founder of the Harvard Negotiation Project and author of the best selling book "Getting to Yes") used to tell us that negotiation is all about

communication, and communication is part talking, part listening. The most important part, he would say, is the  listening.

Advanced listening skills involves the ability to demonstrate immaculate understanding  of our counterparts point-of view, to the extent that we can argue their case and make their points more compellingly and more articulately than they can themselves, even though we don't necessarily agree.

When we apply that level of listening, it conveys to the other party that their concerns are important to us and that we are taking them seriously. This allows them to feel respected and goes an enormously long way in building trust. (A caveat here is worth mentioning, and that is that if this is used as a tactic, rather than an authentic and genuine effort and borne out of constructive curiosity to really understand the other party, it will be transparent and will backfire!)

Once our counterparts know that we understand their interests and concerns accurately, and  they are assured that we are taking them seriously - trust is established and we can then build collaboration. We do this by further communicating to them that we are not only working to get our interests met, but we would like to search for solutions that meet their needs as well.  We frame the problem as "What  ideas can we think of  that could meet their needs and concerns while at the very same time meeting ours as well". This reframing of the negotiation dramatically changes the conversation, and transforms the negotiation from face-to-face competitive zero-sum  bargaining to collaborative side-by-side problem solving.

Unfortunately, Ganavia and Gezlique in our classic case of the prisoners' dilemma above, did not have the opportunity to communicate and both were convicted and sentenced to lengthy prison terms. As negotiators however, we have no excuse!  Become skilled at advanced communication skills, build trust, engage your counterpart collaboratively and achieve the kind of optimal outcomes that until now you have only dreamed of!