Maintain Credibility.

         Nothing can destroy trust and good will like the discovery that one has been lying or that one is operating with less than candor.  Counterparties will clam up and be more inclined to resort to competitive approaches in self-defense if they perceive a negotiator to be dishonest or insincere.  Crafty conduct can not only hurt one in the instant negotiation but also can wreak havoc on one’s reputation in the long run.

         Assess Commitment Levels & Risk Tolerance.

         A classic image is the game of chicken.  Imagine teenagers racing at each other in hot rods in some LA viaduct.  Who will swerve out of the way?  If I were driving, I know the answer.  I tend to be highly risk averse.  It is fascinating to watch commitment levels at play in negotiations.  There is great strength in posing a credible threat.  To the extent one is able to gage the counterparty’s commitment to a certain course of action or deal element, one will understand whether a concession need be made.  The capacity to understand the nature of one’s own and the other’s level of commitment, and also tendency to avoid risk in general and on the particular point at issue comes not only from understanding the person, but also from understanding their context.  What happens to them if they give on a particular point?  What interest is affected?  What in the larger picture do they win or lose?  This analysis should be applied for understanding of both self and others.

         Nosce Mundus (Know the World)

         None of us lives in isolation.  As indicated above, to understand ourselves, we must understand our context.  This is true for understanding the other as well.  An effective negotiator is sensitive to the context in which every party is suspended, recognizing the impact of context and using it as a strength.

         Behold the Business Context.

         Litigators in particular can be reminded to think beyond the case.  Why did this case originate?  What is driving the parties?

         If one is negotiating a real estate deal, it certainly pays to understand the current real estate market, and even the broader economic climate as that affects property and resale values, demand for space, capacity to build, the ability to obtain loans, interest rates, and related issues. 

         More specifically, knowing a market enables the negotiator to arrive at more compelling standards for use when setting values.  The uses of mutually acceptable standards is routinely recommended by proponents of principled negotiation.  Once recognized, they give direction to a negotiation and support fair and doable deals.

         Heed the Hierarchy.

         Wayne Outten, when thinking about strategies for negotiating on behalf of employees, considers where those employees stand within the framework of their employer.  Do they have political allies, “Rabbis,” people willing to go to bat for them?  Do they have “political capital,” credibility with certain supervisors or others in management?  Have they earned loyalty; would harm to the employee engender a sense of guilt?

         Conversely, knowing where the opposing negotiator fits can be helpful.  Is he or she trying to cover for their own mistake?  Is he responsible for the P&L that is affected by this deal or litigation?  Who in the chain of authority must be brought in to achieve closure?  Is the negotiator at a level where he or she is trying to impress a superior, or trying to prove a point to a subordinate? 
        
         Assess Alternatives.

         Any post-modern piece sketching the contours of the Leviathan of Negotiation would have a gaping hole larger than that great beast’s blowhole if it omitted mention of the BATNA coined and popularized by Fisher and Ury.  BATNA – the best alternative to a negotiated agreement – as well as its variants, all other alternatives, good, bad and ugly, can be used by negotiators to test whether a deal on the table is worth taking.  If the likely, tangible alternative to that deal is superior, the rational negotiator keeps bargaining for something better or walks away.

         The simplest example is of a currently employed party testing a proposal from a prospective new employer.  If the job offer is for lower pay, at a shakier institution, doing less exciting work, with worse prospects for advancement, in a less convenient location, with nastier colleagues, and a less impressive title than one’s current employer, no rational worker will take that bait.  When these and other similar factors begin to equal and exceed the appeal of those at the current job, then the new offer begins to seem worth taking.  Of course, returning to self-knowledge, one still needs to be aware of one’s risk tolerance.  Even if the offer is better than one’s BATNA, is one willing to move from the known to the unknown?

         Analyze Risk.

         Beyond the subjective condition of risk tolerance, in the context of pending or potential litigation, understanding alternatives to a deal requires an understanding of the probable consequence of litigation.  This includes not only the like outcome after trial and appeal, but also the direct and indirect costs incurred along the way.  These are often described as risk analysis and transaction cost analysis.⁸   Careful counsel spend hours assessing the strengths and weaknesses of their case to guide clients in assessing the amount of payment that makes sense to put that matter to bed. 

