negotiating in a complex world

Michael Watkins is an associate professor of management at the Harvard Business School, 139 Mor-gan Hall, Soldiers Field, Boston, Mass. 02163.

0748-4526/99/0700-0245$16.00/0 © 1999 Plenum Publishing Corporation Negotiation Journal July 1999 245

In Theory

Negotiating in a Complex World

Michael Watkins

Drawing on the literatures on negotiation and conflict resolution as well asresearch on international diplomacy, the author proposes a framework forunderstanding complexity in real-world negotiations. Rejecting models ofthe process that are simplistic, sterile, or static, he argues that complexity isinherent in negotiation. In ten propositions, he lays out key dimensions ofcomplexity and ways that skilled negotiators can manage it. The proposi-tions focus attention on the ways negotiators create and claim value, shapeperceptions and learn, work within structure and shape the structure,negotiate and mediate, link and de-link negotiations, create momentumand engineer impasses, and work outside and inside. The author also high-lights the importance of organizational learning in negotiation, notingthat most negotiators manage multiple negotiations in parallel, and most

organizations have many negotiators doing similar things.

Few objectives in life can be achieved solely through the use of authorityor coercion. Instead, people negotiate to advance their interests and those ofthe institutions they represent. In an era of globalization and rapid techno-logical advances, of international agreements and corporate alliances, offlatter organizations and vastly proliferating channels for communication,strong negotiation skills are a prerequisite for professional success.

While there are countless “how-to” books and articles on the basics ofnegotiating, few address the complexities that characterize real-life negotia-

tions in government and business. Readers can obtain sound advice on con-ducting negotiations involving a few parties and a modest number of issues.But there is little information available on how to build coalitions in multi-party negotiations, or to manage internal decision making whilerepresenting one’s organization, or to prevent disputes from escalating andpoisoning deals.

More deeply, existing models of the negotiation process tend to sufferfrom one or more of three fundamental deficiencies: they are simplistic, ster-ile, and-or static. Such models are simplistic because negotiations are treatedas isolated interactions involving only a few negotiators and well-specifiedissues, while most nontrivial, real-world negotiations involve many parties,evolving sets of issues, representatives of organizations, and linkages to othernegotiations. They are sterile because they abstract away the emotionaldynamics of the process, ignoring the reality that negotiations almost alwaysinvolve existing or latent sources of conflict that could escalate and poisonthe potential for agreement. They are static because they fail to do a goodjob of characterizing the micro-level dynamics that shape the evolution ofthe process.

To illustrate these deficiencies, consider what goes on when a youngcouple is negotiating to purchase a new home. This commonplace situationcould be treated as a one-time negotiation involving two parties (buyer andseller) and a few issues (price, size, condition). You decide what house youwant to buy, do the necessary pre-negotiation preparation, establishing yourinterests, alternatives to agreement (i.e., in the words of Fisher, Ury, and Pat-ton [1991], Best Alternative To a Negotiated Agreement, or BATNA), andbottom-line, and assessing those of the seller. You make an offer and theseller responds. The process advances through offer and counter-offer untilagreement is reached or you abandon your efforts. When viewed in this way,the key is to do good pre-negotiation preparation, then to formulate a strat-egy for making and responding to offers.

But is it really that simple? In practice, as anyone who has bought ahouse knows all too well, things tend to be rather more complicated. Youmay be looking at many properties and the seller likewise may be dealingwith multiple potential buyers. You probably have to arrange a mortgagewith a bank, and may be exploring several options for financing. You mayneed to close the sale on your current home and move by a certain date, sodeadlines may shape the process. These factors are all beyond the obviousissue of price, repairs, and other issues that may emerge as potential deal-breakers. Even as you negotiate with the seller, you also may have to engagein tense intra-family negotiations with your spouse. Finally, you may have tonegotiate with a real estate agent who represents the seller, but who also hasindependent interests, such as getting on with other business and maintain-ing a good reputation. This “simple” house purchase is actually a multi-party,multi-issue negotiation involving representatives, deadlines, and linkages

246 Michael Watkins Negotiating in a Complex World

Negotiation Journal July 1999 247

among sets of negotiations. Your perceptions of your interests and BATNA,far from being static, may change dramatically as the process unfolds.

Most real-world negotiations exhibit these sorts of complexities. In fact,when one goes looking for “simple” one-issue negotiations, it proves a chal-lenge to find them at all. The implication is that frameworks that focus onsimple negotiations often fall far short of what is necessary to help practi-tioners with the situations they face in their professional (and even private)lives. Complexity is the rule in negotiation, not the exception.

This article challenges the way we usually think about negotiation, high-lighting the need to move from simplistic, sterile, and staticconceptualizations to the complexity that characterizes real-world negotia-tions. At the same time, it is important to avoid being swamped bycomplexity, and to develop frameworks and rules-of-thumb that can helppractitioners to negotiate in a complex world. As a first step in doing this, Ishall present ten propositions about the nature of real-world negotiationsand what it takes to be effective in managing them. These propositionsemerged both from a reading of the literature and observation of negotia-tions in personal life, business and government, as well as from a detailedstudy of a domain where effectiveness in managing complexity is absolutelyessential to success — international diplomacy. The latter study consists of aseries of detailed case histories that examine the actions of leading negotia-tors as they grappled with the most difficult and far-reaching internationaldiplomatic negotiations of the 1990s in the Middle East, Korea, Somalia, andBosnia. The research for the cases was supplemented by interviews withnumerous experienced diplomatic negotiators, as well as a survey of theheads of diplomatic training institutes worldwide.1

While this research focused on diplomats, the findings may well haveimplications beyond the conduct of international diplomacy. As the housepurchase example suggests, multi-party, multi-issue, linked negotiations oftenarise in the personal domain. The challenge of dealing with escalating con-flict and coalitional infighting in family disputes is different in magnitude,but not in kind, from the formidable tasks confronting U.S. negotiators indealing with the North Koreans, Iraqis, and Serbians.

Likewise in business, managers conduct “corporate diplomacy” whenthey seek to negotiate joint ventures, mergers, and acquisitions, influencegovernment officials, work with environmental groups, make investments inforeign countries, and deal with conflict in their organizations. They have todeal with many interested parties, evolving issue sets, and the potential fordisputes that can poison deals. They must manage potentially fractious inter-nal decision-making processes, build supportive coalitions, and overcomecultural barriers. The strategies employed by diplomatic negotiators to nur-ture productive working relationships, surmount opposition within theirown side, and structure deals in creative ways can be applied in a broadarray of business situations.

Ten PropositionsThe following ten propositions lay out the key dimensions of complexityin negotiations and put forward some observations about what it takes tobe effective in negotiating in a complex world. These propositions are asfollows:

I. Negotiations rarely have to be win-lose, but neither are they likely tobe win-win. Skilled negotiators tailor their tactics to the type of nego-tiation, seeking both to create value and to claim value by craftingcreative deals that bridge differences.

II. Uncertainty and ambiguity are facts of life in negotiation. Skillednegotiators seek to learn and to shape perceptions through orches-trated actions taken at and away from the negotiating table.

