Welsh Water Case

Debriefing – Welsh Water (7th Oct 2006)

General: What happened; what was the outcome; were you successful or not; why and why not;

We think we were successful overall. I felt that all the unions and management benefited from the negotiation. We were successful because priorities of the unions were the same which provided them the leverage while negotiating with the Management. Also, the different unions were ready to offer concessions for the over all gain.

· who was satisfied (answer this before comparing walkaways or comparing information);
I think everyone was satisfied with the outcome as all were much above their respective walkaway.

· did either violate his/her walkaway; if so, why?
No we did not violate our walkaway price.

· if there was a gap in walkaways, how did you bridge (or try) the gap.
There was a ZOPA so there was no gap.

· did we get near the “Pareto Frontier?” or …did we “leave money on the table”…where are we on the graph? We did not leave money on the table.

was there anything that surprised you about the negotiation

I thought it would be more distributive as a negotiation because the case suggested that the NUPE was anti NALGO. However, by focusing on problem at hand I believe we let go of our preconceived notions. Also, when the management tried to low ball us we were united in our negotiations and countered that effectively.

Negotiation Process: What was the process of negotiation- opening offers, sequences of offers, counteroffers, anchoring, initial offer, counteroffers? Did the other side start high/low? What effect did this have on the negotiation?
The opening was by Ben (Management). He offered us three options with caveats. He framed his argument that the management and the unions had to work together for future gains. He offered us a package that included the pay increase linked to CPI – 1% and assured us of a market position guarantee of 60%. He also said given the circumstances job security was not possible. The unions rejected the CPI linked wage increase and we pushed for a CPI + 4%. We also state that job security was important the unions. We went back and forth on the CPI linked pay and finally agreed on CPI+ 1% increase. The other two unions wanted to reduce work hours but were more inclined to work on a single scale pay basis, which was a major source of discontentment with the management. Therefore, the unions agreed to this. The management was ready pushing for a PWT schedule but the unions did not see eye to eye with the management on that one. We therefore pushed in the agenda for a profit sharing, with which the other two unions agreed. Also, as the other unions were happy to see us cooperating with them to work a solution we pushed in for a market position guarantee of 65% which the management relented because we were relying on standards and the management found it difficult to put down. Finally, these were the terms:
CPI + 1 *Single Pay Scale*Market Position Guarantee @ 65%
*Profit Sharing

A test: was my negotiation effective? (some of these may not apply in a particular exercise)
Score yourself from 1=poor to 5=excellent
_4_ Planning and Strategy: did I have a strategy; was my walkaway right; did I estimate the other’s well?
_4_Did I establish my own priorities and potential trade-offs
_4__First approach: were we win-win, positive; try to establish rapport; did I deal with first offers effectively?
_4__How well did I develop a plan for managing the process of negotiation?
_4__Did I actively shape the agenda and manage the process to my advantage?
_4__How well did I try understand the other person:
_4__Exploring Interests: did I communicate my interests;
_4__Persuasion: How well did I persuade the other side about my legitimate needs and limits and the value of what I offered
_2__The Other's Interests did I find out the other side's real interests and constraints
_3__Creating Value (integrative or win-win) vs Claiming Value (distributive or win-lose)
_4__Options: Did we explore "expand the pie" options: did we try to find ways of meeting each party’s needs
_3__Inquiry vs. advocacy: did I ask (inquiry) a lot of questions, or just advocate my position
_5__Alternatives: Was I clear on my BATNA; was I clear about what happens if there is no agreement
___Legitimacy: was the agreement considered fair by some external benchmark
_4__Commitments: did the agreement avoid problems in the future; were any “strings left untied?”
_5__Communication: did we practice effective two way communication…did we listen…did we rephrase…
_5__Focus on the problem, not the person: did we avoid attacking or threatening the other person
_5__Relationship: did we deal well with differences; is our relationship better off now than before
_4__Psychological factors: did outside factors (eg. emotions) affect the outcome (their efforts or ours)
_4__Did we reach an outcome that maximized potential mutual gains; did we come close to the "Pareto Frontier?"
_5__Other factors: did anything else affect the negotiation-physical space, time pressure, etc.


Did we use the Techniques of Principled Negotiation: (did the other party?)…If not, what blocked it?
· listen, be warm and friendly; avoid quarreling; ask questions, ask questions, ask questions, ask clarification, rephrase
· be open to persuasion
· be principled (“You want to pay….I need …Can you think of ways that is fairer than splitting
· turn the interaction from adversarial haggling into side-b-side solving of the problem of what is fair.

For Yourself: General Conclusion:
· In areas where you felt you were less than totally successful, how might you be more effective next time. From this exercise, what did you learn that you are going to try to do better next time you negotiate;
The areas in which we were less successful entailed were planning our multi-part union negotiation prior to negotiating. Perhaps if we had a little more time, we may have been better prepared. However, out of the three parties that were negotiating, the union that represented the blue collar workers (NUPE) did not receive the minimum amount of points needed and ultimately went on strike and were left on their own. If we had created a strategic alliance prior to beginning the negotiation, than perhaps all three unions would have been stronger and had a more positive outcome.

· What were keys to the negotiation being successful or unsuccessful
The key to the negotiation being successful was that we approached it as a balanced concern situation and we also knew that we would need to be flexible.

· What would you do differently if you were to do this same negotiation again
As mentioned earlier, the three unions were not acting totally together. Therefore, it was imperative that we work together next time and would suggest creating a partnership or strategic alliance where we act together and if one of the unions did not receive what they wanted then the other two would then walkaway. By acting as one, the other side would not have much opportunity to manipulate each of the unions individually. The blue collar workers were the most expendable out of the three unions, but they needed us more than we needed them. However, having all three unions working together, would have benefited the three unions and made for a stronger negotiation.

· What did you learn about yourself? About negotiations What tendencies do you have in negotiation that you need to be careful about (too aggressive, too likely to quit searching for solutions once your; What do you feel you need to work on? What would you do differently next time?
I learnt that I could learn from the other team members if I let exchange of information flow. I also have to watch out for my aggressive nature.

· What did you learn in general?
I learnt the importance of reading the situation correctly and placing it in context if the situational matrix, thus, helping me deal with the situation in a correct manner. I learnt that even though a negotiation might involve many parties the key to success is exchange of information can greatly increase your leverage as a team.

· If this were a real case, what obstacles to joint problem-solving might you encounter; how would you overcome them?
The problem I foresee on a negotiation like this there could be mistrust toward a union like NALGO from other unions. They might think that we have a hidden agenda and that could be a problem. Therefore, it is important to build trust into the relationship so that we on the negotiation table we speak the same language and are aware of each others priorities. Also, it is possible that the unions have divergent priorities which could be a cause of disagreement. This can again be sorted out by exchange of information and understanding the other sides interests are linked to our interests and vice versa.