Conducting negotiations

Photos: Lukas on Pexels and (insert) Matthew Henry on Burst

This area of the site was written for very experienced trust fundraisers.

Disagreement is a normal, natural part of all charities’ work. We operate in a culture of “niceness”, but that doesn’t mean we shouldn’t disagree – it simply shapes the way we do it. A strong theme of modern management thinking in the literature is about the importance of actually allowing differences to be expressed and addressed, so that the best solutions can emerge. If you look at your contributions to improving the ways things work, you may find that a number of your best contributions come out of tackling these differences. So, it’s a time-consuming issue that you might have rather avoided, but useful work for all that.

I strongly recommend you get a day’s negotiation skills training. Like with many skills, we don’t formally do what it says on the label – formal sit down negotiations with Services are rare and negotiations with funders almost never happen. However, we do a LOT of drawing people out, trying to satisfy them while ensuring we get what we need. Those are the key skills of a negotiator. I did a day’s training 30 years ago and have never regretted it. 

The following is meant to get you by until you can get yourself properly trained up.

Be creative and focus on win:win solutions

As the classic negotiating book, Getting to Yes, states, the goal of negotiating is to get out of trench warfare and get to the point where both parties are side by side trying to solve the problem. If you want different things, that doesn’t necessarily mean you can’t agree, it just means you need to find a solution that works for both.

If your answer doesn’t work well for the two parties, it may not stick. Also, although you have other considerations to think about, Services are your key partners and you want to leave them feeling good about the situation. There’s often creative work to be done to identify a solution that maximises value to the both of you, whether you’re discussing the shape of a new project, what to do about a funded project that’s in trouble or the collection of monitoring data.

Getting to a joint approach means both sides believe the result is theirs, rather than imposed and so they’re more likely to deliver.

That can need real creativity. The material on this webpage probably sits very well with the material in the Problem Solving pages. This page is about how to talk to people well. The problem solving pages are about generating insight and ideas.

Going a step further, David Strauss argues in How to Make Collaboration Work that the best decisions are the ones where there is consensus around it, meaning that whilst not everyone thinks it’s the best solution for them, everyone can sign up. His reasoning is:

• If not everyone is happy with a decision, it’s not a decision that treated everyone with dignity and respect
• Decisions that achieve consensus have often had to achieve a greater level of synergy and creativity
• In practice, decisions where people avoid using formal settling mechanisms like votes are better quality
• At least three out of four times, a consensus decision is achievable. It just needs work.

It’s easy to avoid consensus because the “problem solving” phase seems shorter that way. However, Strauss says, if you include everyone then you can actually get to an implemented working solution more quickly. The reason is that after coming up with a solution it then needs selling / getting made to stick. That process takes a lot less time, Strauss thinks, if everyone has been actively involved in coming up with the solution because there’s more natural buy-in.

Start high and then be prepared to drop

One of my biggest failures as a trust fundraiser is giving too much away to Services. I do it because I’m a nice guy and like to think of myself as kind. When I don’t have clarity, it’s my default mode – I think “I’m asking them to do X rather than help a service user, how can I possibly avoid that?” This is a mistake that I come to regret, because over time the efficiency of the work drops and it becomes harder for the charity to resource its work through trusts. Don’t be like me.

A number of studies have shown that high expectations produce the best negotiating results and low expectations the poorest.  You aren’t formally negotiating and asking for far too much just makes you look silly in the meeting. However, a high but reasonable-sounding ask is best, or “What we really need because of X is Y, but I acknowledge that the Information Team will have needs, too.” Best practice is to drop a little at a time. (All this assumes a situation where there’s enough time for proper negotiations.)

