Negotiating for Partnerships

8/4/2019 Negotiating for Partnerships

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Negotiating to Build

PartnershipsAASHTO Standing Committee on Quality

Daniel Fodera, FHWA Georgia Division



Overview What is BATNA and why is it important

How do you clarify your interests and develop

a BATNA How to think about the other party's interests

and BATNA

Some common negotiation traps.



What is Negotiating? The process of reaching a mutually acceptable

agreement.



Issues, Positions, and Interests Definitions

Issues are concerns that will be on the table for explicit agreementduring the negotiation

Positions are the parties’ stands on the issues

Interests are the underlying concerns that would be affected by thenegotiation outcome. Interests can include price, relationships,strategic goal implementation, reputation, etc

Positions Vs Interests Incompatible Positions, aren’t necessarily Incompatible interests

Interest-driven bargaining leads to greater value creation and provide moreopportunities for mutually satisfactory deals than position-driven bargaining.

Identify Differences to create value Common ground can help, but different interests can open unexpected

opportunities

Differences may come in forms other than interests – risk tolerance, strategies, etc



Issues, Positions and Interests Job offer example:

An issue is base salary.

A position is your desired ―minimum salary.‖

The interests underlying your position may include your need for a good

income — but may also include status, benefits, new opportunities, andother needs that might be met in ways other than salary.

Positions and interests aren't necessarily identical, interests ofteninclude needs in addition to price.

Interest -driven bargainers see negotiation as the process of reconciling underlying interests.

When positions are incompatible, don’t assume that our interests mustalso be incompatible. If you think "zero-sum" — one party's gain mustnecessarily be the other party's loss. Bargainers miss out on creatingpotential, unanticipated value.

Clarifying Interests



Issues, Positions and Interests Identify possible issues, positions, and

interests in the following negotiations

Outdoor advertising?

Proprietary specs on reflective sign sheeting?

Public involvement on a single project?

Joint Strategic goals – Safety?

Process Review Recommendations – Implementation?

Performance Measures – Public or not?



Part One: Identifying your Interests

and Speculating about the other party’s Describe a negotiation you’re facing in the

future

Describe the issues, your position, and yourinterests

Speculate about the other party’s possible

issues, positions, and interests




Leveraging Differences (Be alert to new possibilities for creating

value)

1. Compare interests – list differing interests2. Identify additional differences

3. Brainstorm ideas for a deal




Improving Your Negotiating Skills Continually assess your own and the other party’s interests

before, during, and at the end of a negotiation. Without a refined sense of one's own objectives and trade-offs, it

is difficult to formulate a strategy or judge its success.

Avoid position driven bargaining phrases like, "So, what'syour position?" or "Here's my position."

Probe beyond the other party’s positions by asking "Why?","Why not?", and "How could this idea be improved?", "Whatwould this idea accomplish for you?" You may discover new

interests that you were not already aware of. Research the other side's concerns, ask questions, and listen

carefully. Not just during negotiations, but during anyimportant conversation with another party.




BATNA

Best Alternative To a Negotiated Agreement.

What you would most prefer to do if you and the otherparty are not able to reach a deal.

Importance of BATNA: Help you make smarter choices because they remove the

pressure to reach an agreement.

Give you more bargaining power because they help you

quickly identify how a proposed deal stacks up againstyour alternatives

Understanding and Developing BATNAs



BATNA

Developing a BATNA Brainstorm possible alternatives to a negotiation.

Weigh your underlying interests for each of thealternatives that you propose — cost, time constraints,relationships, etc.

Determine which alternative is your best alternative.

Speculating About the Other Party's BATNA Consider what the other party's BATNA might be and

what value the other party places on it. Don't fall into the trap of deciding how the other party

should see it versus how he or she really views it.




Identify your own BATNA1. Describe a negotiation you’re facing in the future

2. Ask yourself ―What will I do if this agreement cannot bereached?‖

List Alternatives3. Outline the interests that the alternatives meet or don’t meet.

