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Negotiating Conflict. Breakout Session 708 Robert Shearer, J.D., University of South Alabama Jeanne Maes, Ph.D., University of South Alabama DateTuesday, April 27, 2004 Time4:30 p.m. – 5:30 p.m. Negotiating Conflict.

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Breakout Session 708 Robert Shearer, J.D., University of South Alabama

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Breakout session 708 robert shearer j d university of south alabama

NCMA World Congress 2004

“Maximizing Value to Stakeholders…Contract Management in the Business World”


Breakout session 708 robert shearer j d university of south alabama

Negotiating Conflict

Breakout Session 708

Robert Shearer, J.D., University of South Alabama

Jeanne Maes, Ph.D., University of South Alabama

DateTuesday, April 27, 2004

Time4:30 p.m. – 5:30 p.m.

NCMA World Congress 2004

“Maximizing Value to Stakeholders…Contract Management within the Business Cycle”


Negotiating conflict

Negotiating Conflict

“As practiced by many attorneys, deception is the spirit of negotiation. . . . “

W. Steele, Deceptive Negotiating and High-Toned Morality (Vanderbilt Law Review 1986)

NCMA World Congress 2004

“Maximizing Value to Stakeholders…Contract Management within the Business Cycle”


Nature of conflict

Nature of Conflict

  • Conflict is bad.

  • Conflict is good.

  • Conflict is inevitable.

NCMA World Congress 2004

“Maximizing Value to Stakeholders…Contract Management within the Business Cycle”


Negotiating conflict1

Negotiating Conflict

  • Contract formation

  • Contract performance

NCMA World Congress 2004

“Maximizing Value to Stakeholders…Contract Management within the Business Cycle”


Factors to consider

Factors to Consider

  • Nature of the contract

  • Importance of preserving relationships

NCMA World Congress 2004

“Maximizing Value to Stakeholders…Contract Management within the Business Cycle”


Causes of conflict in contract formation

Causes of Conflict in Contract Formation

  • Opposing values

  • Perceived incompatible interests, needs, & wants

  • Relationships - powerful emotions

  • Power - control of resources

  • Information & meaning

NCMA World Congress 2004

“Maximizing Value to Stakeholders…Contract Management within the Business Cycle”


Negotiation strategies styles

Negotiation Strategies & Styles

  • Adversarial – “Zero-Sum”

  • Problem-Solving

  • Competitive

  • Cooperative

  • Blended

    Guernsey, A Practical Guide to Negotiation (NITA 1996)

NCMA World Congress 2004

“Maximizing Value to Stakeholders…Contract Management within the Business Cycle”


Distributive bargaining

Distributive Bargaining

  • Win-lose outcomes (zero sum)

  • Fixed resources to be divided

  • Opposing interests

  • Main concern: maximize one’s own interests

  • Dominant strategies: manipulation, forcing, withholding information

NCMA World Congress 2004

“Maximizing Value to Stakeholders…Contract Management within the Business Cycle”


Integrative bargaining

Integrative Bargaining*

  • Collaborative win-win possibilities

  • Goal: Maximize joint outcomes

  • Strategies: cooperation, sharing information, mutual problem-solving

  • Both sides feel they have greater value than before the negotiation

    E. Wertheim, Negotiations and Resolving Conflicts: An Overview

NCMA World Congress 2004

“Maximizing Value to Stakeholders…Contract Management within the Business Cycle”


Positional bargaining

Softball

Participants are friends

Goal is agreement

Make concessions to preserve relationship

*Ury & Fisher, Getting to Yes (Penguin Books 1981)

Hardball

Participants are adversaries

Goal is victory

Demand concessions

Positional Bargaining*

NCMA World Congress 2004

“Maximizing Value to Stakeholders…Contract Management within the Business Cycle”


Positional bargaining1

Softball

Soft on the people & the problem

Trust others

Change positions easily

Hardball

Hard on the people & the problem

Distrust others

Dig in to your position

Positional Bargaining

NCMA World Congress 2004

“Maximizing Value to Stakeholders…Contract Management within the Business Cycle”


Positional bargaining2

Softball

Make offers

Disclose bottom line

Accept big losses for agreement

Hardball

Make threats

Mislead as to bottom line

Demand one-sided gains

Positional Bargaining

NCMA World Congress 2004

“Maximizing Value to Stakeholders…Contract Management within the Business Cycle”


