INSTANT MESSAGING

Last week, it happened again. In response to an offer deemed insulting, counsel for plaintiff said:

“I want to send them a message . . . “

Far too often, one side or the other instructs me to transmit a demand or offer which is intended to “send a message” to the other side. Before I will agree to do so, I always ask how the requesting party anticipates the other side will respond and whether such a tactic will promote resolution. Usually, the requesting party concedes “the message” is not likely to be well received and reluctantly admits that sending it might undermine whatever progress had already been made.

In general, “sending a message” is not a constructive negotiating tactic because negotiation is not a one-way street. In order to engage in successful settlement negotiations, readily decipherable messages need to travel in both directions. Therefore, anything which has the potential to alter the other side’s responsive messaging should usually be avoided.

Rather than “sending a message,” a party’s demands and offers should be designed to elicit responses that will reveal as much information as possible about the other side’s position and negotiating strategy.

Consider the following hypothetical negotiation in which plaintiff makes an opening demand of $140,000 to which defendant responds with an opening offer of $15,000. Plaintiff decides to match the move and reduces the demand to $125,000, but defendant responds by increasing the offer only $10,000, to $25,000. Disappointed that defendant did not move “dollar for dollar,” plaintiff contemplates making one of the following as the next move:

• Option A — Reduce the demand only $5,000, from $125,000 to $120,000;
• Option B — Reduce the demand $10,000 — to $115,000 — to match defendant’s move;
• Option C — Reduce the demand another $15,000, from $125,000 to $110,000;
Which of the above options is likely to elicit a response from defendant that will best reveal defendant’s negotiating strategy and true target?

Option A will undoubtedly “send a message” that plaintiff is slowing down, but at what cost? Assuming that defendant responds by moving less than $5,000 — which is what one might reasonably expect — what, if anything, will plaintiff have accomplished by “sending a message?” Will plaintiff have learned anything about defendant’s negotiating strategy and true target?

Option B may seem like a reasonable compromise between Option A and Option C, but is it really likely to elicit better and more reliable information about defendant’s true position than Option A?

I would argue that Option C is likely to elicit the best information about defendant’s true position. Assuming defendant responds by increasing the offer to $35,000, plaintiff can reasonably interpret such a move as a message that defendant is willing to move $10,000 every time plaintiff moves $15,000, suggesting a potential settlement target of $65,000. If, on the other hand, defendant increases the offer by less than $10,000, plaintiff can reasonably interpret such a move as a message that defendant slowed down deliberately, signaling a lower probable settlement target.

In other words, the parties to a dispute can frequently elicit more valuable and reliable information by choosing not to “send a message.” Once armed with that information, they will be able to make better tactical decisions going forward.

Before deciding to “send a message,” carefully consider your overall strategic objective and the possible ramifications because every “message” you send has the potential to alter the dynamics of the negotiation in an instant.

As always, I would be pleased to assist you and your clients in the dispute resolution process. Please don’t hesitate to contact me if I can be of service.

Best regards,

Floyd J. Siegal

Comments are closed.

Subscribe to Resolution Strategies

To subscribe to Resolution Strategies, simply add your email below. A confirmation email will be sent to you!