Advanced Negotiation

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Stages of the Negotiation Process

Negotiation is a process by which two or more people (or groups) resolve an issue or arrive at a better outcome through compromise.

Negotiation is a way to avoid arguing and come to an agreement with which both parties feel satisfied.

Negotiation can be used by a variety of groups in a variety of situations—for instance, between startups looking to merge organizations through business negotiations, or between individuals at a market looking to get the best price on an item.

Negotiations are a great tool for conflict management and conflict resolution—even in your personal life, you may find yourself at work in salary negotiations or sales negotiations.

Prepare To prepare, research both sides of the discussion, identify any possible trade-offs, determine your most-desired and least-desired possible outcomes. Preparation can also include the definition of the ground rules: determining where, when, with whom, and under what time constraints the negotiations will take place.

**Exchange Information ** This is the part of the negotiation when both parties exchange their initial positions. Each side should be allowed to share their underlying interests and concerns uninterrupted, including what they aim to receive at the end of the negotiation and why they feel the way they do.

**Clarify ** During the clarification step, both sides continue the discussion that they began when exchanging information by justifying and bolstering their claims. If one side disagrees with something the other side is saying, they should discuss that disagreement in calm terms to reach a point of understanding.

Bargain and Problem-solve The meat of the process of negotiation, during which both sides begin a give-and-take. After the initial first offer, each negotiating party should propose different counter-offers for the problem, all the while making and managing their concessions. The goal of this step is to emerge with a win-win outcome—a positive course of action.

Conclude and Implement Once an acceptable solution has been agreed upon, both sides should thank each other for the discussion, no matter the outcome of the negotiation; successful negotiations are all about creating and maintaining good long-term relationships. This step often includes a written contract and a follow-up to confirm the implementation is going smoothly.

Sequencing Strategies & Tactics The overall plan for how to approach an issue

Also called Incrementalism, this method is characterized by a purposeful strategy whereby the mediator attempts to move the parties from simpler to more complex issues (as defined by the parties)

The logic behind the approach is that trust is low and so the parties need to take small steps to create initial trust and/or foster a positive atmosphere such that subsequent vital issues may be broached.

Gradualism is the **most logical and the most practical **of all the sequencing strategies as it is inherently cautious, which may impart a **sense of ease **among the disputing parties.

However this approach is susceptible to manipulation by the more powerful party, as it can control the process more easily. It also requires patience and ignores the fact that the populaces want tangible change quickly.

Boulder in the Road is the opposite of Gradualism and an approach that proposes to address the more complex issues first, thereby moving the "boulder" or greatest obstacle, which enables an easier resolution of the remaining issues.

Instead of employing either an easy-to-hard or hard-to-easy sequence, negotiators/mediators take the hard issues that the different parties highlight and divide the parties into committees to deal with each issue.

The committee's work simultaneously on specific issues in smaller groups, and then their resolutions are presented to the larger group.

This approach follows the mantra of "nothing is agreed until everything is agreed" and is therefore independent yet flexible.

Its ability to separate complicated issues, addressing them in an isolated manner -- so other smaller issues cannot muddy the process of resolving the more contentious issues.

In this approach, the negotiators are not part of the different smaller committee discussions and, as a result, they lack an understanding of how specific agreements were arrived at and decided upon.

Dealmaking & Implementation

Dealmaking is defined as the art of crafting deals through negotiations focused on an integrative, or value-creating process, rather than through distributive bargaining, or a haggling process.

Dealmaking includes the range of activities both at the bargaining table and away from it that seek to bring two or more parties together toward some common end, whether it is the sale of an asset, a vendor agreement, or a merger between corporations.

Effective dealmaking can help you build a foundation of trust and cooperation—and avoid conflict and chaos—in negotiations

While speedy dealmaking may seem efficient, remember that any time saved during contract negotiation may be more than offset by the time you’ll spend renegotiating the deal.

Alternatively, when negotiators engage in thoughtful deal design, they position themselves to capitalize on the upsides of negotiations and minimize the potential costs.