III. Most negotiations involve existing or potential sources of conflictthat could poison efforts to reach mutually beneficial agreements.Skilled negotiators often are called upon to mediate even as theynegotiate, and intervention by outside parties is commonplace.

IV. Interactions among negotiators are fundamentally chaotic, but thereis order in the chaos. Skilled negotiators find opportunity in the fogof negotiation.

V. While negotiations occurring in diverse contexts may appear to bevery different, they often have similar underlying structures. Struc-ture shapes strategy, but skilled negotiators work to shape thestructure.

VI. Most negotiations are linked to other negotiations, past, present, andfuture. Skilled negotiators advance their interests by forging andneutralizing linkages.

VII. Negotiations are fragmented in time, and movement occurs insurges. Skilled negotiators channel the flow of the process and workto build momentum in promising directions.

VIII. Most important negotiations take place between representatives ofgroups. Just as leaders often are called upon to negotiate, so too arenegotiators called upon to lead.

IX. Organizations often are represented by many negotiators, each ofwhom conduct many negotiations over time. Success in setting uporganizational learning processes contributes to increased effective-ness, both individual and collective.

X. Negotiation skills can be learned and they can be taught. Expertnegotiators possess skills in pattern recognition, mental simulation,process management and reflection-in-action, and these skills can bedeveloped through carefully structured experience.



Proposition One: Negotiations rarely have to be win-lose, but neither arethey likely to be win-win. Skilled negotiators tailor their tactics to the typeof negotiation, seeking both to create value and to claim value by craftingcreative deals that bridge differences.

Negotiations exist on a spectrum ranging from purely distributive, zero-sumgames to purely integrative joint problem solving.2 At one end of the spec-trum, negotiations are win-lose propositions where a gain for one sidenecessarily represents a loss for the other. In the house purchase example, ifthe negotiation were solely about price, then it would be purely distributive.Every dollar gained by the seller is lost by the buyer and vice versa.

At the other end of the spectrum, negotiations may be purely integra-tive or “win-win.” In such circumstances, negotiators either have sharedinterests (which they possibly did not know they had), or perfectly comple-mentary needs and resources that form the basis for a mutually beneficialexchange. As a result, they can engage in a process of joint problem solvingthat creates value for all.

Between purely distributive and purely integrative lies a wide range ofwhat Walton and McKersie (1965) termed “mixed-motive” situations intowhich most real-world negotiations fall. As Iklé (1964: 2) notes in HowNations Negotiate:

Two elements must normally be present for negotiation to takeplace: there must be both common interests and issues of con-flict. Without common interests there is nothing to negotiate for,without conflicting interests there is nothing to negotiate about. . .One should perhaps distinguish between two kinds of commoninterests: a substantive common interest in a single arrangementor object, and a complementary interest in an exchange of differ-ent objects. In the substantive common interest, the parties wantto share the same object or benefit from the same arrangement,which, however, they can bring about only by joining together.When parties are interested in an exchange, they want differentthings. These they cannot obtain by themselves but only cangrant to each other.

Some negotiations tend more toward the distributive end of the spec-trum and others more toward the integrative end. For example, while it maybe possible for the buyer and seller of a house to find ways to create value,their negotiations are predominantly distributive in character. But the mix ofshared, conflicting, and complementary interests means negotiators mustsimultaneously cooperate to create joint value and compete to claim theirshare of the value.3

Because the underlying structure of negotiations varies in this way (andother important ways), there is no one, “best” way to negotiate. Instead, thedevelopment of promising strategies is contingent on where specific negotia-tions lie on the distributive-integrative spectrum. If negotiations are truly

distributive, then little is to be gained by being open about interests, and thekey to success may be being good at taking positions. On the other hand, ifthe situation is highly integrative, then there is little to be lost by sharinginformation and creatively exploring options.

Location on the spectrum depends, to some degree, on how negotia-tions get conceptualized or “framed” by the parties in the first place.Expectations have a potent impact on behavior in negotiation. Even if nego-tiations have some intrinsic integrative potential, it cannot be realized ifsome or all of the negotiators frame the situation in zero-sum terms. Negotia-tors therefore must be adept not just at mining situations for their integrativepotential but also in convincing their counterparts that it is possible to cre-ate value.

To return to the house purchase example, it may be possible for thenegotiators to create value by make mutually beneficial trades concerningfinancing, timing for closure, or repairs. If the buyer can complete repairswith less expense than the seller, for example, then value gets created byreducing the purchase price and shifting responsibility for repairs to thebuyer. But this only can be realized if buyer and seller are open to sharinginformation about their complementary needs and capabilities.

Note, however, that questions of distribution remain predominant inthese negotiations and so the negotiators must pay attention to how theywill claim value. When negotiations are mixed motive, negotiators confrontwhat Lax and Sebenius (1986) termed the “negotiator’s dilemma”: Negotia-tors cannot realize potential joint gains without understanding each other’sneeds, but sharing information about interests may leave them vulnerable toexploitation.4 Value may get created, but the other side may claim the lion’sshare of it.

Proposition Two: Uncertainty and ambiguity are facts of life in negotia-tion. Skilled negotiators seek to learn and to shape perceptions throughorchestrated actions taken at and away from the negotiating table.

Negotiators constantly face what Iklé (1964) described as a “continual three-fold choice” to: (1) accept currently available terms (i.e., proposals fromcounterparts); or (2) break off talks with no intention of resuming them; or(3) continue negotiating in the hope of securing better terms.5 Therefore, afundamental objective in negotiation is to convince counterparts that agree-ing to terms favorable to you is preferable both to no agreement and tocontinued bargaining. Negotiators do this by influencing counterparts’ sub-jective perceptions of the range in which bargaining will take place.

It is possible to do this because most real-world negotiations take placeunder conditions of ambiguity and uncertainty. When negotiations arecomplex, involving many parties and-or issues, negotiators may struggle todefine simply their own alternatives, interests and value-tradeoffs acrosscomplex sets of issues. The resulting ambiguity may leave negotiators open



to having their perceptions of their interests and alternatives shaped by oth-ers — i.e., let me help you understand what you should want. In addition,negotiators usually are uncertain about their counterparts’ interests, bottomlines, and alternatives. You may understand what you want, but not what Ineed in order to enter into a deal. So, it is possible for me to shape your per-ceptions of my end of the bargaining range — i.e., let me help youunderstand the minimum to which I can agree.

Shaping perceptions. As Lax and Sebenius noted, the ability to shapecounterparts’ perceptions about the size of bargaining range is an importantsource of power. “We observe that the things thought to give ‘power’ seemto succeed when they advantageously change perceptions of the bargainingset and to fail when they do not” (Lax and Sebenius 1986: 250). The abilityto shape perceptions may flow from possessing tangible resources, for exam-ple, a military force that permits a negotiator to make credible threats. But itmay equally well come from such intangible factors as having superior infor-mation about counterparts’ needs or the ability to control the sequencing ofwho talks with whom as the process unfolds. Thus, while power may berooted in objective realities (e.g., good alternatives), it is usable only to theextent that negotiators can influence subjective perceptions. Sometimesnegotiators are able to exert a substantial influence over others when theyhave few objective resources, and sometimes negotiators fail to translate sub-stantial resources into bargaining advantage.

