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Negotiation and Conflict Resolution - MaRS Best Practices


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All technology ventures eventually run into conflicts and disputes. Companies survive and thrive by managing and resolving these disagreements quickly and effectively.

Join us and learn practical skills for successful negotiation, conflict management and dispute resolution. And find out how to recognize and respond effectively to different negotiation styles and strategies.

Published in: Business, Technology
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Negotiation and Conflict Resolution - MaRS Best Practices

  1. 1. 11-12-21 1
  2. 2. Negotiation andConflict Resolution MaRS Discovery District Best Practices Series December 8, 2011 Presentation by Michael Erdle, Co-Founder Practical Resolutions Inc.
  3. 3. Introduction
  4. 4. Introductionv  Negotiationv  Conflict Resolution
  5. 5. What is Negotiation?v  Negotiation is: v  a process. v  a structured conversation. v  a means to an end (agreement about something).v  We do it all the time, without really thinking about it.
  6. 6. Basis for Negotiationv  Powerv  Rightsv  Interests
  7. 7. Escalation
  8. 8. PowerPower Strategies: Characteristics of Power:•  Take action unilaterally. •  Adversarial•  Win at all costs •  “Win/Lose” at best•  Attack/Defend •  Usually “Lose/Lose”•  Threaten •  Extremely expensive•  Coerce •  Negative impact on future•  Withdraw (Take the Ball and Go relationships Home)•  Physical (or verbal) violence
  9. 9. RightsRights Strategies: Characteristics of Rights:•  Contracts (guarantee the •  Adversarial minimum) •  “Win/Lose” at best•  Policies, procedures, rules •  Often “Lose/Lose”•  Precedent •  Extremely expensive•  Past practice •  Time-consuming•  Legal action •  Impact on future relationships?•  Third-party decisions (e.g. arbitration)
  10. 10. InterestsInterests Strategies: Characteristics of Interests:•  Identify what’s really important •  “Win/win” process•  Dialogue about needs and wants •  Collaborative•  Honest sharing of information •  Interdependent•  Maximize results for all parties •  Builds trust•  Help everyone explore and •  Positive impact on future understand their own interests, relationship and interests of other parties•  Needs an ongoing relationship
  11. 11. Power, Rights, Interests All out “War” Unilateral Action Power Threats, Coercion Litigation Arbitration RightsCosts Investigation/Fact Finding Go Up Conciliation Interests Mediation Negotiation Problem Solving Prevention Control Goes Up
  12. 12. The “Golden Rule”
  13. 13. De-escalation
  14. 14. Duty to Negotiate in Good Faithv  Obligation to respect the legitimate interests of other party and to deal promptly, honestly, fairly and reasonably with them. v  Shelanu Inc. v. Print Three Franchising Corp. (Ontario Court of Appeal)v  Implied in negotiation where there is an imbalance. v  Wallace v. Grain Growers (Supreme Court of Canada)
  15. 15. Duty to Negotiate in Good Faith Spectrum of contractual dutiesSelfish Selfless Unconscionability ! Good Faith Fiduciary Duty
  16. 16. Duty to Negotiate in Good Faithv  Fiduciary: v  Trustee v  Corporate Director v  Lawyerv  Good Faith: v  Professional Code of Ethics v  Contract v  Employee/Employer
  17. 17. Negotiation Stepsv  Distributing Value vs. Creating Value v  Opportunistic v  Problem-solvingv  Identify Issues v  What does each side want and need?v  Consider Interests v  Common v  Complementary v  Conflicting
  18. 18. Effective Negotiationv  Interests vs. Positions v  “Needs” vs. “wants”v  “Separate the People from the Problem.” v  Soft on the person v  Hard on the problemv  Consider other Options
  19. 19. Effective Negotiationv  Seek Objective Alternativesv  Determine BATNA and WATNA v  Best Alternative to Negotiated Agreement v  Worst Alternative to Negotiated Agreementv  Look for a “win-win” solution.
  20. 20. Effective Negotiationv  Successful relationships are built on communication and trust.v  Lack of trust leads to “win-lose” or “lose-lose”.v  Negotiation is one way of creating trust – or deciding whether trust is justified.
  21. 21. The Prisoner’s DilemmaScenario:v  Adam and Bob arrested near the scene of a robbery.v  Victim, badly injured, says one person hit him but can’t say who.v  Both are carrying stolen property; no weapon.v  Questioned separately by the police.v  Enough evidence to convict both of theft, but not to convict either one of assault.v  Each prisoner must choose whether to confess and implicate the other.
  22. 22. The Prisoner’s Dilemmav  Simple problem: confess or dont confess. v  If neither one confesses, both will serve one year (possession of stolen property). v  If each confesses and implicates the other, both will go to prison for 10 years. v  If one confesses and the other doesn’t, the collaborator will go free, and the other will go to prison for 20 years.
