Episode 34: Does Win-Win Still Work?

Does Win-Win in deal-making still really work?  It depends on the true intentions of the parties and whether you can block out societal conditioning.  And for women, this is a cautionary tale - one that you'll really want to listen to because the win-win strategy might be hurting you.

And are there more effective ways to getting to yes? We answer those questions and more in this episode.  Let's jump in!

Citations and Resources:  ✨  ✨

Clark, John. “Creating and Claiming Value in Negotiation and Mediation”.  Oxford Mediation.  Online   https://oxford-mediation.com/om_thinking/creating-and-claiming-value-in-negotiation-and-mediation/ 

England, Kelsey.  “The Intersection of Gender and Negotiation: A Comprehensive Look at The Literature” Pepperdine Journal of Communication Research.  Volume 11, Article 3.  Pepperdine University.  2023. Online. https://digitalcommons.pepperdine.edu/cgi/viewcontent.cgi?article=1154&context=pjcr 

Euractive.  “Behind The Airbus-Boeing Truce Lies A Common Rival:  China”. 21 June 2021. Online.  https://www.euractiv.com/section/aviation/news/behind-airbus-boeing-truce-lies-a-common-rival-china/ 

Fisher, Roger and William Ury.  “Getting to Yes: Negotiating Agreement Without Giving In.”  Penguin Books.  3 May 2011.  Available on Amazon:  https://www.amazon.com/Getting-Yes-Negotiating-Agreement-Without/dp/0143118757/ref=sr_1_1?crid=2ZTWLDEV8093G&dib=eyJ2IjoiMSJ9.9GetBQhcqwwJB0OKopfvCfak-mpzTTFrwImrhJkY1okCTzcO5iniE8qWtOFrgV6Lqg-t9d4T3KykRRqlXvIp82rDrlQ4_GDTp4d4-rNlDIkQuhNF6gVdBq49woALA42cHM49NaHWz8qH4vaXA35tc66jfzewmuxelTBWWhuq_Nch3MhQMkItAZky_iaGq1a05fLEdy2l-UX8QgPRqmJbvwqY1r_qGqlp_HfRHu_eiPA.FzYK8pgeXUfaMTbhv5P0IfBd1ZxwpBJMSVqPIhoh-5A&dib_tag=se&keywords=Ury+Getting+to+Yes&qid=1716398323&sprefix=ury+getting+to+yes%2Caps%2C353&sr=8-1 

Kennedy, Jessica A. and Laura J. Kray.  “A Pawn in Someone Else’s Game?: The Cognitive, Motivational, and Paradigmatic Barriers to Women’s Excelling in Negotiation”.  Vanderbilt University.  Owen Graduate School of Management.  2015. Online.  https://cdn.vanderbilt.edu/vu-web/owen/files/publications/Final_Kennedy%20Kray_Gender%20Negotiation%20ROB.pdf 

Lax, David and James Sebenius.  Summary of "The Manager as Negotiator: The Negotiator's Dilemma: Creating and Claiming Value".  Citation from Dispute Resolution:  Negotiation, Mediation and Other Processes.  Wolters, Kluwer Law & Business 20 May 2002.  Online https://www.beyondintract

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Transcript

00:00

You are listening to the Kelli confidential podcast with Kelli Wilks. This is episode 34.

00:19

to the Kelli Confidential Show, where we talk negotiation essentials and those crucial conversations empowering extraordinary women. Real women, real issues, let's jump in.

00:35

Hi, and welcome to Kelli Confidential, where we empower women leaders and emerging entrepreneurs with the tools to navigate the complexity of business negotiations. I'm your host, Kelli Wilks, and today we are looking into a crucial topic, the real return of negotiation strategies, from the aggressive pursuit of winning at any cost to the often misunderstood win-win approach and the delicate balance of assertiveness and adaptability. Are you ready?

01:04

Let's jump in.

