Keeping your cards close to your chest is not only important in poker but also in business negotiations. “Negotiations often involve a certain amount of deception – especially when there are experienced negotiators on both sides,” says Katja Wölfl, an assistant professor at the WU Institute for Production Management.

Many studies have already been carried out to investigate the reasons for and consequences of deception in negotiations. However, when researching the literature, Katja Wölfl noticed that the topic is usually explored from the perspective of the deceiver, and rarely from the perspective of the people who are the potential targets of the deception.

Together with Lutz Kaufmann from WHU – Otto Beisheim School of Management and Craig R. Carter from Arizona State University, Wölfl took a closer look at the targets’ perspective. The researchers published their results in 2023. For this work, the authors have now won the prestigious Best Paper Award of the Journal of Supply Chain Management, which was presented at the Academy of Management Conference in Chicago.

It’s all about perception

For her study, the Katja Wölfl conducted interviews with purchasing managers working at business enterprises to find out in which situations they perceive deception by suppliers. This approach revealed that the occurrence and perception of deception depend on a range of different factors.

One of the most important factors is the knowledge of the two negotiating partners. “If there is a large knowledge imbalance, the likelihood of deception is high as well,” explains Katja Wölfl. “Surprisingly, this is also the case in situations where the buyer and the seller both have a lot of negotiation skills and expertise. In such cases, both sides expect to be deceived and enter the negotiation with this expectation in mind.”

The interviews also revealed that deception in negotiations is not as easy to identify as is often suggested in popular books on negotiation skills. “The typical signs of dishonesty, such as body language or word choice, aren’t what really matters in practice,” says Katja Wölfl. “To predict deception, it’s better to look at more complex factors such as power relations or negotiation objectives,” she points out.

The detailed research results can be found in the paper “In the eye of the beholder: A configurational exploration of perceived deceptive supplier behavior in negotiations,” published in the Journal of Supply Chain Management. “This was the first project I carried out as part of my doctoral research,” explains Katja Wölfl. “So it came as a pleasant surprise that it won the best paper award straight away.”

Katja Wölfl will continue to investigate the topic of negotiations in her research going forward. She is currently working on responsible purchasing and the question of how the new supply chain legislation affects business negotiations.