1. INTEREST-BASED NEGOTIATION
Federal Mediation and Conciliation Services
Human Resources and Skills Development Canada
Welcome
Introduce workshop leaders
Have participants introduce themselves
Review participant materials (including agenda)
Invite questions, comments, discussion
FMCS began offering training in IBN in Since that time we have worked with a large number of unions and employers, both in training and in collective bargaining. This experience has taught us some lessons about the potential benefits of communication and preparation for negotiation. We are going to start by telling you a little bit about FMCS - who we are and what we do. Then, we will share with you some of what we have learned about different negotiation skills.

2. Federal Mediation and Conciliation Service:
Dispute Resolution Services:
- Conciliation and Mediation
- Grievance Mediation
- Arbitration Appointments
- Preventive Mediation Program
- Labour-Management Partnerships Program (LMPP)
Legislation, Research and Policy
FMCS is jointly responsible, with the CIRB, for the administration of
Part I of the Canada Labour Code - industries which fall under federal jurisdiction
HQ & Regional Offices - Hfx., Mtl., Tor., Calgary, Vanc.
The bulk of our work consists of the provision of dispute resolution services - conciliation and mediation and grievance mediation
FMCS also does appointments of referees (wage recovery appeals under Part III), adjudicators (unjust dismissals under Part III) and arbitrators (under Part I)

3. Preventive Mediation Program
- Relationship-by-Objectives (RBO)
- Committee Effectiveness (CET)
- Negotiation Skills and Facilitation
- Collaborative Problem-Solving
- Mediation
- Grievance Resolution Workshop
Preventive Mediation Program was introduced in 1993 in response to client demand for neutral, affordable assistance to improve their relationships:
RBO - process for rebuilding a strained labour-management relationship;
CET - joint training in committee skills and assistance with committee structure and roles;
IBN - we would like to stress that FMCS is not selling interest-based negotiation, it is your decision whether or not to apply these techniques, but we believe the joint training can be useful for anyone;
LMPP - mandate to fund innovative joint initiatives, especially those aimed at relationship improvement.
5 years ago began doing internal mediation training as well as to some provinces Nfld. - B.C. (all interest-based)

4. Workshop Objective: An Understanding of: what IBN is IBN steps
IBN techniques/skills
behaviour elements
Concepts or principles e.g. focusing on interests, jointly generating options and postponing commitment
The interest-based approach involves a few simple steps when it is applied to collective bargaining.
Techniques/skills - effective listening, brainstorming, using flip charts & consensus decision-making.
Behaviour elements - the idea is not to suggest that people must behave in particular ways when engaged in interest-based negotiation, but to increase awareness of the affect an individual’s behaviour can have on the process. If you are interested in changing the way you negotiate, the best place to start may be with your own behaviour. Individuals may not be able to control everything in a negotiation, but they can change their own behaviour.
Ask participants if this covers their objectives in coming to the workshop.
Are there other objectives that the participants have that are not covered on this outline?

5. Beer Pricing Exercise

6. Note: Profits are rounded up to the nearest $-million.

7. The IBN Approach

8. What is IBN? collective bargaining an adaptable process
a way of focusing on the process
a negotiation style which encourages creativity, information sharing, and participation
a useful tool for some people at some times

9. What IBN is not ? a quick fix or the solution to all problems
a way to get everything you want at the table
a way to avoid conflict
about being nice and polite and agreeing with everything
the flavour of the month
right for everyone

10. Interest-Based Approach Principles
process counts
focusing on issues, not on the personalities
focuses on interests, not the positions
creating options to satisfy interests
jointly discuss to evaluate the options
postponing a commitment

11. Negotiation Styles: Traditional Interest-Based separate training
send notice to bargain
fixed mandate
exchange demands
push for position, argue, stall
formal, face-to-face
little discussion/many caucuses
single spokesperson
confrontation
verbatim notes
sign-off each item
memorandum signed on completion
Interest-Based
joint training
set joint ground rules
flexible mandate
jointly identify issues
discuss interest, generate options
informal, side-by-side
much discussion/few caucuses
everyone talks
joint problem-solving
flip-charts
no sign-off
memorandum signed on completion

12. Interest-Based Approach Steps:
opening statement
agree on ground rules
establish the issues
Preliminary
identify and share interests
generate options
develop criteria
evaluate options
closure
The first three steps are preliminary steps - before getting into the substance of the issues.
The last five constitute the actual negotiations and are repeated for each issue.
This process is flexible. Every group which has been successful with IBN has adapted these steps to their own needs.
The most important factor is not how you do each of these steps but that you jointly determine the process through discussion.
We are going to spend some time during the workshop discussing each of these steps.
Substance

13. Step 1: Opening Statement:
Purpose:
- sets tone
- expectations
- constituents
Contents:
- commitment
- process
- common goals
An opening statement is optional but some groups find it useful, particularly if they have not already discussed the goals, objectives mission, etc.. of the employer and the union - they may need to discuss whether their goals are aligned before they can share information and power with each other.
The purpose of an opening statement is to set a positive tone for negotiations, to establish clear expectations from the beginning so that both parties view the process as a joint problem-solving exercise, and to commit to sharing information with each other. It may also be useful for sharing with constituents so they can be reassured that both parties have made a formal commitment to frank and open discussion of all issues and to share information as needed. Hopefully, it is a symbol of sincerity about changing certain things in the relationship.
An opening statement contains a commitment to the IBN process and reference to the parties’ common goals.

