Negotiation what should a mediator know

Download this FREE special report, Mediation Secrets for Better Business Negotiations: Top Techniques from Mediation Training Experts to discover mediation techniques for selecting the right mediator, understand the mediation process and learn how to engage the mediator to ensure a good outcome from the Program on Negotiation at Harvard Law School.

Real estate brokers, investment bankers, and executive search firms also serve as dealmakers, of course, but in the end, they typically represent a specific party. By contrast, a true mediator is nonpartisan and is equally responsible to everyone at the bargaining table.

Unlike arbitrators , mediators have no power to impose an outcome on the parties involved. Instead, they are process specialists, adept at moving people from narrow positional bargaining toward a problem-solving approach. If negotiators have been cautious about revealing critical information such as their must-haves and walkaways , a shuttle mediator — someone who goes back and forth between the parties, carrying proposals, floating ideas, etc.

Specialized mediators can also contribute their expertise to deal structuring. While Peppet is generally positive about the prospects for transactional mediation, he notes that it may raise some legal and ethical issues. Also, an argument could be made that a mediator involved in a merger or acquisition might have to comply with security regulations and register as a broker. In this article drawn from negotiation research, the concept of logrolling is explained in terms of both business and political negotiation scenarios.

It is vital that the mediator gains the trust and confidence of the parties so that a full and frank discussion can be encouraged. A full exploration of the problems will help to generate settlement options. Mediators may employ a variety of strategies to achieve a settlement.

The literature suggests that there are five main activities which mediators should employ:. The mediator should question and investigate not just the issues in dispute, but the underlying conflict. Mediators should avoid sympathy with either party. Nonetheless, a degree of empathy is required in order to build trust with the parties.

Persuasion is required in order to drive the mediation forward, as is a degree of inventiveness and the ability to provide distraction. In this context, distractions refers to the ability to take the parties onto another related subject in order to explore settlement possibilities from another angle. This techniques may be sued to avoid the polarisation of positions which is frequently adopted by many during conflict. Most mediation agreement state that mediator shall be liable to the parties for any act or omission whatsoever in connection with the services to be provided by them.

Such a clause is an attempt at a complete exclusion of liability and may be contrast to the immunity of arbitrators. It is arguable that the mediator, if acting purely in a facilitative capacity, should never find him or herself in circumstances which may give rise to any liability.

Nonetheless it is clearly common practice to include an immunity clause in a mediation agreement. A good deal of the literature focuses on the function, role and skills of mediators.

In this respect the mediator must manage the mediation process, gather information from the parties before evaluating and testing that information in order to facilitate the exchange of information which should hopefully then lead to a settlement. These processes can be described as the role or function of the mediator. Research has shown that mediation facilitates settlement in the majority of cases and even where mediation has not resulted in a settlement it was not always viewed in a negative light.

Since the mid s there has been a growing international awareness of the benefits of mediation as a dispute resolution technique. In the US, research by Stipanowich has documented the rise of mediation, which was first taken seriously by the US construction industry.

Many construction disputes can include complex issues and numerous claims by separate parties. Mediation is well suited to and widely used by the construction industry to resolve these types of disputes.

If only the other side was bargaining in good faith, you might think, we would have resolved this issue long ago. Your mediator can help you overcome this barrier. Imagine that your conversations with the mediator have led you to a novel settlement plan: you propose a joint donation of the fragile laptops to public school systems which can bolt them down to make their fragility less of an issue in the countries where you do business. This move could generate favorable publicity for the manufacturer and for you while also introducing schoolchildren future computer buyers to both companies.

Rather than taking the risk that the manufacturer will reactively devalue your idea, suggest to the mediator that he propose it as his own idea. Sometimes the unrealistic views of your own team members will turn out to be the major barrier to settlement. Or perhaps certain members of your team have an exaggerated view of the likelihood that in the absence of a resolution, a court will rule in your favor. Your ability to persuade your colleagues of the unrealistic nature of their views is limited; after all, if you contradict them too strongly, they may doubt your loyalty.

How likely are we to prevail in court? As you take advantage of these techniques, keep in mind that your interests and those of the mediator may not be identical. This is also your interest, of course—but only if the settlement is preferable to your no-settlement alternatives, such as a trial or termination of your relationship with the other party. Imagine that after two intensive days of proposals and counterproposals, you and the computer manufacturer have agreed to a joint donation of the too-fragile laptops to public schools but not on the amount the manufacturer will pay you for lost profits.

What should you do? Instead, ask yourself whether you might do even better. The other side might agree to this deal. Negotiation is a mixed-motive situation where the parties are motivated to cooperate and be creative, but also each is motivated to compete to claim a lion's share of the payoff.

To do this the parties try to establish their relative power in the situation; this resulting perception of power will, in large part, influence the settlement. The topics of "essential preconditions," "bargaining range," "structure," "tactics," and "negotiation styles" are discussed to help the mediator understand negotiation. Finally, some applications of these topics to mediation are offered. Note: In this essay, the terms, "negotiation" and "bargaining" will be used interchangeably.

Essential Preconditions Three pre-conditions are required for negotiation to work: good faith, viability, and early abandonment of the sham. Good faith is a willingness by the parties to make the process work by making concessions to each other. Concession-making, in the form of offers, is the stuff of negotiation.

Viability is the ability of each party, in the end, to make good on its offers. A sham is an exaggerated claim of power used to demand unreasonable concessions from the other party. For the negotiation process to work, the parties must negotiate in good faith by making concessions to each other, be able to make good on their offers, and be willing to abandon their respective sham positions early in the process.

In addition, negotiation is governed by the mini-max principle, i. Negotiation Styles There are two basic styles of negotiation: competitive and cooperative.

A party offering few or no concessions toward settlement is said to be a competitive or hard negotiator. As in most competitive situations opponents are reluctant to share information that might make them vulnerable to each other. Often competitive parties will merely give the impression of making concessions in order to meet the "good faith" requirement. A common saying among negotiators is, "…you need to have a dancer on your team.

Prolonged hard bargaining is considered bad faith negotiation and will ultimately destroy the process. Cooperative negotiation occurs when both parties listen to each other, learn about and try to meet each other's needs.

Cooperative or soft negotiation can result in a compromised gain for both parties. This is not to suggest that the gains will be equal, nor is it to suggest that the parties become altruistic toward each other.

The mini-max principle suggests that the parties are consistently interested in maximizing their gains. Note: Either of these styles, if used exclusively, can be problematic. Experienced negotiators are adept at both and apply them artistically. The Bargaining Range The bargaining range is the realm of potential outcomes. Three terms are relevant: sham position, maximum disposition and minimum disposition. As indicated, the sham is an extreme outer limit usually articulated during the onset of negotiation where boisterous displays of hostility are not uncommon and truth telling is not expected.

The term, "maximum disposition" represents the best outcome a party would hope to achieve through negotiation.

The term, "minimum disposition" refers to the bottom line. It is the least favorable position a party will accept before opting out of negotiation. It is a party's resistance point. This is not fixed but rather varies as a function of a party's perceived power in the situation. Much of negotiation interaction is designed for each participant to determine the opposing party's minimum disposition.