Negotiating agreement without giving in

In business, government, or the family, people reach most decisions through negotiation. Negotiation is a basic means of getting what you want from others. It is back-and-forth communication* designed to reach an agreement when you and the other side have some interests that are shared and others that are opposed.

Although negotiation takes place every day, it is not easy to do well. Standard strategies for negotiation often leave people dissatisfied, worn out, or alienated – and frequently all three.

People find themselves in a dilemma. They see two ways to negotiate: soft or hard*. The soft negotiator wants to avoid personal conflict and so makes concessions* readily in order to reach agreement. He wants an amicable resolution; yet he often ends up exploited and feeling bitter. The hard negotiator sees any situation as a contest of wills in which the side that takes the more extreme positions and holds out longer fares better*. He wants to win; yet he often ends up producing an equally hard response which exhausts him and his resources and harms his relationship with the other side*. Other standard negotiating strategies fall between hard and soft, but each involves an attempted trade-off between getting what you want and getting along with people.

There is a third way to negotiate, a way neither hard nor soft, but rather both hard and soft. The method of principled negotiation developed at the Harvard Negotiation Project* is a method of negotiation designed to produce wise outcomes efficiently and amicably. This method, called principled negotiation or negotiation on the merits*, can be boiled down to* four basic points.

These four points define a straightforward method of negotiation that can be used under almost any circumstance. Each point deals with a basic element of negotiation, and suggests what you should do about it.

People:	Separate the people from the problem.
Interests:	Focus on interests, not positions.
Options:	Generate a variety of possibilities before deciding what to do.
Criteria:	Insist that the result be based on some objective standard.

The first point responds to the fact that human beings are not computers. We are creatures of strong emotions who often have radically different perceptions and have difficulty communicating clearly. Emotions typically become entangled with the objective merits of the problem*. Taking positions just makes this worse because people's egos become identified with their positions. Hence, before working on the substantive problem, the "people problem" should be disentangled from it and dealt with separately. Figuratively if not literally*, the participants should come to see themselves as working side by side, attacking the problem, not each other. Hence the first proposition: separate the people from the problem.

The second point is designed to overcome the drawback of focusing on people's stated positions* when the object of a negotiation is to satisfy their underlying interests. A negotiating position often obscures what you really want. Compromising between positions is not likely to produce an agreement which will effectively take care of the human needs that led people to adopt those positions. The second basic element of the method is: focus on interests, not positions.

The third point responds to the difficulty of designing optimal solutions while under pressure. Trying to decide in the presence of an adversary narrows your vision*. Having a lot at stake* inhibits creativity. So does searching for the one right solution. You can offset these constraints by setting aside a designated time within which to think up a wide range of possible solutions that advance shared interests and creatively reconcile differing interests. Hence the third basic point: before trying to reach agreement, invent options for mutual gain.

Where interests are directly opposed, a negotiator may be able to obtain a favorable result simply by being stubborn. That method tends to reward intransigence and produce arbitrary results*. However, you can counter such a negotiator by insisting that his single say-so is not enough and that the agreement must reflect some fair standard independent of the naked will of either side. This does not mean insisting that the terms be based on the standard you select, but only that some fair standard such as market value, expert opinion, custom, or law determine the outcome By discussing such criteria rather than what the parties are willing or unwilling to do, neither party need give in to the other; both can defer to a fair solution*. Hence the fourth basic point: insist on using objective criteria.

The method of principled negotiation is contrasted with hard and soft positional bargaining in the table below, which shows the four basic points of the method in boldface type*.

The four propositions of principled negotiation are relevant from the time you begin to think about negotiating until the time either an agreement is reached or you decide to break off the effort*. That period can be divided into three stages: analysis, planning, and discussion.

During the analysis stage you are simply trying to diagnose the situation – to gather information, organize it, and think about it. You will want to consider the people problems of partisan perceptions*, hostile emotions, and unclear communication*, as well as to identify your interests and those of the other side. You will want to note options already on the table and identify any criteria already suggested as a basis for agreement.

