Power and Negotiations: Harvard commentary and an elaboration

What is power?

Power is “the capacity or ability to direct or influence the behavior of others or the course of events”[i]. Power can be organizational given by title or rank in an organization or power can be inferential due to relationships or other attributes given technical knowledge or insights. Power is also psychological. In this article from the Program on Negotiation from the Harvard Law School daily blog it is suggested that a strong BATNA, role power and psychological power are “critical to improving your negotiated outcomes.”

I would like to elaborate on this initial commentary and offer some insights for your consideration.

In my most recent book, Peaceful Resolutions, A 60-step illustrated guide to the art of conflict resolution, I expand on BATNA, the Best Alternative to a Negotiated Agreement with step 41. Specifically I suggest:

Step 41: Consider BATNA

The Best Alternative to a Negotiated Agreement (BATNA) is a way to protect yourself to provide you an acceptable fallback position. Sometimes terms can be used to allow for a sale over a period of time taking into account additional variables. You should know your BATNA and have discussed this ahead of time with your team.

To develop your BATNA:

• Generate options if the negotiation fails;
• Further develop the most promising options;
• Tentatively select the most promising alternative(s).

Remember the other side has probably done the same thing and developed their own BATNA. If the negotiation fails and each side falls back to their own BATNA this might be an amicable way to not reach an agreement. The sooner this can be realized the sooner both sides can move on.

The Program on Negotiation at the Harvard Law School offers a free excellent management report entitled “BATNA Basics: Boost Your Power at the Bargaining Table”.²⁰ In short, the article suggests creating a BATNA using a four step process:

List your alternatives. Think about all the alternatives available to you if the current negotiation ends in an impasse. What are your no-deal options?

Evaluate your alternatives. Examine each option and calculate the value of pursuing each one.

Establish your BATNA. Choose a course of action that would have the highest expected value for you. This is your BATNA – the course you should pursue if the current negotiation fails.

Calculate your reservation value. Now that you know your BATNA, calculate your reservation value –the lowest-valued deal you are willing to accept. If the value of the deal proposed to you is lower than your reservation value, you’ll be better off rejecting the offer and pursuing your BATNA. If the final offer is higher than your reservation value, you should accept it.

• Take your BATNA to the next level. Translate your BATNA to the current deal
• Assess their BATNA with care
• Think through two-level BATNAs
• Track BATNAs in multiparty negotiations
• Anticipate hidden hazards of BATNA research

To truly assess a BATNA don’t simply compare your current deal with your BATNA, but instead compare the two possibilities point by point and you may find hidden advantages in one over the other. Assess the probabilities if the current negotiation fails. Consider their BATNA carefully and objectively as you explore your own. It is a valuable insight to consider what the other side will do without a deal.”

Second, I suggest developing a relationship with the other party and listening as critical components, before educating the other party and beginning the process of negotiating.  I suggest that to build a relationship it is necessary to consider the research by David Rock and the SCARF model. 

From step 37 in Peaceful Resolutions I offer:

“Step 37: Consider the SCARF Model

When considering interests consider using the SCARF Model from the Brain-Friendly Workplace.¹⁸ In the SCARF model:

• S is for Status is the relative importance to others.
• C is for Certainty addresses the ability to know and predict the future.
• A is for Autonomy reflects a sense of control over events.
• R is for Relatedness which is a sense of safety with others.
• F is for Fairness which is a fair exchange between people.

When these needs or motivations are not met we feel threatened and we tend to move away. When we feel these have been adequately met we move toward the other party and our interests and pleasures center are stimulated.

For example, if one of the parties were to state that “they don’t consider our input anyway and they think we are stupid” you might want to ask questions like: “What evidence do you have that tells you that they don’t take you seriously?” “How do you know that they think you are stupid?” “Who are they?” “Is it important that you be heard by them?”

This can help us self-evaluate ourselves and then consider the behavior of the other party as well. Either we or they may be acting out due to un-met needs in one or more of these areas. When we can see the other party’s behavior objectively stripped of our biases and inferences, we can look to change our behavior and reactions to the other party.

The SCARF model can be used to monitor our own mood to keep it in check and to help when considering the other party’s perspective. This aids in communication, listening and understanding.”

The more parties can work to reduce power associated with roles for example and focus on the problem the greater the probability of working mutually on interests to find an acceptable negotiated agreement.

I would suggest entering all negotiations with your BATNA on hand.

Finally in step 57 would like to share this brief outline related to a process to work towards conflict resolution.

Step 57: Bring It All Together (Ten Golden Steps)

Here is the process of peaceful resolution collapsed into ten easy-to-follow steps:

1. Define the problem; take on one issue at a time
2. Listen to understand the emotion and facts associated with the issue
3. Identify and clarify interests
4. Generate solutions
5. Determine the impacts of solutions
6. Evaluate the impacts of the solutions
7. Select a solution
8. Implement the solution or go back to an earlier step
9. Before implementing the solution consider testing it first
10. Consider BATNA and WATNA if no solution is found

Having been directly involved with over 2,500 mediations and negotiations I wanted to share these brief elaborations that you to may find useful in your negotiations.

Mike is a manager with over 25 years’ experience at all levels of management. Mike provides services related to negotiation, mediation, and value added services (business valuation reviews, research credit advice, transfer pricing assistance, strategic planning and leadership development) to help clients and boards of directors on a wide variety of issues. When not serving clients as a consultant or blogging, Mike is an avid writer, speaker and educator. When not working Mike enjoys family, church, volunteering, and daily yoga, meditation and exercise.