How Skilled Negotiators Align The Relationship

In this article we will explore the constraints that need to be overcome to build long-term collaborative relationships. We will also propose frameworks that can empower both parties to navigate divergent views and manage obstructionist behaviours.

What we achieve comes from how we go about it! 

Today the complexity of networked business communities, generational changes and the emphasis on intellectual capital over physical assets is elevating the need to give many stakeholders a decision-making voice.

These changing environments can cause decisions based on positional power to be less effective and risk shallow, short-term transactional behaviours. The type that drives each party to focus on getting the most for themselves, rather than to act in the best interests of the relationship and contract.

New approaches are needed and an increasingly attractive alternative is to build collaborative relationships that promote value creation for both parties. This requires decision making to produce longer lasting and more equitable relationships by identifying and building common ground through influence and persuasion.  

The use of frameworks will reduce the adversarial nature and associated costs of transactional relationships and enable both sides to have more predictable outcomes and a culture of cooperation.

For those accustomed to using their positional power, this collaborative and consensus seeking approach can be confronting. The behaviours evident in collaborative relationships contrast widely to the transactional behaviours, shown below.

Using collaborative principles to underpin the relationship

To prepare for a collaborative relationship it is important to separate the desired outcomes we want from the relationship itself and how we will manage it.

The key resource for influencing others is to build strategies based on a full understanding of needs and personal motivations. The failure to understand the other party's needs is a major reason why relationships are unsuccessful and one party can sometimes feel aggrieved.

When we consider our needs alone, we are dealing with only half of the relationship's equation. Once you have clearly identified the needs of the other party, it becomes much easier to align your needs and identify common ground. In turn, shared values and cooperative behaviours emerge and the relationship becomes more sustainable.

An effective way to sustain the relationship is by developing a set of collaborative principles which define how the relationship will be managed. They can become a foundation for policy and the contract's governance framework, allowing the entities to have one voice, clearer expectations, goals and communication processes.

Six key collaborative principles

1. Agreements formed are long term and procedural rules are transparent and unambiguous.
   
   
2. Agreement building is inclusive, avoids bargaining and values the collective knowledge and skills of both parties above perceived status.
   
   
3. Information-sharing boundaries are agreed in order to create value.
   
   
4. Communication exchanges build trust through verification and by preserving esteem through face-saving options.
   
   
5. Issues are framed mindful of the long-term impact on the relationship and to reflect the opportunity for mutual gains and or mutual losses.
   
   
6. Power imbalances are diminished by both parties seeking value creation ahead of value taking.
   

The rigor and relevance of these principles comes from the contribution of both parties and their acceptance at each level of negotiation. These principles are particularly valuable where there is an ongoing need to manage diversity, that is accompanied by differences in values and style. An example is when a culture of tolerance is needed to manage religious, gender and generational differences.

In collaborative relationships, contract price becomes secondary to long-term mutual gains. Negotiations that manage conflict and draw out all the issues to create value are the norm.

Making the change

When moving from an existing contractual relationship into a long-term collaborative relationship, you are likely to hear the question, "Isn't this more of the same?".

One of the first changes felt, is the continual referencing of the collaborative principles and the desire to suspend judgment and view the other side's perspective.

As those involved start to detach from what is familiar, their obstructionist behaviour diminishes and they begin to test the boundaries and meaning of working differently.

They become aware there is more to be gained by connecting organisations than behaving like silos.

As previously unrecognised problems are identified, there becomes an opportunity to create differentiated products and services that raise customer satisfaction levels. As this adjustment continues, people start to observe deeper relationships and find it more intuitive to examine problems from a joint perspective. The anxieties that had been felt earlier are replaced by feelings of empowerment to implement solutions and the desire to acquire new skills and adapt to new ways.

The changes are imbedded so that each side willingly relinquishes the past and comes to realise the shallow and positional relationships have been replaced. Gone too are the recurrent costs of transactional relationships, which characterise unpredictable, one-off relationships, to highly predictable, respected relationships.

A framework to collaboratively negotiate

A key element of any long-term relationship is that it offers procedural fairness and trust at manageable levels of exposure. This means having transparent processes that show how and where decisions are made, the procedures used and how the results are disseminated.

During negotiations, procedural fairness can be managed and paced through four distinct phases:

1. Introductory phase
   
   This involves building common ground at a personal and organisational level, gaining a shared understanding of the subject matter and agreeing to the negotiation's meeting protocols.
   
   
2. Differentiation phase
   
   Both parties avoid problem solving and seek clarification of issues. It is important all issues are surfaced during this phase and that a clear display of differences is encouraged. Conflict is kept at manageable levels by applying the collaborative principles.
   
   
3. Integration phase
   
   Both parties start to manage the transition from position stating, to problem solving. Typically, this requires shifting the focus on the past to the future, searching for options and summarising areas of agreement and common ground.
   
   
4. Settlement phase
   
   This is the final stage where credible offers are accepted and commitment is visible. Decisions are made binding, and ways of implementation and monitoring are confirmed.
   

Keeping the relationship productive

To ensure the relationship is productive, it is essential the relationship's desired outcomes are known and achieved. A useful way to bring clarity and responsibility to the desired outcomes is by establishing a Contract Governance Board. This involves representatives from both sides determining the strategic outcomes and responsibilities. These can include:

• Strategic direction and understanding of each party's business model, priorities, constraints and business processes.
  
  
• Determination of decision making responsibilities and procedures.
  
  
• Establishment of risk/reward metrics and responsibility for financial performance.
  
  
• Establishment of guidelines for sharing infrastructure, such as facilities and IT, whether owned or outsourced.
  
  
• Assessment of customer satisfaction with product/service quality, market reach and technology capability.
  
  
• Assessment of the relationship's ability to achieve milestones, be innovative, deal with conflicts about contractual obligations, and the failure to disclose information and share ideas.
  
  

Like all relationships, collaborative relationships are subject to complacency, changing environments and competing demands. Renewal comes from both sides, identifying what makes their relationship difficult to substitute and what is strategically important.

Collaborative relationships rely less on positional power, they encourage new thought leaders to emerge and create value through their know-how and ability to influence.

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Attributes Of Negotiators & Influencers

Wayne Harrison is the founder of Marketing Down Under Pty Ltd and Fellow of the Australian Institute of Company Directors and Australian Marketing Institute. He is a Senior Negotiation Strategist with globally acclaimed ENS International where his consulting ranges from strategically mapping stakeholders in complex multi-party negotiations, through to sequentially planning and pacing negotiations that exceed billions of dollars. Wayne would like to acknowledge the support of Michael Hudson of ENS International and for information on the specialist influencing and negotiation services offered by ENS International contact via Phone: (02) 9331 4175; Email: wharrison.ens@negotiate.org or visit the web site: www.negotiate.org
First published: 23 November 2006.
Last updated: 23 November 2006.