Southern California Arbitration Mediation and Conflict Resolution : Settle it Now Dispute Resolution Services : Serving Los Angeles, Beverly Hills, Century City : Settle It Now Negotiation Blog

Thanks to Geoff Sharp at mediator blah blah for directing us to this great U.K. Mediation resource, The Mediator Magazine which is great to poke around in a little when you're home for mother's day and mom's gone off to bed.  Here, for instance, are some well taken criticisms of mediation practice by in-house counsel from the article Where's the Magic?

Top of the list of issues which invite scorn is perceived weakness on the part of the mediator. Giving palpable nonsense and well documented fact equal air-time in the interests of appearing open-minded has backfired for a number of mediators. 'It can be frustrating where they [the mediator] can see the irrationality of the other party, how their claims and positions are unsubstantiated, and choose to ignore it,' says Frank Aghovia, legal adviser at Exel Plc. He continues, 'It's like saying, "I know he's talking out of his backside, but can you give him what he wants anyway." He concludes that 'steadfast neutrality is irritating and wastes time.'

One public sector lawyer, though generally more favourably disposed towards mediation, shares a sense of frustration with the purely facilitative model: 'If a mediator is too passive,' he says, 'there isn't going to be any realignment of expectations, there isn't going to be the refocusing of the parties on the strengths and weaknesses of their own and the other party's case. It's simply not going to happen. You're not going to facilitate the movement.'

Naturally it is all a question of degree, but frustration with a style perceived to be 'slow', 'wet', 'namby-pamby', or worse, 'like therapy' is real, and stands in the way of mediation increasing its meagre market share.

It is also evident that some mediators have failed to manage the process with sufficient vigour, fuelling comments like 'I've been at quite a few [mediations] and question what the mediator actually does.' No doubt they've had to spend all their time working with the other side, but if so, this needs to be communicated.

This lack of robustness which for many is synonymous with mediation has bred the widespread belief that mediation only works when both sides want to mediate. And where that's the case, without prejudice discussions will do the job. Until mediation's image hardens to the point where people realise that great mediators can deal with the shirty, dismissive and gratuitously rude types, mediation will remain in the shadows. . . .

These criticisms are real and require attention.  I'm uncertain of the state of "professional" mediation in the U.K., but here in California, its all over the board.  For the mediation advocate and his client, finding the right mediator for the right case at the right time is not only more art than science, it's often more guesswork than art. 

I'll be dealing with the issues raised by this U.K. article in the coming weeks.  For the full article, click on the link above.

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I shouldn't be talking about collaboration and reciprocity without penning a short note of gratitude for the benefits bestowed upon me and my readers by the new Forbes.com Business and Financial Network.  

The BFNetwork has not only introduced me to many business blogs that otherwise wouldn't have come to my attention, my narcissistic perusal of my own posts listed there have drawn me into abundant Forbes.com resources that benefit my readers.  

I urge my fellow Forbes BFN Bloggers to poke around Forbe's  pages to unearth riches that can benefit their readers there.    

(right:  Forbes.com staff writer Tara Weiss)

That ridiculously lengthy introduction out of the way, here's a great article on how to negotiate a higher salary during a recession from Forbes.com staff writer Tara Weiss -- How to Ask  For A Raise When Times Are Hard.  Summary below:

• find out what people in your market and your position are making.
• once you know your market value, request a conversation with your manager about salary
• remind your manager of the strong contributions you've made.
• during an economic downturn, highlight new clients you've brought to the firm and cost-saving measures you've enacted. Include the key projects you've completed and goals you've met.
• prove you're vital to getting the company through a recession
• present your manager with the research you collected on what others in your market are making.
• consider perks outside of salary such as vacation time, health benefits, or reimbursement for commuting and professional training in a job-related skill.
• if you're rejected, ask what you can do in the next six months to make this conversation successful the next time. 

Thanks Tara!

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Thanks to Commitment Matters:  Negotiation Practices in the Commodity World for pointing us to the U.K. Telegraph's provocative article Supermarkets & suppliers: Inside the price war by Jonathan Sibun and James Hall, discussing ruthless negotiation techniques employed by the big supermarket chains in the U.K.  -- like the "Flaming Lamborghini" described below.

My only response is this -- winning at any price isn't worth the price.  Whether you see your customer again makes little difference.  Tomorrow morning, it's your face in the mirror you're required to take a hard look at.  My suspicion?  The "bosses" who direct their staff to negotiate in this manner couldn't or wouldn't do it themselves and those who are doing it are either suffering wage slaves or sociopaths.   

The Flaming Lamborghini

Thought to derive its name from the restaurant in which it was coined - the same London eatery frequented by the infamous Flaming Ferrari City bankers - the Lamborghini is believed to be the model used by Tesco.

The Flaming Lamborghini is a grid-based negotiating tool in which the supermarket buyer takes the supplier on an emotional and psychological roller-coaster ride.

This is done be flip-flopping the salesperson between ‘complacency' and ‘war'.

One minute the buyer is their best friend, the next their worst enemy. This is essentially the clock-face model writ small.

The goal for the supermarket buyer is to make the suppliers feel that they are at the point of ‘maximum performance', while secretly making sure they don't stay there.

A Tesco spokesman said he was unfamiliar with the technique.

For the full article, click here. 

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I'm asked this morning by an ADR colleague whether we can criticize diversity without sounding like racists.  The question itself is problematic because it not only assumes a racial divide, it places "us" on the "white" side of it. 

The question arose from a recent press release by local mediator Elizabeth Moreno -- Is Mediation Losing Its Effectiveness:  Lack of Diverse Mediators.  The release describes an ADR diversity initiative being pursued by Shell Oil.  Shell, noted Moreno, is  

 introducing supplier diversity to the ADR profession [by] extend[ing] business opportunities to certified minority and women ADR neutrals. These efforts, coined as "second tier," allow Shell to influence prime or majority ADR firms, with whom they do business, to also contract with minority and women owned ADR firms within the business community.