14. Opening Statement:
The Union and the Company plan to make every effort to negotiate the collective agreement using the interest-based process. They will endeavour to share information openly and participate in discussions of a range options with the understanding that no final commitments will be made until the end.
As the parties jointly face the challenge of the future, they share the following values:
client focus
the overriding value of people as a resource
union-management partnership
quality and continuous improvement
This was the opening statement agreed to by Bell Canada and the CEP the first time they used IBN. They committed to the process, to sharing information and to discussing all options. It then makes reference to some shared values.

15. Step 2: Ground Rules: establish process: - expectations - ownership
logistics
rules
responsibilities
rights
behaviour

16. Step 3: List of Issues:
identify and explain topic or subject of negotiations - broad, open-ended
establish common understanding of all issues to be discussed
prioritizing issues for the negotiation
There should be no separate lists of proposals and no firm positions entering the process.
Normally, parties each compile a separate list and meet to agree on a single list of issues.
Be realistic, try to limit the list to issues requiring action, real priorities.
The issues should be broadly stated, with no suggested solution or action given.
Preferably, parties meet well in advance of negotiations to develop the issue list and then do any required research jointly.
If the issue is unclear, clarify it and write a definition on the flip chart. Don’t assume that the other side has the same understanding or perception of the issue.

17. Focusing on Interests

18. Identifying Interests Focusing on Interests:
reflects concern about an issue
facilitates information sharing
promotes discussion of options
avoids starting the process with a disagreement
adds legitimacy

19. Step 4: Identifying Interests:
Position
one party’s solution to an issue
make demands
is the close-ended solution
purpose: to communicate the single acceptable outcome
exaggerated statement
gives little information
contains “you” statements
directive language
Interest
one party’s concern, fear, need or worry on an issue
forms the basis for a future solution but is non-negotiable
purpose: to promote
discussion of various possible options
no exaggerated statements
gives much information
contains “I” or “we”statements
non-directive language
Position - a decision Interest - motivation for making that decision
we have made in advance
Make demands - the company will Outlines concerns - our members are having
provide five days per year family leave trouble balancing work & family responsibilities
Contains the solution / close-ended - No solution / open-ended - intended to open a
intended to close a discussion discussion
Purpose: to communicate the single Purpose: to promote discussion of various
acceptable outcome - the more I argue possible options - I’m not committed to a
for it, the more convinced I become particular outcome as long as the problem get that five extra days are needed solved
Exaggerated statements - to support No exaggerated statements
own position
Gives little information - this is what we Gives much information - may provide
want, period examples of problems, etc.
Contains “you” statements Contains “I” or “we” statements
Directive language Non-directive language

20. Identifying Interests Types of interests:
mutual interests
non-conflicting interests
conflicting interests
Mutual interests - shared by the parties, i.e. a healthy workplace, satisfied customers, satisfied employees.
Non-conflicting interests - an interest which the other party does not share, but which does not conflict with their interests, I.e. the union has an interest in the form an increase takes (retroactivity) whereas the employer is only concerned about the total percentage increase.
Conflicting interests - self explanatory, i.e. union interest - increasing employees’ compensation, company interest - cutting costs.
We tend to assume conflicting interests (that is where we focus when drafting positions) and often miss non-conflicting and mutual interests, which can be a source for options.

21. Example Identification of Interests:
Issue: A car pool member who is frequently late.
Statements:
a) “When I am late, my boss is on my case all day.”
b) “ The next time you are even five minutes late, we are going to kick you out of the car pool.”
Ask the participants to identify which statement expresses an position and which an interest. In this example, a) expresses an interest, it outlines a problem without proposing a solution.
Traditional bargaining is based on the assumption that you will do better the more firm your position is when you start the process.
IBN is based on the assumption that you will do better by being open to a range of options, while being very clear on what the problem is. By describing a problem and not a preconceived solution which only addresses your problem, you allow room for the other side’s needs to be met.
Difference between “I” and “you” statements. “You” feels accusatory, blaming. “I” takes responsibility for the problem.

