Wednesday, November 21, 2018

NEGOTIATION 101

NEGOTIATION is not for the faint-hearted. Anybody who wants to negotiate must come to the table prepared- physically, mentally and emotionally. Preparation is the key, that is why homework was invented. In the military, it is called “Intelligence Preparation of the Battlefield”. A negotiator must know when and how to push it or hold back, to win some and lose some, to give in and strike back. While the ideal is to find a way for both parties to find a “win-win” solution, he must also be prepared to deal with the loses and how to cut it. A great general knows when to use his reserves and the aces in his sleeves. When one prays for the rain, he must be prepared to deal with mud too. 

The exercise began on a good note with each “competing” group excited about outwitting each other to gain a favorable contract. It started with strategizing as groups (representing the two opposing countries) established their respective objectives. Was it about kicking the other water company out of business, or was it about forging a solid and mutually beneficial relationship “against” the client country? Both sides tried to play it nice and easy during the first round. Everyone was sensing what the position of the other side would be. They were both trying to figure how the other side thinks, decides and moves. When the die was cast, both sides discover that their expectations are so much different from reality. They both wanted to play it nice but ironically, both of them also felt that the other side will not. They tried to reach an agreement through informal talks hosted by a non-actor. Everyone was hopeful the other would honor the result of the talks but alas, one of them reneged with the agreement- to the dismay of the other. When shots are fired, and blood is drawn, there is usually no turning back. Both parties wanted to give silver for a gold which turned the negotiation into a brawl. The other side was out for the blood of the other and soon enough, they were on each other’s throat until someone had the guts to say “stop, look, listen, talk”. The game ended with an air of bitterness. It was supposed to be “trabaho lang, walang personalan”- focus on the issue and not on the individual. One was disappointed that trust was broken instantaneously. Why can’t they play nice? The other was equally disheartened. Why can’t they lose with grace? When negotiations collapse, who is there to blame? Was it the winner- a no-nonsense player who would do everything for their country’s survival but at the expense of the other? Was it the loser who was trying to play nicely to forge an “unlikely partnership” but naive to the other side’s intentions? Was it the water consumer who seemed to have played the two countries, knowing the long-standing bitterness and animosity between them? What benefit would it bring the consumer if the two suppliers played it rough against each other?
The exercise brought into light the importance of a third party in the negotiation (in this case another country other than the three actors). Hosting negotiators of opposing sides in one’s turf is not an easy task. Aside from the strain it puts on a country’s resources, it also puts its reputation on the line, and puts its own citizens at risk. Opposing parties are sometimes extremely hostile to each other. Hosting them both might bring hostilities in one’s territory. Third parties must have the credibility, tenacity and wherewithal to endure long, tedious, arduous, controversial and complicated negotiations. Back channel talks are important. This is where emissaries- trusted people of both sides come into play. They either bring home good news or carry with them bad ones but they are instrumental in brokering important deals. [In my case, it is our daughter who does track 2 negotiations when I am in trouble with my wife. And she is good at it.]

Negotiations are often misunderstood by many (including me) hence the following questions: What does it take to successfully negotiate with an opposing party? Is negotiation needed with a neutral camp? What are the consequences of failed negotiations aside from the obvious (disappointment, possible hostilities/animosity)? What is the next step after a failed negotiation? To what extent should we pursue negotiation with, say, an extremely aggressive party? When do we stop and say enough?