Negotiators shape counterparts’ perceptions through the combinedimpact of their actions both at and away from the negotiating table.6 At thetable, negotiators play “language games,” competing to influence each other’sunderstanding of interests and alternatives by framing choices, tabling offers,sharing and withholding information, making threats, invoking principles offairness, selectively drawing upon the “facts,” and other classic techniques ofinterpersonal persuasion.7 Away from the table, negotiators may work toimprove their own alternatives to agreement (e.g., by building up militaryforces in anticipation of an international conflict or finding other potentialbuyers for the house being sold). They also may attempt weaken their coun-terparts’ alternatives by, for example, undermining their bases of support orsetting up action-forcing events such as deadlines. As Kofi Annan put it indescribing dealing with Iraq, “You can do a lot with diplomacy, but withdiplomacy backed up by force you can get a lot more done.”8

Learning. Because negotiators face high levels of uncertainty and ambi-guity, and because perception-shaping is a key objective, effectiveness inlearning also is essential to success. What does the other side really careabout? What can I sell internally to my own constituents? In part, skillednegotiators learn by doing the requisite pre-negotiation preparation; diagnos-ing the essential features of their negotiating situations; becoming familiarwith the history, context, and record of prior negotiations; and probing intothe background and reputation of their counterparts.

At the same time, skilled negotiators recognize that conventional prepa-ration has limits. Even the best-endowed negotiating team must cope withconstraints on time, expertise, money, data, access to documents, and otherresources. In addition, negotiations are inherently games of incomplete infor-mation, so much can only be learned directly from counterparts at thenegotiating table. Good negotiators, therefore, use integrated processes ofknowledge acquisition, combining sources of knowledge obtained at andaway from the negotiation table. They learn in order to plan, and plan inorder to learn.

Effective learning in negotiation is disciplined and directed by a point ofview, a set of hypotheses the negotiator begins to develop early on concern-ing the nature of the interests of fellow negotiators and the “formula” for adeal. However, there are risks to learning with a point of view. Prior judg-ments can influence the process of information gathering in ways thatconfirm and reinforce those judgments — a process of selective perceptionleading to self-fulfilling prophecies. The result is a core tension in learning:Negotiators must have a point of view in order to focus learning efforts, buthaving a point of view can distort the process of information gathering inways that lead to erroneous conclusions. The skilled negotiator manages thistension by keeping clear the distinction between assumptions and hypothe-ses. (For a discussion of tradeoffs in learning in negotiation see Rosen andWatkins [1998].)

Proposition Three: Most negotiations involve existing or potentialsources of conflict that could poison efforts to reach mutually beneficialagreements. Skilled negotiators often are called upon to mediate even asthey negotiate, and intervention by outside parties is commonplace.

Negotiators’ efforts to advance their partisan interests almost always gohand-in-hand with efforts to manage conflict in general. Negotiators, orthose they represent, are often already locked in adversarial relationshipswhen negotiations commence, and the experience of past conflict is likelyto have irreversibly distorted their perceptions.9 One need only think ofdivorce negotiations or bitter union-management relations or interdepart-mental struggles in politicized companies or disputes between warringstates to understand that negotiations often take place in the context of pre-existing conflicts.

Even if the parties are not already at “war,” there almost always is poten-tial in negotiation for conflict to erupt and escalate. Every effort atdeal-making is a dispute waiting to happen. Even in our seemingly straight-forward home purchase example, tensions could erupt between the buyerand the agent, or within the buyer’s family, and adversely influence thecourse of the negotiation. Such tensions, real or imagined, may cause abuyer to walk away from a desirable property.



Because negotiation inescapably involves the distribution of value in cir-cumstances where not everyone can get everything they want, conflict caneasily escalate. Beyond this fact, negotiators are people whose egos and rep-utations are on the line. All too frequently, they take defensive actions thatgenerate distrust, creating misperceptions that lead to self-fulfilling prophe-cies. As a result, potential value gets left on the table or even destroyed.Consider, for example, the shareholder value that is lost when corporatemerger negotiations collapse over issues of control, or the terrible humancost of war.

Good negotiators are skilled at diagnosing existing and potential barri-ers to agreement. They recognize that the potential for escalation may berooted in the zero-sum frame of the situation, in mutual perceptions of vul-nerability, in a history of distrust or injury that has transformed perceptions,or in cultural misunderstandings.10 In addition to diagnosing these structural,strategic, psychological and cultural barriers, they are able to craft strategiesto overcome them by, for example, reframing the issues, building productiveworking relationships, setting up confidence building mechanisms, andachieving greater cultural understanding. (For a framework for understand-ing conflict dynamics and approaches to overcoming barriers to agreement,see Watkins and Lundberg 1997.)

Because conflict and negotiation are so tightly intertwined, representa-tives often have to play a mix of roles in negotiations, sometimes acting asnegotiators seeking to advance their partisan interests and sometimes work-ing like mediators to manage conflict between the sides or among theirconstituents. To paraphrase Fisher, good negotiators mediate their own dis-putes.11 The need to mix negotiation and mediation inevitably generatestensions that good negotiators learn to manage.

Productive working relationships are a key resource in managing con-flict, as they act as a kind of psychological buffer during difficult times. Asone negotiator put it, “You have to have the ability to [interact on] humanterms with the other party. Don’t get me wrong. It’s not that you have toplay the nice guy. Not at all. It’s the ability to sense the other party, to under-stand him. You don’t have to fall in love with the other party in order tounderstand. You don’t even have to sympathize the other party in order tounderstand what’s going on with him. But you have to be able to understandand you have to be able to develop trust. But also to project a kind of seri-ousness and, if necessary, also toughness with regard to principles andpositions that you believe you have to protect.”12

At the same time, negotiators have to be careful not to make agreementor avoidance of conflict ends in themselves. There are times when no agree-ment is preferable to a bad one. Skilled negotiators are careful not to getcaught up in the momentum of the process, thereby losing sight of the sub-stance. As one negotiator put it, “Getting to yes is easy; all you have to do isroll over. It’s getting what you want that’s hard.”

Negotiators are not the only players that help (or hinder) the manage-ment of conflict. Various types of intervenors often play constructive roles inhelping to managing conflict in negotiations. Intervenors are third partieswho, either by the invitation of the contending parties or through unilateralaction, seek to affect the outcomes of disputes. Important types of inter-venors include traditional mediators, as well as other parties who seek toadvance their own interests by getting involved, and arbitrators whose coer-cive power allows them to impose terms of settlement. (For a discussion ofintervention roles and sources of power in dispute resolution, see Watkinsand Winters [1997].)

Proposition Four: Interactions among negotiators are fundamentallychaotic, but there is order in the chaos. Skilled negotiators find opportu-nity in the fog of negotiation.

Negotiations are complicated social processes. Their evolution is shaped byinteractions among negotiators as they proceed from initiation to eventualagreement or breakdown. But the core dynamics are elusive and difficult tocharacterize. What is it that causes some negotiations to end in agreementand others in impasse? How is it that negotiators achieve agreements that aremore or less favorable? How are outcomes linked to negotiators’ strategiesand their interaction?

