AGENDAAGENDANov. 2/3Nov. 2/3

• Discussion of grading + questions re: assignments• Discussion of coffee case• Negotiate and de-brief• Intro to integrative negotiations• Case 2 distribution• Film(s)

INTEGRATIVE OR,INTEGRATIVE OR,MUTUAL GAINS OR,MUTUAL GAINS OR,

INTEREST-BASED OR,INTEREST-BASED OR,WIN-WIN BARGAININGWIN-WIN BARGAINING

YOU DO NOT HAVE TO LOSE FOR ME TO WIN

THE PRINCIPLE IS TO NEGOTIATE WHAT IS RIGHT NOT WHO IS RIGHT

Interest-Based BargainingInterest-Based Bargaining

A negotiation or approach that focuses on satisfying as many interests or needsinterests or needs as possible for all negotiators

Source: C. Moore

Interest based bargaining starts with developing and preserving the

relationship. Parties educate each other about their needs, and then

jointly problem solve on how to meet those needs

• In distributive bargaining, the goals of the parties are initially at odds.

More for me means less for you!

• In integrative bargaining, the goals of the parties are notnot mutually exclusive

How can we both win here?How can we both win here?

WIN-WIN IS NOT…WIN-WIN IS NOT…• Compromise• Even split• Feeling good• Just about building a relationship

SIGNS OF WIN-WIN POTENTIALSIGNS OF WIN-WIN POTENTIAL• Does the negotiation contain Does the negotiation contain moremore than one than one

issue?issue?• Can other issues be brought in? i.e. what may Can other issues be brought in? i.e. what may

be defined as a salary issue can be broadened be defined as a salary issue can be broadened to include benefits, vacation, training etc.to include benefits, vacation, training etc.

• Do the parties have different strength of Do the parties have different strength of preferences across the issues on the table?preferences across the issues on the table?

In integrative bargaining, the parties either begin with

compatible goals or, are willing to search for ways to align their

goals so that both can gain

FRAMING: THE MANNER IN WHICH A CONFLICT SITUATION, ISSUE OR, INTEREST IS DEFINED

A critical skill is how you 'frame' the problemA critical skill is how you 'frame' the problem

• Integrative bargaining does not work in all situations. For example, it does not work where price is the single issue. It also requires that participants be willing to operate in a win/win fashion

In integrative bargaining, the parties either begin with compatible goals or, are

willing to search for ways to align their goals so that both

can gainAlignment often involves the

process of persuasion

Interest-Based Bargaining

• A negotiation or approach that focuses on satisfying as many interests or needs as possible for all negotiators

Source: C. Moore

• It is a problem solvingproblem solving process used to reach an integrative solution rather than distributing rewards in a win/lose manner

• It is NOT a process of compromise

Source: C. Moore

Interest-Based Bargaining (continued…)

CLIMBING THE MPA 821 PYRAMIDCLIMBING THE MPA 821 PYRAMID

GENERAL CONFLICT TYPOLOGIESGENERAL CONFLICT TYPOLOGIES

•CAUSES AND REMEDIES- MOORECAUSES AND REMEDIES- MOORE

•PROCESSES OF RESOLUTION-power, rights, interestsPROCESSES OF RESOLUTION-power, rights, interests

INTEREST CONFLICTSINTEREST CONFLICTS•Distributive bargainingDistributive bargaining•Integrative bargainingIntegrative bargaining•Assisted bargainingAssisted bargaining

OTHEROTHER

Mitigating factorsMitigating factorsSpecial toolsSpecial tools

In Mutual Gains Negotiations

Both parties:

1. Take ownership and responsibility for the outcome of the negotiations

2. Work to keep the relationship intact

3. Work on problems rather than make demands ********** {Note the difference from distributive bargaining}

Both parties:

4. Use processes to deliberately stimulate creative solutions

5. Work together to find solutions that benefit all parties

In Mutual Gains Negotiations (continued…)

NOTE-in all 5 steps the emphasis is on SHARED RESPONSIBILITIESSHARED RESPONSIBILITIES

When is Interest-Based Bargaining Used?When is Interest-Based Bargaining Used?

1.1. When the interests of the negotiators are When the interests of the negotiators are interdependentinterdependent

2.2. When future relationships are a high priorityWhen future relationships are a high priority

3.3. When negotiators WANT to establish cooperative When negotiators WANT to establish cooperative problem solving rather than competeproblem solving rather than compete

4.4. When a compromise of principles is unacceptableWhen a compromise of principles is unacceptable

Mutual Gains Bargaining is AppropriateMutual Gains Bargaining is Appropriatein the Following Situationsin the Following Situations

• When two parties have common ground

• In situations where two parties have the same customers, clients, suppliers, or service personnel

• In personal relationships

In all of the above, the parties want to establish and maintain a smooth, continuing, working relationship

