Chapter 28
Negotiating for the Public Good
Lisa Blomgren Amsler
You have a limited budget. You have certain authority, but you cannot force someone to comply with a regulation without invoking other agency resources. Perhaps you are trying to get more resources allocated to your department, division, or bureau. Maybe you have worked on a rule-making proceeding long and hard; you want to get the rule implemented but are concerned that affected parties may challenge it. Perhaps a contractor feels you have violated the terms of a supply agreement, or that your demands are not within the scope of the original construction contract. An agency employee just filed an Equal Employment Opportunity (EEO) complaint against the agency alleging discrimination.
How do you handle the daily conflict that is a part of any public administrator's job? You negotiate every day, and in a wide variety of contexts. This chapter addresses the literature on negotiation from the perspective of what, when, why, and how to negotiate. It advocates interest-based negotiation as the ethical approach for public administrators, contrasted with hard or competitive bargaining. Interest-based negotiation focuses on the parties' needs rather than positions; negotiators use principles and values, not power or threats, to resolve disagreements. What to negotiate briefly covers the breadth of subject matter and context. When to negotiate introduces the question of whether it is appropriate to negotiate and when not to. Why to negotiate provides a short overview of the empirical evidence for resolving conflict this way. How to negotiate provides a step-by-step review of negotiation theory and practice on preparing, initiating, and then conducting negotiation. The chapter concludes with how not to negotiate and how to recognize and avoid hard bargaining tactics. Conflict can be a creative force for good, if you use it constructively.
What to Negotiate: Problems and Context
Problems arise from conflicting interests within an organization or between organizations, stakeholders, other institutional layers within which they are embedded, or within organizational networks. In government, we manage conflict over public policy among the public, stakeholders, or interest groups. Negotiation occurs in a wide variety of public policy arenas (Susskind & Cruikshank, 1987) such as agriculture, health, transportation, commerce, and the environment (O'Leary & Bingham, 2003).
Negotiation also occurs in a variety of organizational contexts and networked settings. Organizations participate in networks especially when they cannot achieve a goal or solve policy problems acting alone (Agranoff & McGuire, 2003). When an organization decides to join the network, it recognizes it must negotiate and solve problems collaboratively (Bingham & O'Leary, 2008; O'Leary & Bingham, 2009). In the international arena, conflict occurs in civil unrest, postconflict reconstruction, nation building, writing constitutions, war, and terrorism. Countries' leaders seek to resolve ethnic conflict and restore the rule of law; they may design institutions that foster reconciliation and consensus building (Bingham, 2011). While these contexts vary, the systems for conflict management share certain fundamental goals: giving people voice, addressing recurring problems efficiently, giving people control over decisions, and providing justice.
When to Negotiate and When Not To
Public administrators have always resolved a variety of disputes through voluntary settlement (Harter, 1987), increasingly negotiation plays a critical role in making an agency more effective and efficient. In the United States, Congress enacted the Administrative Dispute Resolution Act of 1996 (ADRA) and the Negotiated Rulemaking Act of 1996 (NRA) as amendments to the federal Administrative Procedure Act to broaden agency authority to negotiation (Bingham, Nabatchi, & O'Leary, 2005). Many state legislatures made analogous changes to their versions of the Uniform Administrative Procedure Act (Bingham, 2010). These amendments resolved concerns that administrators who engage in negotiation and settlement act outside the scope of their authority. Specifically, the ADRA defined dispute resolution as any procedure in lieu of adjudication, including but not limited to settlement negotiations, conciliation, facilitation, mediation, fact finding, and mini-trials (ADRA, 5 USC sec. 571). The NRA encouraged agencies to consider using negotiation for rule making. Federal agencies may consider whether negotiation is appropriate in light of the number of parties who may be affected by the rule, the likelihood that they may reach an agreement with the aid of a facilitator, and the feasibility of negotiating such an agreement within a reasonable time (NRA, 5 USC sec. 563). These authorize public administrators to explore various means, including principled negotiation and mediation or facilitation, to achieve public objectives without fear that they will be accused of ad hoc decision making.
Not all disputes are suitable for negotiation. Just as the prosecutor will not plea-bargain with a serial killer against whom she has a strong case, the public administrator considering an enforcement action may choose to make an example of an open and egregious violator. Similarly, agencies may choose not to settle a case because an important legal principle or precedent is at stake (for a detailed discussion of cases inappropriate for settlement, see Edwards, 1986, and Fiss, 1984) or because it may significantly affect the rights of nonparties. If administrators exercise this discretion appropriately, they may resolve most disputes and at the same time achieve greater public participation in the decisional processes of government (Stephenson & Pops, 1991; Manring, 1994).