01:10

Most trained negotiators are taught to adopt the win-win goal strategy. This typically follows the integrative, objective bargainer mindset, something that I talk about and teach in my courses. Basically, these are folks who approach deal-making with a more open, ready-minded outlook. And in mediation, we're taught the term good enough outcomes as an effective approach where both parties can come away with something proportionate and, well, good enough to get to yes.

01:41

But is a win-win mindset always the best? Or like other overused leadership ideas and trendy buzzwords, has this reached its sell-by date? What do you think of when you hear win-win? Does it make you think of competition? I mean, winning is a term synonymous with competition and sports, of course, but mainly competition and rivalry at its core. And what if some people interpret win-win as win-win

02:10

at any cost. Because some do. They tell themselves their pursuit of a win dressed up as a mutually beneficial gain is worth the battle at any price. But is it worth it? And what happens if the parties are so entrenched in their pursuit of an idealized, fantasy win-win, those slippery, mutually beneficial outcomes, that the fight becomes a circular war claiming victory only when one party fails? Zero-sum game in effect.

02:40

For background, zero-sum game is part of game theory, which is the study of mathematical models and strategy between parties, how one move affects the next move, and so on. It's used in social science and economic modeling, including some negotiation strategies, and became popular in the latter part of the 20th century, kind of like the 1950s onward, where it was more popular.

03:08

But in summary, zero-sum game is achieved when someone's advantage is as a result of another's equivalent loss. Let's look at an example of what arguably started as a win-win endeavor for two major aviation industry leaders that turned into an ugly battle of winning at any cost. I'm talking about the Boeing-Airbus dispute.

03:32

The longstanding rivalry between Boeing and Airbus is a quintessential example of aggressive competition, this time in the aviation industry, which by all accounts for commercial airliners was small. So what happened? Well, after years of fairly steady sales of their corporate jetliners in two different trade blocks, the Americas and Europe, Boeing and the Americas decided it was tired of sharing the limelight with Airbus.

03:58

and wanted to take a major bite out of the European action its rival was enjoying. So in 2004, Boeing, in what experts later observed was a feigned attempt to balance the market, engaged in an all-out effort to outpace Airbus by influencing government loan and subsidy policies, of which both plane makers previously benefited. Remember that win-win? And Boeing initiated formal legal disputes about the subsidies Airbus received from the EU, citing these as anti-competitive.

04:29

And so began an epic 17 year international legal dispute of record proportions, the largest and longest corporate lawsuit in history to this day. Basically, Boeing wanted in on the European action and felt the EU backed loans and subsidies received by Airbus were anti-competitive, anti-trade in nature. And so not wanting to take it lying down, what did they do? Well, Airbus filed a counter suit against Boeing and the US government citing

04:58

Pretty much the same thing. Boeing's tactics included filing complaints against Airbus for receiving what it considered to be illegal subsidies from European governments, which led to a bitterly protracted legal battle involving the World Trade Organization and other government entities. While Boeing aimed to curb Airbus's growth, this approach strained relationships with important stakeholders, including European airlines and governments.

05:27

Again, this is a good example of where contenders have lost sight of a bigger goal and purpose, the benefit and any sincere intention of a win-win was truly lost in the dust as the US giant threw all available resources at it to win. But it cost them. Boeing's reputation took a major hit as it was perceived as a company that prioritized winning over cooperative industry relations by creating what was to become a gargantuan

05:57

lawsuits, subsidy penalties, and government tariffs in the billions, additionally costing both companies and the WTO, the European Union, and the US legal systems untold wasted hours of battle and legal fees in the hundreds of millions of dollars. And this went on for years.

06:21

In the end, after several expensive tariff rulings and failed appeals by the US and EU courts with no end in sight, the battle finally changed shape and focus when China entered the market as a serious contender for commercial airline sales. And it was only then, in 2021, 17 years, 17 years, it just blows my mind, 17 years after all this started, that exports reported that this

06:50

This, meaning China's entry, was the factor that forced the two trade blocs and their fighting airline suppliers, Airbus and Boeing, to finally agree to suspend the punitive tariffs in favor of true negotiation and a return to some normal business dealings. In short, shareholders likely told them to get their act together to avoid losing critical market share to China, a third party who could take advantage of the fact these two market leaders had really lost focus.

