NEGOTIATING AN AGREEMENT

1
NEGOTIATING AN AGREEMENT

• Tony Faford, CLS
• President
• Specialty Retail Consultants
• Coleen McNelis
• Vice-President Lease Management
• Macerich Company

2

• Getting to Yes

3
Wise Agreement

• Meets legitimate interests of each side
• Resolves conflicting interests fairly
• Is durable
• Takes community interests into account

4
Positional Bargaining

• Arguing over positions produces unwise agreements
• Arguing over positions is inefficient
• Arguing over positions endangers ongoing
  relationships

5
Soft vs Hard Style

• Participants are friends
• Goal is agreement
• Make concessions to cultivate relationship
• Soft of people and problem
• Trust others
• Change your position easily
• Make offers

• Participants are adversaries
• Goal is victory
• Demand concessions as condition of relationship
• Hard on people and problem
• Distrust others
• Dig in to your position
• Make threats

6
Soft vs. Hard style

• Mislead as to you bottom line
• Demand one-sided gains
• Search for single answer you will accept
• Insist on your position
• Try to win contest of will
• Apply pressure

• Disclose your bottom line
• Accept one-sided losses
• Insist on agreement
• Avoid contest of will
• Yield to pressure

7
Principled Negotiation

• Separate people from the problem
• Focus on interests not positions
• Invent options for mutual gain
• Insist on using objective criteria

8
Stages of Principled Negotiation

• Analysis
• Planning
• Discussion

9
Separate People from Problem

• Negotiators are people first
• Negotiator interested in
• Relationship
• Substance
• Positions become entangled with the relationship

10
Solving People Problems

• Perceptions
• Conflict exists in peoples heads
• Put yourself in their shoes
• Page 24 example, Getting To Yes
• Dont deduce intentions from your fears
• Page 25 example, Getting To Yes
• Dont blame them for your problem
• Discuss each others perceptions
• Act inconsistently with their perceptions
• Give them a stake in the outcome
• Face-saving

11
Solving People Problems

• Emotions
• Recognize your and their emotions
• Write down emotions and what you wish they were
• Make emotions explicit/acknowledge as legitimate
• Allow other side to let off steam
• Dont react to emotional outbursts
• Use symbolic gestures

12
Solving People Problems

• 3 Problems in Communication
• Parties are not talking to each other
• Not hearing the other side
• Misunderstanding
• Solutions to Problems
• Speak to be understood
• Speak about yourself, not them
• Speak for a purpose

13
Solving People Problems

• Prevention works best
• Build a working relationship
• Arrive early, stick around afterwards
• Try to get to know other party
• Face the problem, not the people

14
Focus on Interests, Not Problems

• Two men arguing over an open window in the public
  library
• I want fresh air
• I dont want a draft
• Solution - Open window in adjoining room

15
Focus on Interests, Not Problems

• Interests define the problem
• Needs
• Desires
• Concerns
• Fears
• Interests are the silent movers behind positions.

16
Why Does Reconciling Interests Resolve Conflicts?

• For every interest, there likely exists several
  possibilities to meet the interest
• For every opposed position, there likely are many
  more interests than just the conflicting interests

17
Example You rent a house

• What are you interests?
• What are the landlords interests?
• Is there common ground?

18
How do you identify interests?

• Ask Why?
• Ask yourself that question
• Perhaps ask the other side
• Ask Why Not?
• What is the other side expecting me to ask?
• Why wont they give me what I want?

19
How do you identify interests?

• Realize each side has multiple interests
• The most powerful interests are basic human
  interests
• Peace/well-being/safety
• Security
• Recognition
• Economic well-being

20
How do you identify interests?

• Make a list
• You may re-write your description of various
  interests as you learn more about them
• Order them by importance, and be flexible to
  re-order them as you learn more about them

21
How do you identify interests?

• Acknowledge their interests
• This gives opening to ask about other possible
  interests
• Put the problem before your answer
• Construction company example.
• Your interests first/conclusions last

22
How do you identify interests?

• Look forward, not back
• Rather than ask about what happened yesterday,
  ask, Who should do what tomorrow?
• Be concrete, but flexible - illustrative
  flexibility
• Be hard on the problem, soft on people
• Support Attack - cognitive dissonance. Support
  people equal to attacking problem

23
Invent Options for Mutual Gain

• Expand the pie - create new options

24
Obstacles that inhibit creating options

• Premature Judgment
• Searching for the single answer
• Assuming there is a fixed pie., Viewed as fixed
  or zero-sum game
• Thinking solving their problem is their problem

25
Prescription for inventing options

• Separate inventing from deciding
• Brainstorming session with friends
• Dont criticize
• Dont evaluate
• Find most promising solutions
• Improve on other good ideas
• Finalize list and evaluate
• Consider brainstorming with other side

26
Circle Chart
27
Look for Mutual Gain

• Not a fixed pie of solutions
• Identify shared interests
• Latent in every negotiation
• Opportunities/not godsends
• Stressing interests makes negotiations smoother
• Dovetailing differing interests
• Ask for their preferences
• Low cost to me - high cost to them

28
Make their decision an easy one

• Whose shoes - who do you want to influence
• What decision- give them an answer rather than a
  problem
• Threats are not enough
• Understand how they will perceive the solution
  you suggest. Put yourself in their shoes

29
Insist on Using Objective Criteria

• Fair Standards
• Fair Procedures -
• dividing a piece of cake
• Flipping a coin
• Drawing lots
• Third party chooses
• Last best offer arbitration

30
Insist on Objective Criteria

• Make it a joint search for criteria
• Begin negotiations by agreeing on standard to be
  applied
• Never yield to pressure

31
BATNA

• Best Alternative to a Negotiated Agreement
• Not a bottom line - too inflexible
• Plan ahead for BATNA
• Use a trip-wire
• A BATNA is to help you avoid making a mistake

Ideas for this presentation taken from Roger
Fisher and William Ury Getting to Yes Published
1981