If people think they’ve negotiated you down, they are more likely to take responsibility for their end of the bargain, because they feel more responsible for the outcome of the negotiation, apparently thinking they have influenced the opponent. They’re more satisfied with the final arrangement as well.  (Cialdini, Influence, 2007)

Keep asking questions

Unless you know the team in question really well, the chances are you don’t fully know their needs, the strength of their sticking points, what they’d value. The biggest mistake people make in negotiations is jumping in too early with an offer and spending the time when they aren’t talking thinking about their own arguments, rather than listening. Fine if you’ve got just two minutes with a Director. Otherwise, use your trust fundraising superpower of asking good questions. All the time you’re simply asking about their needs, you’re not actually making concessions – a useful fact if they’re a bit heated/demanding at that point.

It sometimes feels like you stand no chance to get what you want, because Services have much more clout (or, can easily wheel someone in who does, unlike you). However, you have more time than their big guns and building a detailed understanding of the realities of the situation is one of your key skills. Knowledge is power and can sometimes get you what you want. 

Think what you can offer

Some of the things you can offer may not cost you anything or be obvious to Services. As long as the whole thing is good enough for them and will seem fair to them by the end, that’s what matters

If you can, come with a number of ideas. Then there’s plenty you can build on.

Know your bottom line

There will be scenarios under which you’d walk away. You need to have developed clarity and confidence about what those are, in case you need to say, “Sorry, but no”. That includes knowing what your “Best Alternative To a Negotiated Agreement” (BATNA) actually is. (There’s a lot of discussion online about BATNAs, if you need to dig further into this topic.)

Assert your/the funder’s needs

As trust fundraisers, we’re not simply asserting our own opinions/priorities, we’re advocates for our funders (and prospective funders) within our own organisations. We need to champion our funders (but, of course, balance that with what Services/their priorities). This is where you have to get out of sales mode. It will help, as you do it, to build common ground by emphasising shared interests, avoiding inflammatory language, and encouraging discussion of disputed issues. It’s best to talk about what you really need, as then things are secure.

This isn’t always easy for trust fundraisers, who are often introverts, less senior and with less people skills than the people they’re negotiating with. However, if you don’t do it then we can’t build the system your charity needs, the strong bridges between funders and services or meet your targets. It’s a dance you have to learn: assertion in a nice way, plus listening, empathy and respect, leading towards constructive ideas that work for everyone.

Consider doing the hard issues towards the end

If you get on great or you’re very short of time, follow the Pareto Principle and do the big stuff first. However, the classic negotiating approach is: you can create a sense of momentum and partnership on the issue to start with the easier stuff. People will be buying into the idea of a solution.

Saying “no” to Services

Harvard Business Review offers the following advice in How to Say No to Taking on More Work:

• Don’t respond with a knee-jerk “no” but be seen to assess the request. Say “No” when you know you need to.
• Don’t hold back the real reason why you’re saying “No”. If you give lightweight reasons, they can be batted aside.
• To maintain a good relationship with the person you’re turning down, it’s critical to “acknowledge the other side”. Be empathetic and compassionate. Maybe offer little ways you can do something.
• Strive for a neutral no – not being nasty, but avoiding the tremendous temptation to soften the no to get a better response. It may give the impression of ‘maybe I’ll change my mind’
• Be prepared for the possibility of negative feedback, and if it happens, don’t assume it will last for weeks
• To get better at saying no, you could practice saying it out loud — either alone, behind closed doors, or with a trusted friend or colleague.

Achieving consensus

In How to Make Collaboration Work, Davis Strauss says that consensus with everyone, it that’s your goal, need to be built step by step. He identifies six consecutive steps that you need to work through:

1. Perception: Is there actually a problem? How do you feel about it? Is it legitimate to discuss it openly?
2. Definition: What is the problem? What are its limits/boundaries?
3. Analysis: Why does the problem exist? What are its causes?
4. Generating alternatives: What are some possible solutions to the problem?
5. What criteria must a good solution meet? Are some solutions better?
6. Decision making: Which solution can we agree on and commit to implementing?

If different people in the group are working on different stages, collaboration on the solution can get shut down.

