Principled Negotiation Maureen Gauci 29 Sept 2013

What is Negotiation? The parties in conflict attempt to resolve their issues on their own, without third party assistance Queen's Fall 2012 M. Gauci

When to Negotiate: Trust levels between parties are decent Current or relatively untroubled history Low or manageable power imbalance Phase of escalation is at productive level (or slightly higher) able to strategically think through the matters that will arise during the negotiation, and the potential outcomes of the negotiation Queen's Fall 2012 M. Gauci

Negotiation Styles Soft (Co-operative) Hard (Competitive) Principled (IBN) Avoid conflict Friends Change positions easily Concede generously Avoid contests of will Make concessions for the relationship Back down to ultimatums Win at all costs Adversaries Dig in to your position Concede stubbornly Win contests of will Demand concessions to have a relationship Make threats, ultimatums Problem solve Professionals Focus on interests Invent options Use objective criteria Separate people from the problem Know each side’s best walkaway alternative Queen's Fall 2012 M. Gauci

Understanding Interests Substantive Interests Psychological Interests Procedural Interests

Principled Negotiator Assumptions: Common interests are valued and sought Interdependence is seen as positive Resources can be expanded through cooperation The goal is a mutually agreeable solution that is fair Negotiation takes place at two levels. At one level, negotiation addresses the substance; at another, it focuses— usually implicitly — on the procedure for dealing with the substance. The first negotiation may concern your salary, the terms of a lease, or a price to be paid. The first point responds to the fact that human beings are not computers. We are creatures of strong emotions who often have radically different perceptions and have difficulty communicating clearly. Emotions typically become entangled with the objective merits of the problem. Taking positions just makes this worse because people's egos become identified with their positions. Hence, before working on the substantive problem, the "people problem" should be disentangled from it and dealt with separately. Figuratively if not literally, the participants should come to see themselves as working side by side, attacking the problem, not each other. Hence the first proposition: Separate the people from the problem. The second point is designed to overcome the drawback of focusing on people's stated positions when the object of a negotiation is to satisfy their underlying interests. A negotiating position often obscures what you really want. The second basic element of the method is: Focus on interests, not positions. The third point responds to the difficulty of designing optimal solutions while under pressure. Trying to decide in the presence of an adversary narrows your vision. You can offset these constraints by setting aside a designated time within which to think up a wide range of possible solutions that advance shared interests and creatively reconcile differing interests. Hence the third basic point: Before trying to reach agreement, invent options for mutual gain. Where interests are directly opposed, a negotiator may be able to obtain a favorable result simply by being stubborn. That method tends to reward inflexibility and produce arbitrary results. However, you can counter such a negotiator by insisting that his single say-so is not enough and that the agreement must reflect some fair standard independent of the naked will of either side. This does not mean insisting that the terms be based on the standard you select, but only that some fair standard such as market value, expert opinion, custom, or law, determine the outcome. By discussing such criteria rather than what the parties are willing or unwilling to do, neither party need give in to the other; both can defer to a fair solution. Hence the fourth basic point: Insist on using objective criteria. The four propositions of principled negotiation are relevant from the time you begin to think about negotiating until the time either an agreement is reached or you decide to break off the effort. That period can be divided into three stages: analysis, planning, and discussion. GIVE EXAMPLE OF BATNA/WATNA using one of the examples given. Queen's Fall 2012 M. Gauci

Negotiation Essentials Prepare your BATNA/WATNA and objective criteria Distinguish between the person and the problem (what are the issues?) Move from positions to interests Develop multiple and creative options Craft a thorough agreement-fair, wise, enduring Queen's Fall 2012 M. Gauci

Separating people from the problem: Human beings first and foremost with: Emotions, deeply held values and beliefs, different backgrounds and viewpoints Make working relationships work by: Building trust, understanding, and respect

Common Interests Queen's Fall 2012 M. Gauci

The Differences Between… Talking about Positions: Fail to listen – restate your position Focus on the past Focus on who to blame, who is right, wrong Identify the other person as part of the problem Go for the win Talking about Interests: Actively listen to the other point of view Focus on the future Identify the problem and discuss what has to be done Tackle the problem together Clarify interests Use creative problem solving and option generation Queen's Fall 2012 M. Gauci

FOCUS ON INTERESTS; NOT POSITIONS The ideal outcome from MY point of view Usually stated as a demand One party is advantaged over the other Position is thrust on the other party with little or no opportunity or desire for understanding Limits options – but very important to hear Positions

