When Negotiation Fails…?

July 17, 2015 By Irma Tyler Wood

Not every negotiation you engage in, even if you are highly skilled, will be a success.  Although the collaborative process of negotiation Ki ThoughtBridge teaches is designed to maximize your possibilities for achieving negotiation success, the process also anticipates the reality that no method or process of negotiation can guarantee success every time.  This blog will explain how one simultaneously plans for the possibility of success and the possibility of failure at the same time.  Below, in figure one is the Seven Element Negotiation process Ki ThoughtBridge recommends for important, complex negotiations.   Six of the seven elements help you prepare for negotiation success.  One, element, Alternatives, helps you anticipate and plan for failure.  This blog is all about how to use your Alternatives in order to maximize your chances for success while protecting your interests in case the negotiations fail.     

“Alternatives,” is a term of art used in this negotiation model.  It refers to all of the things a negotiator can do on their own to meet their interests, without the agreement, approval or cooperation of other party or parties to the negotiation.  Alternatives differ from options in that options require the other party’s approval to implement them, Alternatives do not.  Options must be raised at the negotiation table, in order to implement them.   Alternatives don’t have to be discussed with the other negotiators, you are free to implement them if you choose. For example, let’s say you just got a new job and you need transportation to that job.  The interests, i.e., the underlying goals, needs, concerns and fears that underlie your goal of transportation include quick, reliable, safe, affordable, and environmentally clean and energy efficient transportation to and from work.  To meet those interests, you plan to begin negotiations to buy a used car with a particular dealer.  

In Preparation

As part of your preparation, for those negotiations you should take the following steps regarding your Alternatives:

  1. Generate a list of all of your Alternatives to negotiating with the used car dealer.  Some of your alternatives include going to another used car dealer, buying new from another dealer, walking, using public transportation, taking a taxi to and from work, carpooling, hitchhiking, biking, motorcycling, etc.  It’s important not to immediately eliminate any alternative, get them all down, some are good, others may be less desirable, but consider them all. 
  2. Evaluate the alternatives you’ve generated and choose your BATNA, i.e., your Best Alternative To A Negotiated Agreement.  Your BATNA is the Alternative that best satisfies your major interests.  To determine your BATNA test how well each Alternative meets your interests.  If your BATNA meets all or most of your major interests very well, it may be wise not to negotiate, simply implement it rather than spend time negotiating an agreement.   
  3. If, however, your BATNA leaves many of your major interests unmet, then you will want to do three things:
    1. Focus on preparation using the other six elements, i.e. Communication, Relationship, Interests, Options, Legitimacy and Commitment.
    2. Work to strengthen your BATNA, i.e., try and line other deals from other used car dealers, price, and test drive an electric car and begin negotiating  terms before you  meet with your used car dealer or test the Public Transportation System.
    3. Work to weaken theirs if it is possible to do so legitimately.  

You should only be at the negotiating table, if there is an opportunity to meet your interests even better than you could acting unilaterally, on your own without the other party, to satisfy your interests. 

At the negotiating table.

When at the negotiating table, keep your Alternatives in your back pocket.  Note, of the seven elements, Alternatives is the only one that has a yellow caution flag.  The caution comes from the fact that using your BATNA can sound like or be perceived by the other party as a threat.  Most people, when threatened, get defensive, angry, suspicious and less flexible and open with the person they perceive as threatening them.  As a general rule, this is not the state of mind you want to create in the other negotiator when your goal is success.  

However, there are two circumstances when you can ignore the yellow caution flag.  Discuss your BATNA if the other party or parties to the negotiation underestimate your BATNA or overestimate theirs.

  1. If the other party underestimates your BATNA, i.e., they think you have no choice but to negotiate with them, you might want to educate them gently:
    1. Begin by acknowledging that you both have BATNA’s and can and in fact should use them if together you are unable to come up with a resolution of the issue that is better than your respective BATNA’s.
    2. Frame the negotiating goal as creating an agreement that is better than either parties’ BATNA’s.
    3. If they persist in underestimating your BATNA, explain your BATNA, i.e., I’d rather buy a used car from you, but if we aren’t able to work out an agreement that is fair to you and to me, I will buy a used car from dealer X who is offering me these terms on a 2013_________________________.
  2. If the other party overestimates their BATA, reality test whether their BATNA is as good as they think it is.   

Some general advice:  Don’t use your BATNA like a bat, i.e. a weapon to hurt the other person or to coerce them into doing something they don’t want to do.  Even if you succeed, your success will be short lived.  When someone is coerced, they find ways to undermine, or sabotage the deal as quickly as they can.  If they really are stuck they will seek revenge later in a subsequent deal. 

If you are dealing with someone who attempts to bully you with their BATNA, you have several choices: 

  1. Ignore it, if you think it’s a tactic.  Stay focused on the goal by putting your energy into generating interests, options and standards of legitimacy. 
  2. If they persist in bullying behavior, name the behavior, name the impact,  ask if that is their intent or explain why it’s unlikely to produce the results you both want, i.e., I  never make decisions in an emotionally charged atmosphere; do we need a time out, do we want to continue the negotiations?    Does he or she need time to calm down?
  3. If they are outrageous or abusive, simply get up and leave and say something like, call me when you are ready to negotiate.  Consider a mini BATNA, invite a third party into the negotiations, it’s hard to act like a jerk, when there are witnesses.  That third party doesn’t have to do anything but observe and give you advice, privately.  Or have your boss contact their boss and request a different negotiating party or that the boss attend the negotiations with that person. 
  4. Implement your BATNA, your Best Alternative to a Negotiated Agreement.