More advanced/detailed points on negotiation

1. Joint evaluation of options

In a 2005 article on managing conflict in Harvard Business Review, Weiss and Hughes suggest the following tool for managing conflict:

• Identify the options for going forward
• Agree what criteria you could apply for deciding
• Create a matrix of criteria along the top and options down the side
• Each party puts an identifying mark against the option that, in their view, best meet the criterion:

What this reveals is consensus and differences. Quite often, say Weiss and Hughes, the differences actually reflect different information available to different parties, so differences can be addressed through research and discussion.

2. Body language

Never Split The Difference gives us three tones available to negotiators, that should be used at different times:

• Most of the time, use a positive playful voice, easy going and good natured. Your attitude is light and encouraging. The key here is to relax and smile while you are talking. It stops people putting their walls up. They can relax.
• The “late night FM DJ voice” is deep, soft, slow and reassuring. Sometimes the soothing voice is key to a confrontation. The best way to describe the DJ voice is the voice of calm and reason.
• The direct assertive (which should hardly be used).

If you mirror how they look and repeat the last few words they say, the chances are they will keep revealing more and more information.

If you know where they’re coming from, they will feel heard and less hostile. You can even summarise their position.

3.  Ways to create the best “offer”

1. Consider the different parts/levels of Services

‘While viewing counterparts as if they were one monolithic entity is convenient, that attitude regularly leads to analytical and strategic missteps.’ (Danny Ertel in Harvard Business Review) For example: you might get further with a particular layer of management in Services and clearly you’ll get further with some Services teams, who you may be able to leverage or use as champions if the issue is pan-Services.

2. Consider different scopes to any internal agreement 

‘The vast majority of negotiators take the fundamental scope of a deal as a given. They may consider a limited set of choices—for instance, shorter- versus longer-term deals—but by and large their tactics are guided by a comparison between their best alternative to a negotiated agreement and how close to some preferred outcome they think they can get.’ (Danny Ertel in Harvard Business Review, again)

There’s a common sense to narrowing things if you’re struggling, but it’s also worth just checking would it help to broaden instead (e.g., including more of your funders in the discussion) – the balance of what’s in it for them might change.

What else are you negotiating with Services? Maybe bringing some or all of that in would help.

3. When they say “no”, there’s possibly something interesting behind it

People feel comfortable saying “no”, they’re in control, so if they get some chances to say “no” they’ll be more comfortable. If you then ask “What would you need to make it work?” the chances are they’ll be feeling comfortable, in control and happy to say what they want. I’ve read about someone who negotiated in a very different culture, with people who were pretty macho, where he’d get them to refuse offers just to get them feeling in control.

4. Order the issues in a way that lets you chunk things to your favour

If you do everything separately, you lose some of your leverage, whereas if you’re careful how you combine things you can trade off things of less value to you for things of more value. For example: suppose with a Lottery bid you don’t trust Services to do the service users’ consultations and want to do them yourself. That’s potentially a very valuable trade-off when discussing who does what development work. So, you need the agenda to have a section on development, where you can get them to commit much more to other development work, to balance the fact that you’re investing your own time in those consultations.

5. Use the most powerful F word available – FAIR

We’re swayed by how respected we feel. People comply with agreements if they feel they’ve been treated fairly and can resent it if they don’t.

6. Press for objective criteria

This is particularly recommended when people are being unreasonable. For example: “We should follow how it’s done in other charities?” “Why aren’t we following how it’s done in other services?”

7. Only commit once you know the solution does work for both sides

A lot of ideas may have been thrown around and you might all be tired after thinking hard. So, it’s possible you haven’t actually got the right solution.

