“Interesting,” he responded. “I’ll give the owner a call and see what he thinks. Of course, as you know, we don’t have any obligation to do anything. But we always try to take excellent care of our customers and want you to be fully satisfied.”

Several days later, the store manager called to say the owner agreed to give us a full credit in his store, minus the delivery charge they had previously incurred.

I love presenting my negotiation counterparts with various options and ways we can mutually satisfy our interests. Why?

One, this empowers my counterparts and gives them a sense of ownership over the ultimate result. Parties will be more likely to be satisfied and fully comply with something they choose, as opposed to a result they feel has been imposed upon them.

In almost all cases, you want your counterpart to walk away satisfied. Presenting options helps ensure this feeling. Give your counterpart the power to choose. It will help you in the long-run.

Two, the act of presenting options to your counterpart often portrays you as a fair and reasonable person. It puts that “fair” hat on your head, an important consideration for your negotiation reputation.

It is effectively the opposite of giving an ultimatum, which tends to make others defensive and lessens the likelihood of any deal.

Finally, presenting various options increases the likelihood of reaching agreement, as it provides your counterparts with the ability to satisfy their most critical interests.

It also increases the likelihood of reaching a result that creates additional value for both parties, the one that truly “expands the pie.”

Let’s say a used furniture store offers to sell a couch for $2,000 — but gives customers the option to either pay cash now or finance it at a below-market 5 percent interest rate over one year.

Alternatively, assume the store simply offers to sell the same couch for $2,000 cash now — with no below-market financing option.

If I’m in the middle of a cash-flow crunch and I only have the cash option, I may not even purchase the couch. Or, I may pay the $2,000 now but be less pleased overall than if I had the option to finance it at a below-market interest rate.

On the other hand, if I’m in the middle of a cash-flow crunch, and I have the option to pay cash or finance it at a below-market rate, I likely will finance the purchase.

With this option, I can satisfy both my cash-flow interest and my interest in the couch. I will thus be more pleased overall than if I only had the cash option.

So how can you take full advantage of the power of options?

• Brainstorm with a colleague to generate options that may satisfy you and your counterparts’ interests, and even consider brainstorming with your counterparts to develop types of options that may satisfy your mutual interests.
• Prioritize those options that satisfy your most important interests and that potentially also satisfy your counterparts’ interests.
• Group the most promising options into those you value at equivalent levels, with at least two equivalent options you feel comfortable presenting to your counterparts.
• Present or offer these equivalent options to your counterparts, paying special attention to your counterparts’ reactions to the various options, thus seeking to uncover their most important interests.

The store delivered our new bedroom set last week. Interestingly, of all the options available at the store, and there were many, it was the only set that satisfied both my wife’s interests and my own.

We are both thankful for that.

Marty Latz, a negotiation columnist for The Business Journal of Phoenix where this column originally appeared, is President of Latz Negotiation Institute, a national negotiation training and consulting firm based in Phoenix, Arizona. He has developed and taught negotiation training programs and seminars for corporations, cities, bar associations and law firms nationwide. Participants at his courses leave behind the intuitive and instinctive — along with their inherent uncertainties — and develop the strategic mindset that’s at the heart of successful negotiation. A Harvard Law honors graduate, Marty is also an Adjunct Professor-Negotiation at Arizona State University College of Law. He also negotiated for The White House nationally and internationally on The White House Advance Teams. Marty’s forthcoming book, Gain the Edge! Negotiation Strategies to Get What You Want (working title), will be published by St. Martin’s Press in Spring 2004. For more and for previous columns, see www.NegotiationInstitute.com or email Marty at [email protected].