Category: Uncategorized

Introduction
President Trump’s decision to unilaterally withdraw from the JCPOA (the Iran Deal), has generated polarized opinions both domestically and internationally. If we look at the decision in the very narrow context of meeting the objectives of restoring American resolve and fulfillment of campaign promises, a strong argument can be made in favor of the decision.

However, if we examine it in the broader context of the stated desired and warranted objectives (discussed later in this column), the astuteness of the decision becomes more ambiguous

But even then, there is a refined art and science as to how this proposal phase needs to be conducted so as to attain efficient and optimal results. In this column I will share a powerful technique for the proposal and closing part of the negotiation.

The Conventional Approach
Before introducing this technique, let us consider the conventional approach and it’s pitfalls.

In this column I do not intend to judge the wisdom of the decision from a national security, foreign affairs or political standpoint, but rather to examine it from a negotiation scholar and practitioner perspective. I will survey the objectives; the potential outcomes and costs; and I will then offer an alternate approach which may potentially have been more constructive in meeting our objectives and beyond.

U.S.Objectives and Likelihood of Achieving Them
When we attempt to catalog the U.S. objectives with regard to Iran, and what President Trump hoped to realize by withdrawing from the JCPOA, we envision a renegotiated agreement that provides for:

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Introduction
Negotiation is often seen as an event rather than a deliberate orchestrated progression. As a result, many negotiators will push offers and proposals prematurely, before sufficient information has been developed and adequate trust has been built. Proposals at this stage are typically rejected out of hand even though the proposals may actually be good ones.

In truth, it is only after a productive exchange of information has occurred, a profound exploration of each side’s concerns and needs has been achieved, and the parties genuinely feel deeply heard and understood, that the proposal phase of the negotiation can begin.

But even then, there is a refined art and science as to how this proposal phase needs to be conducted so as to attain efficient and optimal results. In this column I will share a powerful technique for the proposal and closing part of the negotiation.

The Conventional Approach
Before introducing this technique, let us consider the conventional approach and it’s pitfalls.

Typically, a party to a negotiation will offer a single-point proposal or offer. For example a job candidate might suggest a salary of $80,000, or a prospective buyer may offer a home seller $500,000 for the purchase of his home. The other party will usually push back with a counter offer, and the bargaining standoff begins. This will end in either impasse or in a compromise in which potential value has been sacrificed and a degree of resentment might even have been spawned.

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Introduction
Much has been debated in negotiation theory and written of in negotiation journals, about negotiating from a position of perceived weakness. There is comparatively little on negotiating from a position of power, perhaps because that is not seen as very much of a challenge or maybe a challenge that we all hope for!

In truth, negotiating from a position of power comes with its own set of challenges, potential pitfalls and dangers. In this column I shall explore some of these dangers, discuss the importance of balancing power with principle and provide ideas of how to achieve that balance.

Potential Pitfalls in Exerting Power in a Negotiation
The kinds of power we may access in a negotiation could come from various sources. Some examples are: hierarchy; knowledge; and having a strong alternative option.

Hierarchy is power. A CEO negotiating with a manager possesses a status which confers significant power upon him that can be exploited in the negotiation.

Knowledge can be a source of power. Suppose a real estate developer is interested in buying a rental property that is in a residential zoning law area. He has inside knowledge that the zoning laws are about to change and will soon include that area into a commercial zoning area.

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Introduction
A few years ago, while working with the European Union (EU), I was having lunch with several European lawyers in Copenhagen. “Why”, one of them asked me in a thick German accent, “when negotiating deals with Americans, they always come with an army of lawyers and reams of contracts?” (In their countries, lawyers play a very minor role and deals are often still consummated on a handshake).

Thinking quickly on my feet, I responded: “In America, people do business on the basis of not trusting one another, hence armies of lawyers and reams of contracts. When Europeans do business, it is on the basis that you do trust one another and therefore less need for the lawyers and extensive contracts”.

This highlights the cultural differences of whether or not to negotiate with someone we don’t trust. In Europe and Japan for example, establishing trust before negotiating is considered a prudent practice in business. The United States however, with more of a “throw caution to the wind” attitude, and a greater risk tolerance, is less concerned about trust, as long as they do the utmost in mitigating risk with very tight contract language and a strong legal system to enforce any breach.

What happens in a culture that typically builds their negotiations on trust such as the Europeans, and finds they need to negotiate with a partner whom they do not trust?

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Introduction
A recent article in the Wall Street Journal (December 27th 2017) presented an interesting international debate between Germany (together with some other NATO allies) and the U.S. as to whether to engage in dialogue with Russia about NATO-Russia issues. The debate pivots on whether talk with Russia will help or hinder the future defense and interests of the NATO alliance, given what many see as Russia’s aggressive stance towards Ukraine.

The article states that U.S. Secretary of State Rex Tillerson said at a meeting of NATO foreign ministers recently that Washington didn’t want regular meetings with Russia “just to talk”. Instead, he said, that the U.S supports “a dialogue with results expected” (emphasis by this author).

Germany, on the other hand, says it remains open to dialogue and in fact recent meetings have allowed the two sides to openly exchange views on difficult and controversial issues.