22. Identifying Interests:
Position: Demand for higher overtime rate.
Possible interests:
- increase members’ compensation
- job creation
- prevent abuse of overtime
This is a demand which might be raised during collective bargaining.
The union may be asking for an increase in the overtime premium because the union has an interest in increasing the compensation of employees; or, it may be because there is a lot of overtime being worked while some members are on layoff and the union is trying to create a disincentive to the use of overtime; or, it could be that the union believes that the overtime provision has been misused, and wants to create a disincentive.
When the discussion starts with a position, the employer, and even the union, may not understand what is driving the demand and what problem needs to be fixed.

23. Generating Options

24. Step 5: Generation of Options:
Options - are one of a number of possible solutions to resolve an issue.
Purpose:
to increase flexibility in the search for solutions
to develop a better solutions as a result of joint efforts
to provide the participants with ownership of the process
to increase commitment to the final outcome
Position - one party’s solution to an issue; interest - one party’s concern, need, fear or worry on an issue; option - one of a number of possible solutions to resolve an issue.
The problem with settling on the first solution which appears minimally acceptable to both parties, is that it often results in possible joint gains being left on the table (examples from Getting to Yes - the orange, the window in the library, vacation choices).
Generating multiple options can allow for better solutions by creating an opportunity for all ideas to be explored.
By discussing various options, negotiations often gain a better understanding of the issue and each other, and are more committed to the process of developing a solution and are more committed to the eventual decision because they had a hand in developing it.

25. Generation of Options The Process: Brainstorming
ensure full participation
create without evaluating, no criticism
work towards quantity not quality
propose options without judicial prejudice
guidelines:
- alternate the facilitator
- lead with the next number
- keep everything visible by posting
the completed sheets
The rules for brainstorming are intended to ensure maximum creativity, therefore, evaluation and deciding are kept separate from brainstorming.
There should be no evaluation, no criticism, no quality control during brainstorming.
All ideas should be captured on a flip chart as expressed, and posted in clear view of all participants - never turn the page and cover up the ideas because group members often get ideas from other ideas. Posting the flip chart pages also prevents repetition.
In order to ensure full participation, you may wish to start with a round robin, where each person in turn offers an idea or passes, and then move to a free flow of ideas.
Don’t be too quick to end the brainstorming at the first dry spell. Give them a minute and more ideas will generally come forward.

26. Generation of Options Blocks to Creativity:
fear
premature judgement
assuming single solution
assuming limitations
negative attitudes
perception
Fear of looking foolish - we censor our own ideas because we worry that someone will think they are stupid.
Premature judgement - we are socialized to make decisions quickly and we tend to be very quick to find reasons why a particular idea will not work. We do this with our own ideas, and reject them before they are even expressed, and we do this with ideas presented by others.
We are conditioned to focus on solutions and it is difficult to break the mind set that there is only one possible solution and we have already thought of it.
We limit our thinking to that which fits into our paradigm - our knowledge and understanding of the world around us - the rules, procedures and preferences of people in organizations.
Attitude in labour-management relationships - “solving their problem is their problem and solving our problem is our problem”.
Perception - we all see the world in different ways and assume our perception of the problem is a matter of fact, not perception.

27. Generating Options Overcoming Blocks:
informal setting
challenge assumptions
suspend judgement
analyze the problem in parts
recognize point of exhaustion
People tend to be at their maximum creativity level when they are comfortable and at ease - sitting around a flip chart.
Challenge your assumptions and those of others, ask questions: Why could we not do that? Why do you feel it would not work? Why do you believe management (or employees) would not accept it?
Try to avoid the temptation of shooting down ideas because they sound a bit unusual, or because they have been tried in the past, or because you know that a certain group would not support them.
Sometimes groups become bogged down by attempting to solve a large issue that would be easier to address if broken down into the smaller problems which it encompasses.

28. Brainstorming Exercise

29. Evaluating Options

30. Step 6: Development of Criteria:
where possible, use objective standards
agreement on choice of criteria and options is done by consensus decision-making
jointly developed standards can provide a basis for deciding issues in a fair, acceptable and transparent manner
Examples of Standards:
- industry practice
- market rates
- past performance
Some parties find it helpful to use objective, external standards or comparisons to evaluate options in a way both parties will find fair and acceptable.
Some parties use standards that are more subjective, i.e. cost effectiveness, fairness, mutual gain, salability.
Some groups do not use any standards.
The key point is that any standards which are applied during interest-based negotiations must be developed by joint agreement, a process which can take considerable time and effort.

31. Step 7: Evaluation of Options:
The Three-Cut Method:
Does the option satisfy interests?
Are the resources available?
Can the option be sold to others?
The three-cut method, in effect, provides three standards against which options can be evaluated:
1. Does it satisfy interests?
2 Can we afford it?
3. Will our constituents accept it?
Some parties find this process useful in evaluating options and eliminating those which are completely unacceptable to one or both parties.