Why Negotiate: Empirical Evidence on Practice
Although systematic field evaluation is difficult, the cumulative evidence shows that disputants and administrators can benefit by using direct or assisted negotiation to resolve conflict not only in courts, but also involving community and neighborhoods, employment, the environment, education, families, and criminal justice (Jones, 2004). Many studies have concerned court-annexed procedures, but commentators have recognized the ready application of experience from the courts to agencies that have heavy adjudication caseloads (Harter, 1987). Parties report higher satisfaction with the process for resolving disputes when they have more control over it (Wall & Lynn, 1993; Wall, Stark, & Standifer, 2001). Moreover, the evidence shows that negotiated settlements are implemented at higher rates, that is, they stick (McEwen & Maiman, 1984). There is some evidence that mandatory mediation or arbitration may actually slow case processing by diverting cases that would otherwise settle bilaterally, that is, through direct negotiation between the parties rather than through assisted negotiation with a mediator (MacCoun, 1991).
It is cheaper to negotiate an acceptable settlement than to face protracted litigation in any given case. The growth of negotiation and dispute resolution has contributed to the reduced trial rate in the United States (Bingham, Nabatchi, Senger, & Jackman, 2008–2009). Assistant US attorneys representing federal agencies in litigation achieved outcomes in dispute resolution that were not significantly different from the outcomes in litigation; however, the sooner they resorted to a dispute resolution process, the earlier they settled the case and the shorter the total time spent, which reduced the government's costs (Bingham et al., 2008–2009).
Typical measures of success in negotiation include settlement rates, case flow rates, time on the docket or to settlement, participant satisfaction with process, neutral, or outcome transaction cost savings, party success or overall patterns of outcomes from the process, or change in the parties' relationships or the parties themselves (Jones, 2004). For workplace systems, evaluators also look to employee turnover and retention, absenteeism, productivity, or employee citizenship behaviors (Lipsky, Seeber, & Fincher, 2003). Federal agencies have provided guidance for each other through the federal Interagency ADR Working Group (www.adr.gov); systematic evaluation allows agencies to report the effectiveness of their practice. The design of a system for managing conflict or dispute system design also shapes the success of negotiation (Ury, Brett, & Goldberg, 1989). A twelve-year study of a program for assisted negotiation (mediating) discrimination complaints at the US Postal Service showed consistently high participant satisfaction and resulted in a 70 percent or higher settlement rate that reduced the agency's formal adjudications by over 25 percent (Bingham & Novac, 2001; Bingham, Hallberlin, Walker, & Chung, 2009). Experienced litigants in workplace safety and health preferred assisted negotiation (mediation) with administrative law judges to traditional administrative adjudication (Bingham, Malatesta, Foxworthy, & Reuter, 2013).
How to Negotiate: Tools and Skills to Prepare for and Initiate Negotiation
Negotiation is a skill set public administrators use daily. Public administrators use information gathered in preparation to engage in interest-based or principled negotiation (Fisher, Ury, & Patton, 1991). This model of negotiation entails working through the substance of the problem as distinguished from personalities, identifying human needs and interests, brainstorming solutions, and using objective standards to resolve disagreements. By preparing well, negotiators know whether and when to negotiate, the scope and range of possible agreements, barriers that exist to reaching agreement, and whether a given agreement is better than the no-agreement alternatives. By starting negotiation with appropriate ground rules, the parties ensure everyone understands the significance of commitments and has a structure within which to conduct meaningful negotiation that may result in a binding agreement. Public administrators can adapt this basic tool of negotiation to a wide variety of contexts.
Preparing to Negotiate: Research and Tools for Practice
Before sitting down at the bargaining table, negotiators must prepare thoroughly by (1) identifying the subject and scope of negotiation, (2) determining who has the authority to bargain, (3) identifying the culture context for negotiation, (4) identifying negotiating parties' best alternatives to a negotiated agreement (BATNA), (5) determining reservation prices, the settlement range or bargaining zone, and the cooperative or exchange surplus; and (6) analyzing possible psychological or cognitive biases for people on both sides of the table.
Identify the Subject and Scope of the Negotiation
First, determine whether this negotiation is for dispute resolution or planning. Dispute resolution negotiations address an existing claim, case, or problem, often one that can end up in litigation (for examples relating to harassment claims, see Rowe, 1990). There may or may not be a continuing relationship between the parties. Generally a dispute resolution negotiation focuses on past events. Examples of planning negotiations include a contract with future effect, network or collaborative public management, establishing long-term contractual relationships, and negotiated rule making (Bingham & O'Leary, 2008; O'Leary & Bingham, 2009). Planning negotiations generally involve defining a continuing future relationship between the parties. The field is so broad that dispute resolution negotiation includes negotiating peace treaties, while planning negotiation includes negotiating agreements with nongovernment organizations on rebuilding civil society after ethnic conflict.
