Negotiation
Getting to YES
RD 300
14 & 19 November 2001
Negotiation
A process of communicating back and
forth for the purpose of reaching a joint
decision when you and the other side
have some interests that are shared and
others that are opposed.
Hard versus soft negotiation styles.
Positional Bargaining
Most common negotiation style adopted:
each side takes a position, argues for it and makes
concessions to reach a compromise.
Problems:
Locks people into their positions.
Ego becomes attached to your position.
Focus on positions means less attention is paid to
the underlying concerns/issues of the parties.
Positional Bargaining
 Problems (cont.):
Start with extreme positions; try to hold onto
them; make only minor concessions to keep
negotiation alive.
This requires a lot of time and effort.
Becomes a contest of wills.
Can strain and even shatter relationships.
The more parties the more difficult.
Soft
 Participants are friends.
 Goal is agreement
 Make concessions to maintain
relationship.
 Be soft on the people and the
problem.
 Trust others.
 Change your position easily.
 Make offers.
 Disclose your bottom line.
 Accept one-sided losses to
reach agreement.
 The single answer: the one
they will accept.
 Insist on agreement.
 Try to avoid a contest of wills.
 Yield to pressure.
Hard
 Participant as adversaries.
 The goal is victory.
 Demand concessions as a
condition of relationship.
 Be hard on the problem
and the people.
 Distrust others.
 Dig in to your position.
 Make threats.
 Mislead as to your bottom
line.
 Demand one-sided gains
as the price of agreement.
 The single answer: the
one you will accept.
 Insist on your position.
 Try to win a contest of
wills.
 Apply pressure.
Principled Negotiation
Characteristics:
decide issues on their merits.
look for mutual gains.
where interests conflict, use fair standards to
obtain a result.
can be used whether there is one issue or
several.
two parties or many.
useful in prescribed or impromptu
negotiations
Principled Negotiation
4 Key Points
1. Separate the people from the problem.
2. Focus on interests, not positions.
3. Generate a variety of possibilities before
deciding what to do. Invent options for mutual
gain.
4. Insist that the result be based on some
objective standard or criteria.
Principled Negotiation
Three stages:
Analysis stage: diagnose the situation.
Planning stage: generate ideas and decide
strategy.
Discussion stage: communication back and
forth.
Deal with People Problems
A negotiator wants to reach an agreement
that:
satisfies his/her substantive interests; and
preserves/fosters valued relationships.
Most negotiations take place in the context
of an ongoing relationship.
In some cases the ongoing relationship may
be more important than the outcome of any
particular negotiation (e.g. family).
We tend to treat the people and the
problem as one in the same.
Egos become involved in substantive
positions.
People often draw unfounded inferences
from comments on substance.
Deal with people problems directly;
don’t try to solve them with substantive
concessions.
Base the relationship on:
accurate perceptions,
clear communication
appropriate emotions
a forward-looking outlook.
Types of People Problems
(1)
Perception -
both parties may agree as to the facts but
disagree on the preferred outcome.
we need to be able to see the situation as the
other side sees it.
understanding their point of view is not the
same as agreeing with it. You may however
modify your own views as a result.
Don’t
Even if blaming is justified, it is usually
counterproductive.
Don’t deduce their intentions from your
fears. Tendency to put the worst
interpretation on what the other side
says or does.
Don’t treat as unimportant those
concerns of the other side that you
perceive as not standing in the way of
an agreement.
Do
Discuss each other’s perceptions.
Look for opportunities to act
inconsistently with their preconceptions.
Involve the other side in the process of
reaching an outcome. Agreement is
much easier if both sides feel ownership
of the ideas/solutions.
Involve the other side(s) early.
Allow all parties to save-face. A
potentially acceptable solution may be
rejected if a party is forced to lose face
in the process.
Face-saving reflects a person’s need to
reconcile the stand he or she takes in a
negotiation or an agreement with their
principles and their past words and
deeds.