SKILL ACQUISITION.

         Man Learns from Machine – Try the TreeAge Decision Tree Program.
        
         As a general tool in decision making, it is helpful to identify areas of uncertainty and choice points that affect outcomes along the path of a predictable process.  For example, in a case, there might be uncertainty on whether discovery will develop favorable or unfavorable information on a set of points; on whether the law characterizes a particular action or arrangement as legal or illegal; on whether one will win or lose on motions to dismiss and for summary judgment; on the range of damages that might be awarded under different standards at trial; and on likelihood of victory on appeal.  Added to this mix, can be the litigation transaction costs – fees for attorneys and experts, transcripts, photocopying, preparation of exhibits and the like.  These costs can be factored in along the way.

         We all can rough out these factors and do our own math.  If there is a 50/50 chance that we will win $1,000,000 after trial, we can loosely give that case a $500,000 value.  Understanding it will cost the client $250,000 in fees to get there, we might reduce that value to $250,000 if that sum of cash were sitting on the barrelhead for the taking to end the suit. 

         When the factors get complex, we might explore a program that does the math on the factors of uncertainty and choices taken along the way – TreeAge.  This software, available online at treeage.com, helps develop and test outcome through complex decision tree analysis.

         Gather Information.

         Across the board, information is the medium of negotiation.  Information helps us identify our own and the other’s interests.  It is the basis of our understanding of the business, legal, or other risk context for assessing a deal.  It is the prima materia with which we make any assessment of risk or value.  Only with information can we discover and assess our leverage.

         Assess Leverage; Engage in Logrolling.

         Much has been written on leverage.  When one controls the counterparty’s access to a means of satisfying that counterparty’s need, or if one can impede the satisfaction of that need, one has bargaining power.  It is important to be clear on what those levers are on both sides of the table.  It is further helpful to see if there are alternative means of satisfying, or jeopardizing, the need or interest in question; this liberates one from being hung up on a particular risk or issue.

         There are a good number of times when it can cost one party little to satisfy a significant need of the other party.  If each party can offer something of low value to the offeror and high value to the other party, this presents a wonderful opportunity for trading that will generate higher overall value in the deal.  This type of trading, known as logrolling, can be a source of great satisfaction.

         Crunch Numbers.       

         The risk analysis discussion above should already suggest that a good negotiator should not shy away from numbers.  In deals there are often many moving parts, each with its potential economic value.  It pays to try to price values, to calculate risks, to test principles and assumptions by working out their math.

         Develop Principles and Standards.

         At the heart of the Fisher-Ury model of negotiation – in addition to putting the parties into a cooperative frame of mind, focusing on the problem, identifying the issues, discovering underlying interests, and developing options to meet those interests, producing a deal that is superior to the BATNA – is the recognition that developing workable options and deals often depends upon arriving at principles which all parties can adopt.  This fits into our “mundus” section, because they are an effort at transforming the subjective into the realm of objectivity.  Whether it is fair, doable, wise, legal, efficient, considerate, reciprocal, due – whatever the standard, it pays consciously to work to develop standards that can be discussed with and adopted by one’s counterparty in order to address distributive issues or generally to work out a deal.

         This can include finding an objective basis for assessments by turning to authorities in recognized texts – like the Kelley Blue Book for used car values – to experts, like appraisers or accountants, or to broader custom and usage in a particular industry or trade.  The net result is bringing the discussion into an objective realm susceptible to shared, open analysis, and away from the subjective realm governed by the assertion of wills.

Opening to the Great Way

         Having embraced the chiliocosm, framing out content and approaches through the vast domains of self, other, and the world, a comprehensive presentation on Negotiation Skills must finally recognize that we are dealing with what is fundamentally a process. 

         We recognize that there is a wide range of styles and approaches in negotiation that can differ and yet be both effective and legitimate.  Having said that, I still might make a few recommendations.  Since we engage in negotiation in all areas of life, there is something to be said for being bigger than the topic.  Sometimes living with dignity and genuineness trumps a minor strategic gain.   Moreover, with principled, joint mutual gains approaches, it is possible to hold one’s own, and indeed improve the deal outcome, while still acting with decency and in a manner consistent with ones own values.