Positional bargaining3

Softball

Search for the one answer they will accept

Insist on agreement

Yield to pressure to avoid contest of will

Hardball

Search for the one answer you will accept

Insist on your position

Apply pressure to win contest of will

Positional Bargaining

NCMA World Congress 2004

“Maximizing Value to Stakeholders…Contract Management within the Business Cycle”


Principled negotiation

Principled Negotiation

  • Separate the people from the problem

  • Focus on interests, not positions

  • Invent options for mutual gain

  • Insist on objective criteria

Source: Getting to Yes, Fisher & Ury, 1981

NCMA World Congress 2004

“Maximizing Value to Stakeholders…Contract Management within the Business Cycle”


Assumptions of interest based negotiation

Assumptions of Interest-Based Negotiation*

  • Negotiating can enhance relationships.

  • Interests of all parties can be met.

  • Parties can help each other meet their interests.

  • Open discussion expands mutual interests & options.

  • Standards can supersede power

    *Cahill & McCrary, “Interest-Based Problem-Solving,” (EXECUTIVE 1995)

NCMA World Congress 2004

“Maximizing Value to Stakeholders…Contract Management within the Business Cycle”


Conflict handling styles

Conflict Handling Styles

  • Avoiding/Abdicating

  • Smoothing/Accommodating

  • Competing/Dominating

  • Compromising

  • Collaborating

NCMA World Congress 2004

“Maximizing Value to Stakeholders…Contract Management within the Business Cycle”


Breakout session 708 robert shearer j d university of south alabama

Conflict Handling Styles

  • Accommodate

  • Make concessions to

  • preserve relationship

  • Goal is agreement

  • Collaborate/Partnering

  • Win-win approach

  • Develop multiple options

  • Focus on interests

High

Compromise

Focus on Relations

  • Abdicate/Avoid

  • Avoid disagreement

  • Accept other’s position

  • Dominate/Compete

  • Push for one solution

  • Maintain hard positions

Low

Focus on Issues

High

Low

NCMA World Congress 2004

“Maximizing Value to Stakeholders…Contract Management within the Business Cycle”


Goal joint problem solving

Goal: Joint Problem-Solving*

  • Sitting side by side

  • Facing the problem

  • Reaching a mutually satisfying agreement

    *W. Ury, Getting Past No (Penguin 1993)

NCMA World Congress 2004

“Maximizing Value to Stakeholders…Contract Management within the Business Cycle”


Barriers to cooperation

Barriers to Cooperation*

  • Your reaction

  • Their emotion

  • Their position

  • Their dissatisfaction

  • Their power

    *W. Ury, Getting Past No (Penguin 1993)

NCMA World Congress 2004

“Maximizing Value to Stakeholders…Contract Management within the Business Cycle”


Breakthrough negotiation

Breakthrough Negotiation*

  • Go to the balcony.

  • Step to their side.

  • Reframe.

  • Build a golden bridge.

  • Use power to educate.

    *W. Ury, Getting Past No (Penguin 1993)

NCMA World Congress 2004

“Maximizing Value to Stakeholders…Contract Management within the Business Cycle”


Know your batna

Know Your BATNA

  • Best Alternative to a Negotiated Agreement

  • “Walk away” – course of action if an agreement is not reached

  • Access/influence opponent’s BATNA

NCMA World Congress 2004

“Maximizing Value to Stakeholders…Contract Management within the Business Cycle”


Breakout session 708 robert shearer j d university of south alabama

Dispute Management Continuum

War

Time and Expense

Partnering

Appeals

Litigation

Arbitration

Negotiation

Mediation

Facilitated

Negotiation

Prevention

Loss of Control/Damage to Relationship

NCMA World Congress 2004

“Maximizing Value to Stakeholders…Contract Management within the Business Cycle”


Adversarial dispute resolution

Adversarial Dispute Resolution*

Transactional Costs

  • Legal fees & court costs

  • Claims processing

  • Lost income, time, & opportunity

  • Emotional stress

    *J. Reeves, “ADR Relieves Pain of Health Care Disputes,” 49 Dispute Resolution Journal 14 (September 1994)

NCMA World Congress 2004

“Maximizing Value to Stakeholders…Contract Management within the Business Cycle”


