Guidance note on power in negotiations

Negotiations are often seen as an exercise of power between parties; one party’s power relative to the other can more likely than not influence what outcome both can expect from the negotiation table.

 

How then should a negotiator approach the negotiating table with a party that appears to be more resourced, more connected or otherwise in a more powerful position?

This article provides some background to power in negotiations and briefly explores the concept of principled negotiations.

 

The powers of a negotiator

Roger Fisher identifies six categories of power that can be used to enhance a negotiator’s strategy, regardless of the relative power of the other party.

The categories of power are as follows (see Roger Fisher, ‘Negotiating Power: Getting and Using Influence’, The American Behavioural Scientist, 27(2) (1983), 153):

  1. the skill and knowledge to understand what we and the other party want out of the agreement and what opportunities are available to us;

  2. relationships that provide us a positive rapport with the other party;

  3. knowledge of the best alternative to a negotiated agreement (BATNA), or what opportunities we have to look forward to if we walk away from the negotiation table;

  4. an elegant solution that provides options to satisfy the interests of both parties;

  5. legitimacy in our proposals, so that they are perceived as ‘fair’; and

  6. an affirmative commitment to do positive things for the other party.

 

Principled negotiation

These categories of power become essential elements of a negotiation strategy in what Fisher and Ury refer to as principled negotiation (see Roger Fisher and William Ury, Getting to Yes: Negotiating an Agreement without giving in, UK: Randmon House, 1992, xiv), also known as interest-based negotiation. It could also be referred to as a win-win negotiation. Principled negotiation is conceived in contrast to more adversarial modes of negotiation, in which parties compete in a zero-sum game to acquire a larger slice of the same pie. Instead, principled negotiation aspires to find situations of mutual gain, where both parties can cooperate to identify solutions that meet their respective interests.

In a principled negotiation, a skilled negotiator can use the categories of power identified above to improve the position of their client (or their own position), and better prepare themselves against perceived power imbalances that may exist between the parties. The ability to make optimal use of these categories is particularly important where relations of power are dynamic, and skilled negotiators should be prepared to make the most out of opportunities that arise from these changeable relations of power.

A skilled negotiator should particularly be prepared to approach the negotiation table with a clear sense of their client’s BATNA. Fisher and Ury emphasise that a good foreknowledge of your client’s BATNA is important in understanding your client’s position, opportunities and limitations (see Fisher and Ury, 110). In other words, preparation is key. These opportunities and limitations will in turn inform what you want. Clear objectives are essential. If there are generous opportunities for you or your client outside of the negotiation, you are unlikely to accept an unfavourable offer. Likewise, if you or your client is unlikely to find their interests met elsewhere, you will not be so quick to walk away from the negotiation table.

Be mindful, however, not to underestimate your power in negotiations. Any party that has an opportunity for a benefit or a risk of an adverse consequence has a vested interest in negotiations. A negotiators role is to identify and test that interest, to explore possible win-win solutions.

Of course, power is just one factor in negotiations. Complex negotiations are dynamic and a good negotiator will help you prepare by identifying opportunities in your negotiation process.

MPS Law provides expert negotiation services to clients in a wide range of matters, including in relation to commercial matters and native title. More information about native title negotiations is available here.

For more information, contact Michael Pagsanjan (michael@mpslaw.com.au).

 

Guidance note on effective mediation

Mediation is a form of dispute resolution that, if conducted appropriately, can effectively resolve conflicts without having to go to Court.

 

There is a growing trend to explore alternative ways to resolve disputes. This includes mediation. Courts are increasingly referring matters to mediation in an attempt to increase the resolution of disputes without the need for trial. Indeed, trials are notoriously long, unpredictable, emotionally exhausting and expensive. On the other hand, mediation provides disputing parties with an opportunity to take control of the outcome in a way that focuses on what is practical, avoiding the need for rigid legal positioning. 

Mediation may not be appropriate to every situation. For example, mediation requires willing participants who are committed to resolving the dispute. In addition, where there is a perception of a power imbalance, that must be addressed before participants commit to mediation. However, where mediation is appropriate, this brief outline explores four tips that will help you get the most out of mediation.

