Session 6: Negotiating the relationship

Negotiating the Relationship

Dr Alex Hope

BE0964 Partnering and Collaboration

Introduction

• Importance of negotiation?

• Process

• Negotiation Skills

Partnering Success• Partnerships are about

relationships

• The purpose of partnership is ‘to achieve together what we could not achieve alone’

• Need to create trust, equity and mutual accountability

• less determined by the structure of the relationship than by the practice of certain behaviours

Partnering is about people

• Multi-stakeholder/multi-sector partnerships are complex

• Dependent upon the establishment of good working relationships between people from different organisations and cultures, often with different values, interests and expectations

Critical Success Factors

• Negotiation is one of the key CSF in any partnering arrangement

• Negotiation Strategy is important

• Relationships are key

Importance of Negotiation

Planning, conducting and analysing the outcomes of commercial negotiations are key elements of negotiation

Developing the skills of commercial negotiation is a demanding, valuable and often personally challenging task

Commercial negotiations can involve a complex range of financial, business and contractual issues

Importance of NegotiationIn many instances commercial negotiations are becoming more complicated.

The speed of business has increased, placing a severe strain on those who seek to negotiate the finer points of a deal.

The failure to spend enough time in the detail may result in uncertainties, later giving rise to disputes and claims against all the apparently resolved issues.

Strategy is dependant on the nature of the partnership

PPP Process• Complex projects have unique features, so there is no standard way in

which the negotiation procedure should be undertaken

Pitfalls of poor negotiation

Source: PWC (2009)

Preparing for Negotiation

Re-Negotiation

1. Need to cut or re-shape (re-scope) services

2. Looking for your partner(s) to reduce their profit margin?

The adverse financial ramifications of large PFI contracts that were negotiated in healthier economic times are only now becoming clear to many public sector organisations across the UK.

Re Negotiation can still be Win/Win

Negotiation Skills

Negotiation = Influencing

Preparing for Negotiation

Goals: what do you want to get out of the negotiation? What do you think the other person wants?

Trades: What do you and the other person have that you can trade?

Preparing for Negotiation

Alternatives: if you don't reach agreement with the other person, what alternatives do you have?

!

Relationships: what is the history of the relationship? Could or should this history impact the negotiation?

Preparing for Negotiation

Expected outcomes: what outcome will people be expecting from this negotiation?

!

The consequences: what are the consequences for you of winning or losing this negotiation?

Preparing for Negotiation

Power: who has what power in the relationship?

Possible solutions: based on all of the considerations, what possible compromises might there be?

Six Laws of Influence

• Prof Robert Cialdini - Professor Emeritus of Psychology and Marketing at Arizona State University.

• Influence: The Psychology of Persuasion

The law of Reciprocity

• This is a social convention which causes us to feel that we must repay in kind what another person has provided us.

The law Commitment and Consistency

• Once we take a choice or a stand, we experience internal and external pressure to stick to that commitment

The law of Social Proof

• This is the case of ‘keeping up with the Jones’ so if everyone has an iPad, I should get one too

The law of Liking

• People are more likely to buy a product from someone they actually like

The law of Authority

• The legitimacy or authority of the source is important

The law of Scarcity

• The more scarce something is, the more valuable it seems

Learn more on the eLP

The Influence Model was created by Allan R. Cohen and David L. Bradford published in “Influence Without Authority” (2005)

Cohen-Bradford Influence Model

Cohen-Bradford Influence Model

Cohen and Bradford believe that authority can be problematic. It doesn't always guarantee that you'll get support and commitment from those around you; and it can create fear, and motivate people to act for the wrong reasons. This is why it's so useful to learn how to influence others without using authority.

The Influence Model is useful whenever:

1. You need help from someone over whom you have no authority.

2. The other person is resisting helping you.

3. You don't have a good relationship with the person from whom you need help.

4. You have one opportunity to ask the person for help.

5. You don't know the other person well.

Model Steps• Assume all are potential allies.

• Clarify your goals and priorities.

• Diagnose the world of the other person.

• Identify relevant "currencies"; theirs, and yours.

• Deal with relationships.

• Influence through give and take.

Cohen-Bradford Influence Model

Assume All are Potential Allies

Influencing someone else – especially someone who seems to be "being difficult" – can make you feel upset, nervous, or unsure

approach this situation by looking at the other person as a potential ally

Cohen-Bradford Influence Model

Clarify Your Goals and Priorities

Identify why you are trying to influence this person. What is it that you need from them? What are your primary and secondary goals?

keep your personal wants and goals out of the situation.

Cohen-Bradford Influence ModelDiagnose the World of the Other Person

Understand your potential ally's world, and understand how he or she is judged. For instance, what performance metrics do they work by? How are they rewarded?

This step can be challenging; and it will determine whether or not you can identify this person's relevant "currency", which is the next step.

Cohen-Bradford Influence ModelIdentify Relevant "Currencies"; Theirs and Yours

Here, you need to identify what truly matters to your potential ally.

Cohen and Bradford identified five types of currency that are most often valued in organizations.

• Inspiration-related currencies.

• Task-related currencies.

• Position-related currencies.

• Relationship-related currencies.

• Personal-related currencies.

s.

Cohen-Bradford Influence ModelDeal With Relationships

Analyze what kind of relationship you have with this person. If you know him or her well and you're on good terms, you can directly ask him or her for what you need.

If you're not on good terms, or you're a complete stranger, then you need to focus on building trust   and building a good relationship   before you move on to the final step.

Cohen-Bradford Influence ModelDiagnose the World of the Other Person

Understand your potential ally's world, and understand how he or she is judged. For instance, what performance metrics do they work by? How are they rewarded?

This step can be challenging; and it will determine whether or not you can identify this person's relevant "currency", which is the next step.

Introduction

• Importance of negotiation?

• Process

• Negotiation Skills

Further Reading Cialdini, R. B. (1993). Influence: The psychology of persuasion

Cohen, A. R., & Bradford, D. L. (2011). Influence without authority. John Wiley & Sons.

PWC (2009) Strategic Partnerships: The Real Deal? Available at http://www.pwc.co.uk/en_UK/uk/assets/pdf/strategic-partnerships-the-real-deal.pdf