Symposium Book Club – Conversation with Sanda Kaufman about Wheeler’s Art of Negotiation

This is another part of the “virtual book club” discussing readings for the symposium at the University of Missouri on October 7:  Moving Negotiation Theory from the Tower of Babel Toward a World of Mutual Understanding.

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Sanda Kaufman suggested reading Michael A. Wheeler’s book, The Art of Negotiation: How to Improvise Agreement in a Chaotic World (2013).  Here’s her summary:

I find that prescriptions should be accompanied by reasons for why they might work, because otherwise they become recipes – and predictably fail.  Thus people no longer remember why they should or should not do certain things when negotiating.  Failure ensues and then we are discredited!

So I think it is very important to give people the tools to think through why their strategies might work, so they can tailor them to their specific situations.  Otherwise, we turn out dogmatic practitioners who collaborate because competing is not nice.  Schelling, Raiffa, Shell, and Wheeler are the antidotes to such an approach.  In fact, Wheeler’s book illustrates well how we can apply what we learn in the other three books.

John:  Michael Wheeler’s Art of Negotiation: How to Improvise Agreements in a Chaotic World (2013) is not to be confused with Howard Raiffa’s Art and Science of Negotiation (1982), which you suggested that we also read.

Wheeler is professor emeritus at the Harvard Business School and served as editor of Negotiation Journal for twenty years.

The Art of Negotiation fits in the mold of many of the books from Harvard’s Program on Negotiation, starting with Getting to Yes.  It is a practice guide full of negotiation tips illustrated by accounts of real and hypothetical cases and statements of prominent people.  Each chapter ends with a few key bullet points and an appendix summarizes the main twenty-five points as “reasons to embrace chaos in negotiation.”

One of the book’s main points is that negotiation is very uncertain and this uncertainty is missing from the conventional wisdom of guides like Getting to Yes with its somewhat static recipe for negotiation.  Wheeler highlights many factors that are impossible to accurately anticipate before and even during negotiation including but not limited to counterparts’ reactions.  Thus negotiation is a dynamic process in which negotiators must make in-the-moment decisions about how to proceed.

The book’s central framework is that negotiators should continuously learn about a situation, adapt accordingly, and then effectively influence counterparts.  Learning is an ongoing process of observing, orienting, deciding, and then acting, which requires improvisation.  Negotiation situations are ‘wicked problems’ because negotiators get incomplete information and thus experience is very hard to learn from.  (For those who want to learn more about wicked problems, the Rethinking Negotiation Teaching series has many chapters on this.)

I have a few quibbles with this book.  It highlights the term “chaos,” which is sometimes defined as “complete disorder and confusion.”  I think that it correctly emphasizes the uncertainty in most negotiation situations but “chaos” seems like an exaggeration.

Although it includes useful ideas like Getting to Yes and its progeny, the breezy how-to style makes me skeptical.  Although it critiques conventional wisdom for seeming too pat, it has some of that same feel to me.

It also makes some amazing mistakes about BATNA for a sharp guy like Wheeler.  It equates BATNAs with “walkaway” points, which most people recognize is not correct because the walkaway value is calculated by adjusting the BATNA – or really the MLATNA – for various factors such as risk tolerance, transaction costs, and values other than maximization.

Alas, like virtually all texts I have seen, it confuses the “best” alternative to a negotiated agreement with the “most likely” ATNA.  In practice, it would be absurd for negotiators base their final positions on their BATNAs if there is any uncertainty, and they intuitively use the MLATNA instead.  This obvious, yet almost-universal, confusion is one of my pet peeves.

Putting aside my quibbles for the moment, would you say that this is an accurate summary as far as it goes?  Are there important concepts or principles in the book that this summary omits?  What do you think about my quibbles?

Most importantly, given this summary and anything you would add to it, can you say more why this book appeals to you so much?