During the planning stage you deal with the same four elements a second time, both generating ideas and deciding what to do. How do you propose to handle the people problems? Of your interests, which are most important? And what are some realistic objectives? You will want to generate additional options and additional criteria for deciding among them.

Again during the discussion stage, when the parties communicate back and forth, looking toward agreement, the same four elements are the best subjects to discuss. Differences in perception, feelings of frustration and anger, and difficulties in communication can be acknowledged and addressed. Each side should come to understand the interests of the other. Both can then jointly generate options that are mutually advantageous and seek agreement on objective standards for resolving opposed interests.

To sum up, in contrast to positional bargaining, the principled negotiation method of focusing on basic interests, mutually satisfying options, and fair standards typically results in a wise agreement. The method permits you to reach a gradual consensus on a joint decision efficiently without all the transactional costs of digging in to positions only to have to dig yourself out of them*. And separating the people from the problem allows you to deal directly and empathetically with the other negotiator as a human being, thus making possible an amicable agreement.

PROBLEM		SOLUTION
Positional Bargaining: Which Game Should You Play?		Change the Game – Negotiate on the Merits
SOFT	HARD	PRINCIPLED
•Participants are friends.	•Participants are adversaries.	•Participants are problem-solvers.
•The goal is agreement.	•The goal is victory.	•The goal is a wise outcome reached efficiently and amicably.
•Make concessions to cultivate the relationship.	•Demand concessions as a condition of the relationship.	•Separate the people from the problem.
•Be soft on the people and the problem.	•Be hard on the problem and the people.	•Be soft on the people, hard on the problem.
•Trust others.	•Distrust others.	•Proceed independent of trust.
•Change your position easily.	•Dig in to your position.*	•Focus on interests, not positions.
•Make offers.	•Make threats.	•Explore interests.
•Disclose your bottom line*.	•Mislead* as to your bottom line.	•Avoid having a bottom line.
•Accept one-sided losses to reach agreement.	•Demand one-sided gains as the price of agreement.	•Invent options for mutual gain.
Search for the single answer: the one they will accept.	Search for the single answer: the one you will accept.	Develop multiple options to choose from; decide later.
Insist on agreement.	Insist on your position.	Insist on using objective criteria.
Try to avoid a contest of will.	Try to win a contest of will.	Try to reach a result based on standards independent of will.
Yield to pressure.	Apply pressure.	Reason and be open to reasons; yield to principle, not pressure*.

SUCCESS STORIES OF SOME AMERICAN COMPANIES

Although most top managements assert that their companies care for their people*, the excellent companies are distinguished by the intensity and pervasiveness of this concern. The only way to describe it adequately is through example.

RMI

RMI is a good one to start with. A subsidiary of U.S. Steel and National Distillers*, it is an integrated producer of titanium products. For years its performance was substandard. Poor productivity, poor profits. But in the last five years RMI has had a remarkable success, owing almost entirely to its adoption of an intensely people-oriented productivity program.

The program started when "Big Jim" Daniell, a former professional football player, was made chief executive. The program he installed was described by The Wall Street Journal as "pure corn* – a mixture of schmaltzy sloganeering*, communication, and a smile at every turn." His plants are peppered with notices that say: "If you see a man without a smile, give him one of yours," or "People rarely succeed at anything unless they enjoy it." All are signed "Big Jim."

The story doesn't get much more complicated than that. The company's logo is a smile-face, which is on the stationery, on the front of the factory, on signs in the factory, and on the workers' hardhats. RMI's headquarters is in Niles, Ohio, which everyone now calls "Smiles, Ohio." Big Jim spends much of his time riding around the factory in a golf cart, waving and joking with his workers, listening to them, and calling them all by their first name – all 2,000 of them. Moreover, he spends a lot of time with his union*. The local union president paid him the following compliment, "He calls us into his meetings and lets us know what's going on, which is unheard of in other industries."

What's the result of it all? Well, in the last three years, with hardly a penny of investment spending, he's managed an almost 80 percent productivity gain. And at last report, his average backlog of union grievances* had declined from about 300 to about 20. Big Jim, say those of his customers that we've come across (e.g., at Northrop), simply exudes care about his customers and his people*.