Negotiation from Weakness- You’ll be Doing It

For our first “Guest Post Saturday” here at Construction Law Musings, we have a great one.  Victoria Pynchon is an attorney-mediator with ADR Services, Inc. in Century City; an arbitrator with the American Arbitration Association in Los Angeles, California; and, a negotiation consultant and trainer world-wide.  Victoria is one of the founders of She Negotiates University and the author of A is for Asshole, the Grownups’ ABC’s of Conflict Resolution which will hit the stores and Amazon.com next week.

Feel like you’re negotiating from a position of weakness?  Join the club.  I’ve never spoken to an organization big or small or person powerful or weak who doesn’t say the same thing.  Why?  Because everyone wants what they want and few people or institutions think they have the power to make other people do what they want, no matter how much money or power they possess.  People are like that.  They don’t like to be told what to do and don’t much cotton to being paid off to do something they don’t want to do.  Stubborn.  Proud.

Litigators are the savviest students of relative strengths and weaknesses.  You’re strong after you win a summary judgment motion or an award of sanctions for discovery abuses against opposing counsel and their clients.  You’re weak after defendant’s demurrer is sustained or plaintiff skewers your best witness during a recent deposition (my favorite:  a colleague, cross-examining an expert witness who said he relied upon what counsel told him, asked “if counsel told you the moon was made of green cheese would you have factored that into your analysis.”  Improbably, before coaching objections were made, the expert promptly answered “yes.”)

As a mediator, lawyers are always explaining why now is not the time for a sit down.  They’re two years into the case but they “haven’t done enough discovery yet” or they won an important pre-trial motion that they hope to leverage into a jury instruction establishing a critical fact to be the incontrovertible truth.  Why should I settle when I’m in a position of strength? they ask or why should I settle when my case looks weak? My standard answer after 25 years of litigation practice is this.

Because tomorrow you’ll be losing.  Or winning.  You know it and they know it.  Someone always has an advantage but few lawyers are rarely able to hold on to it for long.

So what do the negotiation gurus have to say about getting your own way when you feel you’re weak.  Quite a lot it turns out.

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 Negotiating from a Position of Weakness.  They don’t suggest throwing yourself on the mercy of your negotiation partner as Penelope does (well, not as their onlyrecommendation).  Rather, they suggest a host of strategies weak bargainers can use to act strong, look strong and be strong.

§  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.

As Google executive Eric Schmidt famously said, litigation is just a negotiation being conducted in the courts. Take the long view, bring that tremendous creativity you use when you try a case to a jury to the settlement table and take back what your client most misses ~ control of his present and the ability to plan for a productive future.

As always Vickie and I welcome your comments below. Please subscribe to keep up with this and other Guest Post Fridays at Construction Law Musings.