As much as there should be a sensible basis for proceeding with negotiation, the decision not to negotiate should also be based in a cool and dispassionate assessment of whether it is beneficial to continue.
Such a justification may arise either because the negotiation process has degenerated into an irrational exercise or because rationally behaving parties are unlikely to attain their objectives through negotiation.
Irrational reasons for the breakdown of negotiation may relate to either or both parties, or their respective leadership or negotiators.
Although the irrationality of one such critical actor may be sufficient to justify termination of negotiation by the other, it does not change the irrationality of the underlying cause.
Irrational reasons for choosing not to negotiate include:
- Consistent demands by one party or negotiator for unilateral concessions by the other before negotiations can proceed.
- Unrealistic offers proposed by the other party. This is sufficient reason to break off negotiation where the other party’s behaviour suggests no real interest in negotiation or no real understanding of the circumstances.
- Dishonesty, back-sliding by a party or negotiator or other persistent bad faith (e.g., prolonged delay in response to offer). A particular problem in this regard is where one party repeatedly employs the so-called “fair” strategy” in which the only response to an offer is the statement, “that’s not fair.”
- Ignorance or lack of sophistication concerning the purpose of the negotiation.
- The appearance that the other party views the willingness to negotiate only as a sign of weakness.
- The introduction of artificial barriers by the other party regarding what is and is not negotiable.
Such barriers should not be confused with pre-conditions.
There is nothing wrong per se in a party insisting the other provide some earnest (i.e., and evidence of good faith) or other consideration before any negotiation takes place.
However, where this is done, a similar demand may be made by the other side.
Consequently, a party who introduces a pre-condition must be prepared to match the other party’s pre-conditions.
Even so, negotiations can still proceed where pre-conditions are imposed, provided they are realistic and reasonable in nature. An unreasonable demand may thwart any prospect, such as a condition that would have the effect of giving the other party everything it is seeking, of a negotiated solution.
As a practical matter, effective negotiation requires a degree of co-operation by both sides. It cannot be carried on unilaterally. If the one party is behaving irrationally, the other may attempt to cajole a more co-operative approach, but it is highly risky to offer concessions in the hope of effecting such a change.
When confronting a failure to make progress, a party should always step back and self-evaluate to ensure it has itself behaved in a rational and appropriate manner.
If not, then a change of strategy can be implemented and a more constructive offer can be put forward to the other side to see if there is any real interest in negotiating a resolution.
Where the cause of the breakdown is irrational, the parties forego the opportunity to secure a gain through negotiation.
Where the cause is rational, there are no or insufficient opportunities for such gains or other options that offer a superior prospect of an advantageous outcome.
In such a case, negotiation may be wasteful, while time is spent talking, the opportunity for success by an alternative method may be lost.
Contrary to popular belief, talk is not necessarily cheap. Its cost needs to be assessed and that cost should be considered before deciding to negotiate.
Any person who engages in negotiation should always have the courage to walk away.
Unless a party is prepared to do so, it is almost certain that he or she will be pressured into a bad deal.
