I recently read an interesting article on the value (and pitfalls) of making “Multiple Equivalent Simultaneous Offers” in business negotiations. So, I naturally started comparing the description in the Harvard Program’s article to my own experience in mediation.
PON’s description suggests that making multiple simultaneous offers may create value by seeking trade-offs between the issues that have relatively different values between the parties. The conclusions were drawn from a study by two Northwestern University professors and is based on negotiations involving multiple issues. The report of their study can be found here.
In contrast, most civil case mediations eventually evolve into a single issue: who pays, how much? At first glance this appears to be a zero sum game. Once a mediation gets to that point, alternative offers come in the form of more or less money for longer or shorter terms and/or more or less security for the terms.
True multi-issue negotiations may not be the norm in civil case mediation but the study established some interesting findings that are relevant to mediation and in some cases may result in benefits from the MESO approach. The conclusions were unequivocal and a little surprising but the explanations are enlightening.
The authors found that MESOs lead to a stronger anchoring effect and therefore better outcomes for the offeror. I have described anchoring elsewhere in this blog. This was apparently because the offerees interpreted the MESOs as a more sincere attempt to settle — what the authors called “agreement sincerity.”
Second, the authors found that MESOs resulted in a better joint outcome than single offers. This finding they attribute to the higher probability that one of the multiple offers would be a more attractive starting point for the offeree.
Finally, the study found that the offeror was perceived to be more cooperative and this lead to a more collaborative negotiation. The value of a collaborative negotiation is described in this article.
In the excellent book, Negotiating the Impossible, Deepak Malhotra describes the value of negotiating multiple issues simultaneously in his description of the Power of Framing. In Malhotra’s text, the value is more about finding a way to negotiate a win-win where one issue may be more valuable to one side than the other.
Although it is true that civil case mediation usually resolves based upon a single issue: agreement on money terms, I have long believed that mediation can be — and often is — more than the focused exchange of monetary offers. Prior to mediation, there is value in considering the value in making multiple simultaneous offers and whether there are issues that are less important to your client that might be a relatively low cost concession.