At a macro level, negotiations have been observed to pass through dis-tinct phases — pre-negotiation, deal structuring and detailed bargaining —as they progress from the decision to negotiate to agreement or impasse.13

This multi-phase perspective has generated important insights. But if negotia-tions truly proceeded smoothly from initiation to conclusion in a linear flow,the world would be a much less interesting place. When viewed at a finerlevel of detail, negotiations evolve through micro-interactions among thenegotiators, their strategies and personalities. These micro-interactions arechaotic in nature, with actions generating reactions that are predictable andcontrollable only to a limited extent.14

To illustrate the potential for negotiations to evolve along vastly differ-ent trajectories, suppose that one negotiator is observed making an offer toanother. Does this offer provoke (1) a clarifying question, (2) a counteroffer,or (3) an expression of outrage and dramatic departure from the table? Theanswer will depend on the prior relationship between the negotiators, thehistory of the process to date, the stakes, the content of the offer, and theway in which it was made. The response from the second negotiator is notfully predictable; however, the first negotiator controls it to some degree by,for example, how she or he has built rapport, laid the groundwork, andframed the offer. Likewise, the second negotiator also has control over howto respond to an offer, such as swallowing pride or faking outrage. Other fac-tors, such as the individual’s own emotional reactions or constraintsimposed by constituents, limit a negotiator’s ability to regulate the process.



While negotiation processes may appear to be chaotic, there is order inthe chaos. As they evolve, negotiations exhibit the following classic sorts ofnonlinear dynamics:

Sensitivity to early interactions. The way negotiations begin can pro-foundly influence everything that happens thereafter (Kim and Mauborgne1997). Success in building rapport with a counterpart up-front can increasethe likelihood of achieving desired outcomes. But bad chemistry in earlyinteractions can poison all that follows. Careful preparation is thereforetremendously important. Because human chemistry can make a big differ-ence, representatives must be selected with care. Sensitivity to cultural andsocial norms can powerfully effect initial impressions. Also, perceptions thatthe process is “fair” or “unfair” exert a strong influence on behavior, so nego-tiators need to pay as much attention to negotiating the process up-front asthey do to setting the substantive agenda.

Irreversibility. Negotiators often walk through doors that lock behindthem. Once a conflict has begun to escalate, for example, the attitudes of allinvolved may be irrevocably altered. Likewise, once a negotiator has made aconcession, attempts to take it back may poison relationships and impactreputation. Success in getting someone to make a small initial commitment,on the other hand, often can be leveraged into more substantial gains.15

Negotiators therefore need to avoid taking actions that erect irreversible bar-riers to agreement. At the same time, they can use irreversibility to theiradvantage by, for example, working to get counterparts to make early com-mitments from which they will have difficulty backing away.

Threshold effects. Negotiations often reach thresholds, or “tippingpoints,” where even small incremental moves result in large changes in thesituation. In escalating conflicts, seemingly minor provocations may triggerthe downhill slide into all-out “war.” On the other hand, once major differ-ences in negotiators’ positions are bridged, they may suddenly converge onan agreement. Negotiators therefore need to hone their ability to recognizewhen they are approaching a threshold beyond which a new set of rules willapply. Strategies for “pulling back” from dangerous thresholds (e.g., duringescalation) are an important part of the negotiator’s toolbox of skills. Nego-tiators also need to be aware of their own internal thresholds and developcoping mechanisms that help them to avoid being pushed over the edge.

Feedback loops. Once patterns of interaction among negotiators getestablished, for good or ill, they readily become self-reinforcing. The resultmay be virtuous cycles that build momentum toward desirable outcomes, orvicious cycles that spiral into breakdown. If one negotiator feels unpreparedor otherwise vulnerable, for example, he or she may adopt defensive tacticsthat trigger like responses, creating a spiral of doubt. On the other hand, suc-cess in building a productive working relationship can act as a psychologicalbuffer during the inevitable tough times. Negotiators therefore need to know

how to create virtuous cycles that build momentum toward agreement. Atthe same time, they have to be vigilant to avoid setting up vicious cycles. It isfar easier to prevent negative feedback loops from getting started than tobreak them once they get established.

Because negotiations are complex, there are inescapable limits on nego-tiators’ ability to influence the course of events. At the same time, thecomplexity can be managed — to a degree. The “fog of negotiation” pre-sents opportunities as well as threats. One negotiator described it this way:“[Negotiation] can be quite a chaotic process. That’s the reason why it callsfor creativity. Because it is an unpredictable process, people who are imagi-native and creative can take advantage of the chaos. You know, [awell-known international leader] used to say that if the crisis is small, thenhe has a problem to solve it. He must make it big. Then it’s solvable.”16 In themidst of chaos, skilled negotiators are comfortable with the ambiguity anduncertainty. They are look a few “moves” into the future, set broad goals,and then proceed firmly yet flexibly toward them. As Richard Holbrooke putit, “you know what your long-term objective is, but you don’t know whatroute you’re going to take to get there. You have to be very flexible on tac-tics, but firm on goals” (Rosegrant and Watkins 1996c: 26).

Proposition Five: While negotiations occurring in diverse contexts mayappear to be very different, they often have similar underlying structures.Structure shapes strategy, but skilled negotiators work to shape the structure.

Negotiations occur in a wide array of contexts. Contrast, for example, a legis-lator seeking to gain support for a crucial vote, a manager advocating for anorganization change initiative, a nation rallying potential allies for war againstan aggressor, or a family deciding where to go for a vacation. On the face ofit, these negotiations appear to be very different. But on closer examinationthey share an underlying architecture or “structure.” In all four cases, thenegotiations involve more than two parties and no one has veto power. As aresult, negotiators must build coalitions in order to advance their interests.

The need to build coalitions in a multiparty negotiation, in turn, influ-ences negotiators’ strategies (Lax and Sebenius 1991; Sebenius 1996b). Asone negotiator put it, “. . . when you have a multilateral negotiation, youneed to be able to build coalitions, you need to find ways of getting differentpeople on board. On a bilateral negotiation, you simply don’t have otherplayers.”17 It is thus crucial to identify early on whose support is necessaryand who is influential on other important players. This permits the skillednegotiator to approach parties in a particular sequence in order to cementsupport and influence the perceptions of the remaining players or attemptto influence the order in which issues get dealt with in order to drivewedges in competing coalitions.18 These are not approaches that would beuseful in two-party negotiations. (For a discussion of coalition-building tac-tics see Watkins and Rosegrant 1996.)



In addition to the party architecture — the set of parties and their rela-tionships — other key dimensions of the structure of negotiations19 includethe:

• issue-architecture, the number of issues and relationship among themwhich, in turn, influences whether the negotiation is more distributive ormore integrative, and hence strategies for creating and claiming value;

• information-architecture, the distribution of information (for example,about interests, value, tradeoffs, and alternatives) among the playerswhich influences both the extent to which the parties can shape percep-tions and their need to learn;

• temporal architecture, the key milestones and events that drive actionand influence the strategies negotiators use to force counterparts tomake hard choices;

• process architecture, the way the process has been set up includingwhere negotiations take place and who sets the agenda; and

• linkage architecture, the relationship of current negotiations to othersets of negotiations, past, present, and future.