Second, negotiators must determine whether they face a zero-sum or non-zero-sum negotiation. A zero-sum negotiation is where one's gain is necessarily the other's loss; it is also referred to as the fixed-pie negotiation, because there is a pool of cash to divide. Few negotiations are truly only zero sum. It is possible to enlarge the pie in most zero-sum negotiations with practices to create value, such as unbundling issues and trading interests that the parties value differently (Lax & Sebenius, 1986; Susskind & Cruikshank, 1987). Negotiating prices for new military equipment might be framed as zero sum if it is just about price per plane, or non–zero sum if it is a joint effort to design, build, and test new technology.
Third, identify the conventions for this arena of negotiation. For example, it is conventional in labor negotiations or collective bargaining for the parties to exchange a long list of initial proposals. However, this is not the convention with business agreements that have generally worked well during the term, which will likely entail far fewer proposals for change. Some negotiations are not negotiations at all; for example, a consumer or employee may get stuck accepting, as a condition of sale or employment, an adhesive arbitration clause that is built into a standard form contract. Public sector contracts often have many standard and required provisions that are not negotiable.
Determine Who Has Authority to Bargain
Is the appropriate person at the table? This can be more problematic in the public sector than in the private sector. To negotiate settlement using the mini-trial procedure, parties must bring their chief executives or contracting officers to the table; these top managers listen to each other's lawyers summarize the case in litigation and then excuse them from the room and try to negotiate a settlement. If the dispute is private sector, is the other party a corporate entity represented by top executives? If a party is a membership association like a union or manufacturers' association, ask whether it will have to go back to its membership for approval of any deal. If the other party is an individual with a lawyer, ask who has authority to bind that individual to a settlement. A classic bargaining ploy is for a lawyer to negotiate his or her best deal and only then explain that the client must approve it. Often the hard bargainer makes this the opening for new demands.
In order to avoid these problems, clarify each party's bargaining authority before sitting down to negotiate. Some statutes address the authority of public administrators to settle monetary claims. At the table, make explicit the nature of the agency's bargaining authority and determine the authority of the other party. It is unwise to sign a tentative agreement only to find it is contingent on the approval of someone else to deal with directly.
Identify the Cultural Context for Negotiation
Cross-cultural negotiation, meaning negotiation across national cultures whether internationally or within a diverse organization like the World Bank, provides its own set of challenges (Brett, 2007). Jeanne Brett, a leading negotiation scholar, suggests that culture is like an iceberg; above water are behaviors and institutions; below water are knowledge structures encompassing values, beliefs, and norms; and deep down are fundamental assumptions. Behaviors are the visible ritual greetings that vary by culture, like the exchange of business cards in Asia and touching in Central and South America. Institutions are the legal, economic, and political framework, such as village elders for neighbor or community conflict in Central Africa.
Negotiating across cultures sometimes triggers stereotypes, like the classic criticism of a racial profiling in a police stop-and-frisk program. A stereotype assumes everyone from a given culture shares the same characteristics. Brett (2007) suggests that a more useful concept is the prototype, reflecting the average of a population distributed along a classic bell curve but not necessarily the characteristics of any one person. Cultural prototypes vary along three main dimensions: individualism versus collectivism, hierarchy versus egalitarianism, and beliefs or expectations about the behaviors of others based on shared knowledge of conventions, rules, or context. Most Anglophone and northern European cultures are more individualistic, which carries with it a tendency toward low-context communication, which is direct, immediate, and assertive. Most Asian and southern European or Latin American cultures are more collective, characterized by high-context communication, which is indirect and preceded by a period of relationship building.
A related concept is quick and slow trust; individualist cultures practice quicker trust, while collective cultures are slower to trust. Relationship and trust building across cultures are increasingly important skills both within and among people in organizations (Saunders, Skinner, Dietz, Gillespie, & Lewicki, 2010). The cultural prototype for trust varies widely; 65 percent of Norwegians but only 3 percent of Brazilians say most people can be trusted.
Individualist cultures also tend to be more egalitarian in that differences in status are not evident in communications around the negotiating table. Collectivist negotiating teams act according to the status of each member, with deferral to the highest status. Brett shows how a company from an individualist culture may make a serious mistake if it sends a low-status representative to initiate negotiations in China. A company in China, a collective, more hierarchical culture, may have assumptions about what this signals and how serious the other party is about the negotiation.
Culture interacting with gender may influence a negotiator's style or choice of tactics (Brett, 2007; Schneider, 2002). A classic study of women as negotiators suggests that they do not ask; their lower expectations shape outcomes in salary and other negotiations for themselves (Babcock & Laschever, 2007).
