By Philippe Roy
You’re thinking of using threats in a negotiation? Well, if you stick out your gun, you’d better be ready to shoot, otherwise you’re just an idiot with a gun in your hand!
Here are the reasons why threats can be a dangerous game and why avoiding them will help you become a better negotiator
There is an abundance of literature on negotiation. This is not surprising at all; negotiation is everywhere. People negotiate salaries with their employers, the price of a house, the sale of a company, peace, a political alliance, agreements with unions and all sorts of other deals, regardless of their nature. A lot of content can be found on multiple topics: dispute resolution, win-win negotiation frameworks, communication skills, reservation price, cross-cultural negotiation, negotiation dynamics, interpersonal relationships and many other topics.
Interestingly, resources on the value of threats in negotiations are rarer. The psychology of threats is sometimes mentioned but as a secondary element, which is all the more surprising as it seems to be disconnected from what’s actually happening in real life. In most negotiations, tension is indeed frequently translated into verbal threats. Whilst tension is inevitable and even healthy, threats are very often counterproductive. People making threats rarely evaluate the consequences of their threats, not only for the other party but also for themselves. One could think that such a behaviour only applies to inexperienced negotiators, but it’s not the case. In fact, although they know it’s something to be avoided, even the most talented negotiators often make threats at some point when they conduct negotiations.
Whether you negotiate a multibillion-dollar agreement, a deal with your kids or the outcome of Brexit, here are four reasons why threatening your counterpart is probably a bad idea.
1. Don’t destroy your credibility
People making threats rarely evaluate the consequences of their threats, not only for the other party but also for themselves.
I’ll always remember the scene. I had just told my four-year-old daughter she would be punished if she didn’t listen to me – whatever unwritten family rules she had breached. Without panicking or even looking at me, she calmly replied that she was not worried about it. Because it was not the first time that I was threatening to punish her, and not once had I actually done it. Result: Daughter: 1 – Dad’s ego: 0.
And she was right! There is no point threatening someone – without even considering the ethical aspect of a threat – if you’re not prepared to execute that threat. Whatever you negotiate, whoever you negotiate with, you should always remember this principle: If you stick out your gun, you’d better be ready to shoot; otherwise, you’re just an idiot with a gun in your hand!
An extreme illustration of this principle is the negotiation between Ronald Reagan and the 13,000 air traffic controllers who went on strike in the US in 1981. The former president stated that this strike was illegal and he threatened to fire any employee who did not return to work within 48 hours. To the surprise of many observers, he indeed executed his threat by letting go more than 11,000 people. Had he not carried out his threat, he would have lost all credibility as a leader and a negotiator, and his political mandate would have been severely impacted.
This case remains an exception because, most of the time, threats are pronounced in a moment of emotional exhaustion, in the middle of endless and painful negotiations where frustration is getting the best of the negotiating teams. But the credibility of people uttering them becomes eroded and the outcome ends up being totally counterproductive.
2. Avoid the “Bozo Zone”
In the various negotiations I have conducted, I have noticed that threats are often attached to a big ask. Some negotiators have the quite irrational belief that, in order to make their ask believable, it has to be linked to a threat. The bigger the ask, the stronger the threat. If you don’t accept “this”, “that” will happen. One of the negotiations I led, several years ago, strictly followed this framework. At the very beginning of the kick-off meeting, the other negotiation team looked at us in a very dramatic way (imagine a scene from Once Upon a Time in the West, with the harmonica theme in the background) and told us: “This is what we want, and if we don’t have it we will stop working with you.” As brutal, confrontational and threatening as this message was, it turned out to be useless. Due to their lack of preparation, the threat they had come up with was totally unrealistic. We knew it; they didn’t. It was a meaningless threat without any common sense, disconnected from reality. We instantly knew that what they were asking would simply never happen, whether they worked with us or our competitors. Their ask was so ridiculous, it had a red nose like Bozo the Clown. In this case, they not only lost any kind of credibility, but this episode shaped the following stages of the negotiation to our advantage. If a threat is not credible, whether it’s real or not, it will have no impact on the negotiation.
