Is Win-Win dead? - NegotiationWise

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Is Win-Win dead?

Mehran Mossadegh Is Win-Win in a negotiated outcome still relevant in today’s complex negotiations? Or, is there an alternative approach, which can assist negotiating parties achieve a Wise agreement in a shorter period of time? Following a Wise process that focuses on solving problems is far more effective and generates a better outcome for all parties. A Wise solution is an optimised outcome in negotiations, achieving a negotiated outcome that is favourable, rather than one that is merely acceptable. It influences the other party’s mind and engage in collaborative discussion. Win is defined as being successful or victorious in a contest or conflict, to acquire or secure as a result of a contest, conflict, bet, or other endeavour, to defeat everyone else by being the best or by finishing first in a competition, to achieve victory in a war, battle, or argument, and so on. A win-win negotiation, is one in which all parties and stakeholders to the negotiation can benefit from it, in one way or the another. Such gained benefits are not necessarily at a cost or loss to the other party.

© 2015 - Mossadegh Enterprises Pty Ltd

This article relates to complex multi stakeholder negotiations; especially where there is a possibility of ongoing relationship between the parties. A typical example of complex multi stakeholder commercial negotiation may involve a consortium or joint venture on one side of the table delivering complex technology solutions to a client on the other side. The client itself could involve a number of government ministries, end-user and consultants to the project each with direct involvement in the negotiation process. Such a negotiation may also include several third party stakeholders who are indirectly involved in the negotiation process i.e. sub-contractors, financial institutions and regulatory bodies. An example of complex international conflict resolution negotiation is the nuclear negotiation between Iran and the 5+1. The negotiation involves seven parties directly – China, France, Germany, Iran, Russia, United Kingdom, and United States – and a number of other in-direct negotiation stakeholders.

+61 3 9088 0220 [email protected] www.negotiationwise.com

Level 40, 140 William Street Melbourne, VIC Australia 3000

A Wise solution is an optimised outcome in negotiations, achieving a negotiated outcome that is favourable, rather than one that is merely acceptable.

Typically a win-win negotiation approach requires the ‘co-operation’ of negotiating parties to achieve a mutually beneficial agreement, through a non-zero-sum approach that is to expand the pie, creating value before claiming value. A win-win outcome is one that satisfies all parties to the negotiation, it is mutually beneficial. The desire to achieve a win-win solution results in ‘victory’ for all parties. However, the victory may come at such cost to one or more parties that make it worthless for a party. In other words, the gains are overweighted by the cost which negates the feeling of joy experienced at the conclusion of the negotiation. While the win-win approach may have its place in less complex negotiations, is the strategy still relevant in today’s complex negotiations in the interrelated, interdependent, and globalised world? Where negotiation has multiple stakeholders, either directly or indirectly involved in the negotiation process, is it still possible to find an outcome that all parties can have some sort of a win ? How is such a win defined and how would the win be measured?

In complex negotiations with multiple stakeholders (see side note – first page), comes conflicting and opposing Drivers – needs, desires, interests, fears, and concerns – which makes it extremely difficult to come to an agreement in which all parties can feel victorious. On occasion with some wins, there will be losses or compromise somewhere in the process. The process of compromise can become difficult especially where there are hidden or indirect stakeholders not directly involved in the negotiation process.

In this concept, win is difficult to be measured, and to be sold to the shareholders and constituents. One party may achieve a HUGE win, while the another may have a small win.

Although there may be such a large outcome differential between the parties, the outcome is still labelled a win-win. However, is such an agreement sustainable given the large difference? Would the party with the small win, follow through on the agreement and commit to its deliverables and obligations?

© 2015 - Mossadegh Enterprises Pty Ltd

+61 3 9088 0220 [email protected] www.negotiationwise.com

Level 40, 140 William Street Melbourne, VIC Australia 3000

In win-win concept, win is difficult to be measured, and to be sold to the shareholders and constituents. One party may achieve a HUGE win, while the another may have a small win.

A win-win negotiation strategy, despite a desire for co-operative approach, can suffer from an adversarial and competitive attitude by one or more negotiating parties. The thinking goes: what can I get, what can I give and so on. This competitive nature of human behaviour is even more apparent with some negotiators defining negotiation as a game! It is a naïve notion to imagine during a hostage negotiation for example, that the authorities would consider a win-win resolution. Similarly, neither should complex negotiation be conducted in an environment where adversarial attitudes are entertained or present. The concern with a win-win way of thinking is, that it can set up an environment of competition; instead of developing an atmosphere for information sharing and reinforcing the value of cooperation. The result of a win-win approach can be considered from the Prisoner’s Dilemma, where the parties may settle for less than what they can achieve otherwise than if they were co-operating with each other. In the Prisoner’s Dilemma the ‘naïve’ party is vulnerable to exploitation by the stronger party, provoking a strategy that ‘all defect’ by the stronger party. Therefore in order to avoid all defect, negotiating parties may lead to a ‘Tit-for-Tat’ tactic. Equally, the Negotiator’s Dilemma, the tension between creating and claiming value in a win-win approach, could result in Tit-for-Tat negotiation. As a result both parties defect, that is, an adversarial approach instead of a co-operative approach. The outcome of such a negotiation would be less favourable than the case where all parties were co-operating. A current example of Tit-for-Tat tactic is the current push by U.S. Congress to introduce a bill to trigger more sanctions against Iran should nuclear negotiation fails – i.e. defect. This has in return provoked the Iranian Parliament (Majles) to introduce a bill obliging the Iran government to produce 60% Uranium Enrichment in case U.S. Congress introduce new sanctions against Iran, that is a tactic of Tit-for-Tat. But there is an alternative approach to manage complex negotiations that results in a well thought out, planned, thorough and structured negotiation process with a Wise outcome. Typically, failures in complex negotiations result from a shortfall in the required prerequisite process, which is, the lack of thorough understanding of the problem and requirement of all stakeholders to the negotiation. Different stakeholders come to the negotiation table with different expectation and Drivers, some parties fall short to understand the other parties’ real problem and requests. If each stakeholder problem and requirement is not thoroughly understood, in other words, if the problem is not correctly identified, a favourable solution cannot be found and a Wise outcome cannot be achieved. As in the Prisoner’s Dilemma, any agreement could be the second or third preferred outcome, whereas if all parties were co-operating that may not be the case. Parties negotiate to address and solve their problems, believing that their joint problem and issues can be solved by mutual discussion and collaboration. If a better solution to their problem was possible without the need to discuss and collaborate, there was no need for the negotiation in the first place.