However, empirical research demonstrates that individuals in any culture may vary in their conformity to a prototype such that there is wide variation in negotiation behaviors; any individual may be at the tail of the bell curve. Brett's research has also shown some patterns in the ability of people in different cultures to reach integrative deals that maximize joint value; some differences may be a result of different assumptions about the duration of the negotiating relationship and the proper stages for reaching agreement on different issues. Culture is an important factor, and understanding how it might affect a negotiation is an essential piece of preparation.
Identify the BATNAs for Each Party at the Negotiating Table
Knowing the BATNA is critical to preparation (Fisher et al., 1991). This is the no-agreement alternative or that action each party can take without the cooperation of the other party if either one decides to walk away. Negotiators who do not have a strong sense of the choices if negotiation fails may not recognize a good settlement. Public administrators need to use three crucial variables to identify each side's BATNA: power, time, and information (Cohen, 1991). Sources of power include competition (or demand), legitimacy, risk taking, commitment, expertise, investment, rewarding or punishing, identification, morality, precedent, persistence, persuasive capacity, and attitude.
The power of precedent depends on which of differing interpretations of a statute or a contract the courts will support. Is the law or contract language clear or uncertain? If the contract is clear and favorable, that party is negotiating from strength. The BATNA may be to litigate. If it is uncertain, is this the best case to use to make the precedent? “Hard cases,” it is said, “make bad law.” The power of investment involves considering resources, specifically, how much is invested in resolving the dispute. Will litigation exhaust a limited fund that puts one party in a worse position to negotiate the next case? If the only available settlement exceeds available resources, it may be time to walk away from the bargaining table, that is, exercise one's BATNA.
Time, the second variable, may alter power. Deadlines create settlement pressure. Most deal making occurs at or shortly before the deadline for completing the negotiation. Hence, international mediators go out of their way to create a series of deadlines, fictitious though they may be. Deadlines also shape BATNAs. For example, is there a statutory time limit for instituting enforcement proceedings? Can the agency suspend it while negotiating? Negotiated rule making may take significantly longer to result in a published rule than traditional rule making; the advantage comes when no one contests the rule in court. If there is insufficient time for negotiating draft regulations, this can affect the agency's BATNA for implementing the statute.
Information is the third and key variable; it fosters agreement, and its lack can frustrate settlement. It is important to gather as much information as possible in the preparatory stage of negotiation. After talks become formal, sources of information previously available will dry up (Cohen, 1991). For example, if the agency conducts inspections at a plant or workplace, the investigator has a perfect opportunity to collect information by informal discussions with employees. This information may later be relevant to negotiations over a civil fine. Once the facility calls in its counsel, all communication will occur through counsel. Information about the other party's financial situation, priorities, deadlines, and so on may help define its BATNA and clarify the settlement opportunities (Cohen, 1991). In addition, the agency's representatives should collect and make explicit the same information about the agency, most of which will be subject to disclosure under state or federal freedom-of-information laws.
This information about each party helps it identify the other's BATNA within its organizational context. Is this a small supplier whose primary contracts are with the agency? If the supplier desires a continuing relationship with the agency, its BATNA is not going to be as desirable as negotiating. If this is a major regulated industry with substantial financial resources, it may conclude that its BATNA, delaying implementation of a new environmental or safety technology through protracted litigation, for example, is more desirable than negotiating to comply now. Collect as much information as possible on the cost of compliance, the cost of litigation, and the resources of the other party. Also, determine whether punitive sanctions, criminal prosecution of responsible executives, or other measures might worsen their BATNA. Sometimes a party's BATNA is so bad that it has no choice but to negotiate. For example, a felon caught red-handed must either face prosecution or plea-bargain and turn state's evidence. If the BATNA is a long prison sentence, bargaining may be the only reasonable choice.
Determine Reservation Prices, the Settlement Range or Bargaining Zone, and the Cooperative or Exchange Surplus
Both economic factors and human nature contribute to the dynamics of negotiation and achieving an agreement, but they also create a substantial range of possible agreements (Korobkin, 2009). Negotiation trainers routinely give pairs of students a simulation and debrief on their agreements; they show students the wide variety of agreements that different pairs find acceptable and how some favor one negotiator or the other.
The reservation price (RP) is the walk-away price; it is the least a seller will accept or the most a buyer will pay in a purchase-and-sale negotiation. It is sometimes called the reservation point when the negotiation concerns something that is not economic, for example, the content of a negotiated regulation over carbon emissions and clean air. In this case, the reservation point might involve the nature and timing of new technology to reduce emissions in coal power plants.
A seller whose RP is lower than the buyer's RP has a bargaining zone (BZ, also called the settlement range). This means that there are multiple points between their respective RPs where they could reach an agreement. For example, if a procurement officer is willing to pay a maximum of $10,000 to purchase services from a software developer and the software developer would accept nothing less than $7,000 to provide the services, there is a bargaining zone between $7,000 and $10,000. If, however, the procurement officer will pay not a dime more than $10,000, but the software developer will accept nothing less than $15,000, there is no possible settlement, and both parties would be better off pursuing their BATNAs.