Sanda:  John, of course I agree with your summary, this and the rest of them.  In fact, I have grown to love them to the point where I might send you some books I don’t feel like reading, for a good summary that will save me the effort ;-).  You really capture the essence and for the rest, we can always read the books.

I like this book for the way it addresses uncertainty and the ensuing chaos.

You are right to interpret chaos as it is ubiquitously meant – utter disorder and confusion;  this is after all the biblical meaning in the first line of the Old Testament – no wonder it is widespread.

However, there is also a technical definition of chaos.  It characterizes situations that are very complex and fraught with uncertainty, and where small differences at the outset or during the process can yield drastically different outcomes in two situations that appear very similar in most other respects. That is the chaos that Lorenz’ butterfly can generate all over the world with a tiny flap of its wings at the Equator.  Uncertainty, chaotic behavior, and “wickedness” are steady features of public decisions – my playground.  So of course I like to see them addressed in negotiation how-to books.

You mention that you dislike the breezy appearance of Wheeler’s book, but I fear that is a characteristic of how-to books that helps sell them.  Wheeler is a salesman!  In fact, it is quite a treat to watch him teach and “sell” his points with a wealth of interesting examples.  My (small) problem with this is that there is an example out there for almost any negotiation point we wish to illustrate – but it may not work in other situations. That sometimes makes prescriptions seem more general than they really are, and deceptively easy to implement.  [John:  That is why I get turned off by this writing style.]

We have already discussed offline a little bit your “pet peeve” regarding BATNAs and MLATNAs.  We should take it up live this fall.  However, our conversations – and this one in particular – have led me to wonder why we think so differently about some simple concepts.  I feel fine about BATNAs and about them being considered “walk-away” points, whereas you see … red!

On the other hand, I learned of MLATNAs from you. You’d think they don’t exist in my field. This made me think of an angle I have not seen addressed (let me know if I am wrong) and of which I should have thought sooner because I see it every time I go to conferences that are not in my field.

Here it is: we are aware that disputes in various domains may be different along some dimensions – number of parties, stakes, dynamics, processes etc.  But what of the impact our fields of research have on how we construe and study negotiations or how we read others’ books?  Might legal scholars look at negotiations through different lenses than organizational behavior scholars or than planning scholars?

The MLATNA example suggests that but I would like very much to engage our colleagues in a discussion on this topic.  Do these different lenses exist?  And if they do, what is their impact on how we study and teach negotiations?  Do they not matter because we tend to remain in our respective patches where everyone else wears the same glasses?  Is there something to be learned from our differences of perspective?

To start the conversation ball rolling, I will go out on a limb and propose that those different lenses exist and affect our findings and prescriptions regarding such issues as cooperation and competition, normative views we add to the mix, BATNAs and MLATNAs and more.

John:  It has been a great pleasure – and a lot of work – to read everything that you and the others have suggested and to summarize them.  But I have enjoyed these conversations – particularly the ones with you, Sanda.  I’m glad you have enjoyed them too.

I do think that there are some differences in disciplinary perspectives about negotiation, which is why we made a point of inviting people to our symposium from a wide range of disciplines.  On the other hand, when I reviewed negotiation publications from various disciplines, I found that there is a lot of cross-pollination.

I wish I knew where I read about MLATNAs.  I didn’t see it in any of the legal negotiation texts I reviewed and I suspect that most of my legal colleagues may not have heard of the term, let alone use it.  I did not make it up, however.  Here’s one of a handful of references I found by googling.  And when I searched Westlaw, I found all of ten publications using the term.

Although people in the real world generally don’t use these terms, they generally use these concepts.  When lawyers and litigants consider whether to finally make or accept a settlement offer, I am sure that they usually base their calculations on their analysis of the MLATNAs, not BATNAs.

Indeed, I think that is one of the reasons that most cases settle.  In the US, only a small fraction of lawsuits go to trial (and that doesn’t even reflect the disputes settled without the filing of a lawsuit).

But some freak cases actually do go to trial.  Here’s one of my favorite passages about this from a study about such cases.

