Fail to prepare or prepare to fail – the importance of preparation in workplace negotiations
Negotiation is part of our every day lives both at home, and at work, yet very few people receive any formal training in negotiating skills via their formal education. This is quite astounding when you consider the extent of negotiation which takes place in the home (i.e. use of a car, household chores, curfews for teenagers, grocery shopping duties, allocation of family budget, entertainment activities, purchase of a house or car or any other big ticket item etc). Similarly, in our work lives negotiation is all pervasive and may include issues such as access to training, promotion criteria, overtime coverage, annual leave, conflict between subordinates, dispute settlement, justification for a merit increase and more formal workplace agreement negotiations.
Typically, our negotiations in our home environment are not preceded by a great deal of preparation and perhaps it is here where people can pick up bad habits. These bad habits are then transferred to the workplace and a similar off-the-cuff approach towards workplace negotiations is often encountered.
This is typically so where managers and supervisors have competing demands on their time and it is not uncommon to find a manager come out of a 9:30 am meeting and head into a negotiation about a workplace dispute at 9:45 am with virtually no preparation whatsoever. Surprisingly the prospects of a successful outcome in such a scenario are negligible. The age old adage “If you fail to prepare; prepare to fail” certainly holds true in workplace negotiations. This is particularly so where a manager or supervisor is negotiating with a union official who spends a large part of his or her every day working week negotiating with various companies. As such, they are inevitably skilled negotiators who have honed their skills through trial and error over a long period of time and their skills are internalised to the extent that they are unconsciously competent.
As Abraham Lincoln said, “If I had 6 hours to chop down a tree, I would spend the first 4 hours sharpening the axe”. Preparation is very often the difference between a successful outcome and a failed outcome to workplace negotiations.
In the industrial relations context where the stakes to a workplace negotiation may be high, it is my experience that most managers and supervisors will at least attempt to prepare for the negotiation. However, in my experience there are three often encountered mistakes made by managers or supervisors when preparing for a workplace negotiation. These are as follows:
1. They give very little thought to the negotiation process;
2. They fail to view the issues from the other side’s perspective;
3. They give virtually no thought to the order in which they will deal with the issues for negotiation.
Whenever I am involved in assisting parties to prepare for negotiations I always make sure that these three areas are covered in the strategic preparation stage as they can play a major part in shaping the style as well as the outcome of the negotiation. I will deal with each of these issues:
The Negotiation Process
Very often people do not focus on how they are going to negotiate with the other party. In workplace negotiations, whether you are negotiating with a union on behalf of employees or with employees directly, it is very important to maintain an effective working relationship with the other party. As such, a negotiation process that is not destructive of that relationship is very important.
Thus, if you are going to haggle, bluff, misrepresent and possibly even lie about what would be an acceptable outcome for you this will harm the ongoing relationship. This is particularly so if the other party feels as if they have lost or have been cheated out of a reasonable outcome as a result of the negotiation process.
Accordingly, employers should think about:
What information they are going to share
Any information that is commercially in-confidence, which will not be shared
How you are going to explore the other party’s interests whilst at the same time propose your interests
Are you able to separate the process of generating various options form evaluation of those options
What ground rules would you like to establish for the negotiations
Will you be able to engage in a ranking exercise of the issues for negotiation (see below)
What is the length and frequency of the negotiation meetings going to be
Some of these things you will not be able to determine on your own, as they would require the agreement of the other party. However, by thinking about these prior to the negotiation and developing a plan to raise them, for example in a pre-negotiation meeting you are very often able to shape the negotiation process so that you break down the “us and them” and create a process which is more akin to the parties to the negotiation being joint problem solvers.
View the Issues from the Other Side’s Perspective
Very often management teams will prepare for negotiation by viewing the negotiable issues from their own perspective only. They will focus on the substance of the negotiation and develop arguments/justifications for their desired outcome. Linked to this they may have an ideal settlement outcome and then a fallback settlement outcome. Typically, they would negotiate and try to achieve the ideal outcome by holding on to their position for as long as possible and presenting arguments/justifications in favour of this position.
This style of positional bargaining does not help the parties to achieve a mutually satisfactory outcome.
One way of avoiding this potential pitfall is to focus on your interests that underlie your stated position and to do the same for the other party.
Useful questions that can be used to foster thinking about interests developed by William Ury, co-author of “Getting to Yes” and author of “Getting Past No” are the following:
Ask yourself, “If tomorrow they agreed to go along with what we wanted, what would we want?” or “What do I care about?”;
Ask yourself “If tomorrow we agreed to go along with what they wanted, what would they want?”; or “If I were in their shoes, what would I care of worry about?”;
Ask “Why do they want what they want?”;
Ask “Why will they not agree with what we want?”;
Ask “Whose decision do I want to effect?”
