Recalibrating for Success
By: Michael Schmidt
In the mediation context, most negotiators equate the word “success” with full resolution of all issues in dispute. While there remains some debate on the appropriateness of this labelling, the purpose of this presentation is not to discuss the value of an unsuccessful mediation, which is its own topic. Rather, here we will consider the development of strategies to move an unsettled case towards settlement in circumstances where the trajectory of a negotiation does not appear promising.
We all enter the negotiation forum with expectations. Those expectations are usually derived from past experiences in general, or, from specific case-related discussions. Typically, those expectations, when combined with a client’s interests, inform the rhythm of a negotiators position. Oftentimes, the rhythm is good and the case moves evenly into settlement territory. A good day; and I think most would agree, a rare day.
More often, the negotiator will have the experience of participating in a negotiation where the trajectory of the positions, when viewed together, looks as though the case will not resolve. Most of the participants, if polled, would express the opinion that the matter is not headed towards settlement. There can be little doubt that the level of candour presented is directly proportional to the level of settlement expectation; to put in another way, a poor outcome can be expected simply by virtue of the fact that everyone expects a poor outcome.
Depending on the level of negotiation that has taken place, and sometimes based on something as trivial as the time of day, the belief that the matter is not headed to settlement, can be a pivotal time in the negotiation. The negotiator has to decide to 1) continue to engage 2) change the nature of the engagement, or 3) disengage. Your mediator becomes a valuable resource here.
Continue to engage – The perception that a negotiation is not proceeding in a successful direction, may be just that, a perception. Everyone negotiates in a unique pattern, and the style between hard and easy bargainers may give a false perception. Before a negotiator gives up on their plan, they should be sure that abandonment is necessary. On the other hand, as Mr. Einstein reminds us, the very definition of insanity is doing the same thing over and over again, and expecting different results.
If you elect to continue the engagement, without meaningful alteration, avoid incrementalism if you can, and provide meaningful or substantive data to support a position. We all believe that there is a message implicit in each communication, combined with the explicit position. Where there is a risk that the message will get lost, spell the message out to the mediator so that nothing gets lost in translation.
Change the nature of the engagement – A skilled negotiator will present at the mediation with a Plan B. A method, or strategy by which the trajectory can be improved. Again, the mediator becomes a valuable resource here;
Litmus Test offer: A litmus test is intended to be a decisively indicative test. In negotiation terms – this is the presentation of an offer to test a hypothesis generally related to the opposing parties negotiation position. For example, in the personal injury forum; they won’t concede a portion of liability, because I won’t concede a portion of liability, or their staying high, because I am staying too low. To be effective, the litmus test has to be a decisive alteration in position. Discuss the fact that the offer is a litmus test with your mediator, and consider the anticipated responses.
Often I have a negotiator say that they are making a big move, without making what I as the mediator perceive to be a big move. I typically respond by asking how the negotiator expects the position to be received. Generally they will make a comment to the effect that, if they think like me, they will perceive it to be a big move. They don’t think like you, they don’t perceive the case like you, and that’s why were in plan B in the first place. To be effective, the negotiation receiver has to perceive the altered position in such a way that life is breathed back into the negotiation.
Identify and remediate factual errors, or misconceptions: It is clear that reasonable people will disagree on the appropriate result even in circumstances where factual information is correctly shared. As a mediator, I see cases where the facts as identified in the briefs or opening statements are different. If the issue is one of perception, then there may be little you can do. Credibility battles between parties are rarely worked out in the mediation forum. However, more often than not a proper review of the documentation will correct the error. On a practical level identifying the errors means paying attention to the other negotiator’s brief, and paying attention to the other negotiator’s opening statement. If you don’t pay attention, then you can’t identify the error. Once the error is identified, find the record, review it, and pass along the information. This means having your file available, or at least having access to it.
Identify and remediate information voids: means having access to the between the parties are sometimes, I am able to see that the analysis of one party to the negotiation is missing something. Drilling down on the position will sometimes get to a point whereby the party identifies what from their perspective is missing for them to accept the analysis of the other party to the dispute. Sometimes the information is at hand, other times it can be obtained at the mediation, and still other times, it may be necessary to obtain additional information in the future. Rather than walk away from the process without a deal, if the party who is missing the information explains precisely what they need to empower them to advance the negotiation, then the and the other party is willing and able to provide, then it makes sense to simply adjourn the discussion.
Isolate points of agreement to isolate points of disagreement: A typical negotiation has multiple moving parts. Typically some of the portions of the negotiation are easily resolved. If those issues are identified, and set aside, the remaining dispute typically looks much more manageable.
Re-engage a joint session: Mid-way through the negotiation, a further joint session to discuss the concerns about trajectory, or progress can have the effect of breaking down barriers, or obstacles to the advancement of the negotiation. In such a meeting, discussing the settled, or almost settled issues operates to isolate the size of the ongoing dispute.
Stepping down: Obviously getting the entire matter resolved is the goal. However, if that seems unlikely, then it is appropriate to consider settlement of portions of the case, if practical. In multi-party litigation this can mean settling with one party but not another. While there is usually litigation risk to settling a portion of the case, there is always risk if you don’t. Consider the fact that any settlement that shortens the trial, minimizes litigation risk, or anticipated expense has value to your client. Consider settling liability, but not damages, or vice-versa. Quite often, when a portion of the case is settled, economies of scale operate to make the remaining dispute not worth trying.
Measure your alternatives: Doing nothing doesn’t count as an option. You are engaged in a dispute, and it will come to and end. The goal is and always should be to ensure that the dispute ends as favourably as possible.
Disengage – If you are not going to settle your case, then there is still a valuable way to walk away from a negotiation. It is a rare day when the client’s interests are furthered by storming out of a mediation angry. There can be little doubt that frustration derives from unrealized expectations. Having said that, any additional information that can be learned on the way out of the negotiation will serve the client’s interests in the fullness of time.