In a recent article on the Daily Blog of Harvard Law School’s Program on Negotiation, the authors outlined six strategies for maximizing value during negotiations. While the article focused on business negotiations – deal-making in the course of commerce – the strategies discussed can be equally applied to negotiations focused on resolving business disputes as well.
Strategy #1: Explore Your Alternatives.
In litigation, success is never a sure thing. As a result, it is important to be constantly assessing your alternatives, and to be willing to take an open-minded approach to evaluating settlement opportunities. By knowing what options you have available, you can help put yourself in a position to take control of the negotiations and steer them toward a favorable settlement.
Strategy #2: Explore The Other Party’s Alternatives.
In settlement negotiations, it is critical to explore your counterparty’s alternatives as well. Knowing where the other side has leverage (and where it doesn’t) can help you make informed decisions that anticipate the possible responses.
Strategy #3: Calculate a Zone of Possible Agreement.
Knowing your counterparty’s alternatives will also allow you to calculate a zone of possible agreement (ZOPA). For example, if the other party alleges that you violated a non-solicitation clause and stole 10 of its clients, but you also know that they are most concerned with re-establishing their relationship with three of those clients who were their top accounts, you may be able to begin narrowing down your ZOPA in order to focus your efforts on the more-probable settlement opportunities.
Strategy #4: Make the First Offer (Sometimes).
The Program on Negotiation’s article refers to making the first offer as dropping an “anchor.” In certain circumstances, making the first offer can put you in a position of strength—positioning the negotiations at your anchor instead of the other party’s. However, in many cases, waiting to see where the other party stands before you show your hand can have significant negotiation benefits as well.
Strategy #5: Wait for a Counteroffer.
In settlement negotiations, one strategy that some parties will use is to try to convince the other party to lower its offer rather than making a counteroffer of its own.
Once you have made an offer, it will generally be in your best interests to wait for a response. This should not be a response of, “Here are five reasons why you might want to try again with a higher offer,” but instead a response in the form of a counteroffer that you can then evaluate in light of all of the facts and circumstances at hand.
Strategy #6: Constantly Re-evaluate.
Finally, once you have evaluated all parties’ alternatives, you need to continue to reevaluate those alternatives as the dispute progresses. If circumstances change (which they often do in complex litigation), you may find that you are suddenly in a position of strength to push aggressively for a favorable settlement.
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If you are facing a business or commercial dispute in the Fort Lauderdale area, contact Michael L. Feinstein, P.A. for an initial consultation. Our attorneys are skilled litigators who have decades of experience representing corporate clients in complex litigation. To discuss your case in confidence, contact us online or call (954) 767-9662 now.