The Agony of Opportunity in Negotiation: Number of Negotiable Issues, Counterfactual Thinking, and Feelings of Satisfaction

Original publication by Charles E. Naquin
In Organizational Behavior and Human Decision Processes Elsevier Science (USA), 91 (2003), pages 97-107.
Synopsis by Emily McLeod, Claremont McKenna College '04

Do the number of issues brought into a negotiation affect its outcome? Negotiation literature suggests that including as many issues as possible in negotiations will maximize the opportunity for objectively better outcomes through the integration of issues. However, Naquin's paper argues that the inclusion of a greater number of issues lowers a negotiator's immediate feelings of post-negotiation satisfaction, despite the presence of better objective outcomes. Though an increase in the number of issues in a negotiation is widely thought to be a positive feature, this study suggests such inclusion might entail some negative effects.

Naquin cites a broad base of psychological research, as well as negotiation specific research, to suggest there that there is little connection between feelings of satisfaction and good objective outcomes in negotiations. While much research acknowledges this disconnect, few have examined why this disconnect occurs. Naquin's research seeks to occupy a small, but growing, niche of literature that explores the factors that influence negotiator satisfaction and identifies the reasons for a disconnect between satisfaction and outcome.

The main factors of satisfaction examined in this study were counterfactual thought and number of issues. Counterfactual thoughts are thoughts that imagine outcomes different than reality. These thoughts can be such that they occur in an upward direction, imagining a better possible outcome, or a downward direction, imaging a worse possible outcome. The first hypothesis of the research is that "negotiators will have more upward counterfactual thoughts in negotiations characterized by having more negotiable issues..." The second hypothesis states that "negotiators will be less satisfied in negotiations characterized by having more issues available to negotiate than those with less."

Both hypotheses were supported using a two-part study involving pairs of negotiators. The negotiators were graduate level business students who participated as a class assignment. Negotiators were found to be less satisfied when there were a greater number of issues to negotiate. Furthermore, the individuals that were least satisfied also had the most counterfactual thoughts. These increased counterfactual thoughts were of the upward variety, imagining better possible outcomes. The experimental manipulation had no effect on downward counterfactual thoughts. The negotiation pairs with fewer issues were given a subset of the issues used by the greater issues negotiators to control issue content as a factor of satisfaction.

Those participants that negotiated a greater number of issues had a much greater objective payoff than those negotiating fewer issues yet still reported lower satisfaction with the outcome. Naquin validates the use of non-real objective outcomes in the study by citing the reputational consequences for the group of participants. As part of a class that participated in post-session debriefings and discussed individual's abilities to obtain non-real world positive economic outcomes, it was revealed that these participants did have a vested reputational interest in their achievement.

The study established the number of issues present in a negotiation as an important factor in determining feelings of satisfaction. This finding questions the use of objective outcomes as a measurement of satisfaction. Negotiation strategies that seek to increase the objective outcome by incorporating as many issues as possible are widely taught and may be threatened by the finding of a negative effect from additional issues. Naquin recommends adapting such negotiation strategies to reduce the presence of counterfactual thoughts and the lower satisfaction associated with a greater number of issues. Such an adaptation would be very useful in increasing satisfaction and more research should be conducted in this area.

It is important to keep in mind that these studies were conducted looking at short-term, as opposed to long-term satisfaction. Without further studies it is difficult to assess if the lower feelings of satisfaction remain upon longer reflection or mitigate themselves. The study was also conducted using negotiation pairs. The effect of a greater number of issues in a negotiation with multiple parties has not yet been tested. Though the findings of this paper are limited, it is proposed that they could provide a general framework in many fields where choices are made among multiple issues. In a society that is being offered more information and options every day - through technology and the Internet - the finding that "opportunity of choice among multiple options does not necessarily imply increased satisfaction" is very important.