If there is a BZ, then there is also a cooperative surplus (CS also called an exchange surplus). This amount represents the value created by the deal that the parties will distribute between them in the negotiation. For example, RPs of $7,000 and $10,000 create a CS of $3,000. The procurement officer might attain most or all of that CS by getting the software developer to agree to a contract price of seven thousand dollars.
Identify Cognitive Biases
How the negotiating parties distribute this CS is partly a function of what we know about human nature from cognitive psychology and neuroscience. Negotiators need to understand themselves well to avoid common cognitive traps (Korobkin, 2009). Classic cognitive errors include heuristics, which are short-cuts to reaching conclusions. These include self-serving bias (overvaluing favorable information); salient information (more memorable or detailed); anchoring and adjustment (how an initial offer can shape the settlement range); reactive devaluation (negative judgments of offers from the other side); attribution biases (assuming harmful intent or fault by the other); prospect theory (gain or loss from a reference point); loss aversion (reluctance to give up possessions); and framing effect (gain or loss and risk aversion).
Starting to Negotiate: Ground Rules or Protocols for Negotiation
For more formal negotiations (more than one session with the other party), it is wise to agree on ground rules in advance or at the beginning of the first session. Sometimes, in multiparty public policy disputes, a facilitator will refer to ground rules as the protocol for negotiation (Cormick, 1989). In the labor relations context, four key ground rules translate well to other substantive settings: no press releases except by mutual agreement; meeting times, dates, and locations by mutual agreement; a mutual deadline for raising new issues; and tentative agreements are binding pending final agreement on all issues. A wise bargainer will agree to the ground rules in writing. By negotiating first over the procedure for negotiation, public administrators can set a firm but fair tone for later substantive issues and use preliminaries to develop trust and rapport.
No Press Releases
Negotiation should be conducted in confidentiality, not in the press. Recent statutory changes make this more compatible with freedom-of-information and government sunshine laws than it was previously. Check with legal counsel first. If there are to be press releases, they should be by mutual agreement and committed to writing before the parties leave the bargaining table at the conclusion of the session.
Meeting Times, Dates, and Locations by Mutual Agreement
Ordinarily negotiation take place on the agency's own ground. Even in public sector labor relations, bargaining usually takes place in town hall or on public property, such as in a school building. Of course, there will be instances of negotiation that occur at the other party's place of business, for example, where an investigator is conducting an inspection or an audit of an employer' s books and discusses the scope of the inspection or audit with representatives of the employer. Unlike public sector labor negotiation, which usually occurs at night, most agency negotiation occurs during regular working hours. However, on occasion, it may be appropriate to keep negotiating around the clock until there is an agreement. Labor mediators have long recognized that locking parties who are motivated to reach an agreement into one building for a prolonged period can often break through an impasse. Clearly, if the other party's BATNA is superior for them to negotiation, this stratagem is ill advised.
A Mutual Deadline for Raising Substantive Issues to Discuss
This essentially requires that parties agree in advance on the agenda and scope of the negotiation. A party that has negotiated long and hard over coming into compliance with certain regulations for one of its facilities will not be happy if a second facility is added into the mix after an agreement has been reached. This does not prevent the agency from initiating a separate enforcement proceeding. It simply means that if considering multiple facilities, put that on the table up front to include them in this negotiation.
Binding Tentative Agreements Pending Agreement on All Issues
Once the parties reach agreement on a distinct issue, they should initial the agreement and take that issue off the table pending an agreement on the rest of the issues in dispute. None of these tentative agreements are binding until both parties have approved a final, complete agreement on all issues. However, this ground rule does keep a party from revisiting old ground and reneging on previously settled points, hallmarks of the hard or bad-faith bargainer. This is why some members of the public can become quite frustrated with agency approval processes, or the problem of limited authority to negotiate that comes with being a public administrator. They perceive it as a bargaining stratagem.
Principled or Interest-Based Negotiation and Positional or Hard Bargaining
Interest-based or principled negotiation has come to encompass an approach to bargaining advocated by the Harvard Negotiation Project (Fisher et al., 1991). It is related to collaborative or win-win bargaining (Cohen, 1991). It is the opposite end of a continuum from positional, confrontational, competitive, or adversarial bargaining (Koren & Goodman, 1991). To practice interest-based negotiation effectively, administrators need to understand negotiating limits based on goals, objectives, values, and ethics.
