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  Adam Galinsky
  Adam Galinsky  © Evanston Photographic

THEORY: An offer they can't refuse
Carefully crafted threats can lead to big wins in negotiation - without anyone getting really hurt

By Professor Adam D. Galinsky and PhD Candidate Katie A. Liljenquist

Threats. The promise of coercive action if one's demands aren't met seems the antithesis of the Kellogg School culture, which is built around teamwork, collegiality and the responsible exercise of leadership.

It is true that threats can trigger vengeance and the tragic escalation of conflict, and their use is fraught with a host of unintended and self-defeating consequences. But threats can be an invaluable negotiating tool to help you satisfy your interests. As Kellogg Professor Jeanne Brett has noted, threats may be required to get the other party to the bargaining table, to steer a negotiation away from impasse and toward settlement, and to secure implementation.

We have recently published an article that provides a framework for responsible and effective use of threats. Building on psychological research, we contend that one should make threats that invite the other side to respect and like you. Respect encourages credibility and compliance, while liking discourages defensiveness. How does one make a threat that secures a positive outcome without inciting revenge? We believe that one can capture the upside and avoid the downside of this strategy by employing WISE threats, those characterized by willingness, interests, saving face and exactness.

WISE threats express willingness. A WISE threat is one in which you are willing to impose the stated consequences in the event of noncompliance, yet is also one in which your demands are sufficiently reasonable so that the other side will be willing and able to comply.

WISE threats satisfy interests. A WISE threat satisfies your own interests, targets the other side's interests and is one that will truly help you achieve your goals. To assess whether a threat will satisfy or violate your interests, answer these three questions: Is your threat based on emotion? Will your threat incite a counter-threat that dwarfs your own? Will the threat cost you more than it will cost the other side?

A threat should never be made under the influence of anger and other strong emotions because these emotions reduce and inhibit your ability to perceive your underlying interests accurately. Thus, you should never make a threat that you did not plan in advance. Although making a threat may give you a momentary sense of power, threats should not have as their purpose punishing the opposition but fulfilling your own interests. When you forget this key point, your desire to teach the other side a lesson may cause you to escalate a threat without regard to the toll it could take on you.

Your threat should target the other side's interests to ensure that the threat will function as a motivator. Framing the threat in terms of how compliance will further the opponent's interests, rather than how noncompliance will thwart them, will increase effectiveness.

WISE threats save face. A WISE threat also recognizes that saving face is very important in negotiations. Judith White of the Tuck School and I (Galinsky), along with two colleagues, have shown that when personal prestige is threatened in a negotiation, the action tips the balance away from cooperation toward competition, resulting in fewer agreements and less integrative agreements.

Your threat will affect how the other party views you, and it influences your long-term reputation. Thus a WISE threat allows you to survive the negotiation with pride intact and also allows the other side to maintain its respect. To save face and secure your reputation, avoid making weak threats and ensure that the consequences are meaningful to the opposition. Then be certain to follow through on the threat, but give the other side an easy way to meet your demands by providing choices - alternative demands that are of equal value to you. By framing their compliance as a gift rather than a forced concession, you allow them to comply without sacrificing their self-respect.

WISE threats are exact. WISE threats express unambiguous contingencies, laying out a causal "if, then" sequence of events that attaches specific consequences to the other side's failure to meet your demands and offers a clear timeline and escape route for avoiding the consequences of your threat. In addition, by being exact, you avoid future disputes about whether or not your demands were met.

©2002 Kellogg School of Management, Northwestern University