Every day of our lives, whether in business or in personal relationships, we will engage in communication which requires the need to resolve
divergent interpretations and differences of opinion. This can be in relation to a complex contract or even something as simple as several people seeking to agree where to eat lunch.
In my experience, human relationships are complex and diverse. However, it is the failure to understand the needs and interests of others which can cause antagonism and conflict. In many instances, this can have a significant and detrimental effect on the business and goodwill of commercial businesses.
In complex situations, the best communicators have an ability to identify the parties’ positions of power and plan how best to convey their thoughts accordingly. Such discussions involve an awareness of the other partiers’ perceptions and emotions. Prior to embarking upon negotiation or resolution of a dispute, I advise my clients to consider some of the following issues:
- their relationship with the other party
- the precipitating events of the conflict or dispute
- the visions and requirements of both parties
- the information which should be sought from the other side during the negotiation
- what objectives are required to be considered and
- what are the potential risks and losses to both parties in the absence of an agreement being reached.
Despite technology and modern means of communication, the personal face-to-face meeting, whether over a board table or private meeting room, is still seen as being the most likely means of resolution of disputes. Whether you are about to embark on a multi-party negotiation, or enter into a discussion for a quotation for construction works, similar concepts apply.
A number of points which I have learned throughout my career which apply to such a meeting are as follows:
- It is likely, in any negotiation, that both parties will need to give up ground. Both parties need to communicate their willingness to compromise from their initial starting points.
- While the negotiation is designed to reach a result, it is also the best time to seek information from the other side to clarify any ambiguous points.
- If the parties reach an impasse, a strategy to move things forward can be to change the process from claiming rights and values to creating value for both parties thereby pursuing both parties’ visions.
- It is important to establish credibility in communication by identifying the causative events which created the conflict.
- Observe, learn and develop rapport to enable a behavioural change to influence the outcome.
- Recognise that both parties will have the perception of incompatible goals which can lead to antagonistic interaction.
- A process will need to be implemented where the parties move to problem-solving through an exchange of proposals or offers.
- A positive relationship can be created by enhanced information flow.
- Where a mediator or conciliator is not present the parties will need to be aware of the terms of exchange and the identifiable costs and benefits for each party for not reaching agreement.
- The parties must become aware of the various options and associated outcomes to make an informed decision.
- Human factors of personal identity and issues such as face honouring and social identity cannot be overlooked as important factors.
- Always document outcomes in writing – either in Heads of Agreement or Terms of Settlement.
There is no science to negotiation. The process involves diverse interpretations, emotions and behaviours born of stress and anxiety. It is not surprising that negotiation is paradoxical.
However, it is clear that one is more likely to reach agreement in negotiations by distributing information and focusing on positive and equitable outcomes rather than discrediting the other party.
Mutual trust and cooperation will succeed where adversarial attempts at domination can only encourage litigation.
When faced with an aggressive or domineering party trying to exert their influence or position of power to reach a favourable outcome, it is important to maintain your balance and listening skills. Negotiation must be turned from competition to a communication process grounded in transforming the exchange toward problem-solving. Each individual will have unique perceptions and attributes and these matters will need to be identified and considered.