Reflection on Newtown Negotiation

After two rounds of negotiation, our team (representing the Board) have come to an agreement
with the Union and resulted in a 3 years contract. Here is the analysis on the consequences of the
result.

Both parties enter the negotiation sharing one main interest: to keep the high-quality education
standard in Newtown, resulting in an agreement that all decisions from both Union and Board must
align with education quality. There are 5 key points that were brought on by both parties and serve
as a skeleton plan for the negotiation. The 5 key points are:

 Job security
 Teacher’s workload
 Salary
 Benefits
 Evaluation

As both parties are using collaborative strategy, Union team informed us that their highest priority is
to avoid the teacher lay-off plan. We then inform them about our goal, which is to balance out 2.5
million dollars in the Projected Budget. Both parties then agreed on maintaining the same number of
teachers, but then Board can reduce teachers benefits to reduce expenditure and balance the
budget. By maintaining the number of teachers, we have satisfied Union’s main interest, therefore
make the rest of this negotiation smoother, it also keeps the teachers worry-free about their job
security, so they can focus on delivering their best performance.

After examined the projected budget, both parties realise the numbers are inappropriately
calculated, for example the paper cost was projected to increase 46% from last year figures. We
suggested both parties to try and cut down any irrelevant expenses, such as reducing teacher’s aids,
switching from paper to digital documents, utilise cloud technology for administration, switching to
renewable energy and using water and electricity more efficiently. As a result, we have cut down 2.5
million dollars of irrelevant expenditures and successfully satisfied Board’s top priority interest. The
negotiation is now becoming more flexible for both parties, as well as changes that both teams
made to compromise for the budget down-grading will increase schools efficiency (digitalise data) as
well as educate students on protecting the environment (renewable energy and efficient energy
usage), hence help creates a more culturally-minded generation.

Teacher’s workload was receiving heavy focus from both teams as it is the direct consequences of
the lay-off plan, but since the budget has been balanced and there were no lay-off needed, the focus
on workload shifted from increasing working hours to redistribute teacher’s given hours (7 hours
and 5 minutes a day) more effectively. In short, both team agrees on reducing time on Prep time and
Duty-free time to create a new segment called “Consultation time” where teachers must remain on
campus, ready to assist students if needed. The introduction of “Consultation time” helps create a
more engaging and friendly environment between teachers and students, as well as encouraging
parents-teachers interaction, while keeping the working hours as is.

Board members have determined that Union’s BATNA is stronger and more certain, and we also fully
aware of the catastrophic dispute between the Union and our former Chairman, therefore we are
willing to offer more on the negotiation if we achieved our top interest – to balance the budget.
Hence the 2.1% salary raise every year in the 3-years contract, this is to match the country’s
projected cost-of-life increase. But instead of retroactivity which will be overwhelming for the
budget, both parties have agreed on a 1000-dollar one-time pay-off for all teachers, this is the
Board’s act of good-will, to compensate for our former Chairman attitudes which is an important
factor that lead to a delayed contract. These agreements in teacher’s salary are to ensure teachers
can afford their life expenses and can focus more on delivering the best education quality.

Both parties have agreed to reduce sick-leave and child-birth leave to ensure fairness among all
industries, but the new sick-leave and child-birth leave policies are still reasonably higher than
industrial standards. The Board acknowledged the importance of teachers to our education system
and want to ensure that teachers are provided enough time to take care of their family. Board and
Union will provide members to create an evaluation committee, and teachers are allowed to
challenge the review should it be incorrectly conduct, this helps promote transparency and fairness
in the education system.

In the team-planning state, after going through the information-briefing, we all automatically
prioritise the Commissioner’s interest (prevent the strike, budget issue fix) because firstly, it is an
“order”. The agency theory proposed by Stanley Milgram suggested that when human represents
someone with higher authority, we switched to the “agentic state” and put their interests as our
priority (). The second reason is because our individual interests are aligned with our constituent (job
security). Our team also consider the Union’s interest, given that they have a stronger BATNA,
knowing their interests will help deciding suitable strategies for our negotiation. Unfortunately, we
have failed to rank their interest accordingly, which leads to an initial defensive tactics from both
parties, as we try to hold on to all bargaining points instead of pin-pointing the important ones.
Eventually, with our team being transparent (integrative strategy) and utilise the logrolling
technique (Rapoport et al 1995), we’ve managed to ease the situation and got to know Union
priority.

After knowing how Union ranked their interests, we based our offer according to their job security,
and our budget issue. To avoid lay-off, Union must sacrifice their benefits, we took advantage of this
and pushed them into our offer by calculating roughly how much money could we saved according
to the offer (sick leaves from 12 days to 8 days for example) and further achieve the Commissioner’s
interest. We have targeted their fear of job security by deliberately lied about our BATNA, telling
them that we can just hire new teachers should the negotiation failed, and the Union team believed
it. Thus, allowing us to push the negotiation to our advantage.

