Northern man, Going Postal

How does negotiation work?

So, we are about to enter probably the most important negotiation that will happen for many lifetimes the exiting of the UK from the EU and the detaching of that institute’s tentacles from all aspects of our lives.

But what is negotiation?  How does it work?  I am not a full-time negotiator, but I do negotiate contracts as part of my job (biggest one was just over #1bn for a ten-year deal) and thought I would share my thoughts on this with you all.

One dictionary definition of negotiation is discussion aimed at reaching an agreement .  By that definition you could argue that negotiation is part of human nature.  Anyone with children knows that they start negotiating from the age of four or five ( Do I have to go to bed now?  Can I just watch one more episode? ).  In many cultures people negotiate every time they buy something (we look down our noses at this and call it haggling ).

So what are the important things to bear in mind when thinking about negotiation?

Types of negotiation

There are two main types of negotiation:

negotiating a transaction
negotiating a long-term agreement

The classic example of the first of these is buying a used car.  You are generally not interested in having any kind of long-term relationship with the salesperson, you just want the best deal.  In the second example you need a less brutal approach, as you will be dealing with the other party every day for a number of years.

A transactional negotiation can take minutes, negotiating an agreement can take months.  Interestingly, in the case of Brexit we are doing both we have to negotiate a transaction (leaving the EU) and an agreement (our long-term relationship with the EU).  There are a number of key steps to go through either way:

1. Agree the scope

This is the most important step.  What is it that you are negotiating over (in the terminology of negotiation what is on the table ?)?  Is it vital to you that you can part exchange your old car?  Is free movement of people even up for discussion?  Are you just talking about trade or about social matters (e,g, human rights) as well?

2. MDOs and LAAs

Once you know what the overall scope of the deal is you need to break it into components (e.g. fishing, agriculture, aero, motor).  For each component (or even sub-component) you then have to define your Most Desirable Outcome (MDO) and Least Acceptance Alternative (LAA).  In an ideal world you would end up with 100% of your MDOs (this never happens).  Whilst the LAA is your worst acceptable position it would also be unpalatable to end up there for every component, which is why we also define, before the negotiation starts, our

3. Give to get s

This is where we start to get into the theatrics of negotiation.  The give to get items are those things which you want the other party to think are really important to you but which are actually things that you are happy to give away as long as you get the right thing in return.  For example, as part of Brexit we might argue that it is imperative that we remove the EU branding from all projects which have been funded by the EU so that we have a clean start.  We know that the EU would hate this so we might grudgingly agree to retain the plaques and flags in return for an agreement which makes it easier to deport EU citizens from the UK (the give and the get are often in very different parts of the deal)

4. Walk a mile

What we now need to do is to put ourselves in the other party’s shoes.  What are they really looking for?  What are they prepared to give up?  It is not unusual to run the whole negotiation through multiple times with colleagues role playing the other party until you feel like you are ready to go.

5. Poker face

Finally the hardest part of the negotiation (for me anyway) consistently looking defeated/disappointed when in fact you’ve won a significant concession.  Bearing in mind that negotiations can go on for weeks (in my world years according to the civil service) this is really not easy.

I could continue but hopefully this gives you a flavour of what should be going on behind closed doors on our behalf once we invoke Article 50.  The critical question now is that of who you would trust to do this job?  Personally I could see Farage, Rees-Mogg or IDS being great at this and Boris being dire.  I’d prefer hard-nosed business men over civil servants and politicians but I doubt that will happen.  I wonder who we will get and what kind of deal they will deliver?

Northern man ©