The Harvard Concept - Compatible with the B2B-World?

In this article, a more detailed explanation is provided as to why the Harvard-Concept (in its current 2018 version) is generally regarded as out of touch with reality by the typical B2B negotiator.

In summary:

• The Harvard Concept aims to contribute to a more peaceful world. However, the typical B2B manager seeks to assert himself and win.
• According to the Harvard-Concept, the standard for resolving conflicts is not arbitrarily chosen; the parties must adhere to an objective standard and find a rational solution. The typical B2B-Manager, (as do all people), makes decisions on an emotional level, caught between desires and fears. He favors the solution that offers him the highest individual hedonic value (a pleasant feeling), knowing full well that there are no entirely rational ways to resolve conflicts.
• The Harvard Concept demands full disclosure of information. The typical B2B-Manager reveals only as little information as necessary.

Aspect 1: Objectives and Target Audiences

Goals and Clients in the Harvard-World

Rosner/Winheller (2012) explain the motivation of Roger Fisher (one of the authors of the Harvard-Concept) as follows: “A driving force behind his work in conflict management and negotiation was his experience in World War II, the horrors of war, and the loss of close friends. For him, a better resolution of conflicts, particularly through optimized negotiations, offers hope for a more peaceful world” (p. 92; emphasis by the author. The Harvard Concept aspires to be more than merely a negotiation guide. On p. 93, Rosner/Winheller quote the following statement from Fisher, Ury, and Patton regarding their Harvard-Concept: “We believe that principled negotiation not only provides an effective, universally applicable method for achieving one’s objectives in a negotiation, but also contributes to making the world a better place” (emphasis by the author).

In addition, the Harvard Concept targets very specific clients. The authors explain: “Most of the people we deal with feel that they achieve less in negotiations than they should and could, and they fear that insisting on what is rightfully theirs will damage their relationships” (p. 219). The Harvard-Concept aims to show those who “feel that they achieve less in negotiations than they should and could … how they can obtain what they deserve without harming their relationships” (p. 219). The application of independent fairness-standards is intended to help these individuals “get what they deserve and prevent them from being exploited” (p. 219).

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Goals and Clients in the B2B-World

The B2B-World is different: It is common experience that individuals with responsibilities in business (e.g. managers) generally exhibit a very strong dominance system (as well as an aggression system): “In the realm of pure dominance, it is all about performance, achieving targets, and competition. The economy is prototypical for this value system” (Dr. Hans-Georg Häusel, Life Code, 2020, p. 93 and https://rock-negotiation.de/insights/so-bestimmt-der-life-code-den-ablauf-ihrer-b2b-verhandlungen).

The mindset associated with a strong dominance system is: “Be selfish, look out for your own advantage, assert yourself, increase your power and status, be better than others, … push out the competition” (p. 33, emphasis by the author). A pronounced dominance system is evident among “people who make clear decisions, take responsibility, and drive everyone to achieve peak performance. In the top echelons of companies, on ministerial chairs, and in generals’ uniforms, you find many individuals with a high degree in this dimension” (p. 115). Even if this mindset may seem unsympathetic, the dominance system is “the central driving force of progress” (p. 33, emphasis by the author); people with such a Life Code are therefore indispensable for the well-being of society. In extreme cases, these individuals are “antisocial winning personalities”. Their Life Code can be outlined as follows: “An extreme level in the dominance area, a medium to high level in the adventure area (stimulation), and a medium to high level in control. In all other areas, however, they are far below average” (p. 117). … They are characterized by “almost zero values in harmony” (p. 117). “They are hard on themselves, but even harder on others” (p. 117).

Prof. Salewski sees it similarly: “People, organizations, and states strive for power because they want to demonstrate their individual, structural, or state self-worth - their own identity” (Die Kunst des Verhandelns (2008), p. 251). That is the reality.

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Conclusion

The Harvard-Concept is designed for a world that does not align with the reality of the typical manager. While the Harvard-Concept is intended to contribute to a more peaceful world, the typical manager operates in an environment where the focus is on asserting oneself in competition and enhancing power and status. Consequently, it is not surprising that a typical manager would regard a negotiation model aimed at improving the world as out of touch with reality.

Aspect 2: The Standard for Conflict-Resolution

Conflict Resolution in the Harvard-Concept

The Harvard-Concept is a rational negotiation model (see Rosner/Winheller (2012), p. 82). It strictly demands, that "an outcome that is independent of the will of the parties involved" (Fisher et al. 2018, p. 132). "This means that the standard is not arbitrarily chosen, but must be an objective benchmark, such as market value, an expert appraisal, established norms, or legal regulations" (Fisher et al. 2018, p. 39). Finally, it is made clear: "Objective criteria are your steadfast partner, ensuring that you do not succumb to pressure. Being right gives you strength" (Fisher et al. 2018, p. 139).

“If the other side shows muscle and you have factual arguments, the more you work with those arguments, the more successful your negotiation will be” (Fisher et al. 2018, p. 158).

“... you only yield to factual arguments” (p. 134; emphasis by the author).

Consequently, the Harvard-Concept consistently calls for the termination of the negotiation, should the other side fail to present factual arguments: “If the other side refuses to budge, and fails to offer any factual arguments for its position, the negotiation is over” (p. 139). The following formulation is recommended for ending the discussion: “I have the impression that you have a different idea of negotiation than I do. You have my phone number. If I am mistaken, I will be happy to reengage with you. Until then, we will pursue legal action” (p. 192).

In short: the Harvard-Concept assumes that the other party must be persuaded by factual arguments. It is only worth mentioning in passing that in failed B2B-Negotiations there is usually no legal recourse. This statement likely stems from the fact that the Harvard-Concept was developed as a purely mediation-based approach.

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Conflict Resolution in the B2B World

The (real) B2B-World looks different:

1. Negotiations are only quasi-rational

Anyone who demands a rational negotiation based solely on factual arguments overlooks the scientific finding that, in reality, negotiations are merely quasi-rational (see Salewski (2008), p. 52).

It is often misunderstood that “a person is not at all capable of perceiving something in a purely factual manner; instead, he will always model it with his own personal evaluations and assign, alongside the factual aspect, a personal evaluative dimension” (Salewski (2008), p. 31). Since people make their decisions "always on an emotional level, navigating the tension between their desires and fears", it makes no sense to seek solutions in a negotiation that are "independent of the will of the parties".

Instead, you must understand the motives of your negotiation partner in order to interpret their arguments (see Salewski) and then find solutions that (also) satisfy your partner.

Professor Salewski further explains, “Any attempt to resolve a conflict purely on a factual basis is a desperate effort to shift emotions onto the factual level” (p. 108). He continues: “Unfortunately, these insights are still completely unknown or have yet to take hold in many societal or political areas” (p. 109). “Many conflicting parties still believe in rational methods for resolving conflicts” (p. 109). But, “Life doesn’t operate on strictly rational principles; it is shaped by desires and fears” (p. 264).

2. Arguments Lead to Resistance

Anyone who insists on a rational negotiation solely based on factual arguments overlooks that “within every argument lies the seed of aggression” (Salewski), and this aggression is more likely to provoke resistance than to elicit concession from the negotiation partner. The emphasis on being right, as advocated by the Harvard-Concept behind the statement “the law makes you strong,” does not result in satisfactory negotiation outcomes.

Salewski also explains: “Since resistance is driven by emotions, it cannot be overcome by rational arguments. Therefore, those who are knowledgeable and confident in the facts must handle their conversation partners with extra care and, under no circumstances, try to convince them with even sharper arguments. … While humans possess a tremendous intellect, they prefer to rely on their emotional evaluations, which they then express with rationalized justifications” (Salewski 2008, p. 265; emphasis by the author).

Prof. Dr. Wolfgang Salewski, a former police psychologist in Munich and psychologist for GSG 9, has accompanied more than 60 hostage situations and extortion cases as a negotiator (including the famous hijacking of a Lufthansa 737 to Mogadishu).

For this reason, personalities who focus too much on arguing are not considered efficient negotiators (see Strentz 2018, Psychological Aspects of Crisis Negotiation).

3. Emotions Rule the World

In the 1990s, decision researchers - alongside what is often referred to as an "emotional turn" in general psychology - discovered the central role that emotions play in nearly every decision (Pfister/Jungermann/Fischer, Die Psychologie der Entscheidung, 4th ed. 2017, p. 300; emphasis by the author).

According to Pfister et al., the valence of an emotion (pleasant versus unpleasant) serves as a "common currency" for comparing different options: We tend to favor what offers us the highest individual hedonic value (see Pfister et al. (2017), p. 310). “If we did not have such a common currency, many options would simply remain incomparable, and making a decision in any straightforward manner would be impossible” (Pfister et al. (2017), p. 310).

Accordingly, Häusel sums up: “It is not the intellect that governs the world, it is emotions” (p. 191, emphasis by the author).

Aspect 3: Disclosure of Information

The Harvard-Concept requires that all parties fully disclose all the information at their disposal in order to achieve a Pareto-optimal outcome (see Rosner/Winheller (2012), pp. 212 and 116).

The Harvard-Concept further recommends that you disclose your own interests and considerations first: “If you want someone to listen to you and understand your arguments, then present your interests and considerations first…” (p. 90).

"It may be unwise to commit to positions, but it is very wise to stand by your interests" (p. 92 ff.).

Rosner/Winheller demand "the credible exchange of authentic key information" (p. 134; emphasis by the author) and advise: "This means, first and foremost, entering the negotiations cooperatively, that is, with an initial assumption of trust and, for example, being the first to disclose information while simultaneously promoting a cooperative relationship" (p. 232). However, one must ensure that the "exploitation potential" of the disclosed information remains relatively low.

The Win-Win concept of optimal value creation is based on the idea that "as much relevant information (interests, preferences, possibilities, etc.) as possible is exchanged openly, honestly, and without distortion" (p. 211; emphasis by the author). This exchange is also referred to as Full Open Truthful Exchange (FOTE) (see Rosner/Winheller, p. 211).

If one behaves uncooperatively with respect to FOTE, this is defined as "exploitation" (see Rosner/Winheller, p. 216).

This exploitation (which is based on individual egoism) is also criticized by Rosner/Winheller: “Individual selfishness ultimately results in a collectively poor outcome” (p. 216).

The (real) B2B-World is different: In B2B-Transactions, competition is paramount. Each party aims to achieve its own objectives and is ready to fight for them. As noted above, typical managers have a highly active dominance and aggression system. A competitor would never voluntarily disclose information. Demanding the opposite is out of touch with reality.