© 2015 - Mossadegh Enterprises Pty Ltd

+61 3 9088 0220 [email protected] www.negotiationwise.com

Level 40, 140 William Street Melbourne, VIC Australia 3000

The concern with a win-win way of thinking is, that it can set up an environment of competition; instead of developing an atmosphere for information sharing and reinforcing the value of cooperation.

Negotiation is a conversation between two or more parties for a PURPOSE and with CHOICE. The purpose is solving the problem. The parties exercise their choice to solve the problem with engaging collaboratively with the other side in order to achieve an agreeable solution to the problem. The purpose of negotiation is not victory, especially if the problem is in an un-winnable state. The architecture of a Wise problem solving approach, relies heavily on successful collaboration of stakeholders to find solutions to address the problems. Problems are a result of the underlying Drivers (needs, desires, interests, fears, concerns). Problems can be categorised as short, medium, and long term. For all the stakeholders, each short, medium, and long term problem needs to be clearly identified early in the negotiation process. It is the distinction between short, medium, and long term Drivers that leads the parties in the negotiation to creative solutions to solve the complex equations in a complex negotiation. Let’s consider an example of a project implementation of a turnkey system with a 10-year service agreement option. Negotiating over the project delivery can be the short term consideration. Whilst providing a 10 year maintenance service agreement is a medium to long term consideration. The underlying Drivers of the various stakeholders will differ for the short term compared with long term. For example, the relationship consideration will have varying Drivers and potentially involve different stakeholders during project delivery (short term) and service delivery (medium to long term). During project delivery, project team members will be involved and the focus is on delivery of the agreed requirement specification. Whereas, discussion on the service delivery stage of the agreement may involve different teams and the objective for each team could be defined by maintaining a workable relationship to insure system performance is maintained within the service agreement framework and time frame.

Another long term Driver for negotiating parties could be the issue of potential future projects. A co-operative approach during the service delivery period of an existing contract is required if parties wish to work together on other projects. In the above example, simplifying complex negotiations through win-win strategy cannot deliver an optimum result over long run.

© 2015 - Mossadegh Enterprises Pty Ltd

+61 3 9088 0220 [email protected] www.negotiationwise.com

Level 40, 140 William Street Melbourne, VIC Australia 3000

To achieve maximum success, the idea of a Wise process is to avoid setting up a potentially competitive environment that can result from a win-win strategy.

Miscalculation in developing the right strategy can and does occur when seeking a win-win outcome. With each party focusing on its victory speech, how can parties come to a mutual agreement if their aim is to be victorious? It is quite possible for parties to deviate from identifying the real underlying problems, both theirs and the others, leading to incorrect strategy. Whilst any agreement achieved can be hailed as a victory for a party, it may not necessarily be a Wise solution as it does not address the problems. Such an agreement could suffer during implementation through lack of commitment to it by one or more parties. Breaking down the complex negotiation into short, medium, and long term Drivers and identifying the stakeholders’ problems during these discussions can help negotiators to engage in a collaborative conversation to explore Wise solutions. To achieve maximum success, the idea of a Wise process is to avoid setting up a potentially competitive environment that can result from a win-win strategy. The negotiator’s dilemma in a win-win approach would be to achieve the second or third best available outcome especially if some of the negotiation parties apply the “Tit-for-Tat” tactic. In my experience, during negotiation preparation, many negotiators spend too much time discussing their share of the win and what it’s going to look like and not enough time understanding the other side’s Drivers. This approach invariably translates into an adversarial approach with the other side at the Negotiating Table. The focus becomes how would the win look like, and how can it be sold to their own team, constituents, and shareholders even if such win is of no real value for the party seeking it. In conclusion, the Wise systematic problem solving approach to overcome barriers and achieve Drivers is more effective in complex negotiations. Defining each problem into short, medium and long terms, allows you to think about and understand the other parties Drivers. Devising novel solutions to each problem for presentation during the negotiation is the path to a Wise solution. Only through a planned, structured and well thought out answer to each party’s problems will a Wise outcome be achieved.

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NegotiationWise training programs, a Structured Collaborative Approach to a Wise Outcome focuses on “how to prepare to negotiate” and "how to negotiate” for a Wise Outcome using many interactive practical sessions to practice the theory learnt. To see NegotiationWise training programs schedule visit http://www.negotiationwise.com/register.html

© 2015 - Mossadegh Enterprises Pty Ltd

+61 3 9088 0220 [email protected] www.negotiationwise.com

Level 40, 140 William Street Melbourne, VIC Australia 3000

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Is Win-Win dead? - NegotiationWise

Is Win-Win dead? Mehran Mossadegh Is Win-Win in a negotiated outcome still relevant in today’s complex negotiations? Or, is there an alternative appr...

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