3. Educate, rather than threaten
In the various negotiations I have conducted, I have noticed that threats are often attached to a big ask. Some negotiators have the quite irrational belief that, in order to make their ask believable, it has to be linked to a threat.
As politically incorrect as it may sound, there are situations where pronouncing a threat is not completely irrelevant. Because a given party has a strong BATNA*, it can theoretically afford to make a threat. This is what happened with the air traffic controllers’ strike in the US. Ronald Reagan had a plan B: using military controllers, supervisors and non-strikers. In other words, he was so confident that his alternative option would work, he didn’t need to negotiate any longer and could afford to make a threat.
However, if we focus on more traditional and less confrontational negotiations, how you articulate your message is more important than ever. Rather than making a threat, which can often be emotionally toxic and make your counterpart both defensive and aggressive, you may want to explain and educate. Why not be transparent and tell the other party that, whilst you’d be delighted to have the opportunity to reach an agreement, you have a very satisfying alternative option. And unless the negotiated agreement gets better than this option, you’d have no interest in pursuing the discussion. Another illustration of this approach is given by Margaret A. Neale, Professor of Management at Stanford. In her book Getting More of What You Want, Neale shares the true story of one of her colleagues who received a better offer from another business school. He then decided to go and see the Dean with a threat: either match the offer, or I will leave. It turned out that the Dean rejected the threat because the cost of complying with it would have been way too high (there was actually a spillover risk that other professors would behave the same way). On the other hand, Neale explains that another faculty member shared her competing offer with the Dean, simply asking him what her compensation would be the following year. Because the ask was not articulated as a threat, the Dean didn’t have to worry about having a reputation of saying yes to threats. In parallel, for the faculty member, it took the pressure away from having to accept the outside offer, as well as the risk of losing face.
The key here is to convey your message calmly and respectfully without giving your counterpart the impression that you are twisting their arm. You present your options; they decide.
4. It’s a small world…
We live in a world where reputation is more critical than ever. Whether you’re a lawyer, an entrepreneur, a corporate, political or non-profit leader, the multiple negotiations you’re going to lead will define your personal brand as a negotiator; because the habits we develop and the behavioural patterns we deploy when negotiating contribute to shaping our reputation. Whatever your field is, if you become the person who keeps making threats but never executes them or who continuously makes irrelevant threats, then you’re losing all credibility for future negotiations, in your market, industry or ecosystem.
Think about the Brexit deal. How many times have the respected parties declared they were ready to have a no-deal, threatening the other party publicly with stopping all the discussions?
In an interview published in the French newspaper Le Figaro**, Vincent Eurieult, Professor of Negotiation at ESCP Business School and Sciences Po Paris, explains why Boris Johnson has never been entirely credible when making threats in the Brexit negotiations. Unlike some negotiators, who remain unpredictable until the last moment, suggesting they’re able to make any kind of unexpected extreme decisions, including a no-deal in this case, Boris Johnson’s primary intent has always simply consisted of staying prime minister as long as possible and remaining in charge. His reputation, identity and personal brand attributes have stopped him from being credible when conducting extreme and mad threats. The reality is that, despite those forceful statements, negotiations never stopped.
As the UK begins to negotiate bilateral agreements with other countries in the world, how credible will its negotiators be when they start making threats again?
- In their popular book Getting to Yes, Roger Fisher, William Ury and Bruce Patton introduced the concept of Best Alternative to a Negotiated Agreement (BATNA) as being the option left when parties are unable to come to an agreement.