In the upcoming months Shell will be targeting  . . . ADR services to participate in second tier efforts. Shell astutely recognizes that by embracing the concept of inclusion, the company will rise to a higher level, reflecting its belief that it "will benefit from diversity through better relationships with customers, suppliers, partners, employees, government and other stakeholders, with positive impact on the bottom line."

I'm assuming that my questioner does not agree with the "affirmative action" aspect of this program.  Having debated the affirmative action issue since I began law school at U.C. Davis where the Supreme Court Bakke decision originated, I know well how divisive this issue can be.  But it is an important issue -- an issue critical to a nation not only "conceived in liberty" but "dedicated to the proposition that all men (sic) are created equal."

So Let's Take a Look at ADR and Diversity

I'll ask the academics over at the ADR Prof Blog to correct me if I'm wrong.  

I understand the academic criticism of mediation to be this:  in the immediate post-civil rights era while greater legal protections have been afforded to women and under-represented minorities, the "people" have been channeled into a system -- mediation -- that lacks the prejudice-flattening constraints of the rule of law.  More disturbing, say critics, is the fact that this "lawless" system is largely presided over by -- excuse me if this offends anyone -- OLD WHITE MEN.

I've learned more about racial bias talking to my liberal (white) "unprejudiced" friends this election season than I have since I participated in the "second wave" women's movement in the early nineteen seventies (remember consciousness raising?)  I do not judge them, nor myself, for our necessarily limited view which just happens to be that of the dominant culture.

I know we still have a serious racial divide because when I talk to my educated and liberal African American friends they say things that shock me. Things like -- the U.S. may have started the AIDS epidemic to rid the world of Africans. OK. I get it.  There's something about their experience of America that is so radically different from mine that I think their point of view is, frankly, just a little nuts.  This is what I do know -- I will never truly be able to see the world from their point of view.

That said, I do think we can criticize people for taking advantage of "diversity" issues to forward an agenda -- or their own personal advancement -- other than forwarding diversity itself. We can criticize those who would deepen the divide to profit from it.

I think Obama is modeling the correct response to racial divide, which is one of the reasons his candidacy impresses me so.  There haven't been many public figures willing to talk about the elephant in America's living room -- racism.  Nor has anyone on the national stage in my memory ever said "your dreams do not have to come at the expense of mine."

If I could write a sentence in a circle at this point, instead of linearly as the language requires me to do, I would do so.  Here is what I understood Obama's response to the question of the racial divide in America to be.

Acknowledge it Heal it Move on Heal it Move on Acknowledge it Move On Heal it Acknowledge it

There are no periods in this sentence because this activity needs to be constant and on-going.  Because we will always be stuck in our own point of view.  Because in-group and out-group prejudice will always be with us. And because the more visible markers there are for "otherness" in others, the more prey we are to the error of dividing the world into "us" and 'them."  

The answer?  Diversity.  Vigilance.  Education. 

Toward that end, here are some ADR Diversity resources: 

Commonality to Balance Diversity

Mediation:  the Great Equalizer?  A Critical Theory Analysis

Toward a More Perfect Union in an Age of Diversity: A Guide to Building Stronger Communities
through Public Dialogue

Center for Dispute Resolution, whose mission is to "to promote and provide education and comprehensive approaches to dispute resolution that constructively serve the needs of our culturally diverse society."   

ACCESS ADR:  A 2004 Diversity Initiative Launched With The Support Of The JAMS Foundation And The ABA

Striving for DIVERSITY in ADR & Why it Matters: An Interview with the Hon. Timothy K. Lewis, the Chairman of the AAA's Diversity Committee [who] speaks candidly about his interest in diversity in the decision making professions, and why allowing minorities and women an opportunity to participate is so vitally important.

The Diversity Task force of the International Institute for Conflict Prevention and Resolution ("CPR") whose mission it is to "adopt businessdriven initiatives to increase the ethnic, gender, and social diversity of mediators, arbitrators, and those involved in alternative dispute resolution, both within CPR institute and on a national scale."

Compilation of mediate dot com articles on diversity in mediation 

THE GREGORY SOBEL DIVERSITY IN MEDIATION SCHOLARSHIP APPLICATION

Slouching Towards Inclusion by Carol Miller Lieber & Jamala Rogers

Diversity Resistance

The Media Diversity Institute

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A friend and former legal partner was fond of saying that the biggest lie in the business was I don't take it personally. After four years of full-time mediation, I have another "Big Lie" to add – it’s only about money.

The social scientists who sutdy these things say that the way in which we respond to adversity "often reflects the fact that [our] prestige or status has been threatened more than the fact that [our] purchasing power has been diminished." Miller, Disrespect and the Experience of Injustice, Annual Review of Psychology (2002). In other words, the corporate C.E.O., like any other kid on the block, will retaliate when he feels he has been disrespected.

Conversely, research shows that business people are reluctant to recommend legal action if they believe that they and their company have been treated respectfully. Although this is particularly true of fiduciary and special relationships such as lawyer-client and business partnerships of all kinds, it also applies to arm's length business transactions.

Every commercial interaction, we are told, "represents a social exchange and every form of social behavior represents a resource." Id. People's satisfaction with the outcome of a commercial transaction therefore "depends highly, and often primarily, on their perception of the fairness of those outcomes." Id.

When we, as litigators and counsellors, actively listen to what our clients and our adversaries are saying about the rights and responsibilities of all participants in an ethical business community, we stand the best chance of engendering mutual trust and respect among the parties. In that atmosphere, the probability of becoming embroiled in litigation decreases precipitously. When the parties believe that their concerns are being heard and respected, losses that might otherwise become lawsuits, are far more likely to be addressed as the understandable consequence of the inevitable mistakes and miscommunications that attend all human enterprises.