Consider – ease, process, time pressure, relationships, risks

4. What else could you do to improve your analysis?

5. Are the alternatives practical and actionable? Could they beimproved?

6. Which one is best? The highest value alternative is yourBATNA




Speculate on the other party’s BATNA 1. Speculate what the other party will do if this agreement cannot be

reached‖ List Alternatives

2. Speculate about the interests that the alternatives meet or don’t meet.Consider – ease, process, time pressure, relationships, risks

3. What else could you do to improve your analysis? What can you do to better understand the other’s environment?

4. Bias check – have you fairly imagined the other party’s options?

5. Which one seems best? The highest value alternative is the other party’sBATNA.

6. What questions can you ask during negotiation to uncover the other party’s interests? List them

You’re ready to begin your negotiation. Remember – a BATNA is thestandard against which any proposed agreement must be measured.




Determining BATNA

Compare each alternative toyour interests

Can yougather more information

to improve youranalysis?

Gather informationto assess

alternatives

Refine alternatives so theyare practical and actionable

Select the BEST alternative

Answer the question "Whatinterests does thisalternative meet?"

Answer the question "Whatinterests does this

alternative not meet?"

This is yourBATNA

No

Yes

Repeat to find yournegotiating

partner's BATNA

No

Answer the question "Whatwill I do if an agreement

cannot be reached?"

Are thereany other answers

(alternatives)?

Clarify your interests

Issue Your Position Your Interests

Speculate about the otherparty's interests

Their Position Their InterestsIssue

Describe thenegotiation you're

facing

Yes

Compare interests andidentify additional interests

Brainstorm Ideas for a deal



Examples of BATNA

What do you get if you walk away from the

deal?

Another day at another car dealer Keep the existing job



Common Negotiation Traps Failing to identify your interests

Avoid this trap by clarifying your full range of interests.

In addition to price, consider other interests, such as: maintaining a positive workingrelationship; focusing on the "spirit of the deal" (how the agreement will work inpractice); and ensuring that the negotiation process is perceived as fair and respectfulby both sides.

Neglecting your BATNA Avoid this trap by developing a BATNA — your best alternative to a negotiated

agreement.

Determine what you would do if an agreement cannot be reached.

Ignoring the other side's problem Avoid this trap by viewing the negotiation from the other party's perspective.

Speculate about their underlying interests and BATNA. Compare your interests with those of the other party and look for opportunities for

mutual gain.

Overlooking differences Avoid this trap by searching for differences in interests that can suggest new options

for mutually beneficial deals.

Tool: Avoiding Common Negotiation Traps



Common Negotiation Traps Introducing biases

Avoid this trap by not letting cognitive biases such as role bias (over committing toyour own point of view) and partisan perceptions (painting your side with positivequalities while vilifying your "opponent") enter into a negotiation.

Confusing the deal and the relationship

Avoid this trap by keeping issues surrounding the deal (such as price and servicelevels) and the relationship (such as mutual understanding and respect) separate.

When you and the other side don't feel that you need to trade the quality of therelationship for the terms of the deal, you exchange information more freely andbecome more creative and collaborative in your discussions.

Failing to make appreciative moves Avoid this trap by keeping a constructive dialogue going.

When negotiations stall, solicit the other party's ideas and perspectives on an issue andexpress your appreciation of what the other party brings to the table.

Ignoring the spirit of the deal Avoid this trap by clarifying expectations about how your negotiation will be

implemented.

Determine how you and the other party will work together, resolve disputes,communicate, and handle surprises, before the ink has dried on the contract.

Tool: Avoiding Common Negotiation Traps



Summary Issues are on the table for explicit agreement.

Positions are one party's stands on the issues.

Interests are the underlying concerns that would be affected bythe negotiation's outcome

Common ground can help, but different interests can openunexpected opportunities

Best Alternative To a Negotiated Agreement.

What you would most prefer to do if you and the other

party are not able to reach a deal. To develop a BATNA, you should:

Brainstorm and evaluate alternatives to a negotiation

Determine which alternative is your best alternative.

Speculate About the Other Party's BATNA

Documents

Negotiating for Partnerships