Adversarial dispute resolution1

Adversarial Dispute Resolution

Satisfaction with the Outcome

  • Limited opportunity for expression

  • Loss of control

  • Limited opportunity to participate

  • Unfulfilled interests & “wants”

NCMA World Congress 2004

“Maximizing Value to Stakeholders…Contract Management within the Business Cycle”


Adversarial dispute resolution2

Adversarial Dispute Resolution

Impact on Relationships

  • Process may intensify hostility

  • Future dealings jeopardized

NCMA World Congress 2004

“Maximizing Value to Stakeholders…Contract Management within the Business Cycle”


Adversarial dispute resolution3

Adversarial Dispute Resolution

Recurrence of Conflict

  • Role of parties in resolution

  • Perception of fairness

NCMA World Congress 2004

“Maximizing Value to Stakeholders…Contract Management within the Business Cycle”


Solution

Solution . . .

  • Build partnering into the contracting process

NCMA World Congress 2004

“Maximizing Value to Stakeholders…Contract Management within the Business Cycle”


Why partnering in contract performance

Why partnering in contract performance?

  • To prevent disputes and manage conflict

  • To create win-win possibilities

NCMA World Congress 2004

“Maximizing Value to Stakeholders…Contract Management within the Business Cycle”


The objective of partnering

The Objective of Partnering

  • To design an effective joint problem-solving team composed of personnel from all stakeholder parties, creating a single culture, with a common set of goals and objectives.

NCMA World Congress 2004

“Maximizing Value to Stakeholders…Contract Management within the Business Cycle”


Partnering is

Partnering is…

  • An innovative process for building cooperative, collaborative relationships among diverse stakeholders to achieve specific business objectives.

NCMA World Congress 2004

“Maximizing Value to Stakeholders…Contract Management within the Business Cycle”


In the partnering relationship

In the Partnering Relationship

  • All seek win-win solutions.

  • Trust and openness are norms.

  • No one benefits from exploitation.

  • Innovation is encouraged.

  • Each party is aware of the other’s needs, concerns, and objectives.

  • Overall performance is improved.

NCMA World Congress 2004

“Maximizing Value to Stakeholders…Contract Management within the Business Cycle”


Steps in partnering

Steps in Partnering

  • Top level commitment

  • Facilitator selection

  • Workshop for key players

  • Goal setting

  • Team building

NCMA World Congress 2004

“Maximizing Value to Stakeholders…Contract Management within the Business Cycle”


Steps in partnering1

Steps in Partnering

  • Communication skills

  • Decision-making profile

  • Issue identification/resolution process

  • Action planning process

  • Assessment process

  • Follow-up plans

  • Partnering agreement

NCMA World Congress 2004

“Maximizing Value to Stakeholders…Contract Management within the Business Cycle”


The role of facilitators

The Role of Facilitators

  • Help define issues and clarify objectives

  • Help identify the parties who need to participate

  • Provide expertise in dispute management, collaborative processes, & communications skills

NCMA World Congress 2004

“Maximizing Value to Stakeholders…Contract Management within the Business Cycle”


The role of facilitators1

The Role of Facilitators

  • Help the group establish ground rules

  • Assist participants in setting an agenda

  • Help make physical arrangements for meetings

NCMA World Congress 2004

“Maximizing Value to Stakeholders…Contract Management within the Business Cycle”


Partnering workshop agenda

Partnering Workshop Agenda

  • Introductions/overview

  • Team/trust-building exercise

  • Management team profile

  • Common goals/interests

NCMA World Congress 2004

“Maximizing Value to Stakeholders…Contract Management within the Business Cycle”


Partnering workshop agenda1

Partnering Workshop Agenda

  • Action plans for critical issues

  • Issue resolution process

  • Follow-up plan

  • Mission statement

NCMA World Congress 2004

“Maximizing Value to Stakeholders…Contract Management within the Business Cycle”


At the beginning of the workshop

At the beginning of the workshop…

  • Name/organization

  • Project role, responsibilities

  • Hometown

  • Family

  • Hobbies or interests off the job

  • First or most interesting job

  • What you’d do if you had a one-year sabbatical?