(2) Emotion Emotions often run high from the start.
Emotions can create an impasse.
Recognize your emotions and those of the
other side.
Don’t
Don’t treat negotiators who represent
organizations as mouthpieces without
emotions.
Don’t react to emotional outbursts.
Don’t stop people from expressing their
emotions or dismiss their emotions.
Do
Make emotions explicit and
acknowledge them as legitimate.
Recognize theirs and yours.
Continue listening when the other side
is letting off steam.
Interact with the other side away from
the bargaining table (e.g. dinner).
Make an apology if it is warranted.
(3) Communication
Potential problems:
Negotiators may not be talking to one
another but to other parties. Playing to the
gallery.
Negotiators are not really listening to the
other side. Thinking about their next
argument.
The other side misinterprets the
communication (e.g. language - the word
“average”).
Do
Engage in active listening. Demonstrate
that you have been listening - positive
paraphrasing. Understanding is not
agreeing.
Think before you speak.
Don’t
Blame the other side for the problem;
name-call; or raise your voice.
Allow poor body language.
Communication Issues
Confidentiality (the press, third parties,
constituents).
Size of group meetings.
Communication away from the table.
Ability of negotiator to make decisions on
behalf of their constituents.
Relationships
Negotiations are about relationships.
A working relationship can be very
beneficial - less chance for
miscommunication; more openness;
more trust.
Hard to separate the relationship from
the substantive problem.
Side-by-side joint problem solving.
Focussing on Interests
Many impasses are due to our tendency
to think about our positions not our
interests.
Interests - each side’s needs, desires,
concerns and fears.
Our interests underpin our positions.
Interests
In a negotiation the interests of the
respective parties may be:
the same (i.e. shared);
different but compatible (e.g. Ugli
oranges); or
irreconcilable.
We often conclude too quickly that our
interests are irreconcilable.
Examining each side’s interests instead
of their positions can make solutions
easier to find.
For every interest there usually exist
several possible options that could
satisfy it.
Shared and compatible interests may lie
behind opposing positions.
Differing but complimentary interests
can also form the basis for a mutually
acceptable agreement.
The interests underlying a person’s
position are often not clear. They may be
unexpressed or inconsistent with their
clearly stated position.
Try to discover the underlying interests
of the other side.
In most negotiations, each side will
have multiple interests, not just one.
Every negotiator has a constituency to
whose interests he/she is sensitive. It
may be a constituency of one (e.g.
themselves) or of many (e.g. an
organization or coalition).
Within a constituency there may exist a
variety of interests.
The most powerful interests are basic
human needs:
security
economic well-being
a sense of belonging
recognition
control over one’s life
Make your interests clear. Don’t let them get
lost in the rhetoric. Be specific.
“if you want the other side to appreciate
your interests, begin by demonstrating
that you appreciate theirs.”
Paraphrase their interests. Active
listening. Legitimizing.
Encourage them to listen to you by:
Stating your interests and reasoning
first and your conclusions/proposals
later.
Shared interests:
may not be immediately obvious;
are opportunities to build upon; and
can make negotiations smoother and more
amicable (“in it together”).
Differences (e.g. interests, beliefs,
valued items) can lead to agreements.
Dovetailing - looking for items of low
cost to you but high benefit for them,
and vice versa.
Focus on where you are going, rather
than arguing about the past.
Try to bring to the negotiation several
options that could meet your interests.
While pressing your substantive issues,
keep an open mind to modifying your list
of options.
Successful negotiators invent
options for mutual gain.
Obstacles that Inhibit the
Inventing of Multiple Options:
premature judgment;
searching for the single answer;
the assumption of a fixed pie; and
thinking that “solving their problem is
their problem”.
Inventing options does not come
naturally. Not inventing is the normal
state of affairs.
Sometimes we fear that by inventing
options we will disclose some piece of
information that will jeopardize our
bargaining position.
