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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 Date Tuesday, April 27, 2004 Time 4:30 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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  1. NCMA World Congress 2004 “Maximizing Value to Stakeholders…Contract Management in the Business World”

  2. Negotiating Conflict Breakout Session 708 Robert Shearer, J.D., University of South Alabama Jeanne Maes, Ph.D., University of South Alabama Date Tuesday, April 27, 2004 Time 4:30 p.m. – 5:30 p.m. NCMA World Congress 2004 “Maximizing Value to Stakeholders…Contract Management within the Business Cycle”

  3. 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”

  4. 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”

  5. Negotiating Conflict • Contract formation • Contract performance NCMA World Congress 2004 “Maximizing Value to Stakeholders…Contract Management within the Business Cycle”

  6. 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”

  7. 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”

  8. 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”

  9. 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”

  10. 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”

  11. 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”

  12. 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”

  13. 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”

  14. 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”

  15. 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”

  16. 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”

  17. 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”

  18. 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”

  19. 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”

  20. 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”

  21. 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”

  22. 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”

  23. 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”

  24. 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”

  25. 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”

  26. 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”

  27. 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”

  28. Solution . . . • Build partnering into the contracting process NCMA World Congress 2004 “Maximizing Value to Stakeholders…Contract Management within the Business Cycle”

  29. 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”

  30. 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”

  31. 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”

  32. 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”

  33. 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”

  34. 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”

  35. 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”

  36. 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”

  37. 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”

  38. 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”

  39. 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”

  40. 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”

  41. 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”

  42. 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”

  43. 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”

  44. 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”

  45. 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”

  46. 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”

  47. 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”

  48. 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”

  49. 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”

  50. 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”

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