MISTAKE #1: THEY ARE ILL-INFORMED
Often the other side is acting on bad information, and when
people have bad information they make bad choices.
There’s a great computer industry term for this: GIGO—
Garbage In, Garbage Out.
As an example, Malhotra talks about a student of his
who was in a dispute with an ex-employee who claimed he
was owed $130,000 in commissions for work he had done
before being fired; he was threatening a lawsuit.
Confused, the executive turned to the company’s
accountants. There he discovered the problem: the accounts
had been a mess when the employee was fired but had since
been put into order. With the clean information, the
accountants assured the executive that in fact the employee
owed the company $25,000.
Eager to avoid a lawsuit, the executive called the
employee, explained the situation, and made an offer: if the
employee dropped the lawsuit he could keep the $25,000.
To his surprise, the employee said that he was going
forward with the suit anyway; he acted irrational, crazy.
Malhotra told his student that the problem was not
craziness, but a lack of information and trust. So the
executive had an outside accounting firm audit the numbers
and send the results to the employee.
The result? The employee dropped the suit.
The clear point here is that people operating with
incomplete information appear crazy to those who have
different information. Your job when faced with someone