07:19

So that's a pretty clear-cut example of a win-win intention that, on the back of corporate ambition, disintegrated into a win-at-any-cost objective. But what happens when there's a hidden adversary, when a truly well-intended win-win dispute devolves into a self-sacrificing win-at-any-cost? And unlike the behemoth dispute between Airbus and Boeing that I just covered, the type of dispute I'm about to mention is between...

07:46

just your average people, a couple in fact, and is far more common and I believe far more painful and long-lasting for the people involved. Let's take a listen.

08:01

Before I get into this second example, which is an example of a couple in dispute, let's recap on the last segment where we explored the aggressive negotiation strategy that focuses solely on winning. Many negotiators, especially those just starting out and certainly in sales, assume that negotiations are a dog-eat-dog battleground where the strongest combatant wins. And many people still believe that the heavy-handed or highly calculated methods are acceptable,

08:30

if it moves the business forward. And we see evidence of this in the continued high sales of controversial books like The Way of the Wolf by Jordan Belfort, who most people will remember as the corrupt character forever immortalized in the movie memoir, The Wolf of Wall Street. Belfort's original straight line strategy, like himself, rose to infamy on the back of swindling individuals and businesses out of millions of dollars, something for which he was later prosecuted.

09:01

Once out of prison, Belfort became a bestselling author, a coach, and a speaker, essentially profiting on the back of his crimes. And the methods he used are still, by and large, his original methods. You need read only so far in his book to see references to words like dominance, control, and make them believe.

09:25

Now some people may be okay with this. I reference this book every now and then, and I do so mainly because it's on my don't waste your money list, for what I think are obvious reasons. But for those of you on the fence, you may ask, well, why not? It delivered a result after all, so what's the harm? Well, okay, putting ethics aside to respond to that, the answer is simple and one of logic really.

09:52

because the prevailing strategy is based on a loosely packaged win-win and is more characteristic of a win-lose approach. Or it certainly was a zero-sum game when Jordan and his colleagues were working the naive folks to part with their hard-earned savings or business profits on the promise of an incredible return on their investment, which they knew they knew to be untrue. It was a fantasy. So sticking here for a moment, let's take a look at the real costs of such a short-sighted approach.

10:22

Firstly, and unless it truly is for buying a car or a house, which is where you have a published price and market data that informs those prices treated as a one-time interaction with a salesman or a real estate broker, it creates short-term gains versus long-term needs. It is truly transactional. There is no repeating need. This is a one-time thing. I refer to these in my blogs and courses.

10:52

Deal making with short-term focus is called value claim, typically used in a transactional setting like buying a car, as I mentioned, whereas longer-term deal making is called value create, which is used in scenarios where the stakes are higher, where relationships are involved, or where you need to invest for the long-term.

11:14

First coined in the breakthrough book, Getting to Yes by Fisher and Ury, a book every self-respecting negotiator should have, and the link is in the show notes. The authors propose that the win-win approach is achieved through a problem-solving, cooperative, win-win mindset, where value can be gained for all, thus avoiding the more aggressive, competitive outcomes experienced when the parties focus solely on their distributed parts, i.e. their separate wins.

11:42

The argument is that doing the former will yield more satisfying and longer term gains. I can say as a career negotiator and mediator that the value create win-win approach has, for the most part, yielded better results for me every time because it integrates the needs of both parties. And it doesn't mean an equal 50-50 to yield value for both, although many of us would argue that

12:09

This isn't necessarily the only model for getting good results, and I'll share more on that in my May newsletter. Circling back to Belfort, his short-term win-at-all-cost attitude to growing his Ponzi pyramid certainly gave them short-term gains, but it damaged long-term business relationships, ruined reputations, broke several laws.

12:34

and ultimately resulted in financial devastation for many, many individuals and businesses. And so outside of pro sports, most savvy business people, regardless of the nature of their business, will resist the temptation of the big win, i.e. winning at any cost method, because it just doesn't pay. So let's shift our focus back to the productive win-win mindset and unpack what that really means as an effective goal.

