Horsetrading in Negotiations

(Note:  This is my final post in a short series dealing with Labor Unions.)

The business world is full of principles, many of them existing primarily in the heads of those that spout them.  These often take the form of an “I’ll never, such as:  ”I’ll never…

…do a deal in country x.

…hire a salesperson that doesn’t have a degree.

…give in on an employee’s vacation demands.

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Over my career, I’ve found that most of these pronouncements (with the exception of those that draw a moral or legal line) do little for you.  They tend to codify informal rules of thumb that were often acquired at the school of hard knocks and may have limited general validity.

Such pronouncements can be quite constraining, causing you to take foolish, ineffective, or even destructive positions and cling to them beyond all reason.

I’ll never buy one of those vans.

In my youth (I grew up during the 60’s and 70’s) vans had a reputation for being hippie-mobiles used by people my father generally didn’t approve of.  Throughout my youth, I heard him say how he would “never buy one of those vans” or how he “didn’t understand why anyone would want one of ‘those things.’”

Once mini-vans came into vogue, it was clearly an excellent choice for mom and dad.  Dad’s old pronouncements, however, prevented him from seriously considering one for a long time.  When he did finally purchase a mini-van, my brother and I both repeatedly reminded him how he was “never” going to purchase one.

His position was probably reasonable for him at the time he articulated it, but by avoiding the pronouncement he would have felt much more freedom to reverse his position once circumstances changed.

Principles and Unions

One of the places I’ve seen positions pronounced, and then deeply reinforced, is where they relate to unions and the interplay between union and management.  Some of the classics I’ve heard include:

  • We’ll never allow a union here, we’ll fight to the death.
  • If they (the union) strikes, we’ll break them with salaried workers and eventually move production somewhere else.
  • We will never give in to their demand for (fill in the blank).

Although I’ve never sat through discussions on the union’s side, I’m sure similar discussions go on there as well.

What ends up happening is these pronouncements become positions set in stone, and tend to drive the relationship into conflict when it is unnecessary.

A ditch to die in

I got myself into a pretty deep hole with both the union and my own superiors when I fired an employee for sleeping on the job.  Without getting into the gory details, the employee in question had finished his “quota” for the shift and wandered off to find a quiet corner to get some shut-eye.  When I found him, I immediately terminated his employment.  My thought was simple – “No one who works for me is going to sleep while on the clock.”

My bosses (who were wiser) were almost immediately ready to settle the situation and let the employee back, but I was unwilling to back down.  Eventually, we ended up dealing with a grievance and a long negotiation process which took the situation out of my hands.  In the end, the outcome ended up being pretty much what my boss proposed in the beginning – reinstatement after a week off without pay.

I was lucky my stubbornness didn’t have a negative impact on my career.

Remove the emotion

The best way to avoid this problem is to avoid making pronouncements in the first place.

Sometimes, however, that isn’t possible either because you’ve already staked out a position, or because someone else has done it for you.

If you’re already stuck with hardened positions, your next step is to try to reduce the issue to a common denominator.  One of the most effective ways to do this is to analyze what the principle is worth in terms of dollars and cents.  It’s amazing how readily you can introduce flexibility when you ask – “How much of a pay decrease would the union need to offer in order to convince you to consider that extra week of vacation.”  Once the discussion goes this direction, it isn’t difficult to get the value close to what it’s really worth to the company, rather than just based on someone’s personal principles.

Another alternative is to use a surrogate negotiator, one who isn’t locked into any principled position.  I’ve used this tactic in legal disputes on several occasions when I felt like my personal beliefs, reputation, or interests seemed threatened by what the other party was demanding.  It has worked well during negotiations, as well, as long as the person with the principled position can manage to keep themselves out of the thick of the negotiating.

Horsetrading

Many of the interactions between union and management come down to negotiation and compromise.  The ability to get to an agreement by somehow pushing aside entrenched positions is critical to success.  The only way I’ve ever seen this effectively done is to bring all elements of the negotiation back to a common value (usually money), and trade to get as much of what you want as you can manage.

Conclusion

Find a way to check your principles and pronouncements at the door and come to your negotiations prepared to swap value for value.  In this way, negotiations can be made much simpler and more straightforward than what is typically experienced.

Sometimes it is the only way to reach an agreement or avert a disaster.  28.4

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To the right is the cover of LEVERAGE.   This novel explores the theft of sensitive DOD designs from a Minneapolis Tech Company, and the dangers associated with digging too deeply into the surrounding mystery.  It's sequel, PURSUING OTHER OPPORTUNITIES, is out now, and a third book in the series, OUTSOURCED, is in the works.

My novels are based on extensions of my 27 years of personal experience as a senior manager in public corporations.  Most were inspired by real events.