Good prescriptions for action cannot be made without understandingthe architecture of negotiations — strategy follows structure. If negotiationsinvolve more than two parties, then effectiveness in coalition building islikely to be key. If there are opportunities to create value, then judicioussharing of information about interests may be warranted. If there are sub-stantial asymmetries in the parties’ information, then framing andinformation control can be used to shape perceptions. If negotiations arelinked, then the order in which negotiators make moves in the various nego-tiations may be important.

The ability to diagnose the structure is a core negotiating skill, a sign-post of expertise. As Klein put it in his classic study of how experts managecomplexity, “Intuition depends on the use of experience to recognize keypatterns that indicate the dynamics of the situation” (Klein 1998: 31).Because negotiations vary widely in their structures, there are no simple,“one-size-fits-all” recipes for success. But that does not mean that strategiesmust be worked out from the beginning. Skilled negotiators, like good chessplayers, do not blindly evaluate all possibilities. They develop the ability toassess the situations they face and recognize important structural patterns.Based on this pattern recognition they formulate promising combinations ofmoves, drawing on their own “libraries” of openings, gambits and counters.

It is important to note that the architecture of negotiating situations isneither preordained nor fixed. As Lax and Sebenius (1986) observed, thegame can be played, but it also can be changed: strategy follows structure,but strategy also can shape structure. Deciding whom to bring to the tableand what the agenda will be are among the most important choices negotia-tors make. As the process evolves, negotiators also can take actions to

reshape the structure by, for example, involving or excluding other parties,altering the issue-agenda, setting up action-forcing events, and linking andde-linking negotiations. (For a discussion of approaches to shaping the struc-ture of negotiations see Watkins 1998a.)

Negotiators therefore cannot afford to be reactive; they must enacttheir situations. To shape the structure of their negotiations, both prior toand during them, they need to work in ways that enhance their ability toadvance their interests. Skilled negotiators cultivate the ability to control theprocess, knowing that process control is a potent source of power. Theybegin to frame the agenda and define the issues early on, often before otherseven realize that the game has begun. They know who to involve and whento involve them. They influence the sequence in which issues get dealt with,parties get approached, and linkages get made in order to build momentum.They know if they do not, their counterparts surely will.

Proposition Six: Most negotiations are linked to other negotiations, past,present, and future. Skilled negotiators advance their interests by forgingand neutralizing linkages.

There is no such thing as a self-contained, stand-alone negotiation. Even rela-tively simple negotiating situations involve linkages among sets ofnegotiations. The existence of competing buyers, for example, profoundlychanges the dynamics of a deal involving a house purchase.

In diagnosing negotiating situations and working to shape perceptions,it is essential to look beyond the immediate negotiation to the broaderlinked system in which it is embedded. As former U.S. Secretary of StateJames Baker (1995: 134) put it, “I was taught that any . . . negotiation wasactually a series of discrete problems that required solutions. How youworked the other side in developing the solution to the first problem hadramifications far beyond that single issue. Indeed its resolution could set notjust the logical precedents for subsequent issues, but the very tone of therelationship between negotiators.”

One way that negotiations get linked is sequentially in time. Prior nego-tiations may influence current ones, or current ones may be affected by theprospect of future ones. By first securing mortgage preapproval from a bank,for example, the potential home buyer simplifies subsequent negotiationswith the seller. Likewise, by gaining the support of powerful people earlyon, the legislator increases the chances of building a winning coalition insupport of a proposed bill.

Concurrent sets of negotiations also may be linked in ways that power-fully affect outcomes. Success in setting up a competition betweenalternative potential buyers may increase the seller’s bargaining power: if theseller gets a good offer from one potential buyer, it changes the way theseller negotiates with others. Alternatively, negotiators may engage in multi-ple, mutually interdependent negotiations, all of which have to succeed for



some initiative to go forward. Entrepreneurs often seek to bootstrap them-selves by negotiating what are known as “contingent commitments,” withpotential funders, owners of key technology, and managerial talent, askingthem “will you commit if I succeed in getting others to commit?” If all theselinked negotiations can be synchronized, a new business is born.

Skilled negotiators seek to advance their interests both by creating andneutralizing linkages among negotiations. They also know how to sequenceinteractions in linked negotiations in order to build momentum andstrengthen their alternatives. Home buyers may negotiate, for instance, withtheir spouses for a mandate, then with a bank to secure a mortgage approvalthat caps their purchase price, and then use both the mandate and the finan-cial constraint in their negotiations with the seller. Likewise the seller mayuse offers from other buyers to force the buyer to take action, either tosweeten an offer or end the negotiations.

The ability to use linkage in these ways rests, in part, on negotiators’ability to map the structure of the linked system, identifying existing andpotential linkages. By creating a good map of the negotiating terrain, negotia-tors are better able to develop strategies for shaping the structure infavorable ways.

Proposition Seven: Negotiations are fragmented in time and movementoccurs in surges. Skilled negotiators channel the flow of the process andwork to build momentum in promising directions.

In existing models of decision making, negotiators make important choices,for example whether or not to make a concession, by evaluating their alter-natives through the lens of their interests. Agreement is reached only whenavailable terms are more attractive than no-agreement alternatives. But thesemodels tend to be static. They do not account for why negotiators decide tomake hard choices at particular points in time. Why do the parties decide tocome to the table? What is it that triggers the tabling of a serious offer? Whydo negotiators decide to reach closure rather than continue to negotiate?

Careful observation of negotiation processes reveals that movementtoward (or away from) agreement occurs in surges rather than in an evenflow. Negotiations evolve through substantial periods of inaction which arepunctuated by short bursts of substantial movement. Negotiators make hardchoices (e.g., to make a concession below some important aspiration level)only when they lack more attractive alternatives and “do nothing” is not anoption. So long as negotiators believe that the costs of action outweigh thepotential benefits of inaction, they cannot be expected to act.

Success in creating and claiming value in negotiation generally involvesstrategic efforts to build momentum toward agreement. Negotiators employa wide range of techniques to build this momentum. Phased agreements areone commonly-used technique. By getting early agreement on basic princi-ples or a framework for detailed bargaining, negotiators set up irreversible

barriers to backsliding and hence impel the process forward.20 Intentionalefforts to engineer an impasse likewise may be used to raise tensions.

Action-forcing events are another important tool for getting counter-parts and even one’s own constituents to make hard choices. These eventsmay be imposed on negotiators by external circumstances or constructed bythem. They may be the result of unilateral moves or consensual agreementamong negotiators. They may be intended to spur counterparts or con-stituents, or both (see Watkins 1998b).

The decision about whether to set up action-forcing events such asdeadlines requires careful judgment on the part of the negotiator concerningthe ripeness of the process and the state of mind of the parties. Prematureefforts to drive for closure can easily backfire, triggering breakdown orundermining credibility. Speaking of the strategic use of deadlines, one nego-tiator put it this way:

The deadline is a great but risky tool. Great because without adeadline it’s difficult to end negotiations. [The parties] tend toplay more and more and try to squeeze more and more and try topush more and more, because they have time. Risky because ifyou do not meet a deadline, either the process breaks down youor deadlines lose their meaning.21

Because negotiations are fragmented in time, the time actually spentnegotiating is far less than the elapsed time between initiation and ultimateagreement. Even once agreement is reached, the process continues to flowon into implementation, and associated negotiation and renegotiation. Whenone examines how professional negotiators spend their time, it therefore notsurprising that it too is fragmented. They are involved in many negotiations,at various stages of development.