13:03

As I mentioned earlier, the win-win mindset is widely advocated as the most effective approach to negotiation, and for good reason, because its original intent was to separate people from the problem, focus on interests, not positions, and invent options for mutual gain. I mean, what's not to like about that? Everything about it sounds great, and generally, if those specific principles are followed, most times each party comes away with something.

13:32

In reality, most people aren't trained negotiators and won't have had years of experience in this space or the desire to research it, read law journals and books on conflict theory. So the term win-win is often misunderstood. The most common misconception of a win-win approach is that it's about being nice or yielding.

13:57

when in reality it's about creating and generating value for both parties, which is hard and can be difficult and take time. And that doesn't necessarily mean it's an equal 50-50 value, as I alluded to earlier and as I'm about to explain, but it does mean creating and giving value so both parties come away feeling and perceiving importantly, it's about perceiving that there was a gain. And often these deals are hard, as I said, and they can take...

14:26

longer so if you're impatient you're going to feel

14:33

the pull to close the deal faster. And it takes a certain self-awareness to remind yourself not to be sucked into that, that the more sustainable gains, those that will be lasting, come from doing the work. And so sometimes they do fail. Well, another example is when the purported aims of mutual benefit lead to exploitation.

15:03

ultimately suboptimal gains. Let's take a look. Here's the second promised example.

15:15

Some of you know that I became a legal mediator about eight years ago. I worked in civil settlements for a few years and ultimately returned to corporate work and consulting. In that time, I learned a lot about conflict and the psychology of conflict. And when I was mediating divorce settlements, one of my cases was with a young professional couple. The case started off in the typical manner, avoiding blame.

15:40

But then it soon became clear that the wife was desperate to win her partner back to the point of conceding on many material tradeables creating financial imbalance. Keeping in mind that for most civil divorce settlements, the starting point is 50-50 and the goal is to maintain as much equity balance as possible. At the very least, making sure both parties are close to whole financially, meaning they can pay their bills on an individual income.

16:07

thus avoiding any chance that they could be made insolvent through the settlement. So I had to check with her on a few different occasions if she really wanted to make the offer she was making. They both made good earnings, but she had the lion's share of the equity. And her view was that this approach was a win-win outcome because her belief was that if her ex-partner wanted something, she wanted to give it to him.

16:37

even if it meant she became financially worse off. Her reasoning was that the financial gifting would help him for the long-term, despite the fact that they both had well-earning careers. And in her mind, and so long as she could make him happy, it made her happy. And to her, that was the second win. And as a mediator, we can't direct a court

17:07

coerce people into a certain path. The whole point of mediation, especially psychologically informed mediation, which is something I've covered in a few of my previous shows, is to provide the fertile ground and breadcrumbs to enable the parties to make their own confident informed decisions. And this was what she wanted. She was an intelligent, highly capable person, and this was what she wanted.

17:33

but there's a bite to this. Does a win-win mean win at any cost in this scenario? What do you think? Have you ever experienced this, maybe in a dispute with a family member? The more common place we see this is in the workplace, where a dispute, especially between individuals of different seniority, results in concessions, giveaways of more territory than was needed, really, or equitable.

18:01

Because power informs the decision making. And if a mediator isn't there to aid mutual gains, typically the one with more power comes away with more. That's just how it works. Not always, but more often than not. What's your experience of this? And that's a good segue to our final part of the show with a clear view of both winning at any cost and the pitfalls of win-win.

18:27

Let's address the unique challenge faced by women in negotiations. And this ties back to the example I gave of that couple earlier.

18:37

Women often face and are held in place by social expectations, early conditioning to hold back in favor of others, and double standards that influence their negotiating style. Women's ability and motivation to negotiate access to equal pay, capital wealth, investor funding, access to corporate and political posts.

19:03

all have a direct bearing on their advancement in life and their ability to navigate or possibly affect the gender gap in their community environment.