As much as we'd like to believe that we don't take it personally or that it's only about money, the good news for all of us is that we do and it's not.

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Today the Silicon Alley Insider in its post Google, Viacom: We Won't Settle YouTube Fight Out Of Court asked the same question about Google and Viacom that we've been asking about J.K. Rawling and a middle school teacher -- Whuzzup with the whole settlement thing?

As Alley reports, David Eun, VP in charge of Google content partnerships told Dow Jones Newswires ``we're going all the way to the Supreme Court.  We're very clear about it.''

In the law biz we call this "posturing," and that "all the way to the Supreme Court" comment we call laughable posturing.  Alley says:

Call us dreamers, but we still think both sides could kiss and make up before this gets to the Supremes. After all, the two sides were negotiating for months before going hostile. And Sumner Redstone's other media company -- CBS -- seems quite happy with YouTube. So while both sides can argue that there are important principles at play here, we're pretty sure they can get resolved with an appropriately sized check. 

Of course it might well not be the size of a check but some other set of commercial exchanges, concessions, or synergies that will eventually settle the thing.  

These are business people for goodness sakes.  And never was a business person born who wants to establish Supreme Court precedent.  Talk about giving away your power and control.  

We welcome comments from more knowledgeable readers!

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I'll add these to my blog roll when I'm not rushing out the door.  For now, check out Jonathan Farrington's Blog post on Negotiation - Dealing with the Early Phases, a resource I have to thank the Business Growth Blog for, cited at the end of more excellent advice on Negotiating:  Thinking it through. 

Here's a teaser to get you to the Business Growth post:

Remember that classic scene in "Erin Brokovich" where the high powered, electric utility law team shows up in force to negotiate with the small town law firm? Ed Masry sees them coming in and gets all his staff to file into the board room so they have more "lawyers" on their side of the table… and overpowers the power brokers.

Would you like to have a system that helps you think on your feet like that?

Here is a list of 8 questions you can ask yourself when you suddenly realize that you have to prepare for a negotiation. Use these to generate quick preparation for any negotiation.

For the list of 8, click here!

Thanks guys!  Great advice in both posts with more good negotiation resources at the end of the Business Growth Blog post.

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Because I'm in this Forbes Business and Financial Blog Network, I figured I should finally take a look around to see what useful advice Forbes.com might have for my readers.  And sure enough, a Forbes.com search turned up How to Negotiate Like a Pro from the Entrepreneurs column by Lisa LaMotta.  Below an excerpt and the link here.

Life is one negotiation after another, though too few of us are equipped for battle. Formidable dealmakers like Warren Buffett, Bill Clinton and sports agent Scott Boras tend to be born, not made.

Yet talk to negotiating pros from the worlds of government, finance and media and they'll admit there is at least some science to this art. Winning every point is rarely an option, of course, but if you keep a few principles in mind, you can tilt things in your favor--whether you're signing a peace treaty or just angling for a raise.

If you remember one thing about negotiating, it should be this: It's not the maneuvering once you're in the trenches, but rather the preparation before sitting down at the table that counts.

That means taking the time to define what you want, what you are willing to accept and at what point you will walk away. It also means doing enough research to know what the other side wants--and how far they are willing to go to get it.

Want to know more?  Click here!

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R. David Donoghue over at the Chicago IP Litigation Blog is hosting a new "Carnival" of Blogs that is new to me -- The Carnival of Trust.  

As David explains:

The Carnival of Trust is a monthly, traveling review of ten of the last month's best posts related to various aspects of trust in the business world. It is much like the weekly Blawg Reviews that I post links to and have hosted, but those generally contain far more than ten links. My job this month was to pick those ten posts for you and provide an introduction to each post that makes you want to click through and read more.

I'm ridiculously pleased to be included in the category of Trust in Leadership and Management along with Charles H. Green's Trust Matters; George Ambler's Practice of Leadership;  and Stephen Albainy-Jenei's Patent Baristas  (if they gave awards for blog template design, PB would win in my book every day of the week).  In this crowd I feel like Zelig!

Here's David's generous mention of the Settle it Now Negotiation Blog and my recent post on convincing your clients to give up more than you (their attorney) predicted while still maintaining your credibility.

On the subject of trust-based leadership, Victoria Pynchon at the Settle It Now, Negotiation Blog has an excellent guide for maintaining your client's trust during a difficult negotiation: How Can I Convince My Client to Lose More than Predicted and Still Maintain My Own Credibility? The answer is complex and multi-faceted, but it boils down to the fact that you have to get the stakeholders and decision makers face-to-face, get their buy in on resolution as a goal (in addition to winning), explore all avenues of resolution, and you have to let them explore all aspects of the dispute, even those that do not matter. The last point is a difficult one for lawyers. As a lawyer you generally want to remain focused on the settlement inputs -- money, confidentiality provisions, sale of existing product if something about the product is being changed, etc. -- but from a trust perspective it is important that the stakeholders resolve not just those issues that go into a final agreement, but any problems or concerns they have related to the dispute or the parties to the dispute.

And let me just add here -- though I'll sound like a broken record to my regular readers -- that business people seek out lawyers because they believe themselves to be victims of injustice. (see my short-short video on this topic here)

Though I, as a mediator, am always seeking business solutions to legal problems, the client's injustice problem must be addressed to maintain your credibility (and retain your client's trust.).  Every great mediator I know will address this issue with your client unbidden.  If you're using less than great mediators --  raise the issue yourself -- all competent mediators should be prepared to address the issues foremost on your client's mind right including -- Will I lose?  How much more is this going to cost me? and Am I Being Extorted or Low-Balled?

