'Tis the Season...to practice, refine and hone our negotiation skills

Introduction
With the Holidays fast approaching, festive dinners and family reunions are very much on our minds. The merry partying however is often accompanied by a degree of pressure, due in part, to the potentially volatile human dynamics and family interactions. With the very different personalities and vastly different opinions and beliefs, we wonder with dread, whether Uncle Jack will opine about his strong political views or if Aunt Mavis might start to pontificate about her religious dogma. These sorts of differences and dynamics mean that family gatherings can quickly become the perfect storm for clashes, conflicts and flare-ups.

However, with the danger also comes great opportunity! An opportunity, to practice and refine our skills so as to manage these potentially volatile conversations and emotionally charged situations effectively, constructively, with grace and with poise, rather than to flee from them.

Below are some strategies to help guide you.

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BREXIT: Navigating Highly Complex Negotiations

Introduction
Our work as negotiation consultants involves not only the negotiation process itself, but we are often required to design an overall negotiation structure with which to facilitate productive negotiations. This is particularly true of highly complex negotiations where multiple interest groups must be engaged, and many complex issues need to be resolved. Examples might be land usage and environmental negotiations, policy and regulation negotiations, and peace negotiations in conflict-infested regions.

In these kinds of negotiations, success is largely contingent upon how the negotiating structure is setup: who will be represented and who will represent; how will discussions and dialogue be managed; how will information be shared; what should the sequence of the issues be; how will decisions be made and ratified, and so on.

The design of the negotiation structure is, in itself, a complex negotiation which needs to precede the later substantive negotiations so as to increase the chance of overall success.

Perhaps the paradigm of extremely complex negotiations today is the Brexit negotiations – the “divorce” and untangling between England and the European Union. There are many stakeholders both in Europe and the United Kingdom, with a plethora of very complicated issues that need to be resolved in a way that all parties can live with. Issues include the looming questions of: trade; migration; Britain meeting her financial commitments to the EU budget; rights of citizens and workers; the border within Ireland (between the Republic of Ireland which will remain in the EU and Northern Ireland which will leave the bloc as part of the UK). These together with many other thorny issues will need to be negotiated.

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NAFTA Negotiations: Framing the Problem Constructively

Introduction
Consider a negotiation where a land developer is negotiating with a building contractor to build a development of townhouses to rent or sell. Negotiations are going well until the developer demands a clause for an enormous liquidated damages penalty if the project is not completed on schedule. The contractor now feels exploited and pushed towards what he perceives to be an unfair and unbalanced contract. The developer is adamant that because of previous experiences with contractors and losses he has suffered due to delays, he will not agree to a contract without a heavy liquidated damages clause.

The contractor will likely see his current problem in the negotiation to be how to eliminate the liquidated damages clause, while the developer sees his problem as how to convince the contractor to accept an unreasonable liquidated damages clause.

Typically, as in this example, there is no joint, intersecting definition of the problem to be solved, but rather parallel and polarized definitions as each sees his problem from his particular perspective. Furthermore, both contractor and developer in this case, have framed their respective problems in very narrow, limited and zero-sum-like contexts which often leads to sub-optimal outcomes at best and impasse at worst.

How we frame and define the negotiation problem that needs to be solved if parties are going to agree, can frequently make the difference between agreement and impasse.

NAFTA - A Live Case Study
This week, the NAFTA (North American Free Trade Agreement) renegotiation is entering its fourth round of talks in Washington D.C.

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NORTH KOREA AND NEGOTIATION: Have Diplomatic Efforts Been Exhausted

Introduction
As North Korea threatens the United States and the world, the National Security Council of the UN considers options available that might deter them. There are two options currently being debated, a military option or economic sanctions.

The military option is problematic, because it would likely result in horrific loss of life in South Korea, the very partner we have pledged to protect by way of treaty. Furthermore, if just one North Korean nuclear weapon survives in such an attack, the results could be devastating.

