Negotiation Rules from Harvard Business School

If you’re not already acquainted with Harvard Business School’s free weekly “Working Knowledge” newsletter, do let me introduce you here.  There’s no better negotiation advice on the internet and when it’s all too much reading, skim the concise “Executive Summaries” or, what the heck, check here from time to time and I’ll alert you to the most interesting articles posted there.

This week, Harvard professors John Davis and Deepak Malhotra give us Five Steps to Better Family Negotiations which, I must say, applies to every settlement negotiation that I help facilitate.

My own “executive summary” with excerpts below.

1. Analyze the negotiation space:  this is a fancy way of saying identify all parties who have an interest in the matter being negotiated.  This seems obvious until you sit down with pen and paper (or keyboard and screen) and diagram not just the decision makers but also those, for instance, who will be called upon to put the terms of the agreement into action.  As Davis and Malhotra advise

 many of the parties affected by a negotiation, or able to affect it, will be around for a long time. It is dangerous to negotiate only considering the interests of those at the bargaining table when those who are not at the table will be affected by what is negotiated and can assert their rights or power in the future.

This doesn’t mean that you should bring all of these people to the table, but that you are far more likely to achieve a durable settlement agreement if everyone’s interests have been vetted prior to sending company representatives to the bargaining table.

2. Don’t try to beat the other side

As Davis and Malhotra note, “most successful negotiations entail the possibility of mutual value creation, compatible if not aligned interests, and cooperation.”  Although this advice also helps insure that an agreement will be durable, it also fosters an atmosphere in which the greatest degree of innovative “value creating”  problem solving can take place.

3. Understand the other party’s interests, constraints, and perspective

If you think this applies only to family business negotiations, think again.  Robert McNamara (defense secretary under Kennedy and Johnson) lists “empathize with the enemy” as his first rule of war.  (for the illustrative story, follow this link and click on 1962, where you’ll hear McNamara discuss (or where you can read a description of)  the negotiations that averted nuclear war with the Soviets during the Cuban Missle Crisis).

Close to home, Davis and Malhotra advise:

[T]o get what you want in negotiation, you often need to understand the other side’s needs and interests so that you can “give a little to get a little (or a lot).” Even if the other side is entirely willing to help and is ready to give you what you want, it may be critical that you understand the constraints that he or she faces in meeting your demands. In other words, effective negotiation requires that you understand the other side’s interests and constraints, and that the other party understands your interests and constraints.

4. Avoid single-issue negotiations: identify and negotiate multiple issues simultaneously

Davis and Malhotra again:

Negotiators who negotiate multiple issues simultaneously are more easily able to recognize value-creating tradeoffs. . . . While any multi-issue negotiation is going to be complicated, the likely outcome is considerably worsened when negotiators become overly focused on a single issue or dimension. The far superior approach is for all parties involved to work together to identify all of the issues that are relevant in the current negotiation, and then identify which issues are most important to each person (and which issues each person can concede on).

5. Negotiate over interests, not positions

As Davis and Malhotra note, while the negotiating parties’ positions may be irreconcialble and non-negotiable, often their interests can be satisfied without requiring them to compromise their positions.  For a lengthier discussion of interest-based bargaining, click here.

                       

Victoria Pynchon

Attorney-mediator Victoria Pynchon is a panelist with ADR Services, Inc. Ms. Pynchon was awarded her LL.M Degree in Dispute Resolution from the Straus Institute in May of 2006, after 25 years of complex commercial litigation practice, with sub-specialties in intellectual property, securities fraud, antitrust, insurance coverage, consumer class actions and all… MORE >