Dealing with a dispute and maintaining a good working commercial relationship need not be conflicting goals. In the ‘interest-based’ model of negotiations or dispute resolution, there are four key elements to success.
1. First, separate the people from the problem. People should come to see themselves as working side by side, attacking the problem, not each other. A good conciliator has the ability to recognise and understand the emotions and needs of each party. They acknowledge such emotions as being legitimate and don’t belittle them or ignore them. By allowing the venting of anger and frustration, a good conciliator knows that the negotiating parties are obtaining a psychological release that sets up a fertile environment for reaching a solution.
2. Another element of good negotiation is the ability to focus on interests, not positions – meaning generating a variety of possibilities before deciding what to do and insisting the result is based on some objective standard. The key for a good conciliator is to be able to look beyond each party’s position and identify the shared and compatible interests, as well as conflicting ones. Solicitors often see people in negotiations who automatically assume that the other party’s stated bargaining position is the same as that party’s interests. The truth is that a stated position rarely reflects the party’s interests. Often, people think a dispute is simply about the payment of money, but quite often other interests are at play.
3. The third crucial element is the ability of negotiators and conciliators to invent options for mutual gain well in advance of reaching agreement. Rather than try to narrow the gap between stated bargaining positions, a good negotiator will try to broaden the options available for settlement.
4. The final element is to insist on the use of objective criteria as a reference point. This means that any agreement should be reached independently of the naked will of either party and be referenced to some objective standard, such as market value, expert opinion, precedent, scientific judgment, professional standards, efficiency, tradition or costs.