For this reason it is frequently as interesting to focus on negotiators as itis to focus on individual negotiations. How does a negotiator spend hertime? How many projects is she attempting to manage in parallel? Does a cri-sis in one negotiation crowd out efforts to prepare for another, setting up avicious cycle of crisis-response? How does she deal with the fragmentednature of negotiations? Skilled negotiators are able to keep many balls in theair at the same time. They move fluidly from one negotiation to another,pushing one along a bit here, making a move in another there.

Proposition Eight: Most important negotiations take place between rep-resentatives of groups. Just as leaders often are called upon to negotiate,so too are negotiators called upon to lead.

When negotiations take place between groups, external negotiations andinternal decision making within the groups interact in ways that canenhance or undermine the potential for agreement. As a result, representa-tives must work internally to shape their mandates and negotiatinginstructions, as well as to “sell” the resulting agreements to constituents. At



the same time they must work externally to build credibility and productiveworking relationships while advancing their interests. But divisions withinthe sides may result in rigid, lowest-common-denominator demands thatseverely constrain negotiating representatives. Likewise, good moves madeoutside may have adverse consequences for selling agreements inside. Asone negotiator put it, “You can do things that help you to progress in rela-tionship to your external partner. . . but they would have created problemsfor you on the home front. The gap between those who are leading thenegotiations and all those people who have to come afterward would havegrown, beyond the point where it could be bridged. But if you walked tooslowly you might stay close to your [constituents], but you would have beenvery far away from the other side, and that’s a dilemma that always exists.”22

Dynamics of this sort have long been observed in negotiations involvingunions, corporations, and governments.23 As Iklé (1964: 122) noted:

It would be a mistake to view the parties in international negotiations as ifthey were unitary decision-makers. Domestic politics, bureaucratic idiosyn-crasies, and personal motivations all influence their objectives andnegotiating tactics. Governments are complex organizations, staffed by offi-cials who compete and disagree and who must in fact negotiate amongthemselves to formulate the national interest in any conflict with externalopponents. . . .Each party will try to exploit these domestic constraints ofthe other side and try to take advantage of any dissension it may detectwithin the other party’s government. However, the fact that governmentsare not unitary decision-makers does not necessarily benefit the opponent.The diversity of forces at work within a country can lead to greater initialdemands and more rigid commitments than if a party were all of one mind.

But these dynamics arise in essentially all nontrivial negotiations. Onceagain, it is a challenge to identify situations where the negotiators are notrepresenting the interests of others. Even personal negotiations such as ourhouse purchase involve internal interactions with the family on one side andthe between the agent and the seller on the other.

Good negotiators are skilled at managing the multiple, interacting levelsat which negotiations take place between and within groups, organizations,and nations. In the words of one negotiator, “Sometimes I’m trying to con-vince [my counterparts] that I’m severely constrained [by internal decisionmaking,] and sometimes that I’m all powerful, and sometimes that has tochange part way through.”24

They also understand that managing intra-group decision making —which often consists of shaping internal negotiating processes — is fre-quently more challenging than negotiating with the other side. At the sametime, they constantly look within the other side for opportunities to buildcross-cutting coalitions. As one of the interviewed negotiators put it, “A keyfactor in negotiations is there isn’t just the A-to-B relationship. You can go inbehind B and end up developing internal pressure on B. People say that isn’tvery sportsman-like but it can be quite effective.”

Because representatives have substantial control over the process andthe flow of information between “inside” and “outside,” they seldom aredoomed to be passive messengers carrying out the instructions of their prin-cipals. In the words of one interview subject:

Any negotiator who is really negotiating is much more than a messenger,because even if you put him on a very tight leash, he is going to comeback and say if we go [in this direction] we might get something. He mightexplore something [at the table]. It’s very tough to stop you from explor-ing, at least I found it was very tough for them to stop me from exploring.25

Another negotiator described the process this way:

The traditional model [of the process] is that the leadership sets the goalsand then from those goals [the lead negotiator] can make decisions regard-ing strategy, tactics, and then produce instructions for the team. But thatscenario doesn’t represent real life as far as I understand it or experienceit, because the goal and the strategy is changing constantly. There is adynamic throughout the process. And [the leadership] is not fully in con-trol of it because that dynamic is the product of the interaction betweenyou and the other party, and sometimes more than one party. Things arechanging constantly. And since things are changing, then you can have animpact whatever your position in the loop. [The negotiator] can have a bigimpact if he handles it cleverly and effectively.26

Success in acting as a bridge between internal decision making andexternal negotiating and in reconciling the divergent interests of fractiousconstituencies demands leadership from negotiators, albeit a form of leader-ship that is grounded in credibility rather than authority. To the extent theyparticipate in the development of their mandates and shape internal andexternal perceptions, representatives increase their ability to advance theinterests of their sides — and their own.

Skilled negotiators play a range of leadership roles when they representthe interests of others. Constituents’ interests seldom are cast in concrete atthe start of negotiations. Instead, interests and positions get “constructed” ininteractions between representatives and those they represent, and evolveover time. Representatives may therefore have to act as teachers, educatingconstituents about emerging realities and tempering their aspirations. Whenthe internal interests being represented are diverse, representatives often actlike mediators to narrow differences in order to define a negotiating posi-tion. If internal interests are truly incompatible, representatives may evenbecome partisan coalition builders within their organizations. This is espe-cially true if, as is often the case, the representative has legitimate interests ofher own in the proceedings. (For a discussion of representational roles seeCutcher-Gershenfeld and Watkins 1997.)

The need to play multiple roles and to move between roles as theprocess evolves creates unavoidable tensions for negotiators. Clumsyattempts to “educate” constituents may damage the negotiator’s internal



credibility, but failure to do so may render her ineffective externally. Effortsto build internal coalitions may backfire creating dissension. Skilled negotia-tors are adept at playing multiple roles and at managing the resultingtensions.

The bottom line is that negotiators need to understand how decisionsget made, both within their organizations and the other side. They also haveto ascertain the leadership capabilities of other representatives. Do thesepeople have credibility? Are the able to act as educators and shape the per-ceptions of their counterparts. Can they build the internal coalitionsnecessary to sell agreements?

Proposition Nine: Organizations often are represented by many negotia-tors, each of whom conduct many negotiations over time. Success insetting up organizational learning processes contributes to increased effec-tiveness, both individual and collective.

Many important negotiations in government and business take placebetween teams consisting of people with distinct skills and expertise. Suc-cess in capturing potential learning synergies within a team (and inpreventing uncontrolled leakage of information to the other side) translatesinto increased effectiveness. Skilled negotiators therefore pay careful atten-tion to managing the team learning process, establishing clear roles andresponsibilities for observation and analysis, and devoting substantial timebetween at-the-table sessions to integration and distillation of insights.

Likewise, organizations often have many negotiators undertaking similarnegotiations with different counterparts. Consider, for example, a real estateagency with many agents or a manufacturing company with many purchasingmanagers or a foreign ministry with many diplomats. To the extent that nego-tiators are successful in learning from their past negotiations, capturing theresulting insights, and, crucially, sharing these insights among themselves, theyincrease the overall negotiating effectiveness of their organizations.

