Published in Executive Leadership magazine
Ever wondered how to assess your team’s negotiating capabilities? Hal Movius describes how, in a featured Q&A column from Executive Leadership called The Negotiation Coach.
Q: I work with a group that has completed several mergers and acquisitions on behalf of our organization. We would like to assess how well we have done and where and how we might improve. What’s the best way to go about this?
A: Assessing a team’s performance can yield critical insights and serve as a useful starting point for improvement efforts.Yet most organizations don’t con- duct negotiation assessments because they’re not sure how to go about it. Here are three issues to consider:
1. Who will provide feedback, and how will it be gathered? In many settings, 360-degree feedback is considered essential. Yet getting feedback from past negotiating counterparts is potentially
problematic, as they may have a conflict of interest. Would you view a counterpart’s advice to “be more flexible in meeting our needs” as genuine or manipulative? Similarly, colleagues who have not participated in talks may not have a full picture of the negotiators’ work.
Moreover, asking negotiators to assess how well they have done may not yield valid information because of cognitive distortions in our perceptions of negotiation. For example, negotiators typically overestimate how much value they have claimed because they underestimate the actual size of ZOPA (zone of possible agreement), researchers Richard P. Larrick and George Wu have found.
Try to put negotiators in storytelling mode, which helps them focus
less on how well they did and more on what guided them. A negotiator who describes himself as collaborative, for example, might nonetheless mention that he refused to return calls to “show them we were in charge.”
2. What should be the assessment target? An assessment can take one or a combination of the following approaches. A case-study approach focuses on the structure of an agreement, or compares different agreements, to evaluate whether and how deal design was efficient in each case. This approach can be useful in identify- ing the kinds of trades or terms that created and claimed value and in better designing future deals where similar dynamics and issues are in play.
A process review looks at the procedures and tools used to prepare for negotiations and identifies potential improvements. This is particularly useful in matrixed leadership environments, where authority and information are distributed across groups and geography.
A skills-gap analysis pinpoints gaps in knowledge and behaviors that could be addressed through training or coaching. This is useful in identify learning opportunities.
3. How should findings be applied?
The most powerful assessments serve as a basis for change on numerous levels, including tailored negotiation- skills workshops, enhanced preparation processes, better communication and data-sharing procedures, realigned scorecards and incentive structures, and peer coaching and internal-review procedures during major deals. For example, after an analysis of a dozen of its recent deals, one mergers and acquisitions group in a Fortune 500 company formed implementation teams around key actions, with timelines and milestones attached to each one. ■
This article first appeared in Negotiation Briefings, published by the Program on Negotiation at Harvard Law School. To download free Negotiation reports, visit www.pon.harvard.edu. Reprinted with permission. ©2015 Harvard University.
Hal Movius, Ph.D., is President of Movius Consulting, Inc. and coauthor (with Lawrence E. Susskind) of Built to Win: Creating a World-Class Negotiating Organization (Harvard Business Review Press, 2009)