NEGOTIATION STRATEGIES Laura Bruneau Bruneau Group, Class Action Settlement Services October 26, 2017

REFRESHER Common Types of Negotiation TELEPHONE NEGOTIATION (You & another party) IN-PERSON MEDIATION (Mediator is present) SETTLEMENT CONFERENCE (Judge is present)

REFRESHER Common Types of Negotiation Distributive Negotiation   Fixed pie zero-sum win-lose Interest Based BATNA Good Faith vs. Bad Faith Negotiation

REFRESHER Common Types of Negotiation Distributive Negotiation – Fixed Pie Competitive negotiation used to decide how to distribute money Get an idea of the other party’s walk away value Your power depends on how clear you are about your goals, alternatives, and walk away values Success also depends on how much you know about the other party’s case

REFRESHER Common Types of Negotiation Interest based – Best Alternative To a Negotiated Agreement BATNA = the best “Plan B” you can realistically go to if negotiations fail and an agreement cannot be reached Figure out your no-deal options! You should generally not accept a worse deal than your BATNA

REFRESHER Common Types of Negotiation Good faith vs. bad faith negotiation Good = implied pledge to deal honestly and fairly Bad = taking advantage of the other party by engaging in deception or hard-bargaining tactics False negotiator Bad faith examples: - Refusing to negotiate a legitimate claim. - Refusing to negotiate a fair settlement when liability is obvious. - Changing representatives solely for the purpose of delay once you’ve entered into negotiations. - Failing to provide information which is obviously relevant to the claim.

REFRESHER Getting Yourself Ready Ask yourself the right questions. Is the case ripe for settlement? What documents will be needed, do you have them all? What is your reserve? Does it need adjusting? Do you have the necessary authority? What is your department’s culture with respect to settlements – hard-lined or totally actuarial? What are your expectations? Are you prepared (BATNA)?

Soft Skills Be a Good Negotiator Transforming a zero-sum adversarial process into a negotiation geared towards problem solving and settlement. Always strive to: - Listen to learn – be an active listener - Ask the right questions of the other side - Build rapport & about being nice - Build trust

Soft Skills Be a Good Negotiator Active listening Does not = waiting patiently for the other side to end a rant or nodding and saying, I understand, but… Do proactively interrupt the other party to paraphrase what he has said Do ask follow-up questions to better understand confusing assertions Do acknowledge highly charged emotions or adversarial perspective lurking below the surface

Soft Skills Be a Good Negotiator Asking the right questions of the other side Instead of asking closed, opinionated questions, strive to ask open- ended, neutral ones aimed at information gathering and defining priorities Asking open ended, neutral questions requires you to look beyond your own biases and open yourself up to being persuaded by your counterpart

Soft Skills Be a Good Negotiator Building rapport and what about being “nice”? Engage in small talk at the start of a negotiation but research shows that doing so can bring real benefits Be polite and courteous at all times We equate being collaborative with being nice. It’s OK to be nice, but a collaborative approach = more a bargaining approach than a personality trait Sensing that other party may be angry inside, don’t try to appease the situation by overcompensating on concessions

Soft Skills Be a Good Negotiator Building trust Speak the other side’s language Explain your deal requirements Make unilateral one-sided concessions Label your concessions Manage your reputation Try make party dependence a factor

Soft Skills Negotiating with Difficult People The accidental hard bargainer has biases & emotions affecting decision making. The reluctant hard bargainer has hidden constraints or interests The intentional hard bargainer believes that hard bargaining is the most effective strategy

Soft Skills Negotiating with Difficult People Intentional hard bargainers are seeking to convince you to agree to their demands. Tread carefully and try: To model good negotiating behavior throughout To involve your opponent in finding a solution To generate discussion To avoid a “fight back or give in” mentality “Breakthrough Negotiation”

Soft Skills Negotiating with Difficult People When should you give up the fight against obstinance? Negotiators often fail to recognize when it’s time to walk away from a negotiation dispute. The most common traps are: Psychological trap Fairness judgements Focusing too much on sunk costs

Soft Skills Feeling Ganged Up On Remember your power. Regardless of its source, power has consistent and predictable effects – both positive and negative on negotiations. Three (3) types of power in negotiation: - BATNA power - Role/title power - Psychological power The strategy of "enlightened self-interest"

Soft Skills Caucusing Key advantages include: More open communication with mediator Reduces tensions, therefore more flexible & creative Privacy makes parties more comfortable to disclose information Direct discussion with mediator Be careful about how you may call for a caucus because it may leave the other party feeling a sense of mistrust or weakness on your part

Thank you for listening.