Handshaking Promotes Better Deal-Making
The ritual of shaking hands before negotiations can improve outcomes for both sides
9-Aug-2018 3:05 PM EDT
Newswise — Like any ritual, a handshake may seem like a bizarre gesture when you really stop to consider it. "Why do we touch hands and move them up and down?" says Juliana Schroeder, an assistant professor in the Berkeley Haas Management of Organizations Group. "If you were an alien coming to earth and looking at what people do, you would think, 'What is the purpose of this thing?'"
Asst. Prof. Juliana Schroeder_headshotIn new research set to be published in the Journal of Personality and Social Psychology, Schroeder has found a profound effect to the simple ritual: Shaking hands can improve the outcome of negotiations for both sides. "When you shake hands with someone, you make an immediate inference that 'They are going to cooperate with me; they are not going to do me harm,'" she says. "And so you decide to cooperate with them."
Why do we shake hands?
As far as Schroeder has been able to determine, handshaking has two origin stories. Some believe that it was a way for people in ancient times to show that they weren't carrying weapons--even going so far as to pump hands up and down to dislodge any hidden knives up their sleeves. Another theory is that it was to seal a promise or an oath. "Both of these things are related to the idea of trustworthiness and cooperation," Schroeder says. "The gesture cements an understanding we have between us."
Schroeder has long examined the effect that rituals play in our psychology, looking for example, on how daily rituals around eating can cut calories, or how rituals performed before public speaking can decrease anxiety. In her study, co-written with Jane Risen of Chicago Booth Business School and Franscesca Gino and Michael Norton of Harvard Business School, the researchers tested how handshakes changed negotiations in a series of experiments involving classic negotiation games. In one game, for example, two participants negotiated over a car, considering six aspects including price, color, and model. Each participant had different goals in the negotiation, some of which were aligned and some of which weren't, and they scored points based on how many of their goals they met. Participants were not prompted to shake hands, but researchers noticed that when partners decided of their accord to start their negotiations with a handshake, both ended up scoring more points overall.
Talking more, lying less
That doesn't necessarily mean that shaking hands produced that outcome. "Maybe handshaking people are just nicer, more conscientious people who tend to be more cooperative," Schroeder says. In order to test cause and effect, she and her colleagues set up a new negotiation over a job offer, this time encouraging some partners to shake hands before negotiating while sitting others down right away before they had the chance to shake. Once again, those who shook hands reached greater agreement and scored more points. Moreover, the researchers videotaped the exchange, and observers scored how cooperative the two negotiators were. Not only did they score more points, but the pairs that shook hands also lied less, tended to talk more after the negotiation was over, and even leaned closer to each other while talking.
In another experiment, handshaking even seemed to make a difference in zero-sum negotiations in which one side had to lose in order for the other side to win. In that experiment, involving a real estate transaction, the "seller" had the opportunity to withhold crucial information from the buyer that would drive up the price. When the participants shook hands beforehand, however, the seller was more likely to be honest and divulge that information, even if it meant they achieved a lower price overall. "People say they felt less comfortable lying to their partner when they shook hands," says Schroeder.
In explaining why handshaking has such an effect on negotiations, Schroeder believes that it goes beyond the physical act of touching and moving together: the ritualistic gesture has a psychological effect, she says. "It changes the way you perceive not just the other person, but the way you frame the whole game," she says. "You say to yourself, 'Now we are in a cooperative setting rather than an antagonistic one.'"
In fact, another experiment demonstrated that the power of handshaking is less tied to the specific physical gesture than the meaning we've attributed to it. The researchers instructed some participants to not shake hands, and instead to tell their partner that they were sick and didn't want to infect them. Others were instructed to shake and later tell their partner about their germy hands. In that case, the results were completely reversed, with those who didn't shake hands achieving a more cooperative settlement. "The same physical behavior takes on a totally different meaning," Schroeder says. "It's not so much the physical act, it's more about thinking this person is behaving in a cooperative way."
For those entering negotiations in a business context, a handshake can be a surprisingly easy way to demonstrate that spirit of cooperation, perhaps leading to a better, fairer deal for both sides. That makes it all the more surprising that in the researchers' first experiment--in which participants decided on their own, without prompting, whether to shake hands or not--only 30 percent of them did so. "It's a seemingly small gesture that influences negotiations," Schroeder says. "Engaging in the everyday ritual of handshaking can improve cooperative outcomes."