Download - Negotiation and Conflict Resolution - MaRS Best Practices

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Negotiation and Conflict Resolution

MaRS Discovery District Best Practices Series December 8, 2011

Presentation by

Michael Erdle, Co-Founder Practical Resolutions Inc.

Introduction

Introduction

v Negotiation

v Conflict Resolution

What is Negotiation?

v Negotiation is: v  a process.

v  a structured conversation.

v  a means to an end (agreement about something).

v We do it all the time, without really thinking about it.

Basis for Negotiation

v Power

v Rights

v Interests

Escalation

Power

Power Strategies: •  Take action unilaterally. •  Win at all costs •  Attack/Defend •  Threaten •  Coerce •  Withdraw (Take the Ball and Go

Home) •  Physical (or verbal) violence

Characteristics of Power: •  Adversarial •  “Win/Lose” at best •  Usually “Lose/Lose” •  Extremely expensive •  Negative impact on future

relationships

Rights

Rights Strategies: •  Contracts (guarantee the

minimum) •  Policies, procedures, rules •  Precedent •  Past practice •  Legal action •  Third-party decisions

(e.g. arbitration)

Characteristics of Rights: •  Adversarial •  “Win/Lose” at best •  Often “Lose/Lose” •  Extremely expensive •  Time-consuming •  Impact on future relationships?

Interests

Interests Strategies: •  Identify what’s really important •  Dialogue about needs and wants •  Honest sharing of information •  Maximize results for all parties •  Help everyone explore and

understand their own interests, and interests of other parties

•  Needs an ongoing relationship

Characteristics of Interests: •  “Win/win” process •  Collaborative •  Interdependent •  Builds trust •  Positive impact on future

relationship

Costs Go Up

Control Goes Up

Litigation

Arbitration Investigation/Fact Finding

Conciliation Mediation

Negotiation Problem Solving

Prevention

All out “War” Unilateral Action

Threats, Coercion Power

Rights

Interests

Power, Rights, Interests

The “Golden Rule”

De-escalation

Duty to Negotiate in Good Faith

v Obligation to respect the legitimate interests of other party and to deal promptly, honestly, fairly and reasonably with them. v  Shelanu Inc. v. Print Three Franchising Corp. (Ontario Court of

Appeal)

v  Implied in negotiation where there is an imbalance. v  Wallace v. Grain Growers (Supreme Court of Canada)


Spectrum of contractual duties

Selfish Selfless

Unconscionability ! Good Faith Fiduciary Duty �


v  Fiduciary: v  Trustee v  Corporate Director v  Lawyer

v  Good Faith: v  Professional Code of Ethics v  Contract v  Employee/Employer

Negotiation Steps

v Distributing Value vs. Creating Value v  Opportunistic v  Problem-solving

v  Identify Issues v  What does each side want and need?

v Consider Interests v  Common v  Complementary v  Conflicting

Effective Negotiation

v  Interests vs. Positions

v  “Needs” vs. “wants”

v  “Separate the People from the Problem.”

v  Soft on the person

v  Hard on the problem

v Consider other Options


v  Seek Objective Alternatives

v Determine BATNA and WATNA

v  Best Alternative to Negotiated Agreement

v  Worst Alternative to Negotiated Agreement

v  Look for a “win-win” solution.


v  Successful relationships are built on communication and trust.

v  Lack of trust leads to “win-lose” or “lose-lose”.

v Negotiation is one way of creating trust – or deciding whether trust is justified.

The Prisoner’s Dilemma

Scenario:

v Adam and Bob arrested near the scene of a robbery.

v Victim, badly injured, says one person hit him but can’t say who.

v  Both are carrying stolen property; no weapon.

v Questioned separately by the police.

v Enough evidence to convict both of theft, but not to convict either one of assault.

v Each prisoner must choose whether to confess and implicate the other.


v  Simple problem: confess or don't confess. v  If neither one confesses, both will serve

one year (possession of stolen property). v  If each confesses and implicates the

other, both will go to prison for 10 years. v  If one confesses and the other doesn’t, the

collaborator will go free, and the other will go to prison for 20 years.

Prisoner’s Dilemma

Adam

confess silent

Bob confess 10 10 0 20 silent 20 0 1 1



v  Lack of trust is fatal – neither can trust the other to remain silent.

v  So the only rational action is to confess.

v  That produces the best result no matter what the other person does.

v  Other is silent – you go free

v  Other confesses – both go to jail.

