Attorney for defendant: Listen Mrs. Douglas, in total, we have been at this for some time now and we have made considerable progress throughout these negotiations. I feel as if we are close enough to reaching some type of agreement. We are currently offering $140,000,000 and you are asking for somewhere in the ball park of $200,000,000. We are not prepared to offer that to your clients, but we are prepared to take this case to trial and let the jury decide on this issue. In this case, they could lose and get nothing. We are willing to increase the offer to $150,000,000. They can take this amount today and walk away with approximately $75,000 each. The other option for your clients is to take nothing today and go to trial.

Attorney for plaintiff: We feel as if $160,000,000 would be fair.

Attorney for defendant: Our final offer is $156,000,000.

After discussing the offer and the implications of rejecting it with her clients, the attorney for the plaintiff accepted the offer.

Summary of the Distributive Bargaining Approach:

In this approach, the attorney for the Defendant started the process with the opening offer of $125,000,000. Considering that the defense attorney's target point was $150,000,000 and his resistance point was $175,000,000, his opening offer gave him enough room to negotiate without the risk of going much beyond his target point. His low starting point made it even less likely that he would reach his resistance point of $175,000,000. According to the article, How to Negotiate Effectively, a first offer that comes within a bargaining zone becomes a liability. Mandelbaum (2010). Mr. Smith effectively avoided his bargaining zone and left substantial room to negotiate.

In response to Mr. Smith's offer, Mrs. Douglas proceeds to respond by adopting her opening stance which includes aggression and intimidation. Mrs. Douglas's opening stance attempts to work to get Mr. Smith to modify his proposal by appealing to the notions of injustice towards her client and making specific references to her client's personal scenario. Mrs. Douglas's hardball tactics eventually lead to a concession by Mr. Smith. However, prior to his concession, Mr. Smith reminds Mrs. Douglas that their resources are fixed and limited which is a common trait of distributive bargaining. Finally, with the expectation of closing the deal, Mr. Smith provides alternatives to Mrs. Douglas -- either accept their final offer of $150,000,000 or proceed to trial and risk obtaining nothing. With these alternatives on the table, Mrs. Douglas manages to push the deal closer to her target point before accepting the offer.

Integrative Negotiation

The strategy of Integrative negotiation focuses on commodities among the parties rather than differences. This strategy attempts to address needs and interests rather than positions. Integrative negotiation attempts to meet the needs and interests of all those involved. Lewicki, Barry, Saunders, and Minton (2003). Integrative negotiation is considered a win-win for both sides involved. Successful interest-based negotiation (integrative negotiation) involves the following traits: honesty and integrity, abundance mentality, maturity, and superior listening skills. Laubach (1997). Throughout the integrative negotiation process, negotiators find hidden opportunities for what they can do for each other. It raises the stake in a negotiation, and the level of content between the bargainers. Karrass (1999).

Integrative Negotiation Method in Action

Attorney for defendant: For the last year, we have been attempting to settle this lawsuit against our client and we are aware that both sides have needs and interests that they will seek to have met. The plaintiffs are alleging discrimination and a subsequent loss of salary and raises. Documentation exists that the plaintiffs' salaries average $26,000 lower than those of their white counter parts. Winter (2000). We are here today to attempt to offer and provide a fair and equitable resolution to this problem and it is our client's goal that this type of problem be eradicated for the future.

Attorney for the plaintiff: Thank you, sir. It is our goal to reach a fair and equitable resolution to the problem that you have stated. With that in mind, we feel as if a fair settlement offer would be $200,000,000.

Attorney for the defendant: Mrs. Douglas, I do understand your passion for your clients. However, we are not prepared to offer $200,000,000. Our clients have financial limitations as well, but we are willing to work with you to reach a more favorable agreement for both of us. Tell me, what is your motivation behind this number?

Attorney for plaintiff: Our clients have undergone years of discrimination as you...

We are seeking the fairest settlement for them that will at the same time best compensate them for their losses.
Attorney for defendant: I agree with you, but let's also look at this in a way that is more balanced for my clients. My clients, while compensating your clients to the best of their ability, also seek to provide a better work environment for everyone to ensure that problems such as the current are eradicated. This is also a benefit for your clients as well. With this in mind, we propose an offer of $125,000,000. This will give our clients economic breathing room to correct the issues in the work environment. I am sure that it is extremely important to your clients to have a less hostile work environment in addition to receiving economic compensation.

Attorney for plaintiff: You are correct, sir. However, I do feel as if they should receive more than $125,000,000. My clients could not be fairly compensated by this amount alone.

Attorney for defendant: I do understand that. Let's consider what else we can do for your clients.

Attorney for the plaintiff: Offer more money? Let's consider the logistics here. If our clients accept your offer of $125,000,000 they would receive approximately $62,000 each as there are 2,000 plaintiffs in this case. For the amount of years they have endured the discrimination, I cannot agree that this is not a fair offer.

Attorney for the defendant: Very well then. We are prepared to offer $140,000,000 as compensation for your clients and to give each of them raises of 3% on their current salary.

Attorney for the plaintiff: That sounds like a fairer deal, however, our problem with this would be the likelihood that if a client does not remain with your company they will be prejudiced by this deal, and I would not want to see this happen. Why don't we do this -- our clients will take $165,000,000 and the 3% raise.

Attorney for defendant: $156,000,000 and the 3% raise.

After discussing the offer and the implications of rejecting it with her clients, the attorney for the plaintiff accepted the offer.

Summary of the Integrative Negotiation Approach: In this integrative negotiation approach, the defense attorney begins the process with defining the problem while expressing sensitivity to the needs and interests of the plaintiffs. Many writers on negotiation have stressed the key to achieving an integrative agreement is the ability to understand and satisfy each other's interests. Fisher, Ury, Patton (1991). Next, the attorney for the defendant proceeds to assess the plaintiff's interest and needs in light of the offer that the attorney for the plaintiff has proposed. Not prepared to accept this offer, the attorney for the defendant inquires as to the rationale behind the offer with the expectation of better understanding the plaintiff's interests.

The plaintiff's attorney responds that that their interests are primarily economic and principled. During the process of integrative negotiation, there are numerous competing interests that each side could claim: substantive interests defined as economic and financial issues, process interests defined as the way a dispute is settled marked by a desire and enjoyment for negotiation, relationship interests defined as a desire to protect the relationship that the parties have with each other, and interests in principle defined as a desire for what is fair, just, and right. Lax and Sebenius (1986). In response, the attorney for the defendant mildly interjects his clients' interests as being primarily substantive before counter offering. During the negotiation, each side is careful not to disrupt the atmosphere of trust that was initially established in the beginning. Each side listens to the other and remains flexible to the other side -- both of these are characteristic of the integrative negotiation process. The negotiation proceeds and ultimately concludes with the defense attorney generating an alternative solution -- he both increases their offer and includes the option of a 3% raise for each of the plaintiffs. While this offer of a raise is attractive to the plaintiff's attorney, she proceeds to evaluate other alternatives before she accepts the offer and ultimately closes the deal.

The various techniques can be involved in the art of negotiation. In two of these -- distributive bargaining and integrative negotiation the participants approach negotiation in strategically different ways. Nevertheless, if one is a successful negotiator, the results will be similar -- a resolution that each side can be satisfied with in light of their interests, needs, and objectives.

References

Fisher, Roger, William, Ury, and Patton, Bruce. (1991). Getting…