1. Prepare

Mediation is only effective if you give it the time it deserves, not only on the day of any mediation meeting, but also beforehand.

Before mediation, ask yourself, ‘What do I want to get out of mediation?’ and be prepared to speak to that during the mediation. A good mediator will explore these issues with you well before any mediation meeting. A good mediator will also allow the participants to set the agenda based on the specific needs of the participants.

If you’re attending a mediation in a representative capacity, for example on behalf of an organisation or a community, confirm your objectives and parameters before the mediation. You will get the most out of mediation when you have the authority to settle, or, at least know what is likely to be supported by the ultimate decision makers.

2. Listen

Listening is paramount to effective mediation. Proper listening is more than just hearing the words that someone is speaking. Listen to the tone being used and the emotions that are being expressed. This will help you to better understand the positions that are being put forward. Having said this, don’t assume you understand the position; often problems are a lot more complex than what may be detailed in a mediation meeting. As a result, keep an open mind. This is sometimes referred to as ‘active listening’. 

Active listening will also reassure the other participants that they are being heard, and may help to restore trust between the participants. A good mediator will make sure people are understood and allow participants to speak to each other rather than to or through the mediator. Remember, it is not the role of the mediator to be a spokesperson for the participants. 

We recommend that all participants practice active listening before attending mediation. It is harder than what it sounds, but with practice (say with your family at home, or, with colleagues during a work meeting) it will put you in a good position during any mediation.

3. Explain your challenges

In so far as you are willing and able, be open during discussions. Use your own words to explain the challenges you are facing. Our experience shows that being transparent about what impacts you builds an understanding between participants that can be rarely achieved in any other setting. Indeed, sometimes mediation is conducted after ‘letter-warfare’ driven by legal positioning. Being open in explaining your challenges restores the human reality on what may have been a messy and hard-fought legal battle beforehand.

A good mediator will ask strategic questions of all participants throughout the mediation to help participants explain how they are feeling. A good mediator will probably also, at various times, invite participants to separate sessions where they can privately discuss concerns with only the mediator present. The purpose of those private sessions is not to maintain veils of secrecy. Rather, the purpose of private sessions is to provide a safe environment to help break-down barriers impacting frank communication between the participants. 

Remember, mediation is confidential and without prejudice. This means that neither the participants nor the mediator can talk about what is discussed outside of mediation unless it is agreed by everyone. In addition, it means that anything that is said in mediation cannot be used against you at a later time. 

4. Trust the process

If you do not trust the process and are not wanting the problem to be resolved at all, or, are thinking that you will be able to achieve some other ulterior purpose, do not proceed with mediation. Your time is valuable and mediation won’t work, so don’t waste your time or that of the mediator. 

On the other hand, if you are open to trusting the process and willing to prepare, listen and explain your challenges, mediation may be right for you. A good mediator will explain their role, the process and reassure the participants on the benefits of mediation. A good mediator will also help you to identify common ground and give you opportunities to restore damaged relationships, but equally will not shy away from getting the real issues out on the table for discussion. 

If, during mediation, something is bothering you or you genuinely do not believe what is being said, respectfully call it out and get your views on the table. You should leave a mediation knowing that everything you wanted to say was said during the mediation. A good mediator will give you opportunities to do so without you having to interrupt the other party. A good mediator will also see these ‘flash points’ as opportunities rather than unhelpful impasses. 

Mediation is more than just a fancy catchword. While there are no guarantees, mediation has a solid track-record as an effective way to resolve disputes. Indeed, mediation is now a recognised profession in its own right because of its success. Without doubt, lawyers are not necessarily good mediators – there are a range of other professional backgrounds that may be relevant and helpful to your mediation. Consequently, be sure to choose a mediator that all participants have faith in. 

For more information about how to prepare for mediation, please contact us.

Michael Pagsanjan is a nationally accredited mediator and listed on the Federal Court List of Approved External Mediators for native title matters. Michael has several years of experience with mediation around Australia.