Leveraging on IT for better business performance

Negotiation skills

 

“The interaction between people opens the door to the emergence of conflicts”, it could sound as a sentence taken from the popular Murphy’s Laws, a tenet of those who see the glass half-empty. And yes, it could be seen like that, many other positive outcomes could be stated from the ‘glass half-full’ perspective, ultimately we are social beings and a result of interaction between individuals. But as this article discusses conflict and opportunities for negotiation, so let’s empty the glass and accept the unavoidable emergence of conflicts as a result of the diversity of personalities, ideologies, perceptions, interest, realities, objectives, purposes, etc, that cause that ideas and opinions from one and others don’t automatically join in a common point free of tension.

Globalization, access to bigger markets, a growing number of providers, the tendency to process outsourcing, and the more formally defined relationship with inner processes owners, are factors that drive to a growth in the number of relationships between actors from diverse sectors, diverse geographic locations and with dissimilar cultural backgrounds. The greater amount of links and relationships implies a greater exposure to negotiations and the emergence of conflicts.

One of the skills considered as key for the current organizational environment is the negotiation skill. Those who have or develop this skill are more attractive to organizations because they contribute more effectively to the concretion of their goals.

The current leadership models are supported on flatter structures with less levels of hierarchy, which means more empowerment, decisions been taken in multiple points, by diverse people, and frequently product of consensus between peers.

Internally, negotiations not only occur in vertical dimensions (of hierarchical order: justifying budgets, getting management buy-in) but also in horizontal dimensions (agreements between project teams, product line managers, business unit managers, etc.)

Negotiations could involve positions or discordant objectives that if not treated accordingly could drive to null benefits and could even result in the deterioration of relationships between involved parties. This characteristic makes for negotiations and conflict resolutions to be treated in a similar way.

In the workplace, the issue of conflict resolution is of great interest because of the undesired consequences they can have on organizations, consequences that could impact the bottom line, lead to competitiveness loss, market share loss, and other situations that require that conflicts be addressed and resolved promptly.

Knowing about the changing nature of conflict and human emotion, it follows that treatment of conflicts can not be uniform: the diversity of causal factors implies that a resolution method could not be unique and universal. When you have a hammer everything looks like a nail... and we know that hammering a bolt is not the most appropriate method. Solving a conflict by hammering those involved is not a good option either! But we already knew this, right?

One of the most influential organizations in the subject of negotiations is the Harvard Business School. The methodology of this university is based on providing business managers with tools that enable them to identify the correct approach to use for the resolution of a particular conflict. If still in doubt, a screwdriver is more appropriate than a hammer when dealing with screws.

The Harvard Business School proposal for negotiation and conflict resolution allows for a systematic and effective approach of the problem, obtaining lasting positive results and minimizing the collateral damage that conflicts could bring to the organization.

The proposal is based on viewing conflict resolution as a process, like every other process, there are a number of inputs and the output is the conflict solved. The inputs of the process determine the appropriate resolution approach to apply in a particular conflict.

When talking about a process we are not referring to a sequential one, as is that of a production line, the negotiation process is an elaborated method that, depending on the nature of the conflict, its underlying factors, and its evolution stage, it takes one path or detours to another according to the negotiation progress.

The existence of differences can not be seen as a positive or negative factor, there is not a single way of dealing with those differences as there is not a single negotiating style that works on all scenarios: avoiding conflicts could make sense for some scenarios while advocating for the open discussion of a conflict or even accelerating its climax makes sense for other scenarios.

The Harvard method is based on the application of four principles during the negotiation process:

• Separate the relationship with the people from the substance of the deal. Or, be hard on the deal, soft on the people. Here is why hammering people is not an option (the screwdriver isn’t useful in this case either).
• Focus on shared values and interests, but not on the positions each side takes. A position is typically immovable and hinders the negotiation progress.
• Brainstorm options for mutual benefit. Several options focusing on the interests of all the parties.
• Use objective criteria for decision-making. The proposals are subject to an objective analysis to conclude a result.

In a negotiation the objectives of all the parties should be considered, a win-win relationship should be looked for, free of non-negotiable positions, where every one’s expectations are discussed and mutual benefit agreements are achieved according to objective criteria.

The analysis of the causal or constituent parts of the conflict, the identification of its type (substantive or emotional), its effect (functional or dysfunctional), its relational level (interpersonal, intrapersonal, intergroup, and inter-organizational), and its ignition agents (situations, objectives, personalities) allows for the obtainment of a broad and inclusive perspective of all the elements influencing the conflict, helping on narrowing the choices of techniques that could be applied for its resolution and improving the chances of success in the process.

The negotiation process becomes easier when the parties involved in the negotiation have a collaborative attitude and there is consensus on the objectives. If either party doesn’t have the collaborative attitude, or if the subject under discussion is so complex that there is not potential for value creation, the conditions for the emergence of the competitive negotiation style are set. The competitive style is a style focused on individual gain, no mutual interest, and not focused on building long-term relationships.

The negative connotation currently associated with this style is due to the unbalanced outcome where one party benefits while the other doesn’t, it is a win-lose or zero sum relationship, the benefits obtained by one party are detrimental to the other. This style, however, is considered useful when decisions must be made urgently, are not popular, and there is no time to discuss the available options or alternatives.

Among the strategies that exist for this style, giving the impression of firmness and having high pretensions are the most common. The appearance of firmness puts a pressure on the other party making them go softer on their terms and taving high pretentions are intended for lowering the other party’s expectations.

It is common to arrive at blockages in negotiations driven by the competitive style. Since discussions are centered on positions, and even personalities, the ideas are blurred and a battle of egos emerges. The parties are concerned about their individual objectives and on winning the "negotiation" and they forget all about the other’s perspective. The principle of “walking in others’ shoes” is often forgotten and no mutual points of interests that could benefit both parties are found.

Negotiating under this style is not the best choice of alternative in the course of a negotiation, but having the possibility of dealing with a party unwilling to collaborate, and demanding compliance with its terms, knowing how to cope with a negotiation under this style is favorable.

Having options gives bargaining power and is a fundamental part of the Harvard method to obtain better terms in a negotiation. The BATNA (Best Alternative To a Negotiaded Agreement) is known as the best alternative available before negotiating, it draws a line which should be surpassed for us to think favorably about the negotiation. Falling below this line means the pre-existent alternative is better and what we could obtain from the negotiation is not good enough for our expectative.

Treating conflicts and negotiations under a perspective that lacks methodology and objectivity, without preparation, and without considering the interests of the parties involved is a recipe for obtaining unfavorable terms in a negotiation.

An underlying message is that for negotiating, one must be prepared, investigate the counterpart, determine the likely paths the negotiation could take given either party’s action, and based on this knowledge, further prepare the arguments and the elements that are brought to the negotiating table.