Thanks for the mention, David!  I truly am greatly honored.  But more than that, you've helped me reach greater numbers of business people with a message that I carry somewhat like an old-fashioned missionary -- go beyond positions; find the parties' interests; create value; claim as much of that value as possible; craft business solutions to a legal problems; and, frankly address your client's injustice issues.  They'll be yours for life.

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My Judicate West Video Profile here and, of course, Gloria Swanson in Sunset Blvd. below

My favorite lines:

Joe Gillis: You're Norma Desmond. You used to be in silent pictures. You used to be big.
Norma Desmond: I am big. It's the pictures that got small. 

Norma Desmond: We didn't need dialogue. We had faces!

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In the new issue of The Complete Lawyer, my fellow Human Factor columnists and I talk about what new tricks we had to learn and old skills we had to re-invent when we took the journey from legal to mediation practice.  I give you my section of the column below, encouraging you to link to the Human Factor here to read what my my good friends and colleagues Gini Nelson, Stephanie West Allen and Diane Levin have to say.

My first day of mediation training progressed in somewhat the same fashion as my first few weeks in Civil Procedure. I remember struggling with the theoretical bases of jurisdiction in Pennoyer v. Neff one day only to be told the following week that Pennoyer was no longer the law. “Why,” I remember thinking, “did we even bother with Pennoyer when this Buckeye case about an exploding boiler now seems to be the law? Or would it be replaced next week as well?”

Law school, which taught me to “think like a lawyer,” was the precise opposite of my new mediation studies. Now, it seemed, I was being trained to stop “thinking like a lawyer.” Still, mediation, like the law, was full of conflicting ideologies from which it appeared I was required to choose.

It was easy for me to be evaluative: I had 25 years of legal practice in my backpack. I learned Dr. Cialdini’s “Principles of Ethical Influence”—Reciprocation, Scarcity (the rule of the rare), Authority, Commitment, Empathy, and, Consensus. These power principles helped the mediator to “make the other side see reason” when called upon to do so.

But the evaluative style was not the only prescribed route to mediation mastery. There were many who favored facilitation. The facilitative mediator first creates an atmosphere of hope and safety before helping the parties locate areas of agreement and mutual benefit. Here, the mediator is a follower or helper on the path to resolution, like the protective figures who appear early in a hero’s journey to enlightenment.

You can’t immerse yourself in mediation for long before you hear the clamor of the transformative crowd. Facilitative mediators, say the transformative folks, too often present themselves as wizards who intrude upon the parties’ conflict with their own agenda—usually “resolution be damned, let’s settle this darn thing!” The transformative mediator lets the session wheel out of control if that is where it is eager to go. Conflict is not seen as a state to be avoided or suppressed. Like a loving mother following the course of her child’s flu, the transformative mediator provides the parties with encouragement, opportunities to rest, lots of fluids and a metaphoric place to lay their heads as the conflict runs its natural course.

When I first brought this tangle of methodologies to the few master mediators I know, they all made short work of it with the scalpel of experience. “You are the technique,” they instructed. “Just stay in the process. Don’t guess. Ask questions. Listen. Don’t give up before the miracle of mediation happens.”

Now, four years into a full-time ADR practice, I am still struggling to embrace the entire dispute—the business or people problem that found its way to an attorney because of the justice issues with which it was burdened. I often feel that I’m walking a razor’s edge. I will never stop “thinking like a lawyer.” Nor will I stop pursuing this new way of thinking—one that looks for the opportunity to finesse the legal impasse by using the problem itself as an opportunity to broker a deal.

Why mediation? For me, it’s simply a broader canvass on which to paint a new picture. How mediation? In baby steps, one after the other, in just the same way I learned to be a litigator and trial attorney. How can the Human Factor help with your own life and legal practice? Stick around. Miracles are common here. We think you’ll enjoy the ride.

 

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(pictured, Harvard law School's winning Negotiation Team)

I could write an entire book on why law students should study negotiation as well as an entire chapter on why they should study texts written for MBA students rather than law students.  The latter topic I will cover in a future post.  The former has already been written succinctly as an article -- link and excerpts below.  

From Why Take ADR Courses In Law School by Cathy Cronin-Harris from the March 2008 issue of the Just Resolutions eNewsletter.

Cathy Cronin-Harris is Co-Chair of the Advocacy Committee of the ABA Section of Dispute Resolution. She's a Senior Consultant to the International Institute for Conflict Prevention & Resolution (CPR) and teaches Negotiation at Columbia Law School. She has taught at Georgetown and Fordham Law Schools, and has been an Administrative Law Judge and litigator. She can be reached at chadr5@aol.com.

Familiarity with Negotiation Approaches

[N]egotiation is a . . . . complicated process and demands a . . . . mind set that recognizes the inherent tension in negotiation: you must engage the other side in order to get to agreement while both sides are in a seeming struggle to achieve apparently conflicting objectives. That tension demands more subtlety than pushing [your opponent] into submission.

[E]xposure to negotiation theory and practice will help you understand "when to hold 'em," "when to fold 'em" and when and how to develop other feasible options and approaches beyond just holding out or giving in.

[Negotiation] courses stress the collaborative mode of negotiation or mutual gains bargaining popularized by Fisher and Ury in Getting to Yes. Its fundamental concepts stress objective standards, creativity, option development, respect for opponents and satisfying parties - genuine underlying interests rather than their positions.

Such exposure will expand your repertoire and allow you to negotiate with agility. You'll appreciate varying approaches people take to negotiation, discover ways to lessen competitive tendencies, become more conscious of options you can use rather than relying on raw intuition, appreciate the significant human elements impacting negotiation success, and learn the value of planning. As you become familiar with the broad brush approaches, you'll be enhancing the key skills below.

a. Expanded Communication Skills

In adversarial settings, assertion skills dominate: lawyers use logic, well-developed statement and presentation skills, tightly orchestrated cross-examination questions, and tools to connect with the trier-of-fact, such as compelling language, analogies and themes, to win the day. But when you negotiate, an additional set of communication tools comes into play along with asserting. Those skills focus on enhancing dialogue to solve the problem.