8. Negotiating with someone more powerful

In How to Negotiate with Powerful Suppliers in the Harvard Business Review, Paranikas et al have several suggestions:

1. Bring new value to the people you negotiate with (being the gateway to new funds or reducing their risks). This is why we get a lot further with intransigent Services teams trying to negotiate applications for new staff than existing ones – we’re offering them something they otherwise can’t get.
2. Change how you “buy”. So for example, if Services are amenable to you fundraising for a high six figure version of the project but not a cut-down version, you might negotiate to do both versions at the same time. Alternatively, if all the funders are bundled in a way that’s very difficult for you, see if you can’t split some off from the bundle (e.g., the Lottery as it’s so big, or trusts needing a certain kind of project)
3. Create a new supplier. At one charity, projects for the Lottery had all sat in the Operations Department and the senior staff there were trying to dictate unreasonable terms as regards what we put in for and how we did it. So, I started trying to bring the work of the Information Department into discussions as to what we did with the funder, actively considering their work much more than we had before. The Information Department was a separate department and that meant that Operations didn’t “own” the lottery anymore and so they couldn’t take the final decision – that role reverted to Fundraising.

8. Do things in terms of the funder

If the other side is being unreasonable, you can often up your clout by phrase things in terms of the needs of the funder. People aren’t always interested in the needs of a trust fundraiser, but in my experience, money often talks. Occasionally senior staff will fancy their own knowledge of the funder, but you can always (a) blind them with science or (b) if necessary and realistic, actually get your point confirmed by the funder.

How do you get your point of view confirmed by the funder without making them wonder what’s going on? Drop it into a conversation with them in passing: call them about something legitimate and when you’ve finished discussing that, say something along the lines of “We were just discussing one unusual idea internally, which is: [details]. [Something like: I doubt they were serious / it’s hard to see anyone wanting to pursue it / it might well have been idle speculation]. However, I thought I’d just check with you.” Then quickly move onto something else.

9. What else the subject of negotiations overlaps with

If you’re having trouble understanding where the other party to the negotiation is coming from or you’re dealing with difficult characters, the webpage on internal politics or the Analysis webpages in the Problem Solving and Working with Services sections might have ideas to help you sharpen your antennae. If it’s to do with the content of the negotiations, pages like those on project development might give you more insight. If you’re short of ideas, the Problem Solving pages might help.

10. Very tense negotiations

As you’ll know, this is rarely the situation. However, if you need to have those skills, Never Split the Difference is by someone who conducted extremely tense, emotional negotiations. It’s good on how to handle emotional situations.

11. Working through very stuck situations

Sometimes the differences between you and Services, or your own Fundraising Department are genuinely stuck and challenging. How do you deal with unbridgeable gulfs?

 In Collaborating with the Enemy: how to work with people you don’t agree with, like or trust, international negotiator and facilitator Adam Kahane provides a useful framework:

 Adapt, negotiate, co-create, force or walk away?

 There’s no one right approach and you need to have a sense of the realities and what’s achievable. You need to know what you need. If you can force the situation, that might be better. In many organisations, Services are “top of the heap” but sometimes – with short management chains and / or funding under threat – it can be the other way around.

If you are completely powerless, you probably aren’t going to get far by negotiating (I.e., adapt or exit). If there’s something in it for both parties, you likely want to try and produce something that respects and works for your own separate interests as well as for the system.

 He then says, if you’re looking for a joint solution, there are two approaches:

1. Top down negotiation, that subordinates everyone’s interests underneath. This could produce a new, agreed reality you build on. There is a possibility of this falling apart, Kahane says, because it fails to accord with realities on the ground.
2. Creation of something bottom up that’s workable, at least for some issues, whilst still being potentially in disagreement or even working against each other at times. The key elements of this are: 1. To both assert what you want AND be focussed on coming together  alternating between the two 2. To not get bogged down in your unique view of things but to listen extremely well and in different ways, being focussed on getting into more a debate if the facts (“in my opinion…”) and trying to empathise and share experience (more like reaching out) and to focus sometimes on sensing/ checking the whole (“it seems what we all really want here is…)

Kahane recognises that his option of bottom up creativity is difficult. It requires not just intellectual but emotional effort requiring self understanding and emotional skill. There are some sensible little exercises at the end of his book, to practise if you don’t take naturally to this.