Constructive Ambiguity in Negotiation

In today’s dynamic business world, creating clarity is considered an important part of expected leadership behavior. Leaders must articulate and validate a worthwhile challenge to solve, identify the core issues that really matter. Bringing clarity means you can frame the challenge as a polarizing force to be overcome or to rally the team to focus. In the same context, you probably have also heard the opposite phrase that ambiguity is the enemy of progress or success.

It would seem paradoxical to purposefully use ambiguity in the business world, but ambiguity makes business negotiations negotiable, especially in a multifaceted dynamic global business environment. In fact, constructive ambiguity is a term often credited to Henry Kissinger, which refers to the deliberate use of ambiguous language on a sensitive issue in order to advance some political purpose. 

In the world of business negotiation, constructive ambiguity can be used at least in two ways. 

Interests vs Positions

You have probably read about interests vs positions during negotiation, first proposed by Fisher and Ury in their 1981 book, Getting to YES. Positions are generally characterized as concrete, explicit decisions which tends to be clearly defined (e.g. I will never pay more than $100). Interests, which are more ambiguous, are the cause or motivation behind positions (e.g. I want the lowest price possible). Thus, a position may be a means to satisfy an interest, but a given position is not necessarily the only, or even the best, way to do that. 

For complex business negotiations, focusing on positions are more prone to get trapped in costly deadlocks or breakdown. Such negotiations can also damage long term business relationship, as each party digs in and defends its position at all costs. While positions can be hard to move once expressed or defined, interests, with its ambiguous nature, can leave room for maneuver before parties locked themselves into intractable positions. Both parties will generally have differing positions and they are not likely to be fully compatible. However, the parties may have interests in common, which they can work towards together, or differing interests that are not in conflict, which facilitates a collaborative win-win solution. 

Contracting Options

During the closing stage of negotiation, both parties would need to memorialize the agreements into written contracts. While many western companies tend to take the traditional approach in trying to develop the most inclusive, carefully worded contract with all different scenarios chiseled in stone, 2016 Nobel Laureate economic Professor Oliver Hart pointed out in his contracting theory that it would often be more important for parties to agree to a set of principles in the contract that how unanticipated scenarios would be “equitably” or “promptly” resolved. In another word, the parties constructively leave an ambiguity in the underlining issue in order to move forward. 

Naturally, one has to be careful in managing the delicate balancing in negotiation before intentional ambiguity starts producing confusion and eroding trust between the parties. However, artful use of intentional or constructive ambiguity is part of the negotiation techniques one should be prepared to consider, especially in the fast moving dynamic global business environment.

Related Articles:

Negotiation with non-Decision Makers (11/12/2018)

Business Negotiation in China (8/8/2019)

Commitment and Unbending Principle of Flexibility (11/14/2019)

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