“A trial is a failure.  Although we celebrate it as the centerpiece of our system of justice, we know that trial is not only an uncommon method of resolving disputes, but a disfavored one.  With some notable exceptions, lawyers, judges, and commentators agree that pretrial settlement is almost always cheaper, faster, and better than trial.  Much of our civil procedure is justified by the desire to promote settlement and avoid trial.  More important, the nature of our civil process drives parties to settle so as to avoid the costs, delays, and uncertainties of trial, and, in many cases, to agree upon terms that are beyond the power or competence of courts to dictate.  These are powerful forces, and they produce settlement in a very high proportion of litigated disputes.  Once in a while, however, the process fails and a case goes to trial.”  Samuel R. Gross & Kent D. Syverud, Getting to No: A Study of Settlement Negotiations and the Selection of Cases for Trial, 90 Mich. L. Rev. 319, 320 (1991) (footnotes omitted).

(FWIW, I don’t completely agree with this statement.  Sometimes it makes sense to go to trial truly as a matter of principle, to publicize wrongs, get official vindication, carefully considered risk-taking, etc.)

Several studies have shown that in the vast majority of cases, a trial truly is a failure for at least one party.  For example, in the famous Kiser et al. study, Let’s Not Make a Deal, there was a “decision error” in an astounding 85% of tried cases.  These are cases where one side rejected a settlement offer that was more favorable for them than the result at trial.  Randall L. Kiser et al, Let’s Not Make a Deal: An Empirical Study of Decision Making in Unsuccessful Settlement Negotiations, 5 J. Empirical Legal Studies 551 (2008).

The reasons for this amazing phenomenon are complicated, as analyzed in Kiser’s study and several others, including two studies by Gross and Syverud.  I assume that in a substantial number of these decision errors, people were basing their decisions on their perceptions of their BATNAs rather than MLATNAs.

Making the conceptual mistakes Wheeler did is not unusual (unfortunately) and probably do not, in themselves, lead to these decision errors.  However, if we negotiation scholars and teachers were clearer about these distinctions – and not roll all these concepts into a single, confused “BATNA” – it might help people avoid some of these errors.

2 thoughts on “Symposium Book Club – Conversation with Sanda Kaufman about Wheeler’s Art of Negotiation”

  1. “Chaotic” may not be an exaggeration in some circumstances. There may be 20+ parties, multiple issues, and varying degrees of exposure. Several parties may be aligned on one issue, but not on other issues. The position of one party may depend upon conditions to be fulfilled by one or more other parties. Parties may shift their positions dramatically during the negotiations. Some issues may be subject to summary judgment, and others not. Parties and their own attorneys may be at odds with each other. There is usually at least one party who refuses to participate in good faith. If injunctive relief is an issue as well as monetary relief, more complexity is added. The scope of the release is often an issue. Merely scheduling a mediation is a logistical nightmare. Chaotic is a fair word, regardless of definition.

  2. Thanks, Jill.

    I agree that some negotiations truly are chaotic as you describe.

    Difficult, dramatic negotiations are particularly salient. And there probably are many more very routine negotiations that “fly under the radar” precisely because they are so routine.

    For example, in Ross’s study of automobile insurance claims adjusters and Macaulay’s study of negotiations by middle-level businessmen I cited in a conversation with David Matz, people usually followed more-or-less standard scripts. Similarly, in the “ordinary legal negotiations” (or more generically, norm-based negotiations) I described in the same post, lawyers engage in fairly routine, unchaotic negotiation. For another example of routine negotiations that every reader of this blog probably has engaged in, customer service agents conduct thousands of negotiations every day.

    We generally don’t pay much attention to these negotiations, which often don’t involve bitter disputes, have relatively low stakes, and are handled by people not generally identified as DR professionals. Nonetheless, the principles of negotiation apply in these situations, albeit in limited form in most cases. Although there is some uncertainty in these negotiations, usually they are anything but chaotic.

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