EXPLORING TRUST IN NEGOTIATIONS

Do you trust your negotiation counterpart?

This seemingly simple question delves into the complexities of human interaction, revealing much about personal and professional relationships. Trust is a fundamental element in any negotiation, influencing the dynamics between parties and the outcomes achieved. Understanding the nuances behind this question can shape the path of your next negotiation.

According to Rousseau et al. (1998: 395), trust is “a psychological state comprising the intention to accept vulnerability based upon positive expectations of the intentions or behavior of another”.¹ This definition emphasizes that trust is not merely a passive feeling but an active psychological state where an individual willingly accepts vulnerability, driven by the belief that the other party will act favorably or as expected. Trust, therefore, involves a relationship where one party, the trustor, places confidence in another party, the trustee. This relationship can be inherently asymmetrical, implying a power dynamic where the trustor depends on the trustee’s actions.² Additionally, trust can be mutual, where both parties place confidence in each other, fostering a balanced and reciprocal dynamic.

Negotiation is the process through which multiple parties attempt to reconcile their conflicting interests. This reconciliation necessitates a strategic exchange of information among the parties involved. Trust plays a vital role in this exchange, as parties must have confidence in the truthfulness and reliability of the information the other provides, especially when they cannot independently verify all claims and assertions. According to research, trust can reduce the costs of finalizing agreements, making the negotiation process more efficient and effective.³

Trusting someone can feel effortless when the stakes are low. However, as the stakes rise, so does the complexity of trust. When the potential consequences of betrayal or failure become more significant, the weight of the risk naturally increases.^4&5 In negotiations, effective negotiators face a delicate balance between trust and honesty. The dilemma of honesty involves deciding how much truth to share, given that complete transparency is neither expected nor practical. Excessive honesty can expose one’s bargaining position, whereas too little honesty might hinder the negotiation process. This leads to the dilemma of trust, which concerns how much faith to place in the other party’s statements and promises. Being overly trusting can lead to deception, while insufficient trust might prevent reaching agreements. Thus, the key to facilitating effective negotiations is carefully managing trust and honesty.³

At the Schranner Negotiation Institute, we advise on managing trust in negotiations as follows:

1. Summarize the negotiation process in writing: To prevent misunderstandings and disputes, clearly summarize the negotiation meetings. Since individual perceptions can differ, creating a written summary after each discussion is crucial. Distribute this summary to all participants to ensure everyone is on the same page.
2. Trust actions over words: Focus on your negotiating partner’s actual actions rather than their promises. Structure the agreement to avoid advance payments, ensuring that commitments are met before further steps are taken.
3. Trust is good, but control is better: Statements like “you can trust me” from the other party can be deceptive. Even after reaching a successful agreement, ensure it is followed through, and responsibilities are clearly defined. While trust is essential, having control over the process ensures better results.