Negotiation 4.0: Virtual Negotiations in the age of Social Distancing

The COVID-19 Pandemic has restricted face-to-face meetings and travel. However, negotiations and deal-making are still possible. This is because modern technology supports negotiations — if you follow certain rules.

Negotiations thrive on the presence of the negotiating parties. Personal presence at lengthy meetings in more or less pleasant conference rooms is customary, and for good reason: scientific studies show that negotiators who meet in person achieve better results than those who negotiate online, by telephone, or even by e-mail. Face-to-face meetings provide valuable non-verbal and verbal references including eye contact, handshakes, body language, and voice, which facilitate understanding, establish trust, optimize the search for resolutions, and build lasting relationships.
During the COVID 19 pandemic, a face-to-face meeting and an analogous negotiation carry too many risks of infection. This does not mean, however, that negotiations cannot continue, and as in many cases they must. Thanks to the multitude of communication media — from telephone to video conferencing systems, such as Skype, WebEx, Microsoft teams and text messages — we can continue to do business and conduct negotiations even if we are staying in different places.

However, the following 10 rules should be adhered to when digitally negotiating in this new age:

1. Pay attention to the technology

There are often technical difficulties with videoconferencing. It’s not uncommon to have problems establishing a connection during a meeting, suddenly lose audio and/or image, or experience delays before your computer receives sound or video. Such disturbances are irritating and can interrupt the flow of negotiations. Make sure that you are familiar with the technology and its use, including the specific app you will be using, so that you can concentrate on the content of the negotiation. Don’t, however, let yourself be unsettled if a technical problem arises.

2. Remember the “narrow field of view”

In video conferences, our perception is curtailed by the technology. People generally appear as “talking heads” and we cannot see what is happening in their surroundings outside the scope of their camera. Unconsciously, questions arise in our head and negative thoughts can propagate: If my counterpart is looking away from the screen, is he even listening to me? Is he interested in what I’m saying? Is he disregarding me and my concerns? Is he hiding something from my gaze? Is there perhaps even an “invisible” person in the room?

In addition, a weak Internet connection or poor technology can result in a grainy or choppy image, making it difficult to read the other’s facial expressions. The interpretation of the other’s non-verbal signals is one way to classify “spoken” as credible or not. If this channel is omitted, building trust becomes more difficult.
Making real eye contact is usually impossible during a videoconference. Since cameras on laptops, iPads or PCs are usually located on the frame of the screen, we always seem to be looking down rather than into the eyes of the person to whom we are talking. This lack of eye contact prevents us from building trust and a developing a relationship in the negotiation.

To compensate for these obstacles to successful negotiating, make sure to keep your hand gestures within the frame so that your counterpart can see them. You should also try to minimize any acoustic and visual distractions. Make sure that the area behind you is neutral and professional, and don’t forget to wear appropriate business attire. Just because it is possible for you to “multitask” during a video conference does not mean at all that you should. Resist the urge to read emails or handle other business outside of the screen, even if these would be possible. The signals you send to your counterpart by doing this could negatively influence the outcome of the negotiations.

3. Minimize data protection and security risks

A lack of privacy or data protection can lead to further risks in negotiations with people who may not be trusted. Although the possibility of being secretly recorded is a risk in any type of negotiation, digital negotiations can be particularly easily recorded by your counterpart — perhaps even for another interested party. In addition, others may listen in and possibly even advise your counterpart off-screen. To avoid such traps within your negotiations, if the content of the negotiations is quite critical but the trust is low, it may be advisable to postpone until the negotiation can be conducted again in person.

4. Look out for the potentially increased awareness of differences

A significant difference between in-person and virtual negotiations is usually not consciously perceived . When we negotiate in person, we see our counterpart, but do not see our own face. If, on the other hand, we negotiate via video conference, we usually see both the face of our counterpart as well as our own on our screen. Consequently, video conferencing can highlight obvious visual differences between us and the other party. The visual contrast can clearly display the differences in gender, race, age, culture, clothing, and so on. . This direct visual comparison takes place throughout the duration of the negotiation. This leads to an increased awareness of present inequality and slows down the process of building trust.

This makes it all the more important not only to be aware of this effect in your own actions, but also to be aware that your counterpart is having the same unconscious experience affecting their judgement. Therefore, at the beginning of an online negotiation, be sure to take enough time to make small talk and establish some commonalities. This will enable you to recognize your common ground and eliminate visual differences.

