The Importance of Trust in Negotiations

Trust is a delicate, often mis-understood and, far too often, abused dimension relating to all kinds of human interactions, but since this is a blog about negotiation, we'll stick to that today, trust me.

First off, why is trust so important in negotiations? Simply put, if I can't trust you to fulfill your end of the bargain, my incentive for making good on my end diminishes greatly. What is the point of faithfully executing my duties under our agreement if you aren't going to live up to your end of the deal? However, trust goes deeper than that and comes into play much earlier than at the time the agreement is finalized. From the outset of a negotiation, trust plays an important role - both emotionally and logically. As explained by the folks at trust has two major facets - Emotion and Logic:

Emotionally, it is where you expose your vulnerabilities to people, but believing they will not take advantage of your openness. Logically, it is where you have assessed the probabilities of gain and loss, calculating expected utility based on hard performance data, and concluded that the person in question will behave in a predictable manner. In practice, trust is a bit of both.

So, how do you go about building trust? While each situation is going to differ depending on the various factors involved, the following ideas should provide a starting point:

  1. Establish a line of communication: This is a crucial first step to help you avoid problems down the line that may crop up as the result of misunderstandings. If you haven't established a line of communication before problems exist, it may be harder to gain their trust when other issues are clouding your relationship.
  2. Explain yourself: This goes hand in hand with establishing lines of communication. How many times have you found yourself shaking your head at the other side's demands? What are they thinking!? Communication is a two-way street. Explain your reasoning behind your negotiation position and ask for reciprocity. If both sides have more information, that can easily lead to creative solutions that might not have been obvious when you are guessing about the motivation and reasoning of the other side.
  3. Guard your reputation: It takes a lot of work to establish a good reputation and only one false step to ruin it. Your reputation can go a long way to paving the way for trust to grow in a negotiation. The opposite is also true - your bad reputation will make things much more difficult.
Once you have established trust in a negotiation, you will have a powerful tool to help you leverage your position and get the deal done! For more ideas, check out Deepak Malhotra's great article: Six Ways To Build Trust In Negotiations.


Jeff said...

Hi! You might also want to read what others are saying on this subject: