Negotiation is not Appeasement

The past couple days there has been a discussion between American political figures about appeasement.

One side says it is appeasement to be willing to negotiate with one’s enemies. Candidate Obama—who may have been the target of the remarks by President Bush and Candidate McCain—says it is not appeasement to be willing to talk, as a means of averting violence when there are strong issues between the two sides.

This web log is not about picking politicians. It is about negotiation. Negotiation is not appeasement, it is good sense. Being willing to negotiate—in a context of some agreed ground rules—is the beginning of solving problems by resolving issues.

You need a reasonable set of ground rules, whether the issues are as large as those in the Middle East, or as small as whether Johnnie or Susie gets to play with the fire truck for the next half hour. Those ought to include agreement to be civil, not to call names or make accusations. Instead, the focus ought to be, first, on clear statements by each side on what they need to get out of the negotiation. Not “You stop hitting me.” /”You stop cursing me first.”

Instead, “I need to be able to live without being hit.” The debate is not then to be about which side is stronger and can win a battle, but whether both sides would be happy without violence, and what the details of such a peace would be.

Both sides should be creative about what they might concede to get peace, provided those concessions are part of a package, a complete deal.

The deal struck ought to be one which outsiders would consider reasonable, fair and just.

Although the root of the word “appease” is in the word “peace”, we today usually take the word to mean to buy off at the expense of principle.

However, not every principle is one most people would consider fair, reasonable and just. For example, drawing from the Middle East, some Americans would consider it their principle that every nation should be democratic in government. But not everyone would agree that it is just to apply that principle to a nation not your own.

Some Muslims believe as a principle that a government must follow strictly the rules and governmental structures laid down in the Quran. They do not accept a democratic government, nor practice by non-Muslims of rules of life not in the Quran, e.g., their own faith’s rules of life.

It is clear both cannot exactly follow their principles and come to an agreed resolution, because both sides wish to apply their own principles outside their own dominion. Both sides will need to give to get.

I am not suggesting what that might look like. Wiser heads than mine have been working on this for many decades.

I do suggest that there are rules both sides could agree on during the process of coming to terms, such as mutual respect, civility, working together creatively to make a resolution, and listening sincerely to the views of third parties on what is fair, reasonable and just.

One can, then, be firm (“I will talk, but I reserve the right to say ‘no.’”), and insist on those rules of process as a precondition to speaking, while expressing a willing to negotiation. That is not appeasement.

Negotiation 101: One can negotiate, under pre-established rules of process, aiming at a mutually agreed bargain, without it being appeasement.

Zen and Negotiation

I have not written for a while, having been busy both practicing law—mostly working with inventors to license their patents—and teaching seminars on negotiation.

Doing half a dozen seminars the past few months, I have been experimenting with titles and techniques. I have come to believe that attitude and affect are the most important things to bring to the table.

Books and teachers often teach tricks to use at the table, or clever parries. But this scripting carries a risk. What if you don’t recognize your cue when to use a trick or parry one? (Line, please.)

More important I think is to come to the table prepared mentally. At the least of course is being prepared with information about the folks on the other side, and with a good sense of what you need to bring away (not just a prepared “position” or demand and a fall back).

Scholars about the highest levels of negotiations—settling border disputes and avoiding war, and making high-value deals—know that is all about one’s own psychology, and maintaining self-control and self-awareness.

People familiar with the notion of Zen offer a way to do this, called “mindfulness.” At its essence, it means practicing the art of seeing yourself and your situation from outside yourself. It means seeing the whole picture, in its most objective way. It certainly means not demonizing the other people. And it means keeping your own balance when provoked.

Provocation is often not intentional, but simply the other side stating their needs, which do not match your own.

The best part is one does not need at all to become a Buddhist, does not need to adopt a religion, to become mindful. Nor for that matter to sit in a “lotus” position. One needs to study and practice.

Negotiation 101: Being aware objectively of the process and minute-to-minute changes of circumstance are key to negotiating successfully.