5. Choose the right medium of communication for each phase of negotiation.

Even at a home office, a negotiator has a wide range of communication channels at their disposal. Which one is then the best? Which medium should be used if personal contact is not possible? Every negotiation has different phases. The negotiator should select the appropriate medium depending on the phase. At the beginning of an online negotiation, you can focus on building a relationship, assessing the other party’s interest in reaching an agreement and identifying the dependencies of the opposing side. Video conferencing systems are the best choice for this. The better you can imitate the realities of a live negotiation; the more information will be recognizable and made visible to you. Such systems provide plenty of verbal and non-verbal clues, such as eye contact, body language (especially gestures), tone of voice, and micro-expressions. The larger the field of view, i.e. the visible area, the easier it is to build trust and relationships. For experienced negotiators, who are trained to work with the FACS (Facial Action Coding System ), videoconferencing offers outstanding opportunities for analysis and comparison between the spoken word and facial reactions. This comparison between verbal and non-verbal communication channels can give clear indications about bluffs and lies . Further along in the process, on the other hand, e-mails and file-sharing apps are best suited for exchanging detailed proposals and collaborating on documents. Have you had a flash of inspiration you’d like to share or a new idea with which you want to confront your counterpart? In this case, use E-mail, SMS or a messenger . However, every written word naturally leaves room for interpretation. This is not necessarily positive in your negotiations. If you feel irritated or confused by an exchange, it is important that you pick up the phone as soon as possible to clarify the issues. Otherwise you will proceed into further negotiations with unsubstantiated assumptions.

6. Do not interpret – Verify!

E-mails and texts can easily be misunderstood because they lack non-verbal and visual clues. Even though they have not necessarily established themself as a stylistic device in business dealings, emojis can be supportive and prevent misunderstandings in such instances. This is all the more important because especially in this current time of uncertainty and fear, the probability of misunderstandings and conflicts could grow. Thus, if your counterpart is silent, don’t assume that they are ignoring you intentionally — even though the “power of silence” can be a quite successful negotiation tactic. Make sure that you send a question to the person with whom you are talking or call them to determine whether this is a tactical move or simply a lack of time. Also, don’t be immediately angry if a message appears rude in its wording. Some people are not very articulate in their written expression. Here too, it is advisable to pick up the phone once too often rather than once too little in order to accurately assess the situation.

7. Remain cooperative and monitor your outcome.

During a crisis, people often seem torn between their best and worst instincts. We see very good examples of communities supporting each other in such situations , and at the moment also many people who are following the “social distancing” guidelines to protect the weak or sick. However, we also see citizens who tend to panic buy, hoarding toilet paper or celebrating Corona-Parties . In this unique state of emergency, we can fluctuate similarly during an online negotiation. Negotiators who take a collaborative and constructive approach, however, outperform those with a win-loss mentality. Therefore, strive to understand your counterpart better by analyzing the deeper interests behind their demands. Never stop analyzing. You can never know too much. This helps you find a variety of alternative solutions to achieve the optimal result for your interests. You will also gain clarity about what is really important to your negotiating partner and what they are prepared to give the most for.

8. Prepare yourself even more meticulously.

The above-mentioned hints probably already make it clear to you: the virtual context makes negotiations far more cumbersome, slow and error-prone. You need more time to build trust and to get on the same page regarding understanding. You need to set your “anchors” more precisely, formulate your rhetoric more precisely and reduce the speed of your speech to increase comprehensibility. Intercultural peculiarities must be taken into account even more and person-related challenges must be analyzed even more precisely. All this requires more concentration and discipline. To ensure this, you also need more pronounced emotion management skills. All in all, virtual negotiations are more challenging and require more negotiation skills than analogous negotiations to avoid making critical mistakes. As a result, you also need to prepare yourself more meticulously.

9. Consider the most likely scope of your deal.

The national and global economy needs stimulating impulses in these times of crisis. Every deal concluded, every result of a negotiation count. However, negotiators should think carefully before embarking on a major online negotiation. In China, the first nation to be affected by COVID-19, most companies postponed major IPOs until negotiation groups could travel safely to meet investors in New York, Tokyo, London and other financial centers around the world. In addition, the extreme fluctuations in the stock market make it difficult to create reliable valuations. Smaller IPOs, however, could be carried out through “Internet roadshows”, which enabled companies to present themselves to investors from a distance.

Nobody will deny that building relationships is absolutely necessary in order to build trust in a negotiation and to gain influence over one’s counterpart. But with a little creativity, smaller deals can be made remotely — and can be crucial for companies defying the economic downturn. Contact current and potential partners to see if you can help each other get through these difficult times by continuing to do business with each other. The proven tactics of structured relationship building, such as “liking, reciprocity and ingratiation” apply equally to online negotiations.

10. Do not make online negotiations the new normal.

The coronavirus will eventually run its course and, hopefully, will be brought under control. The social distancing restrictions will be lifted, and negotiators will once again be able to meet and shake hands. After having tested the supposed simplicity and cost saving aspects of telephone and online negotiations, some companies will be tempted to conduct deals and negotiations exclusively online. That would be a mistake. The consequences would be less efficient deals and worse results. When you start a new business relationship, you meet in person to get to know each other better, provided you have the appropriate security. In addition, when using virtual negotiation tools, remember the importance of meeting face-to-face regularly to discuss how your deal is going and to find new ways of working together. In the end, we are social individuals, and only social interaction can lead us to trust and better results. Don’t take the benefits that come from such practices out of your hand.

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