Cohen (1991)characterizes adversarial bargaining as “winning at all costs…Soviet style” (p. 119). The basic notion is that parties often get caught up negotiating over a series of artificial positions instead of addressing their true needs and interests underlying the dispute. They hoard information because they see it as a source of bargaining power. The classic example of positional bargaining is the typical negotiation over any purchase. The new car dealer starts at some fictitious sticker price, and the buyer starts somewhere lower, depending on the quality of his or her research. The parties then take turns stating positions that move incrementally toward each other. This negotiation assumes a fixed pie, that is, the parties are negotiating over how much the dealer will profit from the sale. One party's concession is the other party's gain. Each party's BATNA is to walk away from the deal. The buyer can go to a different dealer; the seller can sell to a different buyer.
There are a number of reasons that public administrators should make every effort to use principled, not positional, negotiation. First, they potentially face a continuing relationship with every regulated entity or former employee; each party is a member of the public that the agency serves. In public service, often how what a public administrator does is as important as what he or she accomplishes. Unfortunately, most press coverage seems to focus on the how, and not the what, of agency business. In other words, principled negotiation is good public relations. Second, principled negotiation is ethical practice. A reputation for integrity is a negotiator's greatest asset. Principled negotiation is a step-by-step recipe for negotiating integrity. Third, public administrators hold a position of public trust. The public has high expectations and holds public administrators to higher standards of personal conduct. It would violate that trust to knowingly mislead a party to a negotiation, and a member of the public might construe many of the standard hard-bargaining ploys as intentional deception.
The Harvard Negotiation Project formulation of principled negotiation entails four steps (Fisher, Ury, & Patton, 1991, p. 13):
- Separate people from the problem.
- Focus on interests, not positions.
- Invent options for mutual gain
- Use objective criteria.
Using this frame, this section addresses five discrete stages in the negotiation process.
Stage 1: Identify Interpersonal Dynamics That May Help or Hamper Discussions
To negotiate effectively, determine whether personality clashes are interfering with substantive discussions. The labor mediator often begins in the hallway, listening to extended descriptions from one advocate of the other team's makeup. For example, the advocate will point out who is constructive, who tends to fly off the handle, who has a long history of animosity with the human resource manager, and who the others turn to for guidance and good judgment. In bilateral negotiations, a supervisor may perform this function for a subordinate who has handled the dispute up to this point. Has the negotiator formed a visceral dislike for the person he or she is dealing with? If so, he or she needs to leave it behind. The negotiation is not about that person's character; it is about solving a problem.
Moreover, anything one party is feeling, the other probably is too. To help identify people problems, try to understand how the other party might perceive and feel about the dispute, suspending judgment, recognizing and legitimating the emotions at work, allowing people to let off steam but not reacting to the outbursts (Fisher et al., 1991). Build a relationship by talking directly to them, listening actively, using “I” statements, and not characterizing them (Fisher et al., 1991). One might call this the Zen of negotiating. Fisher and Brown (1988) suggest that a good bargaining relationship is not the same as approval of the other side, shared values, avoiding disagreement, or perfect trust. Instead, it is establishing an attitude in the context of a long-term continuing bargaining relationship that is unconditionally constructive by using rationality in response to emotion, understanding them when they misunderstand others, consulting them even if they appear not to listen, being reliable and not trying to deceive them, being noncoercive and not yielding to coercion, and accepting them and their concerns as worthy of consideration. The public administrator should think of this as being involved in a long-term bargaining relationship with the public, represented from time to time by diverse people who have business with the agency.
Stage 2: Analyze Their Needs and Interests
In preparing to negotiate, the parties most likely have gathered substantial objective information, not information about the other's perceptions. Perhaps the most useful contribution the Harvard Negotiation Project has made is to give us a language to talk about the most important information in a negotiation. This is the language of interests. The adversarial negotiator will speak the language of positions, as in, “Well, that is our position.” The principled negotiator will attempt to identify the other party's interests, asking questions to determine what the other party truly needs in terms of, for example, security, economic well-being, or recognition of the party's contribution or efforts (Fisher et al., 1991).
To elicit responses identifying these interests, the principled negotiator will use a powerful problem-solving tool: the question, particularly “Why?” and “Why not?” Other problem-solving questions are the same questions lawyers use on direct examination: questions beginning with who, what, where, when, and how. Leading questions, particularly those with an implicit accusation, are not helpful. The principled negotiator may also identify interests by considering the consequences for the other party of a particular negotiating outcome, for example, by looking at the short- or long-term economic impact, legal implications, psychological effects, precedential effect, or impact on the larger affected group' s interests (Fisher et al., 1991). Identify the interests that are separate but reconcilable, conflicting, or shared (Fisher et al., 1991). By identifying where both parties' interests overlap or are compatible, a negotiator can begin to move to the next stage of the negotiation process.