The sanctions option comes with its own challenges. To stand any chance of success, it would require a reluctant China to stop all trade with North Korea. Additionally, we have no precedent to date where sanctions delivered a decisive blow to cause a swift lifting of hands in surrender. The time that it will take for sanctions to take meaningful effect will be too long, by which time time North Korea will have already developed a nuclear capability to hit the US mainland. Furthermore, Putin, who understands the North Korean mentality better than we in the West do, has stated categorically that they would “prefer to eat grass, rather than to give up their nuclear program” – an opinion we should consider seriously.

This leaves us with the nagging question: Has diplomacy been exhausted?

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NEGOTIATING NEW CLIENT RELATIONSHIPS (or the "Differentiation Dilemma")

As service providers or in any sales, one of the more intimidating, but inescapable aspects of the business, is meeting with prospective clients and trying to obtain new accounts. We are not taught how to do this effectively in school, nor do we deliberately go out and seek training or coaching to improve our skills (although that would be money well invested). We attempt an ad-hoc approach without a road map and process, which results in unpredictable and hit-or-miss outcomes.

One of the more threatening situations that we often encounter, is what I call the "differentiation dilemma". In this column, I will equip you with an approach and process to respond to this potentially perilous encounter with a greater rate of success.

While attempting to win over a new client, we may think that we are impressing them with our professional knowledge and acumen. All seems to be perfectly aligned as we begin to feel quite proud of our salesmanship and performance.

However, that euphoric feeling can be rather abruptly shattered when the prospective client says: "So, tell me, why I should hire or buy from you over the other hundred providers/suppliers who called my office last week?"

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DEALING WITH DISHONESTY

When confronted with apparent dishonesty, we feel betrayed, angry, anxious and disappointed. We are also confused as to whether we should confront it or ignore it, or how to confront it if we need to. If we ignore it, we are at risk of allowing it to continue, and if we confront it we risk the relationship - hence the conundrum or the "Dishonesty Dilemma".

A dilemma by definition does not allow for elimination of risks and dangers, and the best we can do is to mitigate the risks while curtailing potential damage and harm.

Although there is not one answer for all situations, in this column we offer guidelines to apply and a thought process to work through to ensure an effective and constructive response.

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CONSULT BEFORE DECIDING TO MAINTAIN TRUST AND CREDIBILITY

With our allies today feeling less sure of our support, U.S. foreign policy is faced with a credibility issue among our alliance partners. Other countries may be less inclined to trust our promises, commitments and pledges and therefore less likely to enter into trade agreements, nuclear anti-proliferation deals and defense treaties with us.

I was recently watching a rerun of Firing Line from circa 1970 in which William F. Buckley Jr. was debating (a very young) John Kerry as to whether or not the U.S. should cut their losses and pull out of Vietnam unconditionally.

Buckley argued that if the United States were to proceed along that course of action, it would send a negative message to our SEATO (South East Asian Treaty Organization) partners that we cannot be relied upon and trusted. Kerry argued (not very compellingly in the opinion of this author) that although the negative message issue was a general concern, it did not apply in the case of Vietnam.

In listening to the debate, I found it astonishing that both Buckley and Kerry failed to suggest the obvious solution to this dilemma. Let us consult with our SEATO partners (or at the least inform them), before making the decision. Consultation means that I inform my relationship partners about decisions that may affect them, that I solicit their thoughts and concerns and listen to them.

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HOW TO TAKE THE NEGATIVITY OUT OF A "NO"

It is possible that after a good-faith attempt to engage another party in negotiation and problem solving, no progress is made. They may be insistent and demanding or unreasonable and uncompromising. They may just be unwilling to work jointly towards a solution or trying selfishly to impose their demands. In this situation, many of us avoid saying "no" even though we should. We become anxious about how the other may take it, and the defensiveness and anger that it may arouse. We may deal with this by avoiding the issue altogether and leaving the other party confused about where we stand. Or, even worse, we may say "yes" when what we really mean is "no".

