What is positional bargaining? - Chapter 1

What is a wise agreement?

A wise agreement can be defined by three criteria:

• Have the legitimate interests of each side been met to the extent possible?
• Have conflicting interests been resolved fairly?
• Have community interests been taken into account?

To reach this wise agreement any method of negotiation should be efficient and improve or at least not damage the relationship between the participants.

What is positional bargaining?

People often engage in positional bargaining when they are negotiating. Each side takes a position, argues for it, and makes concessions to reach a compromise. It refers to successively taking and then giving up a sequence of positions. A good example of positional bargaining is haggling. There are important purposes of positional bargaining, as it tells the other what you want and provides an anchor in an uncertain and pressured situation. It can also produce an acceptable agreement. However, positional bargaining does not meet the basic criteria of producing a wise agreement in an efficient and amicable way.

How can positional bargaining impede a negotiation?

During positional bargaining, the participants tend to lock themselves into their positions. The more they clarify their positions, the more they defend it and the more committed they become to it. Their egos become identified with their positions, making it less likely that the eventual agreement will wisely reconcile the participants' original interests. The more they try to convince the other of the impossibility of changing their opening position, the more difficult it becomes to do so.

How can positional bargaining lead to unwise outcomes?

The more attention is paid to the positions, the less attention is devoted to meeting the underlying concerns of the parties. Any agreement reached may reflect a 'splitting the difference' rather than a solution that was carefully crafted to meet the legitimate interests of the participants. The result is often an agreement (if there is any) that is not as good as it could have been.

Why is positional bargaining inefficient?

Positional bargaining creates incentives that stall settlement. The more extreme the opening positions and the smaller the concessions, the more time and effort it will take to find out whether or not agreement is possible.

How does positional bargaining endanger an ongoing relationship?

In positional bargaining, each participant tries to force the other to change its position through willpower. The result is often anger and resentment as one side gives in to the will of the other while its own concerns go unaddressed. Making concessions for the relationship is also problematic, because it can encourage and reward stubbornness, which also leads to negative feelings. These negative feelings can damage the relationship between the participants.

Why are the negative effects of positional bargaining worse when there are more participants involved? 

Almost every negotiation involves more than two participants. First, it makes reciprocal concessions difficult. Second, in such situations, positional bargaining leads to the formation of coalitions among parties who have shared interests (often more symbolic than substantive). With more members in a group, it becomes more difficult to develop a common position. Then, once they have agreed upon a position, it is just as hard to change it during a negotiation.

What is a soft and a hard negotiating game?

• A soft negotiating game emphasizes the importance of building and maintaining a relationship. This is the kind of negotiating you see a lot with families and friends. The process is usually efficient and produces results quickly. The participants try to be forthcoming, trusting, and generous, and an agreement is likely. The goal of the negotiation is agreement. Though, the agreement may not be a wise one as a negotiation mostly concerned with the relationship risks producing a sloppy agreement.
• A hard negotiating game dominates a soft one in positional bargaining. The participants are adversaries and demand concessions as a condition of the relationship. The participants do not trust each other, dig into their positions, and threaten each other. The goal of the negotiation is victory.

What is meant with the 'second negotiation'?

The game of negotiation takes place at two levels. The first level addresses the substance. The second level refers to how participants negotiate the first level. This second negotiation structures the rules of the game that is being played (a soft or a hard game, or another method). The moves made on this second level establish the procedural rules of the negotiation and may serve to keep the negotiations going, or may change the negotiation completely. Even though its importance, this second negotiation usually occurs without conscious decision-making.

What are the four basic points of principled negotiation?

Principled negotiation is a method of negotiation designed to produce wise outcomes efficiently and amicably, with the participants as problem solvers. It is also called negotiation on the merits. This method can be used in almost any circumstance. Each point deals with a basic element of negotiation and what you should do about it. The four basic points of this method are:

• People: separate the people from the problem.
• Interests: focus on interests, not on positions.
• Options: invent multiple options looking for mutual gains before deciding what to do.
• Criteria: insist that the result be based on some objective standard.

What are the three stages in which principled negotiation is relevant?

Principled negotiation and its four propositions are relevant from the time that someone begins to think about negotiating until the time an agreement has been reached or the decision is made to stop the negotiation. This period can be divided into three stages (in each stage the four basic points of the method are the best subjects to discuss):

• Analysis. In this stage the participant is just trying to diagnose the situation and gather information. All interests and options that are already available need to be identified, as well as the problems, hostile emotions, and unclear communications.
• Planning. During this stage new ideas need to be generated as well as additional criteria for deciding among them. It needs to be decided which interests are the most important and whether or not the objectives are realistic.
• Discussion. In this stage differences in perception, feelings of frustration and anger, and communication difficulties can be acknowledged and dealt with. Each side should try to understand the interests of the other and then together generate options that are mutually advantageous.