It's usually a challenge for lawyers to move from assertive statements to a wider band of communication skills. So negotiators learn to use better listening skills which includes confirming understanding of the other side's statements. They use open-ended questioning rather than restricted cross-examination formats to understand and dig out relevant information. They focus on body language and other signals embedded in communications that can provide information indirectly. They also refine assertion skills by ratcheting down the tone and format of statements to express needs compellingly without rancor. So negotiation will complement any communication skills learned in adversarial settings.

But beyond improving your negotiating ability in disputes, these skills will assist you in conducting your daily practice interactions including interviewing clients, unearthing their real needs and interests, advising them of your evaluations, enlarging their view of solution potential, calming them down, and in a host of other ways both professionally and personally.

b. Enhanced Persuasive Skills

The persuasion studied in most courses emphasizes logical rational analysis. Appellate judges apply it in every case based on the lawyers' logical presentations. Needed in negotiation? By all means. But persuasion to induce another to make a deal requires more. It includes your credibility, command of the subject, astute use of reasonable demands, varied questioning, and relationship building with the other side. We also persuade by showing our willingness to be persuaded: by meeting the other's needs and concerns and exploring a variety of options that might satisfy both entities rather than only pushing our agenda. And some psychological insights come into play about framing our requirements and anticipating likely reactions so we can make our offers more acceptable. While adversarial persuasion involves many of these tools, they are used to convince an outsider that you're right. Negotiation persuasion seeks to embrace your opponent, from whom you want something for yourself, and requires persuasive approaches we ordinarily don't consider.
c. Appreciation of the Role of Perceptions

Every trial lawyer knows that perception plays a role in the court room: it's not just about facts. Trial advocacy aims, in part, to shift the judge or juries' perceptions in your favor. In negotiation, we also deal with perception change efforts since negotiators, like everyone else, bring misperceptions to the negotiation table. They make assumptions, they suffer from partial or selective perception, and they tend to view the opposing side with suspicion. So, we seek to amplify those perceptions to remove the negative conclusions the other side draws from their misperceptions which impede willingness to find solutions. We clarify our intent that may have been misperceived; we demonstrate we're not just competing which they might have assumed; and, we suggest solutions to demonstrate regard for their concerns as well as our own. We explore hypothetical outcomes to induce a broader view of settlement potential. Even in making offers, we account for perception barriers in the way we state offers and use rationales to caste new light on their justifiability. We recognize that the way we use actual leverage or power can alter the other's perceptions toward or against us. Exploring these concepts underscores the important role that perceptual awareness plays in negotiation success.

d. Appreciation of the Human Dynamic

One can't effectively negotiate or help orchestrate it as a mediator without recognizing the human emotions at play in disputes. Emotions greatly affect receptivity to settlement proposals. Anger at past events, negative reactions to offers deemed insulting, absence of control over a situation or perceived lack of respect, attention or appreciation can derail deals. On the other hand, creating a positive emotional environment by building trust, building relationships across the table, and acknowledging the other's emotional state can alleviate some of the negative feelings in negotiation. These courses will highlight the need to consider the human element whenever you deal with clients or others in conflict.

e. Expanded Problem Solving Ability

Many lawyers went to law school to help people solve problems. Then, the adversarial adjudicatory system gets ingrained in their blood. That system and the rule of law it's built upon are still the best route to justice I know, when you can't settle matters. But, to function well as a twenty-first century lawyer, you need to complement your adversarial skills with problem solving abilities that support the mutual search for solutions when conflict exists. The negotiation skills you'll garner in the consensual ADR courses will prepare you to engage in collaborative problem-solving whenever possible and apply many of its tenets and skills even in extremely competitive situations.

While I've only touched on the key benefits of gaining negotiation training by enrolling in one of the consensual ADR courses, I hope I've helped you appreciate the need to treat those elective courses as part of your personnel core curriculum. Rounding out adversarial advocacy courses with vital settlement skills will pay vast dividends in every area of law practice despite your chosen field. You'll be more confident and prepared for the challenges ahead and more successful as you join us in the near future.

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In this part of the new series on getting the parties to the bargaining table, I interview former in-house Chrysler counsel and former Hogan & Hartson partner, Lew Goldfarb, who now has his own full-time outside settlement counsel firm.  

For Lew's full bio and contact information, click here.

• what's the difference between outside settlement counsel and a mediator?

Settlement counsel is an advocate for one side, in my case, that's usually the defense.  While the mediator is a neutral who tries to facilitate a compromise, settlement counsel attempts to achieve better outcomes for his clients for two reasons:  (a) I have a complete understanding of the full range of my clients' interests, many of which are often not communicated to litigation counsel; and, (b) it is easier for me to learn the true motivations (if not the bottom line) of plaintiffs' counsel than it is for litigation counsel to do so.

In class actions, which are my specialty, I strive to craft a solution that responds to plaintiffs' counsel's needs while imposing minimal costs on my client. There are numerous, creative ways to settle class actions that accomplish both objectives effectively.

• I sometimes find that the parties for whom I mediate have not confided in the litigation team all of the corporate interests that are propelling the client toward settlement. I found this to be true in litigation practice and as a mediator. Do you encounter this as outside settlement counsel and, if so, how do you serve the client's interests without stepping on the toes of litigation counsel and vice verse.

There's always a bit of a communication gap between litigation counsel and the client.  When clients hire me as settlement counsel it's in their interest to provide me with complete information in order to get them the best possible outcome, so they rarely withhold any important information fro me. In a recent case, I was not only invited to speak at several client board meetings, I was also asked to spend several days in the field on sales trucks to observe the client's franchisees that were the subject of the lawsuit.  As a mediator, I usually only see the information that the litigation counsel provides as part of his client's submission, which is probably much more selective.

