by Stephanie Overby

How to Tame Negotiation Nerves

Jun 14, 20113 mins
IT Leadership

Anxiety can lead to unfavorable outcomes at the IT bargaining table. Here are some ways to take the edge off.

The mere thought of negotiating a deal can unsettle the nerves: The heart races, the shoulders tense, the palms sweat. When faced with such a prospect, human beings are more likely to feel anxiety—fear, frustration, worry and apprehension—than any other emotion, according to researchers at the University of Pennsylvania’s Wharton School.

These feelings are temporary, but for CIOs who make critical multimillion-dollar deals for their companies, their negative effects on negotiation outcomes can be long-lasting. Anxiety triggers the flight response in negotiators, causing them to make lower first offers, respond more quickly to offers and exit negotiations earlier, resulting in worse outcomes, explains Maurice ­Schweitzer, an operations and information management professor at Wharton and co-author of a study that examined the effects of anxiety on negotiating in more than 500 research participants.

Nervousness during negotiations is involuntary and can induce a variety of symptoms, including physiological (increased heart rate), psychological (impaired information processing), and motivational (decreased self-confidence), says Alison Wood Brooks, lead author of the study and a Ph.D. student at Wharton.

Luckily, there’s a way to take the edge off—and it doesn’t involve two fingers of Glenlivet. (Schweitzer’s previous research shows that while drinking alcohol before negotiations can increase rapport, it impairs cognition.) According to the Wharton study, self-efficacy—the belief that you’re good at something—can mitigate anxiety’s effect on negotiation. And the best way to build that belief is to practice.

Joe DeTullio is no stranger to negotiations, putting together multiyear, multimillion-dollar outsourcing deals at talent agency IMG and Universal Music Group. After more than a decade as a CIO, he’s amassed a bagful of bargaining tricks, but he learned the most in his first job, at the Patent and Trademark Office. “The structure and discipline of the government environment teaches you that process is important whether you are framing a competitive or a sole-source scenario,” he says.

Still, DeTullio says, “I’m much more comfortable in vendor negotiations than [in negotiations] with my boss. If I’m in a vendor situation, I know that ultimately, I’m in control. I know what I want and I know what I’m willing to give up, and the dynamic is more clear-cut.”

No matter the negotiating scenario, DeTullio does his homework. “Whether you’re dealing with a vendor or your boss or even your own team, you can never underestimate how much you need to prepare,” he says. “Knowing what you want, communicating your expectations clearly and defining success criteria are important.”

The Wharton researchers speculate that while high levels of anxiety can have a negative impact on bargaining, a mild case of pre-negotiation jitters can actually improve performance, as long as negotiators channel that apprehension into what the researchers call “defensive pessimism”—imagining the consequences of being unprepared to inspire preparation. As for quieting the disquiet that can come up during negotiations, the best thing to do is to acknowledge it. “Tell yourself that your racing heart and sweaty palms are because you’re excited, not anxious,” says Brooks. “The difference between these two emotions is the way we view the task at hand—negatively or positively.”

DeTullio says a few butterflies in the stomach are a good sign. “If you’re not a little nervous, you’re probably bordering on arrogance, and that’s where you really start making mistakes.”