By focusing on interests, both yours and the other party’s, prior to the negotiation you are in a better position to be able to explore various options that are mutually satisfactory. This style of negotiation preserves the underlying relationship between negotiating parties.
The biggest mistake a manager can make is to seek to win at all costs in a workplace negotiation. This is because over time the ability to influence will change and the party that feels as if they have “lost” the negotiation will want to get even, often at all costs, even if this is destructive to his or her own interests. Such a scenario can make for a workplace riddled with conflict and acrimony.
Once you have looked at both yours and the other party’s interests it is an extremely useful exercise to rank each issue (in a multi issue negotiation) in terms of importance to each party. To do this you simply put on your company hat and rank the issues, let’s assume that there are eight of them, in order of importance. You may either start with the most important issue and then the least important issue and work towards the middle or you could start with each issue and rank it as either one, two, three etc. until you reach the issue which is ranked eighth in importance.
You would then put on the hat of the other party that you are negotiating with and do the same ranking exercise from their perspective.
All those issues, in the above example, which are ranked one to four are then marked as “high” in importance and all those issues ranked five to eight are ranked “medium” in importance. By doing such an exercise you are easily able to identify those issues which have the most potential for conflict and those issues where there is room for movement or compromise.
Order of Issues
The above ranking exercise should also be used to determine the order in which the issues are to be negotiated.
It never fails to amaze me the number of times I have come across senior managers who simply agree to commence negotiations at the start of an agreement, for example, and then work their way through it or worse still, simply start at issue number one on a union log of claims and work their way through it with no strategic thought as to the order in which the issues should be dealt.
By taking such an approach the parties could be unknowingly setting themselves up for failure. Take, for example, that the union log of claims had wages, overtime and weekend penalties as the first three issues on the log of claims. These issues are likely to be extremely high in importance for both the management team and the union/employees. Accordingly the parties could reach deadlock in a very short space of time, given that they would butt heads on all three issues. Very often by starting a negotiation in this way it can exacerbate the differences between the negotiating parties. Preconceived ideas of the unreasonableness of the other side are re-affirmed from the outset and an “us versus them” mindset can very quickly dominate further negotiations.
On the other hand, if the management team have ranked the issues and identified what is high in importance and medium in importance to each party they could then suggest commencing the negotiations with items which were both medium in importance to the union and medium in importance to the company. Hopefully in this way they are able to agree, in principle at least, on some of these medium issues which then breaks down the “us and them” mentality which can be present in workplace negotiations. The mindset of both negotiating parties turns to “Hey, these guys are not so bad after all; we’ve managed to reach in principle agreement on three issues in our first meeting”.
Then the high/high issues are dealt with, but can be separated so that they are not all on the agenda for any one particular negotiation session.
There is also the ability to try to trade off issues which are medium to the company, but high to the union against issues which are high to the company but medium to the union.
In this way at least some logic is brought to bear in terms of the order in which issues are discussed as opposed to blindly starting at the top of a list to which no thought has been given when it was compiled.
I have used this ranking method to great effect with a number of unions. In a spirit of trust both parties agreed to rank the various issues that were up for negotiation and determine those issues which were high in importance and those issues which were medium in importance. The parties then returned to the negotiating table and shared the rankings with each other. This then enabled the parties at the end of each negotiation session to determine which issues would be up for negotiation at the following negotiation meeting and inevitably each agenda was started with an issue which was medium in importance to both parties and the high/high issues were interspersed between the negotiation sessions and there was the ability to openly advocate trade offs between medium/high issues and high/medium issues to each party.
In all these negotiations settlement was reached within six meetings.
However, even if you do not have a relationship with the other negotiating party that allows you to adopt this type of negotiation process, as a strategic preparation tool the ranking of issues and resultant ordering of the issues for negotiation is an extremely important tool in shaping the course of ongoing negotiations.
Summary
So in summary you should always be thoroughly prepared for negotiations. It is not sufficient to simply prepare arguments and justifications for your positions. You need to try to view the issues from the other side’s perspective and understand your interests as well as the other side’s interests. You also need to give thought to the negotiation process and try to structure a process that breaks down the “us and them” and creates a problem-solving mindset. This will not happen on its own; it requires some strategic preparation and planning.
Lastly, it is extremely important to rank issues in importance to both parties. This enables you to easily identify those issues which will require the most preparation given the fact that the potential for conflict is the greatest surrounding these issues. It also enables you to order the issues so as to avoid potential impasse early on in a negotiation. If this ranking exercise is done with the other party it can be a readily demonstrable exercise of mutual trust by the negotiating parties which then flows through to the style in which the negotiations are conducted.
Should you wish to adopt a more strategic approach to preparing for your workplace negotiations please contact Mark Rodgers, Director.