Negotiations often appear to be “fixedsum” games (e.g. buying a car: $100
more for you, means $100 less for me).
Ask yourself whether your proposed
solution meets the self-interest of all
parties.
We are too often unwilling to help the
other party(ies) find solutions that meet
their needs (e.g. history of bad blood).
To invent creative options:
Separate the act of inventing options from the
act of judging them.
Broaden the options on the table rather than
look for a single answer.
Search for mutual gains.
Invent ways of making their decision easy.
Try to think laterally to generate more
options that might lead to a solution(s):
Small group activities (build on each others
ideas).
Use a third party to help you overcome the
tendency for “groupthink”.
Generate variations on your original set of
options.
Don’t throw away “flawed” options too
quickly. They might provide the seed for a
good idea/option.
Create an environment conducive to this task.
The above could be done by each party (among
themselves) or between the negotiating parties.
Examine your problem from the perspective of
different professions and disciplines.
If you cannot agree on substance, you may be
able to agree on procedure.
At a minimum agree on where you disagree.
A perfect “win-win” solution may not be
possible at the time of the negotiation.
Negotiations sometimes result in
provisional or contingent agreements or
partial solutions.
Remember: the context of most
negotiations is dynamic and will continue
to be so after the negotiation.
Can the subject matter be enlarged so as
to “sweeten the pot”?
Successful partial solutions can form the
basis for more comprehensive solutions
later.
Make it easy for the other side to accept
your solution.
Are there useful precedents to draw upon?
Insist on Using Objective
Criteria
Sometimes, despite your best efforts,
interests will conflict.
The temptation is to resort to positional
bargaining in such cases.
The alternative is to make a decision on
the basis of objective criteria.
The more you bring standards of fairness,
efficiency, or scientific merit to bear on your
problem, the more likely is a final outcome that
is wise, fair and stable.
Example, the Law of the Sea conference: MIT
model for the economics of deep-seabed
mining.
Allowed all parties to save face.
How do you develop objective
criteria?
Plan in advance.
Typically more than one objective
criterion is available. Example: car
insurance claim. What is the car’s value?
Are the criteria legitimate and practical?
Examples of Types of Objective
Criteria
Market value
Precedent
Scientific judgment
Professional standards
Efficiency
What a court would decide
Moral standards
Tradition
To produce an outcome independent of
will, you can use either fair standards
for the substantive question or fair
procedures for resolving the conflict.
Negotiating with objective
criteria:
Frame each issue as a joint search for
objective criteria.
Reason and be open to reason as to
which standards are most appropriate
and how they should be applied.
Never yield to pressure, only to principle.
“It’s a matter of principle”.
“It’s company policy”.
A principled negotiator is open to
reasoned persuasion on the merits.
What is your BATNA?
What are the costs and benefits
associated with having a
“bottom line”?
Best Alternative to a Negotiated
Agreement
What is the difference between a “bottom
line’ and your BATNA? Example: selling
your home.
Why should we know our BATNA?
Your BATNA is the standard
against which any proposed
agreement should be measured.
Negotiating without determining your
BATNA is negotiating with your eyes
closed.
Too optimistic or too desperate.
Trip wires – provides you with some
margin in reserve.
The better your BATNA, the greater your
power.
How attractive to each party is the option
of not reaching agreement?
Power balance.
Develop Your BATNA
Invent a list of actions you might take if
no agreement is reached;
Improve some of the more promising
ideas and convert them into practical
alternatives; and
Select, tentatively, the one alternative that
seems best.
Knowing your BATNA gives you
additional confidence in the negotiating
process.
It is easier to break off negotiations if you
know where you are going should the
negotiation fail.
Should you reveal your BATNA
to the other side?
Consider the other side’s
BATNA
If both sides have attractive
BATNAs, the best outcome of
the negotiation, for both parties,
may well be not to reach
agreement.