Since my first day at Wharton, I have always felt comfortable turning to upperclassmen for advice. When it came time to ask for course recommendations, one class seemed to top their lists: Negotiations.
This fall, I took Negotiations hoping this course would equip me with the strategies to achieve favorable outcomes when I had conflicts in my life. I can gladly say this course lived up to the hype. I ended the semester with a few main takeaways that have transformed how I interact with others outside of the classroom.
1) Opportunities to negotiate are everywhere. At the beginning of the semester, the word “negotiation” brought to mind high-stakes situations, such as conversations around million-dollar business deals or diffusing rising tensions between countries. In other words, it represented situations I didn’t expect to be dealing with on a regular basis in the near future, if at all.
While the word certainly applies to these situations, I failed to acknowledge just how often we are able to negotiate in our everyday lives, be it with friends, family, merchants, co-workers, and classmates. They can cover items as simple as where to eat or complex as salary and benefits with our new employer. After taking this course, I have found that I am much more aware of and willing to engage in everyday negotiations with lower stakes. I now jump at the opportunity to negotiate whether it’s with Airbnb owners, my classmates, or my family and friends.
2) It doesn’t hurt to try. In the past, when buying used textbooks from other students, I would have just paid the seller whatever price they considered to be fair. Now, after finding a seller, I do not hesitate to make the first offer, which is a good move in situations where I have a good idea of what a fair price could be (which is not always the case). For one book, I considered $30 to $40 to be a fair price. I already knew what my friends had paid for the same book and had looked at prices online. In this case, I offered $20, which is below – but not unreasonably below – what my research suggested. I did this because making a first offer that is reasonably skewed in a direction favorable to me can “anchor” the negotiation in my favor as first offers are highly correlated with a negotiation’s final outcome. I ended up paying $30 for the book, the lowest price reasonably I expected to pay. Had I not been aware of any negotiation strategies, I would have likely paid more without giving it a second thought.
3) I shouldn’t make a deal for the sake of making a deal. My new-found confidence in negotiating stems from trusting my ability to prepare ahead of negotiations. The most important way to improve negotiation performance is to take time to plan, regardless of the stakes. Negotiating is hard work, which means it’s easy to get too committed to the process and feel obligated to make a deal. I’ve found that having a clear plan prevents me from getting caught up in the act of negotiating and making a bad deal.
For example, I needed to find an apartment for the summer. A place I was looking at was listed for $1,400, but I was able to get the owner to lower the price to $1,000. I was tempted to go with this option, especially because I had worked so hard to get the price lowered. However, prior to the negotiation, I had already found another comparable apartment for $900. I reminded myself that being able to successfully negotiate a lower price did not change the fact that the now $1000 apartment was still a worse deal. I was able to take a step back from the excitement that accompanies negotiating and go with the $900 apartment instead.
4) I can make aggressive offers. From popular culture, most people are familiar with the idea that making aggressive first offers (asking for more than you actually want to provide yourself with more wiggle room) is an effective strategy. I learned to begin doing this in situations where I previously would have just asked for my desired outcome, rather than my desired outcome plus a little more.
For example, I found my mobile coffee order was wrong when I went to pick it up. In this situation, I would have typically asked that they just fix their mistake. Instead, I asked that they fix it (my desired outcome) and refund me for the inconvenience (a little more). Not only did I end up getting my order fixed, I was given a gift card that had more money on it than the cost of my drink. It usually doesn’t hurt to make confident offers that are aggressive (within reason). Often times, people are likely to give you exactly what you want – and even a little more – if they don’t also view your interaction as a negotiation.
5) Negotiations are not win-lose situations. My biggest takeaway was learning how to compromise without feeling like I was giving up, doing something wrong, or “losing” the negotiation. While compromising sounds simple enough, you bring your ego and emotions to the table along with those of every other party. Often, it can be challenging to rise above conflict in a manner that helps to create value for everyone involved.
In many negotiations, there is more than one issue to be considered. Everyone approaches negotiation with different underlying interests and prioritizes issues differently. I learned that the key is to hold my ground on issues that were important to me while compromising more on issues of less value to me.
My family has consistently struggled to plan our vacations due to our inability to compromise, sometimes even to the point where we’d end up not going anywhere at all. When planning our most recent vacation, I was able to recognize that I cared much more about the length of the trip than I did about the location or our activities. As a result, I was able to be more flexible in those areas than I would otherwise. We were able to go to the location my parents wanted while doing the activities my brother wanted – and we returned home on the date I wanted. Everybody won!
Overall, taking Negotiations at Wharton has helped me approach conflict resolution with a more level-head, greater confidence, and a deeper understanding of how to create satisfactory outcomes for both myself and others. I am excited to continue growing as a negotiator in both my personal and professional life by utilizing the strategies I learned in class at every possible opportunity.
My name is Ana Singhal and I am a sophomore at the Wharton School from Columbus, Indiana. I have yet to decide on a concentration, but have particularly enjoyed studying Statistics, Marketing, and Health Care Management so far. On campus, I am involved in Wharton Ambassadors, Wharton Women, and am a research assistant. In my free time, I enjoy running and exploring Philly.