BOOK SPECIAL How to Negotiate Situations That Feel
Hopeless
NEW BOOK: In Negotiating the Impossible, Deepak Malhotra outlines key lessons for negotiating sticky
situations, with examples that include the Cuban Missile Crisis, disputes in
the National Football League and National Hockey League, and several instances
of high-stakes deal-making where companies found themselves negotiating against
the odds.
· BOOK EXCERPT
The
Power of Process
from: Negotiating the Impossible
by Deepak Malhotra
The war for American independence between the
United States and Great Britain lasted eight years, formally ending in the
Treaty of Paris, which was signed in 1783. By that time, the Articles of
Confederation had served as the governing document of the United States for six
years. By design, the Articles gave little power to the central government, and
the sovereignty of the 13 states was paramount. The Articles went so far as to
clarify that the relationship between the states was merely a “league of
friendship with each other.” This was to be expected given the confederation
was formed by people who had just freed themselves from the grip of power
vested in a distant monarch. Soon enough, however, problems with this
arrangement emerged. George Washington, commander in chief of the Continental
Army, had seen the failings firsthand during the war itself. Congress had no
power to tax, and the states were often unwilling to contribute the funds
necessary to pay military wages or the war debt owed to foreign countries.
After the war ended, matters worsened. Congress was considered so powerless
that its delegates often failed to even show up; on occasions when a quorum was
reached, little was accomplished. Even bills aimed at raising tax dollars to
pay the war debt were defeated, not because a majority of the states dissented,
but because the Articles gave every state a veto. In 1786, Rhode Island
defeated such a bill despite support in 12 other states; in 1787, New York cast
the deciding vote to do the same.
Evidence that the Articles had serious
shortcomings mounted. In 1787,the highly publicized but short-lived Shays’
Rebellion, an uprising among Massachusetts farmers who had economic grievances,
made the economic and political problems plaguing the young nation especially
vivid. Soon after, the various states agreed to send delegates to the
Constitutional Convention in Philadelphia. The goal of the convention was explicitly
modest: to consider modifications to the Articles of Confederation. Had the
convention been seen as an event at which reformers would try to completely
overhaul the government and wrest power away from the states, it is unlikely
that any state would have even sent delegates. Yet, that is precisely what
occurred.
Although it is certainly possible to
overstate the role any one person plays at historic events, James Madison is
quite rightly considered to have been one of the few indispensable characters
in Philadelphia that summer. Yet, by almost any measure, the deck was stacked
against him. At 5 feet 4 inches, and weighing close to 100 pounds, Madison did
not project strength or stature. Far from being a captivating orator, he was
shy and sometimes spoke too quietly in the debates to be properly heard. At 36
years of age, he was neither a war hero, nor a prominent national figure, nor
even a senior member of the delegation from his home state of Virginia. Most
problematic, there was very little support for a significant overhaul among the
American population at large, and the notion that state legislatures would
accept any sizable reduction in their powers was almost unthinkable.
Nonetheless, in large part due to Madison’s efforts, when the convention ended,
the delegates had drafted an entirely new constitution that shifted
considerable power towards a new central government. By late 1788, the required
supermajority of states (nine of 13) had ratified it, and by early 1789, the US
Constitution became the law of the land. How did this happen?
NEGOTIATING
THE IMPOSSIBLE
For his contributions, Madison would come to
be known as the “Father of the Constitution.” And while he spoke over 200 times
during the debates that took place in the summer of 1787, much of what he
managed to accomplish might be attributed to what took
place before most other delegates even arrived in Philadelphia. By
the time the convention started, Madison had already shaped the deliberations
that would take place.
Madison arrived in Philadelphia on May 3,
1787, 11 days before the Constitutional Convention was scheduled to start. True
to character, he was the first delegate to show up. George Washington, a fellow
Virginian—and the most popular man on the continent—would be the second to arrive
ten days later. When Madison and Washington visited the convention hall on May
14 for the scheduled commencement of the now-historic deliberations, they
discovered that apart from some local Pennsylvanians, they were the only two
people from among the other 12 states to have made it to Philadelphia. While
justifiably concerned by what the delay portended, Madison got straight to
work. The task ahead, as Madison saw it, was to convince the other delegates
that the Articles of Confederation needed to be thrown out completely. To be
more precise, given the potentially fatal shortcomings of a system in which any
one state could overrule all others on matters of national importance, the new
system needed to vest significantly greater power in a national government.