- Article written by Alexis Feertchak and published in Le Figaro on Oct 9th, 2019, “Boris Johnson est-il un bon négociateur?” (Is Boris Johnson a good negotiator?) https://www.lefigaro.fr/international/boris – johnson – est – il – un – bon – negociateur – 20191009
About the Author
Philippe Roy is a global corporate executive specialised in strategic partnerships management, influence strategies and international negotiations. He has gained his experience working in global leadership roles for tech start-ups as well as Fortune 100 companies (IBM, Motorola, American Express). His views and opinions are personal.
Policy Response To Mitigate The Effect Of COVID-19 On Women’s Labor Market Outcomes
By Tea Trumbic and Marie Hyland
On average, women are under-represented in the labor market compared to men. In many countries, the COVID-19 crisis has caused the gender gap in labor supply to expand. However, there has been substantial heterogeneity between countries. This article explores this heterogeneity in the context of the different policy responses to the crisis
The economic downturn caused by the COVID-19 crisis has been widely referred to as a “she-cession”, and while it is true that women have been disproportionately impacted by the crisis in many countries, there is substantial heterogeneity between countries in the relative economic impact of the crisis on men and women – what we refer to here as the gendered effect of the crisis. The World Bank’s Women, Business and the Law 2021 study, which measures how laws and regulations affect women’s economic opportunity in 190 economies, gathered evidence of different ways that governments and firms have addressed the needs of working parents and essential workers during the pandemic. New studies from India, Italy, Spain, the United Kingdom, and the United States, amongst others, have shown a wide range of impacts of the crisis on the labor market outcomes of men and women and on time spent on unpaid and care work.1
The impact of COVID-19 on women’s economic empowerment can be assessed by looking at many different factors, including wages, productivity, working hours and participation in the labor market. Here we focus on the gendered impacts of COVID-19 through the lens of labor force participation.2 While gains have been made over the past several decades in getting more women into the labor force, women remain under-represented relative to men. As such, it is important to consider how the COVID-19 crisis might pose a threat to these gains and what can be done to keep women in the workforce. This is especially important given that periods of absence from the labor market may have long-term impacts on women’s wages and career progression.3
Considering how the labor force participation of women relative to that of men evolved over the course of 2020 across 53 countries where data is available, on average, the gender gap in labor supply expanded slightly in the first quarter, and then continued to expand at an accelerated pace throughout the second and third quarters of the year, before contracting somewhat in the final quarter. While the gender gap at the end of 2020 was wider than it was before the crisis began, it appears to have peaked in the third quarter of the year. These averages mask the fact that the gendered impacts of the COVID-19 crisis have been highly heterogeneous across the world – labor force data from the International Labour Organisation (ILO) shows that, as of the end of 2020, in some countries the gender gap in labor force participation had expanded in some countries, while it had contracted in others. Indeed, as Figure 1 illustrates, of the 53 countries included in the fourth quarter data, the gender gap in labor supply expanded in 25 countries, contracted in 25 countries, and remained unchanged in three. However, Figure 1 also shows that the average expansion was greater than the average contraction.
While it may be surprising to see that, in several countries, the gender gap in labor supply contracted between the onset of the crisis and the final quarter of 2020, it is not surprising that the economic impacts of the global pandemic have been so heterogeneous. The severity of the health crisis has been highly uneven, with some countries experiencing far higher caseloads of COVID-19, more disease severity, and a higher number deaths than others. Similarly, governments have adopted a wide range of policies in response to the crisis, in terms of both the lockdown measures adopted to curb the spread of the pandemic and the economic and social support programs initiated to help citizens through the crisis.