This difference between the U.S. position and that of Germany, reflect two divergent views on the value of dialogue and talk for its own sake, even when tangible results may not necessarily be the outcome, or even the intent.

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Introduction
With the Holidays fast approaching, festive dinners and family reunions are very much on our minds. The merry partying however is often accompanied by a degree of pressure, due in part, to the potentially volatile human dynamics and family interactions. With the very different personalities and vastly different opinions and beliefs, we wonder with dread, whether Uncle Jack will opine about his strong political views or if Aunt Mavis might start to pontificate about her religious dogma. These sorts of differences and dynamics mean that family gatherings can quickly become the perfect storm for clashes, conflicts and flare-ups.

However, with the danger also comes great opportunity! An opportunity, to practice and refine our skills so as to manage these potentially volatile conversations and emotionally charged situations effectively, constructively, with grace and with poise, rather than to flee from them.

Below are some strategies to help guide you.

Introduction
Our work as negotiation consultants involves not only the negotiation process itself, but we are often required to design an overall negotiation structure with which to facilitate productive negotiations. This is particularly true of highly complex negotiations where multiple interest groups must be engaged, and many complex issues need to be resolved. Examples might be land usage and environmental negotiations, policy and regulation negotiations, and peace negotiations in conflict-infested regions.

In these kinds of negotiations, success is largely contingent upon how the negotiating structure is setup: who will be represented and who will represent; how will discussions and dialogue be managed; how will information be shared; what should the sequence of the issues be; how will decisions be made and ratified, and so on.

The design of the negotiation structure is, in itself, a complex negotiation which needs to precede the later substantive negotiations so as to increase the chance of overall success.

Perhaps the paradigm of extremely complex negotiations today is the Brexit negotiations – the “divorce” and untangling between England and the European Union. There are many stakeholders both in Europe and the United Kingdom, with a plethora of very complicated issues that need to be resolved in a way that all parties can live with. Issues include the looming questions of: trade; migration; Britain meeting her financial commitments to the EU budget; rights of citizens and workers; the border within Ireland (between the Republic of Ireland which will remain in the EU and Northern Ireland which will leave the bloc as part of the UK). These together with many other thorny issues will need to be negotiated.

Introduction
Consider a negotiation where a land developer is negotiating with a building contractor to build a development of townhouses to rent or sell. Negotiations are going well until the developer demands a clause for an enormous liquidated damages penalty if the project is not completed on schedule. The contractor now feels exploited and pushed towards what he perceives to be an unfair and unbalanced contract. The developer is adamant that because of previous experiences with contractors and losses he has suffered due to delays, he will not agree to a contract without a heavy liquidated damages clause.

The contractor will likely see his current problem in the negotiation to be how to eliminate the liquidated damages clause, while the developer sees his problem as how to convince the contractor to accept an unreasonable liquidated damages clause.

Typically, as in this example, there is no joint, intersecting definition of the problem to be solved, but rather parallel and polarized definitions as each sees his problem from his particular perspective. Furthermore, both contractor and developer in this case, have framed their respective problems in very narrow, limited and zero-sum-like contexts which often leads to sub-optimal outcomes at best and impasse at worst.

How we frame and define the negotiation problem that needs to be solved if parties are going to agree, can frequently make the difference between agreement and impasse.

NAFTA – A Live Case Study
This week, the NAFTA (North American Free Trade Agreement) renegotiation is entering its fourth round of talks in Washington D.C.

Introduction
As North Korea threatens the United States and the world, the National Security Council of the UN considers options available that might deter them. There are two options currently being debated, a military option or economic sanctions.

The military option is problematic, because it would likely result in horrific loss of life in South Korea, the very partner we have pledged to protect by way of treaty. Furthermore, if just one North Korean nuclear weapon survives in such an attack, the results could be devastating.

The sanctions option comes with its own challenges. To stand any chance of success, it would require a reluctant China to stop all trade with North Korea. Additionally, we have no precedent to date where sanctions delivered a decisive blow to cause a swift lifting of hands in surrender. The time that it will take for sanctions to take meaningful effect will be too long, by which time time North Korea will have already developed a nuclear capability to hit the US mainland. Furthermore, Putin, who understands the North Korean mentality better than we in the West do, has stated categorically that they would “prefer to eat grass, rather than to give up their nuclear program” – an opinion we should consider seriously.

This leaves us with the nagging question: Has diplomacy been exhausted?

As service providers or in any sales, one of the more intimidating, but inescapable aspects of the business, is meeting with prospective clients and trying to obtain new accounts. We are not taught how to do this effectively in school, nor do we deliberately go out and seek training or coaching to improve our skills (although that would be money well invested). We attempt an ad-hoc approach without a road map and process, which results in unpredictable and hit-or-miss outcomes.

One of the more threatening situations that we often encounter, is what I call the “differentiation dilemma”. In this column, I will equip you with an approach and process to respond to this potentially perilous encounter with a greater rate of success.

While attempting to win over a new client, we may think that we are impressing them with our professional knowledge and acumen. All seems to be perfectly aligned as we begin to feel quite proud of our salesmanship and performance.

However, that euphoric feeling can be rather abruptly shattered when the prospective client says: “So, tell me, why I should hire or buy from you over the other hundred providers/suppliers who called my office last week?”