Negotiation & ADR Prof. John Barkai William S. Richardson School of Law University of Hawaii
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Negotiation & ADR are Professional and Personal Skills
Handling of Problems Western - American Asian designed by Liu Young
www 2. hawaii. edu/~barkai Google: John Barkai
Dragon Naturally Speaking “Premium” edition - $145 Amazon Academic pricing $100 Various microphone options
Not everyone can be a great chef
Not everyone can be a great chef But, everyone can learn to cook
“Even a sheet of paper has two sides” Japanese Proverb
“Every coin has two sides” Proverb
Perspective View
I’ve got it again Larry. An eerie feeling like there is something on top of the bed.
"Then it's agreed. Watson, Smith, Teller, and Wilson go to Heaven; Jones, Paducci, and Horner go to Hell; and Fenton and Miller go to arbitration.
This course will ….
After taking this course A recent student said …
After taking this course My girl friend is like a changed woman
After taking this course My girl friend is like a changed woman (because she thinks I'm a changed man)
Common Forms of Dispute Resolutions • Negotiation: – Discussion for the purpose of settling differences. • Mediation - Conciliation: – A neutral third party assists the parties to reach a negotiated settlement but has no power to decide the issues in dispute. • Arbitration: – A neutral third party is given the power to decide the issues in conflict. The arbitrator decides after hearing arguments and reviewing evidence. • Trial in Court: – Evidence is presented to a judge or jury for a decision under formal rules of law and procedure
ADR Alternative Dispute Resolution
HOW DO YOU SAY “ADR”? Country / Language Negotiation Mediation Cambodia Ka cho cha Agna Kandal Hong Kong Tam Pun Tin Teng India Hindi Oriya Samvad Muleiba Madhyastha Madhyasti Indonesia Negosiasi Penengah Japan Kosho Chotei Korea Hyoepsang Joongjae Malaysia Rundingan Perantaraan Pohnpei Micronesia Paronogorong pene Kamwahu Philippines Negosasyan - Tawad (bargain) Pagbatiin China Tan Pan Tiao Jie Singapore English or Mandarin Sri Lanka Samuthiya Samatha Mandalaya Taiwan Tam Pan Tawa Shay Thailand Jeraja Klaiklea Vietnam Dam Phan Hoa Giai Compiles by Professor John Barkai and students from the University of Hawaii’s JEMBA Program (Japan Focused Executive MBA) and JAIMS’ (Japan American Institute for Management Science) Intercultural Negotiations class.
How many lawsuits are filed in the U. S. each year? Guess!
Over 106 Million Cases Filed in Federal and State Courts in 2010 Source: Examining the Work of State Courts, 2010 http: //www. ncsconline. org/d_research/csp/CSP_Main_Page. html A 2% decrease over prior year
104 Million State Court Cases 2 Million Federal Court Cases
104 Million U. S. State Court Cases 56 20 19 6 2 Traffic Criminal Civil Domestic Juvenile Source: Examining the Work of State Courts, 2010
Hawaii Civil Cases 7, 013 Filed 4, 007 Terminated Circuit Court 2011 -2012
How many jury trials? Guess!
15 Jury Trials 53 Non-Jury Trials Circuit Court Civil Cases in Hawaii 2011 -2012
Jury Trials 1 Contract Trials 12 Tort Trials 3 Other” Trials Circuit Court Civil Cases in Hawaii 2011 -2012
Hawaii Court Statistics Civil Jury Trials 15 6 14 12 17 12 10 16 2012 2011 2010 2009 2008 2007 2006 2005
161 Jury Trials 58 Non-Jury Trials Circuit Court Criminal Cases in Hawaii 2011 -2012
5% Criminal cases are terminated in Hawaii by jury trial
0. 4 % Circuit Court Civil Cases terminated in Hawaii by jury trial 2011 -2012
3% Jury Trials in U. S.