Stage 3: Create or Brainstorm Possible Elements of a Settlement
Some have said that the essence of creativity is the ability to keep an open mind and suspend judgment. In labor relations, a contract settlement will address many issues, from wages to working conditions to job security. During negotiations, the parties begin to get a sense of the possible elements of a settlement without prejudging precisely the puzzle pieces that will fall into place with the final package. Almost any fixed-pie negotiation can be reframed as a deal with a variety of elements. For example, the simple sale can become a public relations asset if the buyer is someone with standing in the community who endorses the product. The ability to use information about interests to enlarge the pie into a multi-element, mutually beneficial deal is the key to brainstorming, or what the Harvard Negotiation Project terms “inventing options for mutual gain” (Fisher et al., 1991, p. 56) and Cohen (1991) calls the win-win technique.
Many public sector managers have already received some training in brainstorming techniques in the context of plans for Total Quality Management. Facilitators have begun to use similar techniques working with city councils on visioning as a method of planning for the future of the community. Essentially a group of people working on the same problem turn to face a flip chart or blackboard or overhead projector. Whether they are on separate negotiating teams or not, all should be facing the same direction to work on the common problem. They designate a facilitator or scribe to write down ideas. The list should be written and placed so as to be visible to everyone in the room. They then proceed to list every idea they can think of to meet the interests they have identified and solve the problem, without attribution or criticism until there is an exhaustive list. After prioritizing the ideas, the group discusses only the top-ranked ones and determines whether elements of these, or some combination of them, might resolve the problem or dispute. This is a highly efficient way for a group to consider solutions to a problem.
The advantage to this process is that as the parties discuss the various ideas, they will of necessity learn more about each other's interests and concerns, which in turn will facilitate the invention of ideas more tailored to meet those interests or concerns.
Stage 4: Package a Mutually Advantageous Agreement
Some mediators will say that they recognize a good settlement because they leave the parties equally unhappy. Often the unhappiness is a pose so that the other party does not think the agency got away with something. In fact, it is possible and desirable to come up with win-win, or mutually advantageous, agreements. The critical skill is deal crafting, or focusing on an integrative agreement that creates the maximum value and dividing in such a way that both parties are better off than their BATNA (Lax & Sebenius, 2002). Some research suggests that cultural differences may interfere with dealcrafting (Brett, 2007).
After generating a list of ideas through brainstorming, negotiators can then convert the ideas into concrete options to implement. Fisher et al. (1991) suggest converting ideas into options by using different perspectives or agreements of different strengths. An agreement may be permanent or provisional, substantive or procedural, comprehensive or partial, unconditional or contingent. The key is to put together a combination of options or elements that meet everyone's needs and interests to some reasonable extent. Examples of successful packages include agreements to pay a civil fine without admission of liability or wrongdoing and employee grievance settlements that both sides agree will not constitute precedent for other cases.
Sometimes parties are reluctant or unable to communicate directly enough about their interests to succeed in putting together a package on their own. In these circumstances, a mediator or other third party's assistance may prove to be invaluable. Mediation is simply negotiation with some assistance. The mediator can use each party's confidential communications to help put together a package for settling the dispute. One tactic is for the mediator to propose a package, taking the onus off both sides and freeing them to agree to the settlement without losing face before their constituencies. This principle works equally well for labor negotiators with their respective constituencies of union members and managers, for lawyers with their respective clients as constituents, or for elected officials serving diverse groups of citizens.
Stage 5: Come to Closure on a Complete Agreement.
The work of an agreement is not done until all the pieces fit and the parties reduce the agreement to written form. If there is an impasse over a particular point, now is the time to use objective criteria to resolve it. The goal of principled bargaining is not to resolve the impasse based on power, coercion, or will (Fisher et al., 1991). Instead, look to law, precedent, tradition, market value, professional standards, efficiency, costs, scientific data, or what a court or arbitrator might do. Resort to notions of equal treatment, fair procedures, reciprocity, and moral standards. Speak to the merits of the dispute; do not resort to personal attacks or threats. If all else fails, do what Ury (1991) refers to as deploying the BATNA. There is a difference between a threat to exercise power and a warning that the agency or organization has a BATNA that provides a more desirable option than anything on the table. This is not threatening; it merely conveys information about interests and needs, and how they might be better met by walking out of the negotiation than by agreeing to a specific option. This is reality, not coercion.
How Not to Negotiate and How to Recognize Hard Bargaining
While one party may be committed to interest-based or principled bargaining, the other may instead engage in hard bargaining or bargain in bad faith (Ury, 1991). Ironically, the most recent comprehensive studies show that there is no advantage to hard bargaining over principled bargaining; in fact, adversarial bargainers were perceived as increasingly ineffective, while principled negotiators were perceived as more effective in a study of lawyers in the United States (Schneider, 2002). Schneider found that as negotiators became more irritating, stubborn, and unethical, their effectiveness ratings dropped. Nonetheless, it is important to be able to recognize, and to respond effectively to, classic hard bargaining tactics. If a negotiator can name the tactic, he or she can raise the question openly to the other party—for example, “Why are you setting preconditions? I want to discuss the merits.” Ury (1991) suggests that naming a tactic and letting the other party know robs the tactic of its effectiveness.