         As we engage in this process, we can negotiate the process itself.  If we find ourselves in a mode of interacting that seems inappropriate or unproductive, we can discuss our approaches with the counterparty.  We are all too familiar with the frustration of negotiating the size and location of the table.  Yet, while we do not wish to be hung up and frozen in our interactions, it can also be liberating – and good strategy – to be alert to process choices that might enhance relationships, information gathering, or the deal.

         Negotiators should cultivate creativity, openness, and flexibility.  We are participating in something greater than ourselves.  Richer possibilities may emerge from a deal than we could have at first realistically have imagined.  This attitude of openness makes us not only more humane and appreciative of others, it also opens us to reality and enables us to see and seize upon opportunities.

         Along these lines, let a lively silence be your baseline.  This helps in decision making on disclosure flow, preserves candor through eliminating impulsive misrepresentations, controls the expression of unhelpful emotional reactions, prevents reactive behavior overall, and encourages listening to others.  It gives one a chance to consider before committing.  Yet, this approach should not be at the expense of wholesome spontaneity and warm sharing.

         Finally, negotiation, at its core, recognizes of the freedom and dignity of all participants.  We all can take it or leave it, talk or walk.  For this reason, it is a beautiful way indeed.

1 Melville, Moby Dick, Ch. 104.

2 Some recommended reading includes: Fisher & Ury, Getting to Yes; Ury, Getting Past No; Mnookin, Beyond Winning; Shell, Bargaining for Advantage; ABA Section on Dispute Resolution, The Negotiator’s Handbook.

3 The phrase “disciplined self consciousness,” coined by John Ross Carter, Professor of Philosophy and Religion; Robert Hung-Ngai Ho Professor of Asian Studies, Colgate University, for use in connection with the comparative study of religion, has wide applicability in the context of negotiation as well.

4 See, e.g., Leonard Riskin (C.A. Leedy Professor of Law and Director of the Center for the Study of Dispute Resolution and the Initiative on Mindfulness in Law and Dispute Resolution at the University of Missouri-Columbia School of Law) “The Contemplative Lawyer: On the Potential Relevance of Mindfulness Meditation to Law Students, Lawyers, and their Clients,” Harvard Negotiation Law Review (May 2002).  This was the centerpiece of a symposium entitled Mindfulness in Law and Dispute Resolution. Professor Riskin has provided training in mindfulness in law and dispute resolution at a wide range of venues including the Harvard Negotiation Insight Initiative, Harvard Law School, Straus Institute for Dispute Resolution, Pepperdine University School of Law, and Benjamin N. Cardozo School of Law.

5 (O would some power the gift to give us to see ourselves as others see us.)  Robert Burns, Poem “To a Louse,” verse 8. In this poem, Burns, who was the Scottish national poet (1759 - 1796), paints a scene of a haughty beauty at Church, unaware of the louse on her bonnet and of others’ awareness of same.

6 Thomas-Kilmann Conflict Mode Instrument -- also known as the TKI (Mountain View, CA: CPP, Inc., 1974–2009), by Kenneth W. Thomas and Ralph H. Kilmann; see, http://kilmann.com/conflict.html.
G. Richard Shell, Bargaining for Advantage – Negotiation Strategies for Reasonable People.

7 G. Richard Shell, Bargaining for Advantage – Negotiation Strategies for Reasonable People.

8 For helpful articles on decision trees and risk analysis, see, Douglas C. Allen, Analytical Tools and Techniques: Decision Analysis Using Decision Tree Modeling; Marjorie Corman Aaron, The Value of Decision Analysis in Mediation Practice, 11 Neg. J. 123 (1995); Marc B. Victor, The Proper Use of Decision Analysis to Assist Litigation Strategy, 40 Bus. Law 617 (1984-1985); Jeffrey M. Senger, Decision Analysis in Negotiation, 87 Marquette Law Rev. 723 (2004); David B. Hoffer, Decision Analysis as a Mediator’s Tool, 1 Harv. Neg. Law Rev. 113 (1996).