How to deal with different people and different circumstances and what is the role of negotiation power? - Chapter 10

What are the pros of using positional bargaining compared to using principled negotiation?

Positional bargaining is easy compared to principled negotiation. First of all it does not require much preparation. It is also universally understood. It is possible to engage in positional bargaining even when you do not speak the same language. Finally, it does not require much of the activities that are used in principled negotiation, such as looking behind positions for interests, inventing options for mutual gain, and finding and using objective criteria.

In which contexts could you use positional bargaining instead of principled negotiation?

To begin with, you need to consider how much the subject matters to you. Depending on how much the subject is worth to you, it may be too costly to start principled negotiation. Secondly you want to look at the complexity of the subject matter. A very complex subject requires careful analysis of interests and creative dovetailing. Thirdly you need to evaluate how important it is to maintain a good working relationship. Maintaining a good working relationship may be more important than the outcome of any one agreement.

In a negotiation where two sides have different beliefs with regards to fairness, what are the pros of using external standards?

Using external standards improves the negotiation in three ways. Firstly, it is easier to agree to follow an external standard than to give in to the other side's positional demand, and so the costs of backing down are reduced. Secondly, any outcome that is informed, even by conflicting standards of fairness, is likely to be wiser than an arbitrary result. Thirdly, some standards are more persuasive than others, unlike arbitrary positions.

Why can it be useful to explore how conflicting standards have developed?

Most of the time one standard is more persuasive than another. It may be more on point, more widely accepted, or more immediately relevant in terms of time, place, and circumstance. However, there may be occasions where it is not that obvious. It may then be useful to investigate how and why conflicting standards have developed. By understanding the history and logic of how certain standards have developed, you can better argue which standards are more appropriate in your negotiation.

Is it essential to agree on the standards that are to be used in the negotiation?

Using external standards help to expand the area of potential agreement. However, it is simply one of the tools that can help in reaching an agreement. If the parties cannot agree on which standards to use, there are other possibilities of reaching an agreement. The parties can explore trade-offs, use an arbitrator, split the difference, etc.

Why should you carefully consider accepting an agreement in which you are receiving more than you believe would be fair?

If an agreement is presented to you in which you are receiving more than you believe is fair, you should carefully consider it. Besides your moral self-definition, there are other factors to take into account. The other side may be believing to be doing you a favor and wanting something in return later, or they may later conclude that the agreement is unfair and be unwilling to carry it out. You should also consider where you are in the negotiation. If you have not yet reached the end, the other side may believe you are taking advantage of them and consider you untrustworthy and not want to continue the negotiation to the end. A good reputation for fair dealing opens up the possibility of future creative agreements that would otherwise be impossible.

How to deal with a negotiation where the people are the problem?

When people are the main focus of a negotiation, the following is recommended:

• Build a working relationship independent of agreement or disagreement.
• Negotiate the relationship.
• Distinguish how you threat the other from how they treat you.
• Deal rationally with irrationality.

How can you build a working relationship independent of agreement or disagreement?

Substantive issues need to be disentangled from relationship and process issues. Substantive issues can be terms, conditions, dates, prices, liabilities, numbers, etc. Relationship issues refer to the balance of emotion and reason, the degree of trust and reliability, the ease of communication, attitude of acceptance or rejection, the degree of mutual understanding, and relative emphasis on persuasion or coercion. There does not have to be a trade-off between these issues. In general, a good working relationship makes it easier to get good substantive outcomes, and good substantive outcomes tend to make a good relationship better.

How to negotiate a difficult relationship with the other side?

People problems can prove to be too big despite your efforts to create a good working relationship and negotiate substantive differences on their merits. In that case you need to negotiate the relationship on their merits with principled negotiation. You should find out the underlying interests, propose external standards on how to deal with each other, and not give in to pressure tactics. Try not to look back too much and do not use blame. Try to focus on the future and make it easy for the other side to change their approach. Finally, have your BATNA prepared so you can back out if you need to and the other side may consider to negotiate with you in another way.

How to be rational when the other side is acting irrationally?