161 Jury Trials 58 Non-Jury Trials Circuit Court Criminal Cases in Hawaii 2011 -2012 Of 3575 cases terminated – 4. 5% by Jury; 1. 6% Non-jury
>5 % Criminal cases are terminated in Hawaii by jury trial
Trial Rates: 0. 8% District Court 13% Small Claims 2010 -2011
3% Jury Trials in U. S. Vanishing Trials – Federal Court – 1962 -2002 12% to 2%
Vanishing Trials – Hawaii Circuit Court – 1964 -2010
Hawaii Circuit Court – 1978 -2010
What is the appropriate amount of Conflict? Conflict
In one of our concert grand pianos, 243 taut strings exert a pull of 40, 000 pounds on an iron frame. It is proof that out of great tension may come great harmony. Theodore E. Steinway
CONFLICT IS LIKE WATER: Too much causes damage to people and property Too little creates a dry, barren landscape devoid of life and color. - Designing Conflict Management Systems - Cathy Costantino & Christina Sickles Merchant
All polishing is achieved by friction - Mary Parker Follett
Who has the Power?
Information is Power
The easiest way to improve your negotiation skills is to A__ M___ Q____!
Ask More Questions
Expand the pie
Two Key Ideas about Negotiation & ADR 1) Focus on Interests not positions 2) Improve the Communication (information & temperature)
Positions Interests
Positions WHAT? Proposed Solutions
Interests WHY? Are WHY you want the positions
Mommy Daddy (oranges)
Juice Rinds
Some Common Interests We Have Acceptance Fulfilment Accountability Independence Achievement Knowledge Opportunity for Input Autonomy Privacy Belonging Recognition Clarity Acknowledgment Responsibility Love Commitment Affection Respect Nurturance Competency Appreciation Relaxation Consistency Satisfaction Efficiency Safety Fairness Security Freedom from Fear Trust Understanding Validation
Interests Goals Needs Dreams Desires
Same bed, different dreams
Iceberg Theory “Below the line” issues Huge & invisible Purposely hidden Out of awareness
Advantages and Disadvantages of Cooperation and Competition
“And notice, gentlemen, this year’s model has twenty per cent more trunk space. ”
You can't always get what you want but if you try sometimes you might find you get what you need The Rolling Stones
U. S. Declaration of Independence
53 CA 32 TX 29 NY Constitution 1 AL DE MT ND SD VT WY
The Camp David Accords September, 1978 Framework for the Conclusion of a Peace Treaty between Egypt and Israel The following matters are agreed between the parties: - the full exercise of Egyptian sovereignty - the withdrawal of Israeli armed forces from the Sinai; - the use of airfields …for civilian purposes only, and - stationing of Forces No more than one division of Egyptian armed forces [permitted] Only United Nations forces and civil police equipped with light weapons to perform normal police functions will be stationed within an area lying west of the international border and the Gulf of Aqaba, varying in width from 20 km. (12 miles) to 40 km. (24 miles). [limited border armed forces]
The Camp David Accords For the Government of the Arab Republic of Egypt: Muhammed Anwar al-Sadat For the Government of Israel: Menachem Begin Witnessed by: Jimmy Carter, President of the United States of America
GETTING TO YES Separate People from Problem Interests not Positions Invent Options Objective Criteria BATNA http: //mediationadvocacy. com/Getting%20 to%20 Yes. pdf
BATNA Best Alternative To a Negotiated Agreement
YOUR BATNA TELLS YOU WHEN TO WALK NOT WHEN TO SIGN
Tolanski Curve Illusion
Conflicting Interests
Examples of Complementary Interests One party might care Other party might more about: care more about: Form, appearance Substance
Examples of Complementary Interests One party might care Other party might more about: care more about: Form, appearance Substance Economic considerations Political considerations
Examples of Complementary Interests One party might care Other party might more about: care more about: Form, appearance Economic considerations External considerations Substance Political considerations Internal considerations
Examples of Complementary Interests One party might care Other party might more about: care more about: Form, appearance Economic considerations External considerations Immediate future Substance Political considerations Internal considerations More distant future
Examples of Complementary Interests One party might care Other party might more about: care more about: Form, appearance Economic considerations External considerations Immediate future Tangible results Substance Political considerations Internal considerations More distant future The relationship
Examples of Complementary Interests One party might care Other party might more about: care more about: Form, appearance Economic considerations External considerations Immediate future Tangible results Progress, change Substance Political considerations Internal considerations More distant future The relationship Respect for tradition
Examples of Complementary Interests One party might care Other party might more about: care more about: Form, appearance Economic considerations External considerations Immediate future Tangible results Progress, change Precedent Substance Political considerations Internal considerations More distant future The relationship Respect for tradition This case
Cuban Missile Crisis 1962 OK Mr. President, let’s talk.