• Now that I've been mediating full time for four years, I find I'm much more prone to ask the parties interest-based questions than I was as a litigator. When I say "interest based," I mean corporate realities such as chain of command; upcoming mergers or acquisitions; a new management team; quarter- or year-end financial planning; divisional loss history; and, the like.  If you find that to be true as outside settlement counsel, what do you think accounts for corporate counsel keeping their litigation team largely in the dark about issues that might have a substantial impact on the ultimate resolution of the matter?

Since I have always approached litigation with a view toward early resolution, either as in house counsel, outside litigator or mediator, I would usually make the same inquiries regarding the client interests that you do as a mediator. My only explanation as to why corporate counsel may withhold such information from their litigators may be that they are not seeking a negotiated outcome. In that case, they may believe that their litigators will be more effective and focused without being encumbered with "interest-based" information.

• My peers in the mediation world are fond of saying that litigators have to "churn" cases before settling them. I find that a shockingly cynical attitude.  I often found that clients were more settlement averse than their litigation counsel.  What is your experience in that regard?

I have to admit that I am more on the side of the cynics. I've had this longstanding belief that the legal profession imposes enormous economic costs on society without a commensurate benefit to the public, all in the name of providing access to the legal process. (See Goldfarb v. Virginia State Bar, 423 U.S.886 [1975]) I believe that litigators tell themselves that they were hired to litigate not settle the case. I think it's less a matter of "churning" than it is the litigators' belief believe that "early" resolution means winning a dispositive motion, even if it takes a year or more to get an outcome. (See my article "Litigate it or End it" which discusses this issue.)

While there are always legitimate corporate reasons for not settling a case, litigators are reluctant to discuss early settlement with their clients for two reasons: (1) loss of fees; and, (2) fear of showing any lack of resolve to win the case. My experience is not that clients are settlement averse, rather that litigation counsel convince their clients to hold off on settlement for one more dispositive motion.

• How did you come to champion the use of settlement counsel? 

I honed my skills as settlement counsel while serving for 16 years in house at Chrysler. When I arrived at Chrysler in 1985, the company was engaged in costly litigation with GM over a GM/Toyota joint manufacturing venture in Calif. The General Counsel asked me to look for alternatives to the litigation, which is when I found an article by Roger Fisher of Harvard promoting the use of separate settlement counsel. Chrysler did so and settled the case within a few months. I was then placed in the role of overseeing all class action litigation and serving as settlement counsel as well. Most in house counsel are not sufficiently immersed in the litigation, however, to serve as settlement counsel or simply do not have the time.

• As a former litigation partner in an AmLaw 100 law firm, do you wish you'd had inside settlement attorneys working side by side the litigation team? 

Because of my experience as in house counsel settling cases, I was always the partner urging my fellow litigators to evaluate settlement possibilities. For all the reasons set forth in my answers above, most large law firms do not embrace the idea of institutionalizing an in-firm settlement section. One exception was Wilmer Cutler in DC which did set up an ADR group within the firm with the idea that clients would make use of it. I don't know whether it still exists. I still think it is a great idea, although not as effective as the hiring of a completely separate firm or individual to explore settlement.

• Doesn't it take outside settlement counsel an unnecessarily long time to "get up to speed" on a major piece of litigation -- thereby making it less cost effective than simply hiring a mediator to help the litigators settle their own cases?

Not at all.  When I take on an assignment as settlement counsel I provide the client with a budget that includes a separate breakdown for "up to speed" time. While I need to understand the merits of the client's defense I do not need to read all the briefs since I generally am not called on to argue the merits of the case. Most importantly, I must fully understand what the client's interests are and what it is willing to offer up in settlement. For better or worse, what I offer is a very low cost, low risk means of exploring and settling complex litigation. 

Thanks Lew!  I can think of a couple of complex anti-trust, securities and IP cases I could have used your services for.  I hope this interview gets the word out to attorneys feeling pressured to settle a difficult case but unable to get the other side to the bargaining table.

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If you aren't using writs of attachment in contract cases where the amount due is certain, you aren't using the most powerful means of increasing your bargaining power in litigation.

Attend LACBA's Brown Bag Lunch with Judge James Chalfant at the Stanley Mosk Courthouse 111 N. Hill Street, Los Angeles on May 15, 2008.  Program Description:

Writs and Receivers: Practice tips for those who are rarely there. Judge James Chalfant will host a brown bag lunch highlighting tips and tricks for those who may not have much experience in this area. There is no cost to attend, but participation is limited to the first 12 attorneys who register. The program will be held in the judge's chambers at Stanley Mosk Courthouse, Dept 85. Please note, there is no CLE credit for this program.

Click here to register online.

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I'd just posted a piece on Negotiating from a Position of Weakness when along comes Harvard Business School Working Knowledge with an article about Negotiating with Wal-Mart by Julia Hanna. associate editor at the HBS Alumni Bulletin.  Below, one successful vendor's Wal-Mart Negotiation Rules.

• When you have a problem, when there's something you engage in with Wal-Mart that requires agreement so that it becomes a negotiation, the first advice is to think in partnership terms, really focus on a common goal, of getting costs out, for example, and ask questions. Don't make demands or statements ... you know, can we do this better and so forth. If the relationship with Wal-Mart is truly a partnership, negotiating to resolve differences should not endanger the tenor of the partnership.
• Don't spend time griping. Be problem solvers instead. Approach Wal-Mart by saying, "Let's work together and drive costs down and produce it so much cheaper you don't have to replace me, because if you work with me I could do it better."
• Learn from and lobby with people and their partners who have credibility, and with people having problems in the field.
• Don't ignore small issues or let things fester.
• Do not let Wal-Mart become more than 20 percent of your company's business. It's hard to negotiate with a company that controls yours.
• Never go into a meeting without a clear agenda. Make good use of the buyers' face time. Leave with answers. Don't make small talk. Get to the point; their time is valuable. Bring underlying issues to the surface. Attack them head on and find resolution face to face.
• Trying to bluff Wal-Mart is never a good idea. There is always someone willing to do it cheaper to gain the business. You have to treat the relationship as a marriage.
• ommunication and compromise is key.
• Don't take for granted that just because the buyer is young they don't know what they are talking about or that it will be an easy sell. Most young buyers are very ambitious to move up within the company and can be some of the toughest, most educated buyers you will encounter. Know your product all the way from the production standpoint to the end use.
• Chances are your buyer does, and will expect you to be even more knowledgeable.
  