  23. 23. The Prisoner’s Dilemma Prisoner’s Adam Dilemma confess silent confess 10 10 0 20Bob silent 20 0 11
  24. 24. The Prisoner’s Dilemmav  Lack of trust is fatal – neither can trust the other to remain silent.v  So the only rational action is to confess.v  That produces the best result no matter what the other person does. v  Other is silent – you go free v  Other confesses – both go to jail.
  25. 25. Multiple Negotiationsv  Selfish strategy works in a “winner take all” game.v  Life is rarely like that.v  Most negotiations are based on a continuing relationship.v  What happens if there’s a series of negotiations?
  26. 26. Multiple NegotiationsPayoff Matrix Player 2 Player 2 cooperates retaliates Player 1 cooperates 3, 3 0, 5 Player 1 retaliates 5, 0 -2, -2
  27. 27. Multiple Negotiationsv  “Tit-for-Tat” strategy is most successful.v  Four key conditions: v  Nice v  Retaliate v  Forgiving v  Generous
  28. 28. Multiple Negotiations1.  The player always cooperates, unless provoked.2.  The player always retaliates, if provoked.3.  The player is quick to forgive –co-operate next time.4.  The game must continue long enough for the ‘retaliation and forgiveness’ pattern to affect opponent’s behaviour.
  29. 29. Power Ploysv  Classic “Hard Bargaining” Ploys v  Extreme claims, small concessions v  “Take or leave it.” v  Unreciprocated offers v  Threats and warnings v  Attacking the alternatives v  Good cop, bad cop
  30. 30. Ways to Respondv  Extreme claims, small concessions v  Tit for Tat – make equally small concessions.v  “Take or leave it.” v  Make a counter offer. v  Offer an alternative. v  Don’t be afraid to walk away.
  31. 31. Ways to Respondv  Unreciprocated offers v  Don’t negotiate against yourself. v  Wait for a serious counter offer.v  Threats and warnings v  Don’t make a counter-treat. v  Challenge the underlying assumptions .
  32. 32. Ways to Respondv  Attacking the alternatives v  Ask for an explanation. v  “Why do you have a problem with…?”v  Good cop, bad cop v  Negotiate with the boss. v  Use the “good cop” to your advantage.
  33. 33. Understanding InterestsCommon Interestsv  Parties want the same things.v  E.g. company and workers both want to avoid strikes and workplace grievances (costs them both money).
  34. 34. Understanding InterestsComplementary Interestsv  Parties want different things, but they don’t conflict.v  E.g. company wants to increase productivity & profits; workers want better pensions.
  35. 35. Understanding InterestsConflicting Interestsv  Parties want different and incompatible things.v  E.g. company wants to reduce labour costs; workers want to be paid more.
  36. 36. Understanding Interests Triangle of Satisfied Interests Three Types of Interests:! ! Results (Substantive Interests): This is the “what”. Getting to a deal is the result or substantive interest.! ! Process (Procedural Interests): This is the “how”. The process -- how long it takes, how fair it is – are process, or procedural interests.! ! Emotion (Psychological Interests): This is the “why”. Wanting to “win”, to save face, gain respect, are psychological interests.! !Note: Triangle adapted withpermission from CDR EMOTIONAssociates, Boulder, Colorado (Psychological)
  37. 37. Negotiation Stylesv  Assertiveness vs. Empathyv  Three common negotiation styles v  Competitive v  Accommodating v  Avoidancev  Effective negotiator is assertive and empathetic.
  38. 38. Negotiation Skillsv  Communication is the key to effective negotiation.v  What you say is often less important than how you say it. v  Tone v  Body language
  39. 39. Negotiation Skillsv  Understanding and recognition do not mean compromise and concession. v  “I understand” vs. “I agree”.v  Your own emotions and subconscious brain can hinder your ability to negotiate effectively.
  40. 40. Negotiation Skillsv  Listening v  Develop “active listening”.v  Understanding v  Acknowledge the other person’s perspective.v  Flexibility v  Be open to other options.v  Pragmatism v  Accept the best available option.
  41. 41. Conflict ManagementMediationv  Mediation is a form of facilitated negotiation.v  The Mediator guides the process and helps the parties negotiate more effectively.v  The Mediator does not decide who is right or wrong.
  42. 42. Mediationv  Interest-based Mediation v  Mediator is a facilitator. v  Focus on interests, not legal rights or obligations. v  Options for creative solutions.v  Evaluative Mediation v  Neutral evaluation. v  Based on legal rights & obligations.
  43. 43. Mediationv  Qualities of an effective mediator: v  Subject area knowledge v  Negotiation & mediation process skills v  Lets parties make key decisions v  Creative approach to the problem v  Patience
  44. 44. Resourcesv  Cohen: You Can Negotiate Anything, Bantam, 1980v  Fischer, Ury and Patton: Getting to Yes, Penguin, 1991v  Ury: Getting Past No, Bantam, 1993v  Mnookin, Peppet and Tulumello: Beyond Winning, Harvard University Press, 2000v  ADR Institute of Ontario (ADRIO)
  45. 45. Questions?