Some negotiations can involve many human emotions (anger, fear, frustration) that make people act impulsively or irrationally. Even if the other side appears to be acting irrationally, you yourself should try to act rationally if you want to fulfill your purpose. You should also consider that what appears to be irrational to you, may not be irrational to them. They may value things differently, they may have traumatic experiences that cause their behavior, there may be communication failures, etc. By tracing the other's reasoning to its underlying motives you may be able to establish change.

Should you negotiate with people committing illegal action?

In some situations it may seem better not to negotiate at all, for example when dealing with terrorists or dictators. Negotiating with such people may imply that you are giving status and reward to their illegal actions. However, unless you have a better BATNA, the question is not if you should negotiate, but how you should negotiate. Negotiating is not the same as giving in. Communication can be the way to change by learning about underlying interests. If a war occurs, it can be seen as a move within a negotiation. The violence is intended to change the other side's BATNA so that they are more likely to agree to terms of peace.

Can you negotiate with people that are acting out of religious conviction?

People's religions are unlikely to be changed through negotiation. However, you may be able to change their actions through negotiation. It may be possible to find pragmatic agreements that are of mutual interests.

How to accommodate people's similarities and differences in negotiating with different people?

In a negotiation you should be aware of people's values, perceptions, norms, concerns, behaviors, and mood of those that you are negotiating with. You will be more likely to work out an agreement. In general the advice is as following:

• Adapt all the general advice that has been given here to the specific negotiation.
• Do not stereotype individuals, but simply pay attention to the differences in beliefs and customs. Every person is affected by their environment, upbringing, culture, group identity, etc., but not in an individually predictable way.
• Listen actively and question your assumptions.

What kind of differences should you pay attention to in a negotiation?

Everybody is different, but some common differences that you could look at quite easily to assist you in improving your negotiation are:

• Does the other like to negotiate at a fast or a slow pace?
• Is there a high or a low degree of formality?
• Does the other prefer a close or a distant physical proximity?
• Is there a short or a long time frame?
• Is the relationship all-encompassing or only business?
• Which kind of agreement would be more binding and inclusive (oral or written)?
• Will the negotiation be private or public?
• Will the agreement be flexible or rigid?

In what way can the location of the meeting influence the negotiation?

When organizing a meeting, there are many aspects of the location that have influence on the negotiation. You need to be aware of possible interruptions, if you need staff support, where both sides will be comfortable, and if you need the facilities of a conference room.

How does the way of communication influence the negotiation?

Many negotiations are conducted by telephone, email, or text messaging. These interactions are very different from face-to-face meetings. For example:

• Texting increases the likelihood of unintended misunderstandings due to the short length and abbreviations.
• Empathy and sense of human connection with the other are reduced due to not having the other in front of us, which reduces the impact of mirror neurons in our brains.
• It is harder to hear and interpret the emotional undertones of communication due to the lack of audio and visual cues in texts and emails.

How can you optimize the form of communication you are using to benefit the negotiation?

There are occasions in which using the phone or email are preferred. It can be easier to ask tougher questions on the phone, and many people find it easier to be less accommodating when they are not facing the other. Using email gives you time for reflection and research, and helps you not to react impulsively. However, difficult issues, such as those that involve emotions or relationship issues, are best negotiated face-to-face. When using email or text messaging, try to create a personal connection before starting the negotiation about the substance.

What can be said about the relationship between strategy and preparation?

In almost every negotiation, strategy is a function of preparation. If you are well prepared for a negotiation, a strategy normally suggests itself. By analyzing your own and the other's interests and the standards to use, it will become clear which strategy to use. Also, if you have your BATNA prepared, you will know when to stop the negotiation. On the other hand, even if you have a well developed strategy, but you have not considered other aspects of the negotiation, you may get trapped in the negotiation. You cannot know for sure what the strategy of the other will be, and so you should consider different options.

How do you go from inventing options to making the agreement?