It is therefore important to focus on the management of organizationalknowledge, and not just on the development of individual competence.How do new members of an organization or team learn to negotiate? Areinsights from past negotiations captured and shared among negotiators? Cru-cially, how is knowledge preserved and forgetting prevented? In situationswhere there is substantial turnover in an organization, the risk of “organiza-tional Alzheimer’s” is very high. Memory loss can only be avoided byself-conscious management of the acquisition and dissemination of knowledge.

Dedication to individual learning is a prerequisite for organizationallearning. Skilled negotiators cultivate a continuous improvement mindset.They do not passively collect and analyze information. Rather, they immersethemselves in information about their environments, searching for emergingthreats and opportunities; they systematically identify and tap into goodsources of information and build networks of relationships to support intelli-

gence gathering. Crucially, they reflect on their past experiences in order tolearn from them.

Skilled negotiators also cultivate an integrated awareness that helpsthem to extract useful knowledge from what is going on in negotiatingprocesses. As one of the interviewed negotiators reported, “You have tohave the ability to look at the big picture. To set the strategy in accordanceto concrete goals. From that goal to devise not only the strategy, but also thetactics, how to achieve these goals. And that’s ability to combine the bigthings with the small things. I think it’s a rare quality. You have people, theycan deal very cleverly with the big things, with the forest, but they are get-ting lost while dealing with the trees. So you need people that can dealeffectively with both.”27 Good negotiators also know how to interpret anddraw meaning from a combination of verbal and nonverbal information.They have the ability to understand and control their own reactions to whatpeople are saying and so avoid creating unnecessary barriers to learning.They develop strategies for better eliciting information from counterparts atthe table, for example through active listening.

For individual learning to contribute to organizational learning, how-ever, negotiators must share a continuous improvement mindset and specificmechanisms must be set up to encourage collective knowledge sharing andreflection. This could take the form of post-negotiation debriefings thatfocus on distilling and sharing key “lessons learned” or “trip reports” thatsummarize novel and interesting developments in specific negotiations. Thekey is to create flexible, time-efficient processes for sharing knowledge, usu-ally emphasizing person-to-person transmission over written documents.Flexibility and time-efficiency are important because the pace at which mostnegotiators work can crowd out time for reflection. Being “too busy” oftenis the enemy of (and poor excuse for) effective organizational learning.

Proposition Ten: Negotiation skills can be learned and they can betaught. Expert negotiators possess skills in pattern recognition, mentalsimulation, process management and reflection-in-action, and these skillscan be developed through carefully structured experience.

Finally, there is a commonly-held view that great negotiators are artistswhose innate temperament has endowed them with unique insight andskills. In this view the best negotiators are inspired, natural tacticians whoare able to go to the table and convince others through the use of intimida-tion, sheer charisma, force of will, self confidence, and a toolbox of tacticaltricks. This view is common because, to some degree, it is true. Some peo-ple do seem to have more natural ability to negotiate.

At the same time, this view of the great negotiator as born-not-made isproblematic and misleading. For one thing, it understates the importance of sys-tematic analysis and development of strategy. All the negotiators we interviewedcited extensive preparation and analysis as being crucial to their success.



In addition, the impact of learning-by-doing and formal training aregiven short shrift by the “born negotiator” view. A recent survey of heads ofdiplomatic training institutes asked them to specify the extent to which theyagreed with the statement, “Great negotiators are born, not made.” On a five-point scale where 1 signified “disagree strongly” and 5 “agree strongly,” themean response was only 2.7. When they were asked to respond to the state-ment, “People can be taught to be better negotiators,” the mean responsewas 4.6. All the respondents saw training and development as very impor-tant. In follow-up questions, they ascribed roughly 45 percent of the typicaldiplomat’s effectiveness to a combination of on-the-job experience and for-mal training and 55 percent to the inherent capacity they brought to the job(which is itself partially a function of experience.) Of the 45 percent of effec-tiveness accrued though work experience, approximately 70 percent wasascribed to learning-by-doing and 30 percent to formal training. All thesecountries invested substantial resources in developing the negotiating skillsof their diplomats.

The bottom line is that, regardless of inherent ability, everyone canlearn to be a better negotiator. The more interesting question therefore is not“Are great negotiators born or made?” but rather “How best do we developnegotiating ability?” To answer that question, it is necessary to probe whatcontributes to the development of expertise. How does the expert mind dif-fer from the novice mind? What cognitive capacities do skilled negotiatorshave that are absent in their less-accomplished colleagues? How might suchcapacities be enhanced?

Research on the development of expertise suggests that experts man-age complexity better than novices because of their superior abilities inpattern recognition, mental simulation, parallel management of process andsubstance, and reflection-in-action. Pattern recognition is the ability to seefamiliar patterns, for example coalitional alignments, in complex and confus-ing negotiating situations. Like the expert chess player, skilled negotiatorsfilter out irrelevant clutter and see configurations that represent threats andopportunities. They also have the ability to come up with promising coursesof action rapidly, and then simulate them forward in time in the imagination.In this way, the skilled negotiator develops provisional action-sequences,anticipates reactions and other contingencies, and then refines or discardsthe plan as necessary.28 What Christensen et al. (1991) called “dual compe-tency” in managing substance and process permits the negotiator to keeptrack of the substance of negotiations while at the same time shaping theevolution of the process. Reflection-in-action is the ability for the negotiatorto, as Ury (1991) so aptly put it, “go to the balcony” in the midst of tense anddifficult proceedings, get perspective on what is happening and why, andadjust strategies accordingly. (See also the pioneering work of Schon[1983].)

The best way to develop these capacities is by exposing practitioners toa diverse range of realistic situations, both real and simulated, and allowing

them to reflect on the experience and absorb the lessons. Success in doingthis fosters intuition and heightens situational awareness. This, in turn,allows negotiators to rapidly develop workable options under time pressure,a hallmark of expertise. As Klein (1998: 42) put it:

The part of intuition that involves pattern matching and recognition offamiliar and typical cases can be trained. If you want people to size up situ-ations quickly and accurately, you need to expand their experience base.One way is to arrange for a person to receive more difficult cases...Anotherapproach is to develop a training program, perhaps with exercises andrealistic scenarios, so the person has a chance to size up numerous situa-tions very quickly. A good simulation can sometimes provide more trainingvalue than direct experience. A good simulation lets you stop the actions,back up and see what went on, and cram many trials so a person candevelop a sense of typicality.

The most powerful capability-building experiences combine structuredon-the-job training (sometimes including formal mentorship) and formalstudy. Formal study is important because while real-world work experienceunquestionably can be good teacher, negotiations come in such a wide rangeof sizes and shapes that it can be difficult to draw general lessons. To theextent that negotiators do learn from history, they may develop characteristicstyles that work well in some situations and not others, but not understandwhy this is the case. This is why exposure to structured experience — in theform of cases, stories, and simulations — can be so powerful, so long as theprograms are developed with care, and so long as participants are givenopportunities to discuss and reflect on their experience.

