Post #6 – Positions and interests in a negotiation

In this post we wanted to talk about positions and interests in a negotiation. Roger Fischer and William Ury covered this topic in their book Getting To Yes.

The book, first published in 1981, is a classic on negotiation. We’ve read it various times and always found it contains clear, helpful ideas; it offers perspectives but is also practical. We cannot do it justice in this brief post. Below we just highlight a few ideas that we have found particularly useful.

What is the context of negotiation? you and the other side have interests, some shared and some opposed.

What happens often in negotiations? each side takes a position and positions become entrenched; the focus is the interests that are opposed and not giving in; in the end, whatever the outcome, both sides are worn out and the relationship is harmed.

The book, Getting to Yes, tries to answer this problem.

We have found ourselves in any of the following situations, which have involved both shared and opposed interests with our other side: agreeing on terms for a funding round and a new shareholders agreement; two founders don’t get along anymore and one of them will leave; the company is being sold and investors and founders do not agree on terms for the transaction; things are not working, but founders and investors don’t agree on what changes are needed.

Founders and investors are partners, but there are times when they become adversaries in a negotiation and the relationship becomes strained; one side’s gain is the other’s loss. Sometimes negotiations drag on and on and leave a bad taste, they can even damage relationships irreparably.

A lot of things can come into play in negotiations: time pressures, emotions, fatigue; people can approach a negotiation feeling threatened, angry, afraid or upset.

Covid-19 left some companies in a very difficult situation; they needed to fundraise in an unfavourable context, or reduce expenditures, or fire team members; and the need to reconcile different and opposing interests and aspirations was even more difficult.  

Negotiation cannot be avoided. No matter how great the product is; no matter how outstanding, brilliant, and hardworking all the people sitting at the table. Interests, priorities, or points of view are not always aligned. Even fantastic growth can’t do away with negotiation.

Getting to Yes starts by explaining the problems in positioning bargaining, which is what happens when one or both sides take a position and resist as much as possible making concessions; negotiation becomes a battle of wills and a trade-off between defending your position and defending the relationship. People can then take either of two approaches: dig in and play hard; or, to keep the relationship on good terms, play soft and make concessions regardless of substance.

The problem with positioning bargaining is it often leads to unfair agreements; stubbornness matters more than substance; one or both sides end up feeling resentful and exhausted.

Yet positional bargaining is entrenched and even what is expected.

The book proposes an approach they call principled negotiation, which focuses on interests and objective criteria; the aim is to reach agreements that are fair to both sides, durable, and help to set a precedent and to strengthen the relationship.

Focus on interests, not on positions”. A position is something I decide and usually is what I communicate; interests on the other hand are my underlying motivator, they are what leads me to take a position (in this context, interests can also mean needs, concerns or aspirations).

Any given interest can be addressed in different ways, which are different positions. But it is positions that are communicated because positions are usually clear, specific, and easy to communicate. Because of this, the path of least resistance is to jump to state our positions. On the other hand, there can be various interests that lead me to take on a specific position; some of them might not be easy to explain, and some may even be contradictory.

It is always hugely valuable to identify the other side’s interests, all of them; some of them will be shared, some will not be shared but will be neutral to our interests, while others will clearly be in conflict.

Focussing on interests and not on positions is not a guarantee for success; but in our experience mixing these two up often becomes an early stumbling block; if it can be avoided, what will follow is likely to work better; it also makes it easier to follow another of the book’s advice “separate the people from the problem”; often the two sides are separated by their positions but united in the interests they share, and this in turn makes it easier to work on the more personal side of a negotiation.

After identifying interests, the natural step is to identify options that can address these needs; these options can be assessed, criticised, improved, and shortlisted; different standards can be considered; and step by step, the options are narrowed down.

Statements generate resistance, whereas questions generate answers”.

As said in the beginning, Getting to Yes is a useful book. Unfortunately, the ideas it contains are not always easy to apply. No matter how compelling, in the heat of the moment sometimes these clear and reasonable ideas become buried. This does not take away from their value; it is just a consequence of how strong emotions can come in to play in these situations and trip us over; and it also reflects that it takes practice. “Studying books on swimming, riding a bicycle or riding a horse will not make you and expert”.

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