Negotiating a budget with your manager: the weight of the first number
Discussing a budget with your manager means reconciling operational needs with resource constraints. The specific question is this: how can you prevent the first amount mentioned from becoming the sole benchmark for what is reasonable?
What the literature establishes
Amos Tversky and Daniel Kahneman (1974, Science) describe anchoring: an estimate can be influenced by an initial value even when that value provides no relevant information. Adjustments made from this starting point may remain insufficient. In a budget discussion, this suggests distinguishing a documented amount from a number that simply happens to be available, without assuming that every proposal from a manager represents a bias.
The opening amount can structure the negotiation
Adam D. Galinsky and Thomas Mussweiler (2001, Journal of Personality and Social Psychology) show, in experimental negotiations, that first offers influence final agreements and can benefit the person making them. They also show that this advantage can disappear when the recipient focuses on information inconsistent with the anchor, notably their own target. The relevant mechanism is therefore not just who speaks first, but also the reference point each party prepares before the discussion.
The premature conclusion
One might conclude that you should always be the first to propose a high budget to your manager. These studies do not justify turning that tactic into a rule for a lasting hierarchical relationship, where the credibility of estimates also matters. A more cautious application is to prepare an independent costing and its assumptions before discussing the amount already mentioned. (our executive and employee training programmes)
What the evidence cannot settle
Negotiation experiments reproduce neither approval responsibilities, nor compliance rules, nor the history of a relationship between a manager and an employee. They do not demonstrate that a particular protocol improves budget decisions in Zurich companies. Equally, a difference between two estimates does not prove anchoring: it may reflect different information or project scopes.
A practical check in Zurich
Within SHR’s programme on building an effective relationship with your manager, one possible application in Zurich concerns project budgets in financial services, insurance, tech and the European headquarters of international groups. Before the discussion, the employee and manager separately record their estimates, the scope considered and their cost assumptions, then document the reasons for the amount ultimately selected. Over a pilot period defined in advance, they can measure the proportion of cases in which the final amount is justified by verifiable evidence — quotations, volumes, requirements — rather than solely by reference to the first number. This indicator checks the traceability of the decision, not the elimination of anchoring bias. To go further: explore the Building an Effective Relationship with Your Manager training in Zurich in the canton of Zurich, or browse our executive and employee training programmes in Switzerland.
In pictures: Building an Effective Relationship with Your Manager in Zurich
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