In ConclusionReal-world negotiations are complex. They involve a mix of value creationand value claiming. Negotiators have to shape perceptions and learn in theface of uncertainty and ambiguity. The inevitability of conflict sometimesrequires practitioners to mediate even as they negotiate. Interactions amongnegotiators are inherently chaotic and that makes feedback loops easy to setup and hard to break. Negotiations occur in a diverse array of contexts andunderlying structural similarities may not be obvious. Linkages almost alwaysexist and strongly influence outcomes. The process is fragmented in timeand negotiators may need to manage many negotiations in parallel. Internaldecision-making processes are likely to be as problematic as external negotia-tions. Organizations have to manage many negotiations and negotiators inparallel.

At the same time, the complexity of negotiation is manageable, at leastto a degree. Skilled negotiators can create and claim value, shape percep-tions and learn, work within structure and shape the structure, negotiateand mediate, link and de-link negotiations, create momentum and engineerimpasse, and work outside and inside. Organizations can create learningprocesses that powerfully leverage the experience of their individual nego-



tiators. In this and myriad other ways, people become better able to negoti-ate in a complex world.

This essay represents an early effort to articulate and embrace the com-plexity of negotiation without being swamped by it. The propositionspresented here are intended to form the basis for the creation of models ofthe negotiation that move beyond simple cases without proposing modelsthat are unnecessarily complicated, that merge emotional and strategicdimension, and that provide more dynamic models of the evolution of theprocess.

NOTES

1. For the case studies see Lundberg (1996), and Rosegrant and Watkins (1994, 1995, 1996band 1996c). A total of 35 senior diplomats were interviewed for the project. The survey was alsoadministered to deans and directors of academies and institutes of international relations. A totalof 56 surveys were sent and 60 percent were returned.

2. Walton and McKersie (1965) made the important distinction between distributive and inte-grative bargaining. They also noted that negotiators may engage in negotiations involving a mix ofdistributive and integrative bargaining which they termed “mixed-motive.” Lax and Sebenius(1986) re-conceptualized the distinction between distributive and integrative bargaining. Ratherthan discrete types of bargaining, value claiming and value creating were viewed as processes thatwent on in parallel in most negotiations. “. . .[N]egotiators should focus on the dynamic aspects ofnegotiation, the process of creating and claiming value” (p. 254). “Value creating and value claim-ing are linked parts of negotiation. Both processes are present. No matter how much creativeproblem-solving enlarges the pie, it still must be divided; value that has been created must beclaimed” (p. 33).

3. For a detailed discussion of differences as a potential source of joint gains see Chapter 5 ofSebenius (1984) and Chapter 5 of Lax and Sebenius (1986).

4. This term and definition is explicated in Lax and Sebenius (1986). Walton and McKersie(1965) observed that a tension often arose when negotiators engaged in a mixed-motive negotia-tions: “At virtually every turn the negotiator finds himself in a dilemma: Should he concealinformation in order to make his tactical commitment more credible, or should he reveal informa-tion in order to pursue integrative bargaining; should he bring militant constituents into thesession to affirm feeling, or should he use small subcommittees in which new ideas can be quietlyexplored, etc.” (p. 183). Lax and Sebenius (1986) placed this strategic tension between value cre-ating and value claiming — which they called the negotiator’s dilemma — at the heart ofnegotiation. See Chapters 2 and 7 of Lax and Sebenius (1986). See also Chapters 10 and 11 ofRaiffa (1982).

5. For a discussion see Iklé (1964), Chapter 5.6. In Chapter 9, Lax and Sebenius (1986) call this “changing the game.” See also Sebenius

(1992: 31): “Much existing theory proceeds from the assumption of a well-specified and fixed situ-ation within which negotiation actions are taken and agreements determined. In effect, analystsposit a mapping between the structure of a known situation and the ultimate outcome.” Yet pur-posive action on behalf of parties can change the structure of the situation and hence outcomes.The idea of moves at and away from the table is developed in Sebenius (1996a).

7. See for example Cialdini (1984) and Zimbardo and Lieppe (1991)8. United Nations Press Release, 24 February 1998, Kofi Annan’s return from negotiating the

crisis-ending agreement with Iraq.9. For a discussion of the impact of conflict on perceptions, see Robinson (1997a and 1997b).10. For a detailed examination of barriers to negotiated agreement see Ross and Ward (1995)

and Arrow et al. (1995).11. Roger Fisher argues that every negotiator has a dual role as partisan advocate and as co-

mediator. Negotiators may understandably have a bias in favor of their own side. In fact, diplomatsmay correctly perceive their mandate to behave as a zealous advocate of their nation’s interests.But arguing in favor of one set of interests is less than half the diplomat’s job. Two diplomatsnegotiating on behalf of their respective countries also have the joint task of efficiently producinga workable agreement that reconciles, as well as can be, the interests of the two governments in amanner that is acceptable to both. Although each negotiator’s task can thus be seen as that of aco-mediator, the normal relationship between internal and external negotiations does not make itpossible for two negotiators to use the tools and techniques that a skilled mediator might employ.See R. Fisher, “Negotiating Inside Out: What are the Best Ways to Relate Internal Negotiationswith External Ones” in Breslin and Rubin (1991).

12. Interview with senior Israeli negotiator, September 1998.13. Zartman and Berman (1982) termed these stages the diagnostic phase, the formula phase,

and the detail phase.14. For an introduction to nonlinear systems theory, see Gleick (1987).15. This is the “commitment effect.” See Cialdini (1984).16. Interview with senior Israeli negotiator, September 1998.17. Interview with senior U.S. State Department negotiator, August 1998.



18. For a fascinating discussion of this and other approaches to political manipulation, seeRiker (1986).

19. For discussions of the role of structure in negotiation, see Sebenius (1992) and Sebenius(1996a) The ideas of structure in time and space is developed in Watkins and Passow (1996) andWatkins (1998a).

20. For a discussion of approaches to building momentum in conflict resolution processes,including phased agreements, see Watkins and Lundberg (1998).

21. Interview with Avi Gil, June 1998.22. Interview with Robert Gallucci, July, 1998.23. Walton and McKersie (1965) proposed a model of intra-organizational negotiation and dis-

cussed interactions between internal and external negotiations in Chapters 8 and 9. “Theorganizations participating in labor negotiations usually lack internal consensus about the objec-tives they will attempt to obtain from negotiations. . .Generally these internal conflicts must beresolved during the process of negotiation with the other party. . . .These two processes — Inter-group and internal consensus — are not always mutually facilitative. In fact, more often they arethe opposite: a tactic which brings about internal consensus may not be instrumental for distribu-tive bargaining; behavior which resolves internal conflict may not be consistent with therequirements of integrative bargaining; and so on.” (pp. 281-282). Putnam (1988) analyzed thedynamics of these interactions as “two-level games.” See also Allison (1971); Chapter 17 of Laxand Sebenius (1986); and Fisher et al. (1991).

24. Interview with Robert Gallucci, July, 1998.25. Interview with Robert Gallucci, July, 1998.26. Interview with Avi Gil, June 1998.27. Interview with Avi Gil, June 1998.28. The role of pattern recognition and mental simulation is making expert judgment possi-

ble is developed in detail in Klein (1998).

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