1. Cognitive Biases in Negotiation:
How to Play the "Brain Game"©
© Laura A. Frase

2. Our Reliable brains….

3. The Brain and Biases Brain “chunks” the new with similar
When information conflicts, brain uses cognitive bias to resolve
Instantaneous and subconscious
“Irrational” thinking results
Dozens of biases

4. Some Biases that Affect Negotiation
Self-Enhancing Biases
Memory Biases
Decision-Making Biases
When combined - effects amplify
Emotions increase impact

5. It’s all about Me!

6. Self-Enhancing Biases
Egocentric Bias - “What I want is what you want.”
Illusionary Superiority - “All children are above average”
Overconfidence bias - “I am convinced I am right”
POSITIVE, NORMAL illusions

7. Examples and Strategies for Self-Enhancing Biases

8. Well, the way I remember it…

9. Memory Biases Hindsight Bias – “It’s 20/20 you know.”
Availability Bias – “It must happen a lot because I hear about it everywhere.”
Other biases effect memory

10. Examples and Strategies for Memory Biases

11. Decision-Hindering Biases

12. “What’s Good for You Is Bad for Me”

13. Reactive Devaluation Bias
Perceived value of offer is tied to source of offer
Bad relationship causes dismissal of best concessions
Offer inconsistent with other’s interests
Manner of delivery triggers

14. Reactive Devaluation Examples and Strategies

15. “I Just Can’t Lose!”

16. Risk/Loss Aversion Bias
We take more risk to prevent loss
We take less risk to achieve gain
We ramp up commitment
Bias triggered by framing –“loss” language increases risk response

17. Risk/Loss Aversion Examples and Strategies

18. “Since it agrees with me, it is right”

19. Confirmation Bias Seek/interpret only that which confirms
We remember best what confirms
Memory becomes “selective”
Resist changing assumptions – “facts” back us up

20. Confirmation Bias Examples and Strategies

21. First Impression is Strongest

22. Anchoring – Powerful Effect
What’s first has greatest sway
Compare new information to anchor
Implicit or explicit
Precise offers increase effect
Unreasonable or irrelevant anchor causes effect

23. Anchoring Examples and Strategies

24. Battling Bias – Change Rules of Game
SELF AWARENESS
Think slowly & pause
LISTEN
Ask questions
Reframe message
Generate alternatives
Develop systems to test assumptions

25. Battling Bias - Change Rules of Game
Separate message from messenger
“Consider the Opposite”
Use Expert Settlement Counsel
Red Team
Mock negotiations
Replace anchor

26. Caveat – Blind Spot Bias

27. Other Brainy Games

28. Conclusions We are all swayed by biases They are normal
We are not helpless
Self-awareness, pausing, and generating alternatives helps us play the “brain game”