Producers and Networks Worked From Faulty Script

The Fall 2007 strike by the Writers Guild against producers and the TV networks illustrates exactly the wrong way to bargain if you want a deal. I am not privy to the bargaining tables, so I can’t assign blame for certain. But I know the management side expressed some faulty reasoning in their public statements.

Experts say there are four basic principles for successful negotiation at all levels. One is to leave all the personal stuff at the door. Instead, this seems to be a contest to show who has a bigger something. Score: 0-0. Second basic: both sides should be focused on inventing possible solutions rather than repeating their opening positions as mantras. I don’t know how detailed the Guild ideas were about dealing with electronic media—which are the crux of the dispute. But Management initially refused to even mention these media in any deal. Score: Writers 1 – Management 0.

Another principle is to express clearly and candidly to the other side what you see your interests and needs for the final outcome to be. Because I am not privy to the bargaining I cannot score this. The Writers were pretty candid publicly, not as far as I know the Management side.

Let me expand on this a moment. The root purpose of any contract is to allocate risk. More precisely, it is to lay out a bunch of what-ifs (conditional events) and say what each side must do or receive in each case. Example: ‘If Harry Homebuyer comes up with the finance to buy 123 Main St. by such and such date then Oscar Owner must deliver to him good title and vacate promptly, else Oscar keeps Harry’s deposit.’ It is almost like programming, in a computer sense, a relationship between people or entities. The focus is on conditionalal or uncertain events. Sometimes the ‘program’ is a ‘regardless.’ For example, ‘Regardless whether corn prices go up or down between now and ninety days from now, A must deliver to B on that date 1000 bushels at a dollar a bushel.’ (B risks the price might go down, and A that it might go up.)

Everyone agrees it is uncertain even months later what will end up the success or shape of the economics of electronic media. This is exactly when you start building what-ifs, dividing the risks so each side has some risks and some possibilities of reward. The Writers seemed ready to do this, but Management initially said they would not bargain in this area at all as long as there is uncertainty.

This seemed more a cheap excuse or cover for using cash in bank to wait out the writers and break their Guild than anything else. The producers were stalking horses for huge corporations. Those three really big dogs could live off their various enterprises and cash probably much longer than can the writers off their personal savings.

What the big dogs do not have is public support, both in terms of American support for underdogs, and American demand for new comedy and drama. The underdog support touches another basic principle of negotiation, that almost everyone likes to be seen as a fair-dealer, although self-evaluation in this area varies.

So what we saw mostly was not negotiation but a kind of cold war. It is likely to continue. Will there be winners? The Canadians have developed a facility for producing TV and artsy movies. The big dogs cranked movies into cans in anticipation, and were slowly letting them out of cans. They could eventually start buying TV ‘product’ from Canada. Non-US movie studios might increasingly make product for movie theatres, although probably not the large-scale movies only Hollywood can mount. One could also expect sports to become bigger on TV, and for 2008 presidential politics, another sport, a really big one as it turned out. Senator George J. Mitchell, who settled the conflict in Northern Ireland, famously said “Conflicts are created and sustained by human beings. They can be ended by human beings."

Splitting the Difference Can be Lose-Lose Negotiation

I want a million dollars for my building and you think it’s worth half that. Why don’t we just split the difference? One answer is that although it seems on the surface an efficient solution, it is really expedience, not reason.

To see that, let’s look at a famous dispute recorded in history where someone recommended splitting the difference. Two women came before King Solomon, sitting as judge, to settle a custody dispute involving a single living child. Each woman claimed that the other woman's baby had died, and that the surviving child was her own.

There was very little useful evidence. There were only two witnesses, the disputing parties, and each claimed to be biological mother of the child. They contradicted each other about their relationship with the surviving child. Each had a strong reason to lie and thus neither was credible.

Solomon was not stymied. After all, as king he was the law. He ordered the bailiff to bring a sword, to cut the surviving child in half, and to give each woman an equal share.

One of the women shrugged and quickly agreed to the plan. "Seems fair to me."

Still, the other woman wasn't pacified. She shrieked, "This isn't right! Please! Give her the child! Anything, but don't kill the baby!"