32. Achieving Closure

33. Step 8: Closure: all issues discussed
objective is still a collective agreement
“No” is part of the process
packaging of issues
broad perspective
consensus decision-making
Parties move toward closure once all issues have been put through the steps - interests, options, evaluation of options.
Remember that it is still bargaining and traditional-type trading often takes place. The parties will be at impasse on some issues and compromise, trading and difficult decisions are still required.
It may be necessary to group issues because the solution to one issue may depend on solution to another.
Be creative and remember that no issue is final until they are all final.
Look for the solutions which are acceptable to both parties although may not be either party’s first choice.

34. Closure:

35. Consensus Decision-Making

36. Consensus Decision-Making:
unanimous agreement on a single course of action reached through a cooperative, not a competitive process where each member can say:
I understand what is being proposed...
I had the opportunity to express my views and I understand the views of the others...
It was arrived at openly and fairly…
It is the best solution for us at this time
I will support the implementation of the solution
A consensus decision has been reached when:
the group comes to agreement on a course of action
and group members feel that their views have been heard and that they have heard and understood the views, needs and concerns of other group members
and when all members can support the group decision because they feel that the decision was reached in a fair and open manner and the action taken was the best solution available in the circumstances (even though the decision taken was not their first choice, they can live with it).

37. Consensus Decision-Making Guidelines:
listen and be open to persuasion
encourage participation
share information
treat differences as strengths
avoid agreeing hastily, bargaining or voting
Ensure that everyone’s views have been solicited.
Recognize that there will be conflicting views and treat differences of opinion as strengths, not problems, on the basis that the more ideas and opinions that are brought in, the more the group has to work with and the better able the group is to find the best solution.

38. Communication and Effective Listening

39. Communication: put yourself in their shoes discuss perceptions
focus on issues, not personalities
focus on future, not past
legitimacy of emotions
allow venting but avoid reacting
Attention fakers - looking straight at you, smiling, nodding, but not hearing a word you are saying..
Criticizers - not listening because they are already busy judging and dismissing what you are saying.
Bored listeners - impatient, disinterested, yeah, yeah.
Difficult material blockers - these people are all ears when you are describing your new car, but tune out once the subject becomes more complicated or dry.
Note takers - miss the message - focusing on recording actual words.
Mental rehearsers - thinking of what they will say as soon as you stop talking - especially in negotiation. And they tend not to be thinking how to respond to your concerns as much as thinking about how they will express their own.

40. Exercise on Perceptions

41. Effective Listening: 75% words ignored, misunderstood, forgotten
brain 8-10 times faster than speech
active listening - 17 seconds
not trained in listening
In IBN it is important to have a genuine understanding of the other party’s needs if you are sincere about trying to find creative solutions that will meet the needs of both parties. Therefore, effective listening is crucial.
There is only one way to become an effective listener - recognize and become more aware of your owns poor listening habits, Find a listening exercise and practice
There is a listening exercise in the Jenks article. Here is another one - CORRECT Poor Listening Habits:
Concentrate on what is being said - requires effort.
Observe facial expressions and body language.
Respond - with your eyes, facial expressions, body language - don’t shake your head, cross your arms or roll your eyes while they are speaking.
Reflect on what is said by the others by paraphrasing or repeating back what was said, checking for understanding.
Elicit further information by asking questions, not challenging question, but genuine attempts to understand.
Control the urge to interrupt or respond, focus on understanding first, then being understood.
Take advantage of the lag time (between the speed of your brain and their speech) to notice nuances and body language. Is their body language confirming or contradicting their words?

42. Effective Listening Bad Listening Habits:
attention fakers
criticizers
bored listeners
difficult material blockers
note takers
mental rehearsers

43. Summary: What it takes to Succeed:
genuine desire for change
commitment at all levels
long, broad view and is part of overall approach
flexible mandate and timeline
empowered negotiators
open sharing of information
communication with constituents
Negotiators and senior decision-makers from both organizations must be committed to the IBN process and understand the implications in terms of sharing information, flexible mandate.
IBN will not improve your life overnight - it is useful in situations where the focus is more on building a long-term relationship than in achieving significant gains in an upcoming round of bargaining.
This cannot succeed at the bargaining table if the parties are at war on the shop floor.
IBN is an information-intensive process - both sides must be prepared to explain and share information on key interests.
Negotiators must be empowered to discuss anything that is raised at the table, all options.
Parties must be open to a range of options - not previously committed to a single outcome.
Constituents are interested in the process as well as the outcome of negotiations and negotiators ignore constituents at their peril.
The time and effort will not be expended unless there is a genuine desire to change - “if its not broken, don’t fix it”.