FOCUS ON INTERESTS; NOT POSITIONS Closely connected to values and priorities Expressed as underlying wants, needs, fears, etc. Qualities that motivate our position Fundamental reasons behind positions not generally discussed - unless someone asks! Concerns, Hopes, Expectations, Assumptions, Perceptions, Priorities, Values, Impacts, Consequences (CHEAPP VIC) Positions Interests

FOCUS ON INTERESTS; NOT POSITIONS Basic Human Needs*: Have fun, relax, play, be happy, peace Survive: physical, financial, emotional Power: respect, dignity, consultation, Success: competent, capable, recognition, purpose/meaning, important, autonomy Contribute: co-operate, collaborate Belonging: friends, family, workplace, social connection* Positions Interests Needs Physical safety Emotional safety Self-worth Autonomy Freedom Social connection Security (things will be OK) Contribution Important Purpose/meaning Competent Belonging Have fun – be happy Peace *As per Dr. William Glasser 13

Some common interests: To be heard To be consulted To be respected To co-operate, collaborate To be treated fairly, equitably To have stability To trust, be trusted To have flexibility

Queen's Fall 2012 M. Gauci

Stage 1 - Preparation Think through the (potential) difficult conversation Identify the issues you believe need to be resolved What are your interests? Develop your BATNA/WATNA Determine applicable objective criteria What are the interests for the other side? Who (authority), How, Where? Queen's Fall 2012 M. Gauci

BATNA Best Alternative to a Negotiated Agreement: Invent a list of actions you might conceivably take if no agreement is reached. Improve some of the more promising ideas and convert them into practical options Select, tentatively, the one option that seems best (the better your BATNA, the better your negotiating strength is) Queen's Fall 2012 M. Gauci

WATNA Worst Alternative to a Negotiated Agreement WATNA is the worst case scenario against which any proposal should be measured WATNA is used to aid in decision-making when searching for solutions Queen's Fall 2012 M. Gauci

Examples of Fair Standards OBJECTIVE CRITERIA Examples of Fair Standards Examples of Fair Procedures Precedent Scientific judgment Professional standards Efficiency Costs What a court would likely decide Moral standards Equal treatment Tradition Reciprocity Fair standards. You will usually find more than one objective criterion available as a basis for agreement. Suppose, for example, your car is demolished and you file a claim with an insurance company. In your discussion with the adjuster, you might take into account such measures of the car's value as (1) the original cost of the car less depreciation; (2) what the car could have been sold for; (3) the standard "blue book" value for a car of that year and model; (4) 45 what it would cost to replace that car with a comparable one; and (5) what a court might award as the value of the car Coin toss Taking turns Drawing straws, cards etc.

Stage 1 –Set the Stage Some common ground rules: All relevant information will be disclosed All information will be kept confidential Good faith will be demonstrated throughout the process Parties will demonstrate active and respectful listening Parties will use non-judgmental communication (no accusing, blaming, name-calling etc.) Agree on method for breaks and caucus (if necessary to use this) Settlement discussions are on a “without prejudice” basis Queen's Fall 2012 M. Gauci

Stage 2: Stories Each person gives their perspective on: The “what happened” conversation Use “I” messages to remove blame and maximize the opportunity to be heard. Frame in neutral, non-blaming language. Use CHEAPP VIC to frame your interests From this stage will come the identification of issues Queen's Fall 2012 M. Gauci

Stage 2 - Issues Focus on the subject matter of the problem Separating People from the Problem: Focus on the subject matter of the problem Put yourself in their “shoes” to try and understand their perceptions Be empathic and non-judgmental Look for opportunities to act inconsistently with their perception of you Expect to determine differences of opinion/value/expectation, etc. Use neutral framing– don’t make it personal! Queen's Fall 2012 M. Gauci

Stage 3 - Discussion When the parties communicate back and forth, looking toward agreement, the same four elements are the best subjects to discuss: Problems (people & other) can be acknowledged and addressed. Each side comes to understand the interests of the other. Both can then jointly generate options that are mutually advantageous Together they seek agreement on objective standards for resolving opposed interests. ASK: How are you going to start that conversation? (Problem to be solved – underlying issues leading to the problem;

Generating Options Only when interests have been identified, should the search for solutions/options begin. Otherwise, the danger is what you are trying to “fix” may not actually be the problem… Avoid the assumption of the “fixed pie” Reality-check options to ensure they will stand the test of time and wisdom! Queen's Fall 2012 M. Gauci

Fair, wise and enduring Agreements Any resulting agreement should always answer the questions: Who What How When Where, and What if Queen's Fall 2012 M. Gauci

Obstacles Time Environment Expectations of others History Competitive party “Un-enlightened” i.e lack of training Unclear expectations of process and parties Lack of preparation Power imbalances Unaddressed Cultural Differences Queen's Fall 2012 M. Gauci