The following guidelines will help you in moving from inventing options to making concrete commitments:

• Think about the agreement from the beginning. Envisioning what the agreement might look like will help you analyze which issues should be dealt with and what may be necessary to resolve them.
• Craft a framework agreement. A framework agreement is a document in the form of an agreement with blank spaces for each term to be resolved by the negotiation. It serves as a starting point and an agenda for the negotiation.
• Move towards agreement gradually. Even if you are not able to agree on everything immediately, you can try to narrow the options under consideration, and move on to another issue until later. You can go through the agenda several times and difficult issues can be revisited more than once.
• Agree to tentative commitments. Tentative commitments give you a sense of progress, but they are not final until the end.
• Be persistent with your interests, but not with any one solution.
• Make an offer. An offer should be the natural result of the negotiation and should not be unexpected.

What is negotiation power?

Negotiation power is the ability to persuade someone to do something. The power will depend on the context, on who you are trying to persuade, and what you want them to do. A lot can be done to increase your negotiation power even when the power seems to be one-sided. There are almost always resources and potential allies that can be exploited.

What are the sources of negotiation power?

There are seven sources of negotiation power. The four elements of principled negotiation are the first four sources (people, interests, options, objective criteria). The fifth source is your BATNA. The sixth source is the power of commitment. The seventh source is the power of effective communication (including process management).

How can the trustworthy reputation of the other increase your negotiation power?

If both sides have trustworthy reputations they are better able to influence each other, compared to when both sides have a reputation of dishonesty. Even if just the other side has a trustworthy reputation, it means you can benefit from that. It means that you can have a good working relationship and you can safely enter into an agreement that will benefit all sides.

How can effective communication increase your negotiation power?

Good communication can help the other side understand your thinking, reduce their fears and misperceptions, and promote joint problem-solving. When you know that the other side has understood you, they cannot dismiss your disagreement as a lack of understanding. Good listening can also increase your negotiation power as it increases the information you have about the other side's interests and possible options for agreement. It also makes the other feel heard and they will be more willing to listen to you as well.

How can understanding the other's underlying interests increase your negotiation power?

The better you understand the other side's underlying interests, the better you will be able to satisfy them at a minimum cost for yourself. For example, there may be a concrete interest of money, but you could ask the other side what the money will be used for. There may be an underlying interest that is compatible with your own.

How can creating good options increase your negotiation power?

If you are able to identify the true underlying interests of the other side, you may be able to develop creative options to dovetail the interests of both sides. Successful brainstorming increases your ability to influence the other.

How can using external standards increase your negotiation power?

External standards of legitimacy can be used to increase the legitimacy of your offer, as well as protect you from illegitimate offers from the other side. It can help you resist pressure to give in too easily. By finding precedents, principles, and other legitimate external criteria of fairness, you can enhance your negotiation power, as asking for no more than is fair is one of the most powerful arguments you can make.

How can a well developed BATNA increase your negotiation power?

If you have a good BATNA you can use that as an argument with which to persuade the other side of the need to offer more. You can also draft a micro-BATNA (a BATNA only referring to the current meeting and what you can do if the meeting is inconclusive). Worsening the other side's BATNA is another way to increase your negotiation power. This tactic can be used to either coerce or exploit the other, but you can also use it to ensure a fair outcome.

How can the power of commitment increase your negotiation power?

There are three ways in which you can use a commitment to enhance your negotiation power:

• Commit to what you will do, for example by making a firm offer. Making a firm offer provides an option to the other that you will accept. You lose the opportunity to haggle about better terms, but you gain simplifying the other side's choice and making it easier for them to commit.
• Commit to what you will not do. Locking into a position has high costs. If you do it too early it limits communication and may damage the relationship. However, if you are clear about the other's interests and have explored the options, you can provide legitimate reasons independent of your personal will that justify your rigidity.
• Clarify what you want the other to do. By being clear about what you want the other to do you avoid messy commitments that leave out crucial information and are not operational. It also avoids giving the other the opportunity of not doing more than they have to if you give them that freedom.

How can you redirect the negotiation by reframing?

You can change a negotiation from positional bargaining to principled negotiation by moving the focus from position to interests, options, standards, or your BATNA. In reframing to interests you could ask them what their reasons are for what it is that they are saying. In reframing to options you could accept what they are saying as simply one option, and suggest a brainstorming session. In reframing to standards you could accept what they are saying and ask on what standards they are basing their statements. Finally, if none of the above work, you could reframe to your BATNA and tell the other side it may be wise to take a break and see whether or not it is actually possible for you both to reach an agreement.