Forbes India 15th Anniversary Special

Negotiating in a crisis

In this article, writers want to highlight the important factors, based on their experience teaching and researching negotiation, to be taken into consideration in the post-crisis negotiations.

IESE Business School
Published: Apr 23, 2020 04:30:03 PM IST
Updated: Apr 23, 2020 04:47:29 PM IST

Negotiating in a crisisImage: Shutterstock

The village was destroyed. Only a week ago it was a place ebullient with energy and zeal because it was a Friday evening and the next morning was the republic day. It was a festival and a holiday. In a society of six-day weeks, a holiday on Saturday feels heavenly. But the next morning, the 26th January 2001 turned out to be anything but heavenly. The biggest earthquake in the history of the Indian sub-continent devastated the region of Gujarat on that day. Some villages literally disappeared from the region. The epicenter of the earthquake was in the district of Kutch. In the aftermath of the earthquake, , when the mourning was over and rebuilding the village was the need of the hour, the then Chief Minister (and now the Prime Minister of India) visited the village. Local representatives presented their case and the summary of their representation was, “We don’t know where to begin?”

It was a critical situation. The community was shattered in every sense of the term, resources were scarce, and morale was low. The Chief Minister said, “Repair the school first”. The logic, as he explained later, was that the community not only needed to rebuild everything but also needed to feel alive again. Nobody can boost the morale of a human being like a happy child. If the school is rebuilt and kids start going to school again, it may have a vivifying impact on the community. The rebuilding of the Kutch district and the state of Gujarat eventually culminated in the state emerging as the prime economic motor within a few years. The government received special recognition from both the United Nations and the World Bank for its rebuilding efforts. The interesting aspect of this anecdote is that quite often in a post-crisis situation, the focus in the rebuilding effort is not just on economic criteria of efficiency but also on the socio-emotional impact of the policy.

The world today is facing a crisis. It’s a crisis that is unprecedented. We don’t know how we may end up on the other side. In the last twenty-four hours, I talked to my relatives and friends in Munich, Adelaide, San Francisco and London and they all are living in the same condition. Everyone is confined at home, praying for the safety and health of their loved ones and unsure and insecure about the future. Negotiating post-crisis requires a different mindset and a different focus.  In this article, we want to highlight the important factors, based on our experience teaching and researching negotiation, to be taken into consideration in the post-crisis negotiations.

The Four Keys to Negotiation Post-Crisis:
1.    Heal wounds
When Nelson Mandela became the president of the Republic of South Africa in the year 1994, he saw his mission as one of ‘preaching reconciliation’. In a post-Covid19 world, we will see a society shattered and fractured. From a shop-floor worker to the CEO and from young startups to governments, nobody is going to leave unscathed from this crisis. In such an environment every negotiation situation will be a situation of healing wounds. While organizations will have to understand the personal and financial loss many employees may have suffered, employees will also have to be conscious of severe scarcity of resources many organizations may have faced. Negotiators generally claim value in a negotiation. But in the post-covid world we will have to move from claiming to caring. There are two characteristics of crisis negotiations that need to be understood well. First, most negotiations are multi-issue negotiations and hence complex. Second, most negotiations need an agreement. Not having an agreement jeopardizes not just the negotiation in question but many subsequent negotiations. That’s why helping others will be the first step towards helping ourselves.

2.    Confront emotions
Managing emotions will be crucial. Managing emotions mean neither suppressing nor succumbing to them. It is important to recognize the emotion of the other side proactively. At the beginning of the negotiation process, one could state, “I know that you are feeling really upset and insecure because of the current situation.” Identifying emotion of the other side is also a great tool to empathize with the other side and establish a collaborative relationship.

3.    Continue the dialogue
 By reaching out and talking to other stakeholders we may or may not solve our problems. But by not reaching we definitely will not solve anything. When emotions and lack of empathy dominate decision making, continuing the dialogue becomes challenging.  Stopping the dialogue, stops the progress and doesn’t resolve the problem. It is not a surprise that the New York Police Department’s hostage negotiation team’s motto is ‘Talk to me’. In the post-Covid world ‘talking to all’ should be the policy of every government in the world.

4.    Remember the process is paramount
Every point mentioned above can be tackled proactively through an effective negotiation process design. Negotiators beforehand can design a negotiation process where they can foresee a proper strategy for all the concerns outlined above. For example, a proper combination of different channels of negotiation, can help different negotiation parties express themselves without getting overwhelmed by emotions. Studies have shown that negotiating online or through email reduces emotional involvement of negotiators while face-to-face negotiations are a great facilitator of empathy and trust. A negotiator can effectively use online and offline channels for reducing emotional impact and creating empathy.

The key to success in a crisis negotiation is management of the process and preparation. Effective preparation of negotiation helps a negotiator understand the larger picture and evaluate high stakes of different parties. On the other hand, controlling the negotiation process can ensure that despite all complexities the negotiation continues. In the post-coronavirus society, we all will need to remember this. Because collectively as a society we will be facing a complex negotiation of coexistence and survival. And we will not be able to afford a deadlock.

By IESE Business School´s Kandarp Mehta, Senior lecturer in Entrepreneurship and the Negotiation Teaching Unit, and Guido Stein, professor in Managing People in Organizations and Director of IESE Business School´s Negotiation Teaching Unit.

[This article has been reproduced with permission from IESE Business School. Views expressed are personal.]