A team at the Blavatnik School of Government at the University of Oxford have been tracking and comparing government policies adopted in response to the crisis around the world.4 Their 20 indicators cover containment and closure policies, as well as economic and health policies. While the data do not have a gender-disaggregated component, these policies are likely to have differential impacts on men and women. Combining this data on policy responses with labor force statistics, the data show the expansion of the gender gap in labor supply was larger in countries where governments had adopted more stringent containment measures to curb the spread of the virus. In particular, more widespread school closures were associated with a greater widening of the gender gap – a fact highlighted in the World Economic Forum’s most recent Global Gender Gap report.5 This finding concurs with previous research that has shown that, in the United States, the COVID crisis has disproportionately impacted female workers because of the concentration of female employment in the services sectors that were hit hard by lockdown policies, and because the burden of school and daycare closures has tended to fall on the shoulders of working mothers.6
COVID policy response data has also been collected by the World Bank’s Women, Business and the Law team. While the dataset covers a narrower range of policy responses relative to the Oxford data, it gives a more detailed view of those that are targeted at, or have a greater impact on, women.7 The policies tracked fall into three categories: childcare policies, access to courts during the crisis, and health and safety measures.
The need for extraordinary childcare policies was precipitated by widespread school closures. The range of policies adopted by countries include additional family leave granted to parents, childcare subsidies or tax credits, and the provision of childcare services to essential workers. The Women, Business and the Law data provide details of over 100 different childcare measures that were adopted in response to the crisis.
As women initiate the vast majority of family court cases globally – including cases related to marriage or divorce, custody of children and requesting protection orders – the ability to access such judicial services is vital for women’s agency. Recognizing this, governments responded to citizens’ needs to access these services in innovative ways. Examples include the prioritizing of matters related to family law, remote access to courts, and automatic extensions of protection orders. In total, the Women, Business and the Law team recorded over 300 different policies adopted by countries across the world to address citizens’ need to access court services during the crisis.
Research has shown that the COVID-19 crisis has led to secondary impacts on the health and safety of women and girls, including a “shadow pandemic” of increased gender-based violence.8 The Women, Business and the Law data show that governments have adopted a wide range of polices to tackle this, including provision of extra health care services, domestic violence hotlines and additional access to shelters. In total, Women, Business and the Law collected data on over 170 extraordinary measures adopted by governments to address health and safety concerns.
Combining the policy response data collected by Women, Business and the Law with labor force data, we see that countries where the gender gap expanded the most had actually adopted a greater number of policies in response to crisis relative to those countries where the gap contracted the most. Countries where the change in the gender gap since the onset of the crisis is in the top tenth percentile of the distribution adopted, on average, seven measures, as recorded by Women, Business and the Law. On the other hand, countries where the change in the gender was in the bottom tenth percentile (those where the gap contracted the most), adopted 5 measures. However, while female employees appeared to have fared relatively worse in economies that have adopted a greater number of gender-sensitive responsive policies overall, the adoption of COVID specific childcare measures is correlated with a contraction of the gender gap in labor supply (Figure 2 on the next page). The fact that the average number of COVID policy measures was higher in countries where the gender gap in labor supply expanded the most may reflect the underlying correlation between the number of measures adopted and countries’ lockdown policies.
Conclusion
While it may be surprising to see that, in several countries, the gender gap in labor supply contracted between the onset of the crisis and the final quarter of 2020, it is not surprising that the economic impacts of the global pandemic have been so heterogeneous. No country can reach its full potential without the equal participation of men and women.
The findings, interpretations, and conclusions expressed in this paper are entirely those of the authors. They do not necessarily represent the views of the World Bank and its affiliated organizations, or those of the Executive Directors of the World Bank or the governments they represent.
About the Authors
Tea Trumbic is a Program Manager of the Women, Business and the Law project at the World Bank. Prior to joining the World Bank Group, Tea worked at the Ministry of Finance of the Republic of Croatia and the International Monetary Fund. She holds a bachelor’s degree in economics from Stanford University and a master’s degree from the London School of Economics.
Marie Hyland is an economist at the Women, Business and the Law team. Her research focuses on the impacts of legal reform on women’s economic opportunities and outcomes. Marie holds a PhD in economics from Trinity College Dublin. During her PhD studies, Marie spent time at the University of Maryland as a visiting Fulbright scholar.
Endnotes
References