Solomon allowed the child to live. Pointing to the woman who complained about his proposal, he said, "This one is the mother," and awarded custody to her.

Who knows whether this really happened? Still, had Solomon not had the wisdom for which he is famous, it certainly would have been a case of splitting the difference.

Is splitting the difference for your current deal best, or would you be better off trying one of two other methods. The first is to think about whether the deal isn’t really more complex than just price. Are there other terms as or more important, such as payment scheduling or a million other things? If you are splitting a pie, is there any way to work together to make the pie bigger?

The other method is to see if the type of object in question or similar ones are sold often enough in the market to warrant looking at comparable sales. In real estate both parties would of course check that. However, in other areas the idea does not always occur. eBay® is a possible basis, but is tricky to use since only final bids are close to valid. Sometimes one can get hold of comparable salary data, while keeping in mind no two people are exactly fungible. Still, it’s worth looking for external market measures before jumping to a split. That is especially true since an exaggerated first offer by one of the parties distorts where the split is between them.

Negotiation 101: Don’t just split the difference. Think about an alternative method, such as negotiating other terms or looking for comparable things actually sold.

Negotiate ‘Off The Line’

In late Feb. ’07 the Edmonton Oilers ice hockey team dealt away one of their top players, Ryan Smyth, to the NY Islanders. Many were surprised, because Smyth is a native Canadian, (he grew up near Edmonton in Banff) and Canadian teams don’t often trade away Canadian players—it ticks off the locals. Why they did may have been a miscalculation by Smyth’s agent, Don Meehan.

Apparently, and I have no inside information (I read http://chuqui.typepad.com/two_for_elbowing/), Meehan and team G.M. Kevin Lowe were talking right up to the trade deadline, and were about $300K apart out of $5 million a year on a five-year deal. (Imagine the airborne testosterone.) Who is going to blink first? Meehan supposedly did not think Lowe would do a trade, but would blink first and kick in the extra 6%. Instead, Lowe picked up a phone and traded Smyth away.

Doing that, he ticked off fans but also scared every player negotiating with him for several years, until the memory fades. He probably pays a lot less for the player he gets for Smyth, giving him money to buy other players and maybe wins more games each year over the long haul. Also, he wounds Meehan’s reputation, perhaps helping himself even more, since Meehan has several players in his stable. There’s another hooker: not having signed a 5-year contract as they were discussing, Smyth apparently becomes a free agent in a few months, and Lowe can try to get him back, but maybe at his price.

I am not going to second guess what should have happened in the emotional last 30 minutes. I am instead going to talk about how difficult it is to bargain when you insist on inching along the line that separates the two parties on price, each making small concessions.

Bargaining experts suggest you get “off the line.” Here’s what I mean—and from here I allow myself a bit of fiction, since I don’t know the facts about this hockey player. Maybe the length of the contract could also have been put in play. Depending on his age and injury history, Smyth might want a contract longer than five years, to protect himself. Lowe (management) might really have wanted a shorter contract, if Smyth’s future beyond three years or so is uncertain.

Meehan, the agent, might have offered to do a four-year deal, but with a guaranteed fifth year if Smyth scores so many goals the fourth year, in exchange for the $300K per year. Presumably, he knew his client’s needs exactly at this time, and had “chess-boarded” what might happen at the last moment. What if Lowe, the G.M., sees a long future for Mr. Smyth and refuses that? Then Meehan can suggest—or Lowe might—a longer deal than five years, with a few more bucks per year.

Or there could be bonuses each year for goals scored, or opponent goals blocked (or major opposing players sent home on medical leave—maybe not).

The point is that it is no longer a pure blinking contest. When there are continuing relations between the negotiators, no one really wins a blinking contest. It makes everything a personal contest, with the players as pawns. Better to get into shared problem solving. (Better, also, not to bargain in the last 30 minutes, but humans tend to procrastinate, including me.)

Bargaining ‘off the line’ is an example of what negotiation pros call moving from the personal to problem solving—treating the situation as a problem both sides want solved, and working together despite different interests to satisfy the both interests as well as possible. It’s a lot less stressful than horse-trading and gets better results.