Madison understood that the greatest barrier
to the drastic change he wanted was the default process that was in place: the
Articles of Confederation were going to be the starting point of any
conversation. As long as the Articles served as the template to be revised,
they would be too powerful an anchor in every discussion of how to structure
government appropriately. A process based on, “How should we revise the
Articles?” could never lead to as much change as a process based on, “What is
the best system of government?” The process would need to be changed.
Madison, working with George Washington and
other like-minded delegates from Pennsylvania and Virginia, started to draft an
alternative document that could serve as the starting point for discussion.
What came to be known as the “Virginia Plan” consisted of 15 resolutions that,
although presented as revisions to the Articles, in fact upended the existing
compact between the states. Among its proposals were the idea of proportional
representation in Congress, giving power to citizens rather than state
legislatures; the veto power of the executive branch; elements of checks and
balances; and the ability of the legislative branch to negate state laws that
were incompatible with the national interest. Perhaps most astutely,
anticipating the resistance of state legislatures to the changes, it also
proposed a revised process for ratifying the new Constitution: it called for
ratification not by state legislatures, but by assemblies specifically selected
for this purpose by the people of the various states.
Not even the considerable talent gathered in
Philadelphia in May 1787 could have created such a document without the
exhaustive preparation Madison had undertaken before setting foot in
Philadelphia. One month earlier, in April 1787, after countless weeks of
careful and extensive research on the history of different forms of government
dating at least as far back as ancient Greece, Madison had drafted a document
titled “Vices of the Political System of the United States.” In it, he laid out
a careful critique of the existing system, as well as ideas on how the problems
could be addressed. Shared with the Virginia and Philadelphia delegates in May,
this treatise served not only as the backbone of the Virginia Plan but also as
the basis for reformation presented at the Constitutional Convention.
The convention finally started on May 25.
Only four days later, Virginia Governor Edmund Randolph presented the Virginia
Plan. Reactions ranged from enthusiastic support to shock and anger. But the
die was cast, and all of the debates to follow would take place in the shadow
of the Virginia Plan. There was now an entirely new process in place; instead
of debating the legitimacy of revisions to the Articles, arguments were focused
on supporting or opposing elements of the Virginia Plan. Many compromises were
made by all sides in the months ahead, but as each day progressed, the Articles
of Confederation were left further behind.
HAVE
A PROCESS STRATEGY
What truly exemplifies Madison’s genius is
not merely the extent of his preparedness, but the focus of it. Whereas most
people know to prepare for the substantive discussions that will eventually
occur, Madison understood the power of shaping the process that will
ultimately determine whether, when, and how the substantive discussions will
take place. The most obvious examples were Madison’s extensive efforts in
resetting the starting point of discussions and the coalition-building he
did before the convention even started. If he had not executed these
process interventions, the negotiations might well have gone a different way.
Another crucial process element that favored Madison was the gag rule that
delegates instituted to shield their debates from public interference; if too
much information on the ongoing negotiations had leaked early on, it would have
been difficult for some delegates to continue the controversial work of the
convention. If these process elements had not been carefully considered and
shaped, the debates would have started—and likely ended—quite differently.
The substance of a negotiation is about what
the parties are trying to achieve. Process is about how they will get from
where they are today to where they want to be. In the previous section, I
discussed the peril of focusing exclusively on substance and ignoring the
frame. In this section, I will make the same argument regarding process: even
the most brilliant strategy for the substance of negotiations can be undermined
if there is insufficient attention to process. Here are just
a few elements of process to consider and try to shape:
·
How long will negotiations last?
·
Who will be involved and in what capacity?
·
What will be on the agenda, and in what order
will issues be discussed?
·
Who will draft the initial proposal?
·
Will negotiations be public or private?
·
When and how will progress be reported
outside of negotiations?
·
Given multiple parties or issues, will there
be one negotiation track or many?
·
Will all the parties be in the same room at
the same time?
·
Will negotiations take place face-to-face or
via technology?