Cuban Missile Crisis 1962. The U. S. placed nuclear missiles in the U. K. , Italy, and Turkey with the capability to strike Moscow. The Soviet Union began to build missiles bases in Cuba for ballistic nuclear missiles with the ability to strike most of the continental United States. The U. S. is considering the following options: pressure diplomatically the Soviet Union to remove the missiles, attack the missile bases by air, set up a naval blockade of Cuba, invade Cuba and the Soviet Union, who supplied the missiles, claim that Cuba has a right to protect itself from a potential U. S. attack. A. Positions B. Possible interests
Cuban Missile Crisis Positions U. S. Soviet Union No Yes missiles in Cuba. Missiles can be in Cuba.
Cuban Missile Crisis Possible Interests U. S. - Security - protect the U. S. from easy, “first strike” missile attack - prevent the Soviet Union from placing nuclear weapons close to the U. S. - -maintain image as a world superpower Soviet Union -prevent U. S. attack of Soviet Union - prevent U. S. invasion of Cuba support other Communist nations, - maintain image as a world power
Cuban Missiles Resolution Publicly, the Soviets dismantled their offensive weapons in Cuba and return them to the Soviet Union, subject to UN verification, in exchange for a U. S. public declaration and agreement to never invade Cuba. Secretly, the U. S. agreed that it would dismantle all U. S. -built Thor and Jupiter IRBMs deployed in Europe and Turkey.
Power Imbalances
Smart Bargaining: Doing Business with the Japanese Graham & Sano Japan External Trade Organization's (JETRO)
Cuckoo Strategies Sengoku period battle 15 th century warring states period in Japan
Cuckoo Strategies Nakanunara, koroshiteshimae, hototogisu (If the cuckoo does not sing, kill it. ) –by Nobunaga Oda – (ruthless) Nakanunara, nakashitemiseyou, hototogisu (If the cuckoo does not sing, coax it. ) –by Hideyoshi Toyotomi – (creative) Nakanunara, nakumadematou, hototogisu (If the cuckoo does not sing, wait for it. ) –by Leyasu Tokugawa–(patient)
36 Chinese Strategies Applied to Negotiations
PREPARING AND PLANNING
If I had six hours to chop down a tree, I'd spend the first hour sharpening the ax. Abraham Lincoln
Planning on roaming the neighborhood with your buddies again?
