Book Excerpt: Lie Spotting

Typically, the lies you will hear during a negotiation are lies of omission. In one study, 100 percent of negotiators actively lied about or failed to reveal a problem if no one directly asked them about it.

Liars are far more comfortable concealing information than falsifying it, because concealment doesn't require them to concoct, remember, and then tell a story. It's easier to feign confusion or pass the omission off as a mistake should the deception eventually be noticed. The liar can claim he was planning to mention the relevant fact but got sidetracked; maybe he didn't know it was important; he might simply have forgotten to bring it up; and, in any case, it's all a blur now. He can no longer even remember what was discussed on that particular occasion.

Regardless of whether or not a lie of omission is a "real" lie, the fact is that many such falsehoods eventually become lies of commission--outright falsification--once the opposing side does think to inquire about them. [Psychologist and pioneer in the study of human emotions] Paul Ekman calls lies of omission "concealing lies" and lies of commission "falsifying lies." According to Ekman, a concealing lie often becomes a falsifying lie when the liar feels that the victim is challenging him. This speaks directly to the fact that a good negotiator should not put a liar in a position in which he feels he has no choice but to lie.

Since negotiations are frequently the starting point for business relationships, it's just plain good business to steer clear of the cycle of distrust and deception that so often entraps participants at the negotiating table.

What makes a good negotiator? Lots of people will tell you that he's shrewd, astute, and somehow naturally gifted at wheedling exactly what he wants from a transaction. The facts are otherwise. A good negotiator is willing to do the homework--to put in far more prenegotiation time planning, strategizing, and analyzing than his opponents will know. The real work of a negotiation takes place before anyone comes to the table. If you want to learn the surefire ways to close a durable, lie-proof deal, you'd better be ready to work hard.


Avoid False Promises. Think hard about the promises you make. Researchers have found that making false promises is one of the most damaging bargaining tactics negotiators employ. Imagine you've accepted a job to run a global operation, only to discover your new employers were planning to shutter most of its foreign business. Negotiators known for such false promises suffer significant reputational damage and can have difficulty recovering. Though misleading a partner during negotiations can bestow a short-term advantage on the liar, ultimately it causes so much long-term damage to one's reputation that it's not worth it.

Declare Your Honest Ways. People feel justified in lying when they think they're dealing with a liar. Therefore, you should take every opportunity to bolster your company's honest reputation and your own personal reputation when negotiating. Those who might have considered lying, because they think it's the only way to "win," will be relieved to know they don't have to be on guard around you. When GM introduced Saturn in 1990, the brand won an immediate following not just because it was a well-priced, well-designed small car, but because people loved the no-haggle sales experience GM had also introduced with the Saturn. Saturn managed to make fair dealing a brand hallmark. If more businesses were to do the same, negotiations of all kinds would become far less stressful.

Prepare, Prepare, Prepare. As with most activities, investing time is what gets the best results. The success of savvy negotiators is a result of the tremendous amount of planning, strategizing, and data analysis--in other words, the hard work--they do before they ever start bargaining.

Your preparation should start with a checklist that includes:

Information You Need That You Don't Have. Draft questions that allow you to ask for the missing data in a way that's appropriate to the bargaining process. Try to anticipate what will be covered throughout the negotiation and decide when you'll bring up each question.

Information You Will Be Expected to Share. Imagine what you would want to know if you were sitting on the other side of the table, and be prepared to provide it in the same detail you might request of others. Prepare for the unexpected as well. Make sure to have all your data printed out or backed up well ahead of time, so that a mistake doesn't make you look as if you're trying to hide something when in fact you're just a victim of poor planning or a technological glitch. For example, let's say you're merging a Web site with a larger one in the market. At the last minute, your buyer requests the traffic data directly from the server logs that would back up your contention that you're the second biggest site in your market. You readily agree...and then your servers crash, your buyer gets skittish, and the deal falls through. Nothing raises red flags faster than promising information and then being unable to procure it. Don't let this happen.

An Outline of How You Believe Your Bargaining Partner Perceives You. This should include specific beneficial outcomes you think he'll gain from a closed deal.

Your Real Bottom Line. What's a guaranteed deal breaker? What's the likely outcome should you decide to walk?

The Issues That Must Be Discussed. Tedious, but a necessary discipline; list them ahead of time in detail.

The Concessions You Are Willing to Make. Talk possible concessions through ahead of time with all members of the negotiating team so the group presents a unified front as the difficult work of parsing through concessions arises.


Demand a Face-to-Face Meeting. Yes, your travel expenses might go up if you want to protect yourself against deception. It's worth it. Face-to-face meetings should be your priority whenever possible.

Set the Stage. If you have control over the meeting environment, make it warm and friendly. Some might suggest creating an environment that is purposely intimidating, but it's not necessary. A relaxed meeting environment encourages your negotiation partner to let down his guard. He will be more inclined to reveal what you need to know.

Make sure that the setting provides a clear view of his face and body. A jittery foot could suggest a case of nerves, but if he twitches just as you start asking questions about company debt, you'll realize you may need to probe the issue in more depth.

Once you've developed a rapport with your negotiating partner, consider bringing in a third party to witness the negotiation. In fact, you could encourage the other party to do the same, thus transmitting your intention to tell the truth. When you signal that you're intending to be truthful, others will be far less motivated to deceive you.

Reprinted with permission, Liespotting: Proven Techniques to Detect Deception by Pamela Meyer, St. Martin's Press, 2010

Before it's here, it's on the Bloomberg Terminal.