It has been scientifically proven that humans are pre-programmed to obey the authority, it is part of
forming a society, the presence of hierarchy, as Milgram has explained in his series of famous
experiments (Milgram, 1974). This explains why our team took on the projected budget as granted
and decided not to question it accuracy in the planning stage, due to its formal presentation, the
whole team have assumed that projected budget has “Legitimate Authority”. It is until the Board
team faced pressure from the Union team threatened to cancel the negotiation, we started to revisit
our given information and recalled the lack of transparency from the former Chairman, the team
then decided to question the legitimacy of the projected budget.

Failed to realise there was a problem with our projected budget has changed our team planning,
point system and bundling drastically. Because the budget was taken for granted, the team then
shift our focus to the suggested 5 key-points mentioning earlier, tried to develop a point system and
bundles accordingly and fallen into a phenomenon called tunnel-visioning. Tunnel-visioning simply
means when the human brain is too focus on one aspect of the task, the person lost the overview of
the situation (Boer, 1995). We were too focus on combining those 5 key-points to satisfy the
Commissioner’s interest and seemingly “forget” to analyse other valuable information given and
narrowed our negotiation options. This has put the team in a worse spot during this negotiation,
because not only Union’s BATNA is stronger, our team do not have the flexibility to bargain due to
our strict bundles and is the consequences of the Board team accepting the projected budget.

In the team planning phase, our team, after analysing the given situation, concludes that the Board
has a weak BATNA. In case the negotiation did not end with a contract, the best alternative that can
satisfy our priority interest (job security) is to make a negotiation with the Commissioner, suggesting
decreasing the Board salary and limited our expenses to get more funds to compensate the budget
and continue negotiate with the Union for a contract. It could possibly help the team keep our job
but did not satisfy any other interest of the team members, such as financially independence (got a
decrease in income) and career advancement (due to the poor record of this negotiation). This
realization has forced the team to lean towards integrative strategies during our planning phase,
extending our resistance as well as lowering our opening and target points, the team also
approaching the Union with a friendly and submissive attitude, willing to offer more to keep the
Union in the negotiation.

However, as an individual, there are still possible BATNAs for myself to consider that will satisfy most
of my personal interest. One BATNA in my options includes myself arranging a private negotiation
with the Commissioner, in which I can deliberately worsen the negotiation with the Union and stop
both parties to come to an agreement, I can then offer the Commissioner to lay-off my 3 teammates
and use their enormous salary as extra funds to complete the contract with the Union. This BATNA
will satisfy the Commissioner’s interest in preventing the strike, and it will also help his re-election
campaign later. I will still be able to keep my job and my salary, as well as promotion opportunity for
helping the Commissioner sealed the deal.

Looking back at the negotiation, our team performance is reasonable, all members are well-
informed on the current situation, we have utilised the integrative strategy well by being
transparent and we learned to step back and re-assessing the given information, rejecting the
projected budget and opened other solutions to our negotiation. However, there are things on both
team-level and individual-level that we can improve on.

Team wise, our team needs to practice more team coordination, there were situations where not all
four members of the team agreed on an offer, but the lack of coordination and communication
means slower reaction and interference, which give the Union a chance to take advantage of our
team mis-matching opinions. In hindsight, we should have assigned specific rolls for each member,
such as lead negotiators, supportive negotiators and observer. This will assure smooth operation
within the team, hence better result.

Individual wise, I have not utilised chit-chat time to figure out extra information on the other team.
In this negotiation, I have allowed the Union members to take initiative in chit-chat and passively
responded, which exposed my team information and gain nothing in return. I should also be more
cautious on analysing given information, the “tunnel visioning” problem has caused me to develop
bundles and plans that are irrelevant after we found out about the inaccurate projected budget, the
team ends up wasting the whole planning phase and must revaluate on-the-spot our bargaining mix.

Overall, to continue becoming a professional negotiator, I need to improve my planning phase,

analysing given information thoroughly and with an unbiased manner, then I can narrow down
specific information that I need and cater a better chit-chat plan to find out. By retrieving enough
information, I can improve the outcome of the negotiation.
Reference list

Rapoport, A, Erev, I, Zwick, R 1995, “An Experimental Study of Buyer-Seller Negotiation with One-
Sided Incomplete Information and Time Discounting”, Management Science, l. 41, no. 3, pp. 377-394

Milgram, S. (1974) Obedience to authority. Harper & Row.

Louis C. Boer, 1995, HUMAN TUNNEL VISION AND WAITING FOR SYSTEM, Cambridge