·
How many meetings will be scheduled?
·
How will major deadlocks or other problems be
managed?
·
Will there be outside observers or mediators?
·
Will deadlines, if any, be binding or not?
·
What milestones might help build momentum and
keep the process on track?
·
If the negotiations end in no deal, when and
how might parties reengage?
·
Who are the parties that need to ratify the
deal, and how much support is sufficient for passage?
In most negotiations, some or many of these
factors will be predetermined, or there may be a default process in place due
to precedent or the actions of other parties. But as we have seen, defaults
need not be blindly accepted—they can be reset to great advantage. This happens
only when negotiators have evaluated all of the important elements of process
in advance and have assessed how alternative processes might facilitate or
hinder progress.
DON’T
IGNORE THE IMPLEMENTATION PROCESS
In the case of the United States Constitution,
the crucial role of process can be seen even after the close of the convention.
Much of the success in achieving ratification by the states can be
attributed to the type of process that was implemented. Recall that many state
governments would not have been in favor of the kinds of changes the new
Constitution proposed. Moreover, many detractors of the Constitution were going
to argue that delegates at the Constitutional Convention had exceeded their
authority, that there was going to be too much power vested in the national
government, and that individual rights were not sufficiently protected (a
concern that was later remedied by the Bill of Rights).
How do you get sufficient support for a deal
that is certain to shock many of those who have been outside of the
negotiation? Fortunately for Madison and other supporters of the Constitution
(dubbed the Federalists), the process for ratification was tailor-made to help
them overcome opposition by the Anti-Federalists. First, and most crucially,
according to Article VII of the Constitution, only nine of the 13 states needed
to ratify the Constitution for it to go into effect for those states. This was
despite the fact that any previous revision to the Articles of Confederation,
which is what the new Constitution was supposed to be, had required a unanimous
vote by all 13 states. Second, ratification took place through specially called
state ratification conventions, rather than by the sitting state legislatures.
Third, delegates were empowered to make only one choice—vote yes or no—and
could not propose amendments or negotiate for revisions. And fourth, the
Federalists moved quickly and strategically to schedule early votes designed to
win passage in five of the pro-Constitution states. This made it easier for
delegates in other states who might have been on the fence to feel more
comfortable voting in favor. Certainly, substantive concessions were also made
to shore up support in some states—most notably, reaching an understanding that
the Bill of Rights would be taken up by the first Congress under the new
Constitution. But it is hard to imagine how the Federalists could have achieved
success without the right process elements in place. If ratification had
required consensus, states like Rhode Island, which had not even sent delegates
to the Convention, would have surely vetoed all efforts from the start. Had
states been allowed to vote on different versions of the Constitution, or to
reopen debates in the hopes of scoring concessions, deadlock would have almost
certainly resulted. Likewise, had the Anti-Federalists been given more time to
mount an organized challenge to the Constitution, things might have ended
differently.
THE
POWER OF PREPARATION
As evident throughout, Madison understood the
power that comes from being the most prepared person in the room. It was this
quality that inspired him to conduct his scholarly research before the
convention and to reach out to other Virginia delegates asking them to arrive
early to draft “some materials for the work of the Convention.” He brought the
same quality into the Convention itself. William Pierce, the delegate from
Georgia who became famous for penning character sketches of other delegates,
referred to Madison as someone who “always comes forward as the best informed
Man of any point in the debate.”
The benefits of thorough preparation are as
evident in complex deal making as they are in board meetings, sales calls,
legal proceedings, and promotion discussions in faculty meetings. In every one
of these environments, some show up woefully unprepared, some have done enough
preparation to get by, and others are ready to respond to almost anything. In a
truly important situation, you don’t want to be any of these people. You want
to be a Madison: someone who has all of the facts at your fingertips, who can
anticipate the arguments and reservations of the other parties, and who has
carefully examined not just the strengths but also the weaknesses of your own
argument. This is the person who is hardest to ignore or push around, to whom
others are most likely to give deference, and who will most easily shape or
reshape the process and the substantive negotiations effectively.
Excerpted from Negotiating the Impossible by
Deepak Malhotra, copyright 2016, Berrett-Koehler Publishers. Reprinted with
permission of the p
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