On Negotiator Blunders

Answer By Osama El-kadi

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The most common negotiator blunders are, first, talking too much during negotiation and second, making threats that cannot be carried out.



Q Sometimes a negotiator is his or her own worst enemy. What are some common negotiator blunders?

A The most common negotiator blunders are, first, talking too much during negotiation and second, making threats that cannot be carried out.

If so to speak the opponent called one’s bluff, what would the negotiator do if his threats were not real?

Let me tell you a little story to illustrate this one that I was aware of it personally when I worked for the House of Fraser Group in London in the 90’s.

Mr. Al-Fayed the owner of Harrods was known to have made such a blunder with the CEO of Estee Lauder.

Mr Al-Fayed wanted a reduction in price among other things from this company. He demanded the CEO to give in to what he wanted saying (threat) that he will no longer use this brand in his stores if the price was not reduced.

The CEO responded (calling his bluff) by saying that he will send his trucks on Monday morning to collect all his goods from the House of Fraser Stores and Harrods.

Mr. Al-Fayed immediately realising his "negotiator Blunders" and apologized for the first time in his life to the CEO. He then politely asked the CEO to reverse his decision.

The fact of the matter was that Estee Lauder business accounted for £100 million of House of Fraser turnover and they certainly had the upper hands.

Mr. Al-Fayed did not study his own negotiating position before going into such a losing war with the CEO of Estee Lauder.

If he analyzed his position before hand and not immersed himself in his own wishful thinking, he would have realized that his position is weaker to that of Estee Lauder.

Mr. Al-Fayed could then decided to delay the challenge until his position is stronger (advance his position). He could set about to reduce Estee Lauder leverage over his stores and then when his position becomes stronger, he could enter the challenge and win.

It is surprising however that Mr. Al-Fayed, a known negotiator of high caliber to make such a "negotiator blunders", especially after winning the negotiation of a life time ending in taking over the whole Group in the first place and owning Harrods.





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