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Is negotiation a political issue?

You bet.

Qureshi: Pakistan Won't Negotiate With Terrorists

(RTTNews) - Pakistan's Foreign Minister Shah Mehmood Qureshi said Monday that his government would not negotiate with "terrorists" even as it seeks open dialogue with some militant groups.

Jimmy Carter and Hamas

WASHINGTON TIMES EDITORIAL
April 16, 2008

Jimmy Carter's decision to meet with the terrorist organization Hamas is turning the former president into something of a political pariah.

New York Times "On the Issues" Foreign Policy Terrorism and Iraq

John Edwards

 On North Korea: "We should negotiate with the North Koreans. We should be tough. We should require that they stop their nuclear development program. We should have the absolute ability to verify that that has occurred."

On the Middle East: Has said that he believes "a two-state solution is ultimately the answer" but would not negotiate with Yasir Arafat. (before Arafat's death, obviously) Would send an envoy to the region.

Glenn Greenwald in Salon
Wednesday Feb. 27, 2008 
Majority of Israelis want to negotiate with Hamas

Sixty-four percent of Israelis say the government must hold direct talks with the Hamas government in Gaza toward a cease-fire and the release of captive soldier Gilad Shalit. Less than one-third (28 percent) still opposes such talks.

I could go on but you get the point.  The first decision any negotiator must make is whether he's willing to negotiate with the "opposition."  And the second is on what terms.

That decision -- and the many ways in which you can bring your opponent to the bargaining table any time you wish -- with the expectation that your negotiations will either successfully resolve your dispute or drastically limit the amount of time you spend litigating it before settlement will be the subject of this week's posts. 

Along the way, we'll talk about the many ways in which the masters of international diplomacy manage to take advantage of favorable negotiation conditions and to finesse unfavorable political climates for the purpose of getting warring parties to meet in an attempt to reach accord.. 

Stay tuned!

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Check out today's Naked MBA post The Importance of Negotiating Your Salary.  Here's the best advice going:

Practice

Any good negotiator knows that you have to practice. Plan what you want to say and how you want to say it. Have mock negotiations with your friends or your career advisor. Practice negotiating at the drycleaner, with your cable company and with any other service you purchase. Eventually negotiating will feel natural, and you’ll appear more comfortable while you’re doing it. This is important, because you don’t want to come off as nervous or aggressive.

For the full post, click here.

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I was cruising around the blogosphere this morning looking for links to the prime directive of all negotiations -- know your BATNA -- when I ran across this great 2007 post by Penelope Trunk of the Brazen Careerist -- How to Negotiate When You Have Nothing to Leverage.  

Penelope suggests the weakest strategy available -- exchange power for sympathy.  "If one person has a great BATNA," writes Penelope, "and the other has a terrible one, it’s not really negotiations; it’s trying to get a little something extra. It’s asking for a favor. If you approach negotiations from this perspective then you are much more likely to get a little bit of what you want."

Two of the savviest negotiators around Deepak Malhotra and Max Bazerman in their tremendously practical book Negotiation Genius have devoted an entire chapter to Penelope's problem called, not surprisingly, Negotiating from a Position of Weakness.  Their recommended strategies include the following:

• Don't Reveal that You Are Weak

[H]aving a weak BATNA is not terribly problematic if the other side does not know that your BATNA is weak. If you have a weak BATNA, don't advertise it! 

• Overcome Your Weakness by Leveraging Their Weakness

[W]hen both parties have a weak BATNA, it means that the [Zone of Potential Agreement] is large.  In other words, a lot of value is created when the two sides reach an agreement.  Who claims more of this value? . . . [T]he one who fares better is the one who makes the other side's weakness more salient throughout the negotiation. 

• Identify and Leverage Your Distinct Value Proposition

[V]ery often, you do bring something to the table that distinguishes you from your competitors.  This is your distinct value proposition (DVP), and it need not be a lower price.  You may have a better product,, a higher-quality service, a good reputation, a strong brand, or a host of other assets that your [bargaining partner] values and that you can provide more effectively or cheaply than your competitors.  

• If Your Position is Very Weak, Consider Relinquishing What Little Power You Do Have (This was Penelope's strategy in the Yahoo negotiation subject of her post). 

[I]f you can't out muscle the other side in a negotiation, you may want to stop flexing our muscles and, instead, simply ask them to help you.  When negotiators try to leverage their power, others reciprocate.  This pattern can be disastrous when you are the weaker party.  But when you make it clear that you have no intention of fighting or negotiating aggressively, others also may soften their stance.

• Strategize on the Basis of Your Entire Negotiation Portfolio

[A]udit the implicit assumptions you make when formulating your negotiation strategy.  You may perceive yourself as being "weak" if you only measure strength as the ability to push hard in any given negotiation without losing the deal.  But you may discover that you are actually quite "strong" once you begin to think about your ability to withstand losing some deals because you are maximizing the value of your entire negotiation portfolio.