Multiple Negotiations

v  Selfish strategy works in a “winner take all” game.

v  Life is rarely like that.

v Most negotiations are based on a continuing relationship.

v What happens if there’s a series of negotiations?


Payoff Matrix

Player 2 cooperates

Player 2 retaliates

Player 1 cooperates 3, 3 0, 5

Player 1 retaliates 5, 0 -2, -2


v  “Tit-for-Tat” strategy is most successful.

v  Four key conditions:

v Nice

v Retaliate

v Forgiving

v Generous


1.  The player always cooperates, unless provoked.

2.  The player always retaliates, if provoked.

3.  The player is quick to forgive –co-operate next time.

4.  The game must continue long enough for the ‘retaliation and forgiveness’ pattern to affect opponent’s behaviour.

Power Ploys

v Classic “Hard Bargaining” Ploys v Extreme claims, small concessions

v  “Take or leave it.”

v Unreciprocated offers

v Threats and warnings

v Attacking the alternatives v Good cop, bad cop

Ways to Respond

v Extreme claims, small concessions v Tit for Tat – make equally small concessions.

v  “Take or leave it.”

v Make a counter offer.

v Offer an alternative. v Don’t be afraid to walk away.

Ways to Respond

v Unreciprocated offers v Don’t negotiate against yourself.

v Wait for a serious counter offer.

v  Threats and warnings

v Don’t make a counter-treat. v Challenge the underlying assumptions .

Ways to Respond

v Attacking the alternatives v Ask for an explanation.

v  “Why do you have a problem with…?”

v Good cop, bad cop

v Negotiate with the boss. v Use the “good cop” to your advantage.

Understanding Interests

Common Interests

v  Parties want the same things.

v E.g. company and workers both want to avoid strikes and workplace grievances (costs them both money).


Complementary Interests

v  Parties want different things, but they don’t conflict.

v E.g. company wants to increase productivity & profits; workers want better pensions.


Conflicting Interests

v  Parties want different and incompatible things.

v E.g. company wants to reduce labour costs; workers want to be paid more.

Triangle of Satisfied Interests

EMOTION (Psychological)

Three Types of Interests:!!Results (Substantive Interests): This is the “what”. Getting to a deal is the result or substantive interest.!!Process (Procedural Interests): This is the “how”. The process -- how long it takes, how fair it is – are process, or procedural interests.!!Emotion (Psychological Interests): This is the “why”. Wanting to “win”, to save face, gain respect, are psychological interests.!!

Note: Triangle adapted with permission from CDR Associates, Boulder, Colorado


Negotiation Styles

v Assertiveness vs. Empathy

v  Three common negotiation styles

v Competitive

v Accommodating

v Avoidance

v Effective negotiator is assertive and empathetic.

Negotiation Skills

v Communication is the key to effective negotiation.

v What you say is often less important than how you say it.

v Tone

v Body language

Negotiation Skills

v Understanding and recognition do not mean compromise and concession.

v  “I understand” vs. “I agree”.

v Your own emotions and subconscious brain can hinder your ability to negotiate effectively.

Negotiation Skills

v  Listening v Develop “active listening”.

v Understanding v Acknowledge the other person’s perspective.

v  Flexibility v Be open to other options.

v  Pragmatism v Accept the best available option.

Conflict Management

Mediation v Mediation is a form of facilitated negotiation.

v  The Mediator guides the process and helps the parties negotiate more effectively.

v  The Mediator does not decide who is right or wrong.

Mediation

v  Interest-based Mediation v Mediator is a facilitator. v Focus on interests, not legal rights or obligations. v Options for creative solutions.

v Evaluative Mediation v Neutral evaluation. v Based on legal rights & obligations.

Mediation

v Qualities of an effective mediator: v  Subject area knowledge

v Negotiation & mediation process skills

v Lets parties make key decisions

v Creative approach to the problem

v Patience

Resources

v  Cohen: You Can Negotiate Anything, Bantam, 1980

v  Fischer, Ury and Patton: Getting to Yes, Penguin, 1991

v  Ury: Getting Past No, Bantam, 1993

v  Mnookin, Peppet and Tulumello: Beyond Winning, Harvard University Press, 2000

v  ADR Institute of Ontario (ADRIO) http://www.adrontario.ca/

Questions?

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