Cuckoo Strategies Sengoku period battle 15 th century warring states period in Japan
Cuckoo Strategies Nakanunara, koroshiteshimae, hototogisu (If the cuckoo does not sing, kill it. ) –by Nobunaga Oda – (ruthless) Nakanunara, nakashitemiseyou, hototogisu (If the cuckoo does not sing, coax it. ) –by Hideyoshi Toyotomi – (creative) Nakanunara, nakumadematou, hototogisu (If the cuckoo does not sing, wait for it. ) –by Leyasu Tokugawa–(patient)
They would never reveal every fact, because successful negotiation does not hinge on full disclosure. 1 minute audio clip
Distributive Negotiation • Competitive • Win-Lose • Zero-Sum n The Pie • Buyers = as low as possible • Sellers = as high as possible • Long term relationship not important • Claiming as much value as possible in the negotiation
Integrative Negotiation • Cooperative • Win-Win • Expanding the possibilities n The Pie • Buyers and Sellers work together to get more • Long term relationship is important n The value of the relationship • Creating Value in negotiation
Positive Bargaining Zone Seller’s Bargaining Range Positive Bargaining Zone Buyer’s Bargaining Range $5 $10 $15 $20 ST, Seller’s Target Point BR, Buyer’s Resistance Point SR, Seller’s Resistance Point BT, Buyer’s Target Point
Negative Bargaining Zone Seller’s Bargaining Range Negative Bargaining Zone Buyer’s Bargaining Range $5 $10 $15 $20 ST, Seller’s Target Point SR, Seller’s Resistance Point BR, Buyer’s Resistance Point BT, Buyer’s Target Point
Sally Swansong
101 Ways to get a bigger piece of the Pie It is not (always, or even often) about the money
BEFORE THE NEGOTIATION n n n n Prepare. Know your BATNA Focus on interests, not positions Know your interests Prioritize your interests Improve your BATNA before the negotiation starts Improve your BATNA during the negotiation
BEFORE THE NEGOTIATION Set a high goal for yourself n Estimate their BATNA n Estimate their interests n Estimate the ZOPA (zone of possible agreement) n Talk with others who have negotiated with them
AT THE TABLE 1 n n n n Develop a relationship before talking money Recognize their negotiating style Don't narrow your negotiations to one issue Don't quickly accept the first offer even if you think it's fair. If you agree in haste, you may repent at leisure Ask lots and lots of questions Active listen
AT THE TABLE 2 n n n Pace them Make the first offer to anchor (if you have enough info) Start with an extreme, but not outrageous offer If they make the first offer, ignore any extreme offer and anchor your offer in a favorable position Justify all offers and concessions
AT THE TABLE 3 n n n Take a seat to your advantage (not detriment) Wait for TOP to finish before responding Hint at, or disclose your BATNA, to improve their offer Mislead them about your BATNA Determine their interests Ask. Estimate based upon available info. Assume and ask Qs to confirm Be willing to make the first concession Don't make multiple, unilateral concessions Concede slowly Concede in small steps Make you concessions 1/2 of what you would naturally do
AT THE TABLE 4 "That sounds a little high (low). " - to induce concessions n Don't be in a hurry to make the deal n Ask for an "extra. " Nibble n Don't take it personally n Frame issues as "gains" for them, not losses n Use silence n Consider if they have a hidden agenda n Keep the emotional temperature low
AT THE TABLE 5 n n n n n Have limited authority Think about the long term Is it worth serious negotiating on this one? Don't appear desperate for the deal Invent options for mutual gain Seek objective criteria Act confident and informed "Split the difference" only when it is to your advantage Flinch
AT THE TABLE 6 n n n n n Offer contingent concessions Don't act like you "won" or you won't next time Don't underestimate your offer Be willing to walk away (at least for a while) Be willing to suggest mediation Make a larger concession than you thought necessary Most psychological principles suggest your offer is too extreme Over optimistic, Selective perception, Do not reject their offer based because of reactive devaluation
TIPS FOR NEGOTIATING WITH A COMPETITIVE NEGOTIATOR Flinch. Take time out. Remember your BATNA! Get another opinion. Ask "how" they will negotiate. If they don't know what "win-win" means, they won't be negotiating that way. Avoid multiple concessions if your concessions are not matched by their concessions. Recognize "dirty tricks" and comment on them immediately.
TO IMPROVE YOUR NEGOTIATIONS: Think in terms of interests Classify the type of negotiation: Deal or Dispute Distributional or Integrative Expand the pie Use a planning chart Investigate the opposing negotiator Consider both strategy and tactics Set high goals for yourself Practice before you negotiate Determine your BATNA
TO IMPROVE YOUR NEGOTIATIONS: Ask lots of questions Separate the people from the problem Generate alternatives by brainstorming Frame your proposals as a gain to them Flinch when you hear a high demand Protect your facts when necessary Be willing to make concessions, but only if they do too
TIPS FOR NEGOTIATING WITH A COMPETITIVE NEGOTIATOR Flinch. Take time out. Remember your BATNA! Get another opinion. Ask "how" they will negotiate. If they don't know what "win-win" means, they won't be negotiating that way. Avoid multiple concessions if your concessions are not matched by their concessions. Recognize "dirty tricks" and comment on them immediately.
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