Here are some classic hard bargaining tactics (Mnookin, Peppet, & Tulumello, 2000; Ury, 1991):
- Using good cop–bad cop routines, in which one member of the team appears reasonable, while the other threatens irrational rage
- Setting preconditions to bargaining, that is, designating a demand as a precondition
- Making personal, ethnic, or racial attacks
- Using deception, such as manipulating data or using false figures
- Stone-walling
- Making take-it-or-leave-it offers, such as a first, firm, fair, final, nonnegotiable offer (Boulwarism; for discussion of its use in politics and foreign policy, see Jacobs, 1989)
- Locking oneself in with a public or press announcement
- Making extreme demands and refusing to make concessions or making only very small ones
- Placing major demands at the beginning of the agenda
- Escalating demands or backtracking during negotiations
- Bluffing and appearing irrational
- Using commitment tactics in which a party claims to have no authority to compromise and, after agreement, having the relevant constituency reject it and raise their demands.
There is some empirical evidence of gender and cultural variation in willingness to use these tactics (Lewicki & Robinson, 1998).
If you are facing one of the tactics on this list, the key is not to react because tactics such as these are effective only if you allow them to be. Ury (1991) recommends a state of detachment he calls “going to the balcony” to watch the negotiation as if from a great distance. He suggests calling a caucus or break, examining the BATNA, identifying the tactic, asking the other side to restate its position, and then directing it back to a principled substantive discussion by asking problem-solving questions. Largely ignore personal attacks; willfully misunderstand a first, firm, fair, final offer as the party's goal or aspiration in negotiation instead of recognizing it as nonnegotiable; and continue to approach the negotiation constructively, which will disarm the other side. As a last resort, deploy the BATNA to test the other side's resolve to be unreasonable. However, meeting tricks with tricks will only escalate the adversarial atmosphere, perhaps to the point of a breakdown in talks. This is not to recommend a policy of appeasement. If there are points with which both sides can agree because their interests are reconcilable or compatible, then by all means agree. However, do not yield in the hope they will reciprocate. Maintain a principled approach to the negotiation. If all else fails, propose bringing in a third party, such as a mediator, to work through the deadlock.
Summary
This chapter introduced the skill of negotiation. With preparation, appropriate ground rules, and interest-based or principled negotiation in appropriate cases, public administrators can better achieve public objectives than through costly and time-consuming adversarial processes.
To prepare for negotiation, identify the subject and scope of the negotiation, and then determine who has the authority to bargain. Carefully determine the best alternative to a negotiated agreement by considering the power of the parties, the time available to reach an agreement, and information regarding costs, interests, needs, priorities, deadlines, finances, and political pressures. Identify reservation prices, the bargaining zone, and the possible cooperative surplus. Reflect on possible cognitive biases that can affect judgment in negotiation. Negotiate ground rules or protocols for the negotiation, including a limit on press releases except by mutual agreement; a schedule for meeting times, dates, and locations by mutual agreement; a deadline for raising substantive issues to negotiate; and a rule that tentative agreements are binding pending an agreement on all the issues on the table.
Interest-based or principled negotiation is effective for achieving objectives. Use the language of interests, not positions, during bargaining. Identify interpersonal dynamics that may help or hamper discussions. Gather as much information as possible about the other party's needs and interests by using problem-solving questions and active listening techniques. Create possible elements of a settlement using brainstorming techniques. List all the alternatives without attribution or criticism before determining which to discuss first. Use meeting both parties' interests as a basis for prioritizing alternatives, and combine elements of the best ideas to create options for an agreement. Package a mutually advantageous agreement, and use objective criteria, not threats or power, to resolve sticking points. By brainstorming and expanding the pie, public administrators can create value and joint gains.
Finally, do not react or yield to hard bargaining ploys, but call a caucus, name and raise the tactic, ask the other side to restate its concern, and then direct the discussion back to interest-based or principled bargaining by asking problem-solving questions. Inform the other party if the best alternative to a negotiated agreement is better than the proposed agreement as a last measure on reaching impasse, and bring in a mediator if necessary. By recognizing and avoiding hard bargaining tactics, public administrators can negotiate in the public interest.
Public administrators are engaged in a continuing relationship with the public and those they regulate. Interest-based or principled negotiation is good public relations, ethical practice, and consistent with the public trust. The empirical evidence shows that interest-based negotiation is at least as effective as hard bargaining; some evidence suggests it is more effective. Negotiation skills can apply to the whole scope of human interaction, from the interpersonal to organizational to global. Public administrators can better achieve public objectives through negotiation than costly and time-consuming adversarial processes. Conflict can be a creative force for good when it is used constructively.