• Increase Your Strength by Building Coalitions with Other Weak Parties

In the realm of international relations, a vivid example of the power of coalitions surfaced during the 2003 World Trade Organization negotiations in Cancun, Mexico.  Disgruntled by the continued lack of attention paid to the issues of concern to developing nations . . . twenty-one "weak" countries banded together to create the Group of 21.  This group is now in a much stronger position to negotiate for the interests of its members than any member nation would have been on its own.

• Leverage the Power of Your Extreme Weakness-They May Need You to Survive

[I]t is often useful to tell the negotiation "bully" that an overly strong show of force can be counterproductive:  "If you push me too hard, you'll destroy me -- and lose a value-creating partner."

• Understand -- and Attack -- the Source of Their Power

A number of Planned Parenthood clinics around the country have adopted a particularly creative strategy for fighting back [against protesters], usually referred to as the "Pledge-a-Picket" Program.  Here's how it works:  The clinic asks its supporters to pledge donations to the clinic on a per protester basis.  The more protesters that show up to picket the clinic, the more money the clinic raises in donations! . . . The Planned Parenthood of Central Texas in Waco has even posted a sign outside its clinic that read:  "Even Our Protesters Support Planned Parenthood."

Once the Planned Parenthood clinics understood that the source of their opponents' power was the ability to draw large numbers of protesters outside the clinic, they were able to think of a novel way of diminishing the benefits of doing so.

Malhotra and Bazerman conclude their chapter on Negotiating from a Position of Weakness by noting that

while being in a position of weakness is sometimes unavoidable, you will negotiate most effectively when you leverage the fundamentals -- systematic preparation and careful strategy formulation.

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The provocative comment we're following is Jay Welsh's remark that to settle most cases the Plaintiff has to accept a lot less than he wanted to recover and the defendant has to pay a lot more than he ever imagined paying.  And the response we're replying to is Canadian lawyer Michael Webster's:

When the issues have been crystallized into legal ones so well, you are in a lose/lose situation. The manager's dilemma then becomes counsel's dilemma: how do I manage to convince my client to lose more than I ever predicted and still maintain my own credibility.

The reason litigators settle law suits is because the outcome of litigation is uncertain and its pursuit expensive.  But that just states the problem.  How do you "tell" a client in the midst of expensive litigation that he's going to have to pay way more or accept way less than his attorney predicted (with appropriate disclaimers) long, long ago?

First, let me provide a checklist for success in commercial mediation:

1. Bring the real deal-makers to the mediation or settlement conference for it is they -- not their attorneys -- who will  make the decision to pay way more or to accept way less than they had previously imagined.   
2. Bring the parties back into the conflict as participants in its resolution again.  Businesses have commercial problems that have business solutions.  Litigation is often just the stick to force the continuation of commercial negotiations that broke down in so spectacular a way that the parties stopped talking to one another, hired lawyers, and began to fight over legal issues the parties neither care about nor understand.  The parties have now experienced how surreal their negotiation becomes when it's conducted in the courts.  They're probably ready to deal again.  Let them.  
3. Permit the parties to discuss all aspects of the conflict whether they are relevant to the legal issues or not.  The reason one party initiated litigation against the other party is not because he wanted to create precedent.  And if precedent is what a party wants, money might but often cannot settle the matter.  
4. Bring the experts along and let them talk to one another about the ways in which the matter might be resolved or even why their expert opinions are diametrically opposed.  
5. Address the parties' justice issues.  People seek out lawyers for one reason and one reason only.  Because they believe themselves to be the victims of an injustice.  And if its the defendant you represent, the injustice visited upon it is the litigation itself.  I spend a significant amount of time during a mediation discussing justice issues with the parties. 
   1. they're being extorted
   2. they're being low-balled
   3. they were defrauded
   4. their trust and confidence was betrayed
   5. their competitor's market tactics have been unfair and violative of any number of state or federal laws
   6. their intellectual property was stolen
   7. etc., etc., etc.
6. Let the mediator talk with the parties about what the justice system can do, what it should do, what it most likely cannot or will not do.  Most parties will not be happy with their attorneys if their justice issues are not addressed at the time of settlement.  And its my job to make clients happy with their attorneys.
7. Let the mediator help the parties understand that their case has -- with no one's fault -- gotten worse rather than better over time and why.   
8. When all else fails, blame the "system." 

Why Parties Pay More or Accept Less than They Want To

Jay Welsh is right.  If the parties have hired a mediator to settle complex commercial or mass tort litigation, they have done so because they need to pay more and accept less than they are prepared to do.  Otherwise, they'd settle without the assistance of a mediator.

This does not mean that the mediator bangs heads or twists arms.  There are hundreds of reasons why parties do not continue to trial and thousands of good excuses for corporate counsel to stop the bleeding.  They include:

1. the witnesses on the other side performed better in pre-trial testimony than expected
2. the Judge made pre-trial rulings that cut the heart out of your case
3. the Supreme Court (state or federal) just over-turned a hundred years of precedent making one party's legal case far worse and the other's far better than expected
4. it's the economy, stupid
5. the client realizes during the course of the mediation that there's more than one way to organize the facts and apply the law -- something lawyers are trained to do and even sophisticated clients find hard to swallow.  Having had an "aha" experience during the mediation, the client realizes there's more (or less) at risk than he's been thinking and the offer/demand now on the table looks pretty darn good after all
6. the other side becomes un-demonized during the course of the mediation, making it easier to part with money for the purpose of resolving the one thing both sides have in common -- a difficult, uncertain, expensive, dangerous lawsuit.
7. one side simply out-negotiates the other (it happens) 
8. one or both sides lose heart for the battle when they see that the delta between the their bottom lines is not as great as they expected it to be
9. the parties manage to "expand the pie" (more about this later) such that the plaintiff does not have to accept that much less nor the defendant pay all that much more than each anticipated (it happens)
10. one party genuinely develops an understanding of and empathy for the other side's position and changes a hard line attitude against settlement as a result (it happens)

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