NCMA World Congress 2004

“Maximizing Value to Stakeholders…Contract Management within the Business Cycle”


Developing goals and responsibilities

Developing Goals and Responsibilities

  • Organization_______

  • Our organization’s goals on this project are:

  • From our point of view, the goals and responsibilities of the other organizations represented on this management team are:

    __________________________________________________________________

NCMA World Congress 2004

“Maximizing Value to Stakeholders…Contract Management within the Business Cycle”


Problem issue identification worksheet

Problem/Issue Identification Worksheet

  • I represent___________

    The following issues or problems are high priorities and need to be addressed at this partnering session:

  • ______________

  • ______________

NCMA World Congress 2004

“Maximizing Value to Stakeholders…Contract Management within the Business Cycle”


Action planning

Action Planning

  • Identify the problem.

  • Analyze the problem.

  • Causes/Impacts

  • Evaluate possible solutions.

  • Recommend a solution.

  • What

  • When

  • Who

  • How

  • Where

  • Measure/Assess

NCMA World Congress 2004

“Maximizing Value to Stakeholders…Contract Management within the Business Cycle”


Issue resolution process

Issue Resolution Process

  • Commitment to resolve disputes internally

  • Clarify decision-making authority

  • Categorize disputes (interpretation, performance, site-level, etc.)

NCMA World Congress 2004

“Maximizing Value to Stakeholders…Contract Management within the Business Cycle”


Issue resolution process1

Issue Resolution Process

  • Set realistic timetables

  • Get the right people involved

    Authority & expertise

    Outside neutrals

    Internal resolution board

NCMA World Congress 2004

“Maximizing Value to Stakeholders…Contract Management within the Business Cycle”


Partnering action plan

Partnering Action Plan

  • Monitor action plans

  • Orient new players

  • Evaluate partnering process

  • Plan follow-up activities

  • Formal workshops

  • “Lessons learned” sessions

  • Site level meetings

  • Support level meetings

  • “Extra-curriculars”

NCMA World Congress 2004

“Maximizing Value to Stakeholders…Contract Management within the Business Cycle”


Partnering agreement

Partnering Agreement

We, the partners of the XYZ Project, recognizing our common goals and interests, are committed to achieving the following objectives:

  • Quality

  • Safety

  • Timely performance

  • Financial viability for all parties

NCMA World Congress 2004

“Maximizing Value to Stakeholders…Contract Management within the Business Cycle”


Partnering agreement1

Partnering Agreement

We will achieve these objectives through:

  • Mutual trust and respect

  • Open communications

  • Proactive problem-solving

  • Flexibility and responsiveness to each other’s needs

NCMA World Congress 2004

“Maximizing Value to Stakeholders…Contract Management within the Business Cycle”


Partnering vulnerabilities

Partnering Vulnerabilities

  • Skepticism of the process

  • Resistance to change

  • Lack of top management commitment

  • Uneven levels of commitment

  • Changing business conditions

  • Failure to share risks

NCMA World Congress 2004

“Maximizing Value to Stakeholders…Contract Management within the Business Cycle”


Partnering vulnerabilities1

Partnering Vulnerabilities

  • Lack of open communications

  • Personality conflicts

  • Changes in key personnel

  • Failure implement action plans

  • Failure to use issue resolution process

  • Loss of momentum/no follow-up

NCMA World Congress 2004

“Maximizing Value to Stakeholders…Contract Management within the Business Cycle”


The follow up workshop

The Follow-up Workshop

  • Time frame

  • Assessment of technical vs. nontechnical issues

  • Type of facilitator

  • Agenda

NCMA World Congress 2004

“Maximizing Value to Stakeholders…Contract Management within the Business Cycle”


Follow up agenda

Follow-up Agenda

  • Refocus on common goals

  • Focus on the positive aspects of partnering and evaluate the process

  • Evaluate the project status from each stakeholder’s perspective

NCMA World Congress 2004

“Maximizing Value to Stakeholders…Contract Management within the Business Cycle”


Follow up agenda1

Follow-up Agenda

  • Re-emphasize the value of different decision-making styles

  • Develop new action plans

  • Create new strategies to keep the partnership alive and well

NCMA World Congress 2004

“Maximizing Value to Stakeholders…Contract Management within the Business Cycle”


Lessons learned

Lessons Learned

  • What practices, processes, etc. have worked well and should be continued?

  • What do you perceive as the greatest obstacle(s) to achieving our common goals?

  • What can the other party (ies) do to help us be more efficient and effective?

NCMA World Congress 2004

“Maximizing Value to Stakeholders…Contract Management within the Business Cycle”


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