For Interest-Based Bargaining to Work,For Interest-Based Bargaining to Work,Both Parties Need to be Committed to:Both Parties Need to be Committed to:

1. Understanding the other party's needs and objectives

2. Providing a free flow of information - both ways

3. Seeking the best solutions to meet the needs of both sides

Some Costs of Interest-Based BargainingSome Costs of Interest-Based Bargaining

• Requires some trust

• Requires negotiators to disclose information and interests

• May uncover extremely divergent values or interests

• Clearly takes more time

Adversarial Barg’g Mutual gains barg’g

Training Separate for employer and union

Joint employer/union

Focus Exchange formal demands/proposals

Joint identification of issues/problems

Process for negotiations

Formal, sit on opposite sides. Bound by what said

Informal, no bargaining table, non binding discussion

• The minimum standard for an interest based solution to a problem is that it has to be at least equal to or better than what the parties believe they would have negotiated with a rights or power approach

The five skills for mutual gains bargaining1. Establish and build a working relationship

1. Trust matters!2. Establish and maintain effective 2 way communication3. Identify and explore underlying interests

1. Separate the problem from the person4. Invent options5. Identify and use external standards to decide among

options1. This allows participants to save face by backing off

their own position but not ‘give in’ to the other party’s.

"In interest-based bargaining, both sides are equally involved in the process of problem definition and both need to agree fully on what the problem is."

Lewicki and Hiam

Some Suggestions for Some Suggestions for Framing/ReframingFraming/Reframing

• Frame issues in the form of problem statements,Frame issues in the form of problem statements, i.e. how can we…i.e. how can we…

• Frame issues so that multiple solutions are Frame issues so that multiple solutions are possiblepossible

• Frame issues in a value free mannerFrame issues in a value free manner

A critical skill is how you 'frame' A critical skill is how you 'frame' the problemthe problem

• FRAMING: THE MANNER IN WHICH A CONFLICT SITUATION, ISSUE, OR INTEREST IS DEFINED

Early stage framing might present the negotiation itself in a way to get the desired responses from the other side.

For example, “ you might propose a ‘frame’ of cooperation by describing the negotiation as an opportunity for us to find the common ground we both know is there despite our difficulties on some issues.”

WHEN YOU SENSE THE WHEN YOU SENSE THE POSSIBILITY OF A NEGATIVE POSSIBILITY OF A NEGATIVE

BARGAINING RANGE…BARGAINING RANGE…

REFRAMING THE PROBLEM OR QUESTION WILL OFTEN BREAK

WHAT APPEARS TO BE AN IMPASSE

Identify and define the problemIdentify and define the problem

• Define the problem neutrally so it is mutually acceptable to all sides

• State the problem with an eye to practicality and comprehensiveness.

• State the problem as a goal and identify obstacles to meeting that goal.

• Separate the problem from the person

SUCCESSFUL FRAMING SUCCESSFUL FRAMING DEMANDS GOOD, ACTIVE DEMANDS GOOD, ACTIVE

LISTENINGLISTENING

Some principles for effective reframing-Some principles for effective reframing-MayerMayer

• Even in the most hostile, negative presentation of an issue there is information about a person’s concerns and attitudes that can be used usefully.

• Constructive framing is about clarity and honesty, not about smoothing difficult issues over!

Some principles for effective Some principles for effective reframing-Mayerreframing-Mayer

• Reframing must reflect the most important needs of the parties-don’t just sugar coat the tough ones.

• Successful reframing is interactive and iterative. The disputants must all be actively and personally involved in the reframing process.

Framing exerciseFraming exercise

• Marion needs help from Joe’s Marion needs help from Joe’s department in the form of some of department in the form of some of Teresa’s time. Joe is swamped with work Teresa’s time. Joe is swamped with work and can only commit one day of Teresa’s and can only commit one day of Teresa’s time when Marion needs at least 3 days. time when Marion needs at least 3 days. Clearly there is a negative bargaining Clearly there is a negative bargaining range. Reframe the problem so that room range. Reframe the problem so that room to negotiate is created.to negotiate is created.

As in Any Bargaining, Interest-Based Bargaining Has Three Main Aspects

1. Solid planning and preparation before you start

2. Careful listening so that you can find what the other side really wants

3. Attending to the 'signals' the other side sends through his or her conduct once bargaining gets underway

Source: Schell, page xiv

The Mutual Gains ApproachHas Four Key Steps or Phases

1. Effective preparation

2. Inventing options to create joint gains

3. Using fair standards to distribute joint gains and maintain relationships

4. Anticipating the problems of follow-through

Positions

• In bargaining, a position represents the maximum gain expected. Often, it is put forward as a demand

• Arguing over positions tends to lock the parties into their positions

• A position is a very specific solution to a problem. It is likely to be concrete and explicit

stalemate

Interests Definition - Fisher and Ury

• The basic problem in a negotiation lies not in conflicting positions, but in a conflict between each side's needs, desires, concerns, and fears... Interests motivate people; they are the silent movers behind the hubbub of positions... Your interests are what caused you to decide

"Interests are the broader perspective(s) that usually lie behind a position.