19:14

And while we'd like to think this has moved on substantially since the women's lib movement of the 1960s, the reality is that those social barriers still exist, including women's own perceived limitations in deal-making as some of the contemporary research papers continue to illustrate even today. And I've included two university studies from Vanderbilt and Pepperdine universities in the show notes, published respectively in 2015 and 2023.

19:43

And both mirror that the same barriers still exist, just in different degrees, sadly, as I'm sure many female readers will have experienced. And while women's negotiation prowess won't solve world peace, of course I know that it won't, their ability to understand and better navigate the social bias and double standards placed on them when they choose, with purpose, to negotiate the landscape in front of them, will be a challenge.

20:12

give them a fighting chance to achieve better and more meaningful outcomes. And we know this has the potential to create economic and societal opportunities everywhere.

20:27

And it's no secret that the thesis of my work is that there's a correlation between the way women are marketed to, to pursue negotiation competency, and their stunted ability to secure favorable outcomes, at least similar to those achieved by their male counterparts. You have to see it to be it, as the saying goes. If women aren't encouraged to seek out negotiation training and they only see the white male archetype attending and excelling at those courses,

20:55

And this is true, I have talked about it repeatedly, I've studied it, you just have to Google a few university courses on negotiation and it's right there in front of you. If this is what they see, how likely are they to pursue this type of competency? The list of barriers for women who negotiate is long and complex, definitely a subject for another show.

21:22

and it's one I'm definitely doing soon. I'm working on it. But in the meantime, bringing this full circle back to our topic today, the reasons why this is also relevant is because the win-win goal for negotiators has a gender bias, and therefore it is an approach women should take with caution. The main reason for saying that, and as the studies show, is because women are more likely to concede a deal.

21:49

Women are more likely to be considered favorably for compromise by their male counterparts when it's seen that the second win in the win-win scenario is for the benefit of others. Let me repeat that. Women are more likely to concede a deal and are more likely to be considered favorably for a compromise by their male counterparts when it's seen that the second win

22:19

is for the benefit of somebody else, not for them. According to both the Vanderbilt and the Pepperdine studies I've included, this is an inherent societal expectation routinely placed on women of all societies, more so in Eastern and collectivist societies, but all women generally have been conditioned that service to others is a virtuous trait. And most men have been conditioned to recognize and expect this characteristic in women.

22:49

They are looking for it. So much so that when women are proactive and purposeful in their pursuit of a negotiation and one that specifically benefits them.

23:00

like a salary negotiation or a promotion or a financial settlement, they are more often perceived as aggressive, masculine, pushy, and ultimately perceived less favorably by both men and women.

23:17

As a compensating effect, women are more likely to undermine their own negotiation by conceding on both low and high value tradeables and over compromising on the win, even to the point of disadvantage. So they are seen as giving.

23:36

And tragically, this is often done subconsciously. Women don't even know they're doing it.

23:45

Does any of this resonate? Have you found yourself doing this? Keep an eye out for it. You'll see it. You really will. It happens a lot more than you think. It's critical that women recognize this societal trait as a barrier to each deal she's doing and that you not ignore the potential for this happening.

24:12

The best way to manage this over and above self-awareness, number one, is to ensure strength of clarity in your purpose and mission. Number two is to know how to bridge a realistic collaboration to your counterpart's purpose and mission. Notice I didn't say compromise. I said realistic collaboration to bridge your counterpart's purpose and mission.

24:41

And number three, that you follow the tenets of value creation. These are to separate the people from the problem, focus on the interests, not the positions, create options for mutual gain, and remember that you are not a caregiver in this deal. You are a strong, vibrant problem solver and badass bargainer.

25:09

Thanks for joining me today as we explored the complex landscape of what winning means in negotiation and we took a cautious look at the extra challenges facing women negotiators. Remember, effective negotiation is not just about the outcome but how you achieve it. And we don't always get it right. It's the trying that counts. Balance, clarity, and maintaining an assertive focus on your purpose will keep you on track for solid outcomes.

25:35

And join me next time when I host author, mediator, and lecturer Monica Hanaway for another show exploring how culture influences outcomes in mediation. It's not to be missed.