Never concede to anything which is unacceptable just because of a fear of being assertive and saying "no". John F. Kennedy's famous statement: "Don't fear to negotiate but don't negotiate out of fear" is a good rule to remember in this situation.

Knowing how to say "no" constructively and positively is a skill that we all need in order to manage our relationships with authenticity and effectiveness. In this column, we provide a three-step formula for saying no while taking the negativity out of the "no!" and without even uttering the word.

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ON MAKING THE FIRST OFFER

THE CHALLENGE
A strategic question that is often asked when it comes to negotiation is: should you make the first offer or wait for the other party to put their offer on the table first?

I have heard different opinions from various negotiation theorists. There are those who suggest that it is better to wait for the other party to put forward their offer first. This, they argue, will give you a sense of where the lower end of their zone of possible agreement may lie and from which you can then work upwards if you are selling, (and the reverse if you are buying).

These theorists also suggest that the "appropriate" response to their offer should be an obvious and highly exaggerated flinch, thereby clearly indicating how "crazy" they are for even considering such an "unreasonable" offer. The hope is that the all-powerful flinch will immediately shift them away from their initial position and closer to where you want to them to be.

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NEGOTIATING WITH PURPOSE

On occasion, as part of a client engagement, we might do an "audit" where we will observe our clients as they conduct a live negotiation. During these sessions, we are always struck by the same thing. This "thing" grates on our ears like a beautiful piece of opera sung atrociously off key. It assaults our senses mercilessly. It turns an elegant waltz into a grotesque and awkward stomp. What is this "thing" you ask? It is excessive, relentless, redundant, purposeless and aimless talking.

Often, negotiators perceive the negotiation process as being to persistently assert their demands, declare their positions and impose their proposals without any consideration of the other side's concerns or needs. They think that the more insistent they become the better negotiators they are. They believe that the only way to "win" is to continuously and repetitively state their positions without allowing their opponent to get a word in edge-wise. Oddly, they don't seem to realize that they are engaged in a terribly inefficient and unproductive process at best and a downright destructive one at worst.

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THE (real) ART OF THE DEAL Negotiating Agreements for the Long Term

Patrick Nelson had just started a new business and needed an investor. His father-in-law agreed to invest $500,000 in exchange for a 10 percent share in the venture. He also demanded that Patrick appoints his son, Kevin, (Patrick's brother-in-law) to the position of vice president and that he makes him a minority shareholder. Patrick optimistically accepted these terms.

A few months later, Kevin relocated to another state to be closer to a new potentially large client. Communication between Patrick and Kevin became less frequent, and within a year their relationship started to deteriorate. They were in disagreement about the decision-making processes and about each one's authority within the company. To make matters worse, Patrick's wife (Kevin's sister) had filed for a divorce. Patrick eventually saw no option but to fire Kevin. This resulted in Kevin and his father suing Patrick for a cash settlement equal to their equity shares in the business and for wrongful termination. What started out as an ideal arrangement ended as a nightmare!

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GOOD PERSONAL RELATIONSHIPS - A HELP OR HINDRANCE IN NEGOTIATIONS

In a recent article in Foreign Policy Magazine titled: "How Trump can play nice with Russia without selling out America" (January 6th 2017), Michael McFaul, the U.S. Ambassador to the Russian Federation (2012-2014) expresses concern over President-elect Trump's desire to foster better relations with Putin. He writes "Better relations should never be the goal of U.S. foreign policy toward Russia or any country in the world. Diplomacy is not a popularity contest".

McFaul's perspective appears to be that better relations could negatively impact negotiations and the protecting of our interests. He seems to think that with better relationships, we are more likely to make deeper concessions in order to maintain the relationship. His perspective makes sense if we see negotiation as an adversarial face-to-face confrontation, haggling over who will extract greater concessions from the other.

And therein lies the problem!

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