In contrast to positions, interests define what the parties care about more broadly, and there are often multiple ways to resolve the conflict between competing interests."

Lewicki and Hiam

Remember!!Remember!! There Are 3 Elements of Interests There Are 3 Elements of Interests

DYNAMICS or PROCESS

ISSUES ANDSUBSTANCE

ATTITUDESAND EGOS

Interests

• Interests are what motivates people to a particular course of action. They are the silent movers behind positions. Behind opposing positions lie shared and compatible interests as well as conflicting ones

Interests (continued…)One of the areas that clearly differentiates good

negotiators from poor ones, is the ability to identify interests - both yours other's

• Get at interests by asking open-ended questions

• Why do you want that?

• Why is that important to you?

• What will achieving X help you to do?

• What will happen if you do not achieve your objective??

Interests (continued…)

• Or, if that does not work, try to ask them to criticize… "What is it about the proposal that doesn't work for you?"

Interests (continued…)

• If conversation is difficult or, heated, take a deep breath and …

PUT YOURSELF IN THE OTHER PERSON’S SHOES

For Mutual Gains Bargaining to Work,Both Sides Need to be Committed to:

1. Understanding the other party's needs and objectives

2. Providing a free flow of information both ways

3.3. ******Seeking the best solutions to meet the needs of both parties.***

The Phases in Integrative Bargaining

1. Planning

2. Initial face-to-face meeting

3. Mutual gains problem-solving

4. Reaching agreement

5. Living by the agreement

The Ground Rules

• During planning, the combinedcombined bargaining group makes decisions regarding ground rules to be followed.

Typical mutual gains ground rules-WeissTypical mutual gains ground rules-Weiss

1. Participation by everyone2. Honesty and no deceptions3. Joint communications-eliminate negotiating through

the media4. Anyone can facilitate the discussions5. Flip charts used as memory joggers6. The only record is the agreed upon notes7. Only the spokesperson can make any official offer

If Needed - Joint Training

"Nothing is more powerful than creating a learning environment between 'adversaries’, that is 'non-binding' to allow people to build

relationships and break down barriers"

Weiss

Steps in Interest-Based Bargaining**use in your case

1. Planning

a. Identify the interests that youyou expect to be satisfied in the negotiations - three types. Be clear on; why the needs are important and how important they are to you

b. Speculate on the interests and their types that might be important to the others - and in what priority. Prep some questions to get at their interests

c. Identify your BATNA

d. Give some thought to how the problem might be framed.

Especially, consider what you might do if Especially, consider what you might do if unexpectedly a negative bargaining range should unexpectedly a negative bargaining range should evolveevolveHow might the other side frame it and how could you How might the other side frame it and how could you re-frame?re-frame?e. Give some thought to objective standards against which alternatives can be assessed.

Steps in Interest-Based BargainingSteps in Interest-Based Bargaining2. Begin negotiations by educating each other about

your respective interests

–If other negotiators present positions, you take the initiative to reframereframe them into interests

–Be specific about why interests are important

–Make sure all interests are understood

Steps in Interest-BasedSteps in Interest-BasedBargaining Bargaining (continued…)(continued…)

3. Frame the problem in a way that is solvable by a win/win solution

•Remove egocentricity by framing the problem in a way that all can accept

–Include the basic interests of all parties

In this model, both parties are involved equally in the process of problem definition, and both need to agree

fully what the problem(s) is

Steps in Interest-Based Bargaining

4. Identify in advance general criteria that must be present in an acceptable settlement–Look for agreements in principle

–Identify acceptable objective criteria that will be used to reach more specific agreements

5. Generate options5. Generate options

THE BRAINSTORMTHE BRAINSTORM What you are looking for are

options, possible agreements, or pieces of an agreement

Always remember to separate the process of inventing options from

the process of deciding among those options

Options Deciding

Committing

Judging

Narrowing

Arguing

Evaluating

Inventing

Not Committing

Improving

Generating

Brainstorming

Suspending Judgment

Use Integrative OptionUse Integrative OptionGenerating TechniquesGenerating Techniques

• Expand the pie - ways that more resources or options can be brought to bear on the problem

• Alternating satisfaction - each negotiator gets 100% of what he/she wants but at different times

• Integrative solutions - look for solutions that involve maximum gains and few or no losses for both parties

SOME WIN-WIN APPROACHES THAT OFTEN WORK

1. CONTINUALLY ask questions about underlying interests and, questions about priorities

2. Un-bundle the issues3. Make package deals not single-issue offers.4. Make multiple offers simultaneously5. Don’t be afraid to use good contingency

contracts