Dealmaking Tips for a Successful Negotiation Imagine the range of possible future scenarios. Prevent future disappointment by limiting the time frame of agreements. Be ready with enticements. Although business negotiators typically benefit from a more methodical pace, there may be times when you might choose to set the stage for a quick yes from your counterpart. Listen to learn. Don’t overlook the value of using a “soft” approach to build rapport and uncovered key interests. Look for linkages. When engaged in multiple negotiations, we tend to concentrate on those that are most financially lucrative and pay less attention to those that don’t seem as critical. Find opportunities to do good. In negotiation, when we seize on opportunities to help those less fortunate, we enrich them and the deal

Implementation is the process of putting a negotiated agreement into action

The real challenge lies not in hammering out little victories on the way to signing on the dotted line but in designing a deal that works in practice.

An implementation mindset is especially useful in identifying the parties' often unrecognized and unexpressed expectations

Negotiating a contract with implementation in mind prevents a deal that cannot work in practice because of terms that are not sustainable for either party.

Building Coalitions

A coalition is a temporary alliance or partnering of groups in order to achieve a common purpose or to engage in joint activity.

Coalition building is the process by which parties (individuals, organizations, or nations) come together to form a coalition.

Forming coalitions with other groups of similar values, interests, and goals allows members to combine their resources and become more powerful than when they each acted alone.

A relatively common practice utilized in multi-party negotiations, used to gain advantage in the negotiation

Coalitions are more common when negotiators stand to **gain more **through collaboration than through competing.

Benefits of Coalition Building A coalition of organizations can win on more fronts than a single organization working alone and increase the potential for success. A coalition can bring more expertise and resources to bear on complex issues, where the resources of any one organization may not be sufficient Involvement in a coalition means there are more people who have a better understanding of the issues A coalition, by virtue of the contacts and exchanges of information and other contacts, avoids duplication of efforts and improves exchanges and shared learning among key players A coalition can build a lasting base for change as it becomes more difficult for opposition groups to disregard the coalition's efforts as dismissible or as special interests;

Coalition building is the "primary mechanism through which disempowered parties can develop their power base and thereby better defend their interests". Through coalitions, weaker parties to a conflict can increase their power.

The formation of a coalition can shift the balance of power in a conflict situation and alter the future course of the conflict. People who **pool their resources and work together **are generally more powerful and more able to advance their interests, than those who do not.

Through the coalition, members may be able to resist certain threats or even begin to make counter threats.

Generally, low-power groups are much more successful in defending their interests against the dominant group if they work together as a coalition. This is certainly more effective than fighting among themselves and/or fighting the dominant group alone.

Information Sharing at the Bargaining Table

The prospect of sharing information at the bargaining table can be intimidating, it can either fix your counterpart into a position you didn’t intend or bring you to an advantage.

One of the advantages of sharing information during negotiation is that your counterpart will likely match any information you share with valuable information of their own thanks to the power of reciprocity.

The different types of information exist in any negotiation and the** importance of this data may fluctuate** as the process unfolds. A wise negotiator must pause to consider the possible benefits and costs of revealing or concealing such information.

Remember, before any negotiation begins,** list the information you need** to resolve your dispute or to build a strong deal and anticipate any information the other side will want from you, and consider how you’ll respond to these queries.

Anchoring is a well-known cognitive bias in negotiation. It is described as the common tendency to give too much weight to the first number put forth in a discussion and then inadequately adjust from that starting point or the “anchor.”

Research on the anchoring bias has shown that negotiators may be able to gain an edge by making the first offer and anchoring the discussion in their favor.

Letting your counterpart know your bottom-line, highest price, or** lowest acceptable offer**, is an example of the anchoring effect in negotiation and demonstrates the powerful effect of information on bargaining strategy.

If your counterpart drops the first anchor then the first and perhaps most important step is to recognize the move and defuse it. If you don’t defuse the anchor first, you are suggesting that their anchor is well within the bargaining zone.