How to negotiate with stakeholders

In this article we now turn to the negotiation itself. Having discussed stakeholders, how to engage them and what approach the negotiations should take in previous articles, it remains for us to pull these elements together into a cohesive framework and toolset. Every step is also a negotiation, of course.

Step #1 - Establish the stakeholders and  rules of engagement

1. Prepare a proposal for the stakeholders setting out the objective of the agreement, how they are expected to be affected by it, and what engagement will be required from them to achieve it
2. Use a questionnaire to standardise the stakeholder engagement. Using the same questions will facilitate comparison and evaluation. It will also ensure that each stakeholder is treated equally and, if published amongst the stakeholders, it will promote transparency and trust
3. Agree with each stakeholder to what extent they will be actively participating in negotiating an agreement (e.g. RACI - responsible, accountable, consulted, informed)
4. What does the alternative to a negotiated agreement look like for each stakeholder? It is conducive to encourage stakeholders to ascertain this for themselves and may or may not be useful to publish/share these too (depending on the stakeholders attitude to absolute transparency)

Step #2 - Set the framework and approach

1. Convene preliminary meetings between the participating stakeholders and draw up a Terms of Reference (ToR). The ToR should comprise:

• Roles and responsibilities (including authority in decision making)
• Escalation process and external authorities (e.g. ratifying decisions, resolving impasses, and regulatory and budget approval)
• Frequency of meetings and rules on behaviour (code of conduct and redress/sanctions that may apply), quorate attendance, advanced notice of meeting scheduling, and requirement for published agenda prior to meetings
• Specify whether there will be working groups assigned to specialised discussions and how they will be assigned and report back to the stakeholder meetings
• Share the stakeholder questionnaires and discuss which objectives are shared and which are antagonistic. Agree which to tackle first. It may be worth starting with accord so that some progress has been demonstrated and relationships formed before moving into contention. Alternatively, getting to the main issues might suit everyone better
• Agree how the agreement will be documented and worked on (single text iterated throughout and then finalised, or multiple texts brought together later in a final single text)

2. Agree the schedule of meetings and deadlines avoiding the exertion of calendar/diary pressures that might disadvantage stakeholders in the negotiation
3. Agree that the negotiation remains between the parties; any statements to external audiences will be issued by the chair/leader and agreed by all prior to publishing. In some cases it may be essential to relax this control - some stakeholders need to signal a nuanced message to the parties they represent in order to give them room for accommodating their partners in the negotiation
4. Agree which data and metrics are pertinent to the negotiation, benchmarking etc. (e.g. what does the current state look like? What would the improved state look like? What does the standard for the industry look like?)

Step #3 - The negotiation

Regardless of whether the negotiating parties wish to begin with what they agree on or whether they begin with the issues, it is important to record the specifics in a document that will be approved by all. 

1. Cases for and against positions should be given equal time for presentation and structured so that questions and counter arguments do not interrupt the coherence of the presentation
2. All statements must be backed up by evidential information from a source that is recognised by all
3. All commitments and targets within the agreement must be demonstrable with consensus on what evidence and metrics may be required to do so
4. The criteria for bonuses or penalties and redress must be clearly stated with any dates, target metrics, and other specifics clearly stated and agreed to by all. The schedule for applying these must also be stated
5. A separate environment should be utilised for disputing parties to resolve their differences. The rules of engagement must be followed to ensure respectful disagreement and if disagreement persists, arbitration should be sought and more creative ways of resolving the dispute should be explored. It is important to foster an attitude amongst the disputants that they are all trying to solve the problem: separate the people from the problem
6. Concessions should be rewarded and recognised by the negotiating parties

It is important to face the fact that not all negotiations will result in an agreement. Success may be partial, however, and the final deal may stipulate areas and issues that remain outside its scope. These might be reserved for subsequent negotiations but will at least bolster the validity of the current agreement. The measure of success is, of course, the extent to which the deal improves on each stakeholder’s ’alternative to a negotiated agreement’.

Bibliography:

‘Getting to Yes: Negotiating an agreement without giving in’ (Roger Fisher, William Ury, and Bruce Patton, published by Houghton and Mifflin). The Harvard Negotiation Project.

‘The Person and the Situation: Perspectives of Social Psychology’ (Lee Ross , Richard E. Nisbett , et al. published by Pinter and Martin)