Negotiation – An Art or a Science?
Webster defines a “science” as a “branch of knowledge concerning a subject.” A science is often thought of as being definite and predictable. For example, in mathematics we know that if you add 1 + 1, you always get 2. We also know that the area of a square or a rectangle is always determined by multiplying its length by its width. In physics, we know that you can determine foot pounds of energy by multiplying velocity or speed by weight. Simply put, science deals with predictable results.
Webster defines an “art” as a “system of rules and traditional methods for the practice of a craft, trade or profession, the application of knowledge and skill.” The results of practicing an art are not always definite or predictable as in a science. The act of negotiation does not always bring about a definite or predictable result. Therefore, negotiation appears to be an art, not a science.
I distinguish between an art and a science because it is important to realize that regardless of the skill of the negotiator or the procedure followed, and although you may have identical negotiators in two similar but separate transactions following identical procedures and methods of negotiations, the results often differ because of the many variables that come into play. Examples of variables are the parties involved, their needs, moods and financial positions at the particular time, the economy, interest rates, the condition of both parties’ businesses, and quite often and very importantly, the egos and personalities of the parties involved.
To be successful in the art of negotiation, one must learn the rules and traditions involved, as in any other art. Following are some of the most significant rules and traditions of the art of negotiation, emphasizing legal negotiations.
1. Know what you are talking about.
Be acquainted with all relevant facts and try to agree upon the facts. Differences must be isolated and identified. The negotiators should also agree, if possible, on applicable law. The facts and applicable law are threshold matters ideally resolved at the outset. However, disagreements regarding either does not necessarily preclude final resolution. Differing opinions regarding the facts or the law will affect each negotiator’s view of final resolution.
2. Determine the goals of the parties.
Try to determine the motives and needs of the opposite parties (what exactly each party is trying to achieve). After disclosing the needs of each party, experienced negotiators often can arrive at a solution acceptable to both sides.
For example, if the parties agree that money is the issue, an explanation of the tax benefits or detriments to each may result in an acceptable, mutually beneficial agreement, which may not have been reached without disclosing each party’s goals. Considerations may be whether or not the money is taxable or deductible or treated as capital or ordinary income. Disclosing each party’s objectives can speed up the negotiation process and assist in resolving a dispute and reaching a final agreement. It is not unusual for an apology from one party to the other to move the other party to accept an otherwise unacceptable proposal. It is essential that the negotiators know and try to understand their client’s motives and objectives.
3. Determine the temperaments, personalities and egos of the parties (and of the negotiators).
Ego and pride can be major obstacles to resolving a controversy because everyone wants to win an argument and be proven right. A major function of independent negotiators (i.e., lawyers, real estate brokers, mediators) is to render non-emotional, objective service to the negotiation process. Awareness of the temperaments, personalities and egos of the parties and keeping the parties apart to avoid them from offending each other will allow the negotiators “give and take” during the process without unduly upsetting the parties. Never let your ego or pride get in the way of contacting the other party to the negotiation to continue ongoing communication to resolve the problem.
4. Make reasonable demands or offers.
Do not make demands or offers that are unreasonable and which you should know will not be accepted. An unreasonable demand or offer often results in bringing the negotiation process to a halt. Always appear to be reasonable, yet firm.
5. Be honest in your dealings and negotiations.
Be honest without divulging confidences. A negotiator never should be guilty of misrepresentation (different from not saying anything, if what you are withholding will hurt the process). However, not saying anything in certain circumstances may result in a misrepresentation upon which the other party may rely.
6. Do not create obstacles to the process.
Never build a “brick wall,” or insurmountable obstacle, between you and the other negotiator. The only time you should say that a point is nonnegotiable is when it truly is, and then, depending on the circumstances, after trying to achieve that point without so stating.
7. Disclose “clinching” facts at the opportune moment.
Although certain facts may be very persuasive, consider withholding them temporarily and disclose them at an opportune time when you feel that it will do the most good in bringing the dispute to final resolution, the “icing on the cake,” so to speak.
8. Make a definite offer.
In financial negotiations, never offer to pay or accept a range of dollars. For example, do not say “I will accept or pay $100.00 to $125.00.” We know that if you are the person offering to pay, and you make that offer, you will be asked to pay the higher amount. Conversely, if you are the person making the demand, you will be asked to accept the lesser amount. It is better to set the higher or lower amount at the outset, which the other party may accept or counter. These are some of the basic rules of the art of negotiation. We hope that by following these simple suggestions and guidelines you will be able to achieve successful results in your negotiations.