Lovisha Arora, Author at Stitt Feld Handy Group

Sunk cost – wedding during COVID-19

2021-08-19 11:49 am Comments Off

Wedding

Imagine you have a wedding booked for May 2020. You’ve been planning for over a year, dealing with all the different vendors so that you aren’t having to last minute plan for your big day. You booked the venue more than a year in advance, the only way to ensure the dates. All your family and friends have booked the day of and are planning to attend, some of them have already bought dresses and clothes to wear. Then COVID-19 hits and everything shuts down. What do you do?

You’ve already spent considerable time planning the wedding, You have many non-refundable deposits paid that you can’t get back if you cancel. You might feel like if you cancel now the time and effort you spent planning is wasted. Additionally you feel like the money and energy your family and friends put in to help with the wedding would be wasted if you postpone.

That would be falling into the Sunk Cost Fallacy. No matter what decision you make now the non-refundable deposits are gone, the time you spent planning is gone, you can’t get it back, you have already sunk it in.

You need to focus on the best decision for you going forward regardless of what you have already sunk in. Think about what is important to you. It might be; celebrating with family, having a big party, being married as soon as possible, not spending much more money than you originally planned, or many other things. You should be making your decisions based on how you can best meet those goals based on the situation we are all currently in. Is that a 2 person ceremony, an online ceremony, a smaller wedding next year and similar wedding next year?

What is important in your decision making is that you are deciding based on what’s best for you going forward, not based on how much you have already sunk in to the wedding plans.

This doesn’t only apply to weddings. It can apply to many situations that we are all dealing with these days. Vacations, family reunions, holiday celebrations, birthday parties, graduations, ADR workshops and many more examples. We are needing to sometimes re-think how we make decisions and find creative solutions to meet our objectives even if we had already planned on meeting them in a different way.

If you’re interested in hearing more about the sunk cost fallacy, please watch this video (hyperlink video to https://www.sfhgroup.com/sunk-cost-and-the-sunk-cost-fallacy/).

To learn conflict resolution skills that you can use at work and in your personal life, please visit our Alternative Dispute Resolution Workshop page to learn more about upcoming in-person and instructor-led online sessions.

To improve your negotiation skills and get the results you want while negotiating, please visit our Become a Powerful Negotiator Workshop page to learn more about upcoming in-person and instructor-led online sessions.

To gain skills to handle difficult conversations and difficult people with confidence, please visit our Dealing With Difficult People Workshop page to learn more about upcoming in-person and instructor-led online sessions.

To make better decisions, we need to understand how our mind takes shortcuts and how those shortcuts trick us into making bad decisions. If you understand how your mind works and when it fails you, you will make better decisions. To improve your decision-making skills, please visit our Effective Decision Making Workshop page to learn more about upcoming in-person and instructor-led online sessions.

Tips to Improve Your Conflict Resolution Skills

2021-08-12 12:34 pm Comments Off

Conflict is bound to arise in any business. The conflict may occur between co-workers or with a client. An unresolved conflict has the potential to negatively impact the productivity and profitability of any company. Through an improvement in yours or your colleagues’ dispute resolution skills, a conflict is less likely to hamper the day-to-day operations at your workplace. Below are a few conflict resolution tips that can be easily followed:

1. Look at the Big Picture

Don’t focus on those who are bogged down in the conflict. There is little to gain by trying to resolve any he-said-she-said debates that may occur. Instead, listen to what each person says to try to figure out his or her specific needs and interests and the underlying issues. If attention can then be paid to addressing the underlying problem, there is a greater likelihood that a mutually agreeable resolution can be found.

2. Remember to Listen

Sometimes people just need to air their grievances. It is important to show the other person that you have heard what they’ve said. When you listen to somebody you are more likely to take a positive step towards the resolution of the conflict. Even if you don’t agree with what has been said, you have indicated that the lines of communication are open.

3. Address the Problem Sooner Rather Than Later

When you learn of a conflict, you should take all steps available to communicate with the parties involved at the outset. As the conflict tends to deepen the longer it remains unresolved, there is a heightened need to quickly address the situation that gave rise to the conflict. If you choose to avoid dealing with the conflict, then it is likely that the problem will become more difficult to resolve.

4. Get Conflict Resolution Training

An effective way to improve your conflict resolution skills is to receive professional training. You will learn new techniques to apply that should lead to the resolution of workplace conflict in a more effective way.

If you can de-personalize a conflict, actively listen, address the situation quickly, and seek out professional training, you will set yourself up for enhanced success in resolving disputes that may come up. Stitt Feld Handy Group offers alternative dispute resolution training to small and large businesses with courses in communication, negotiation, mediation and arbitration that use the latest adult education techniques. Contact us today to learn more about how to get started.

Three ways to effectively persuade others

2020-06-03 11:29 am Comments Off

A challenge that is currently facing many people in the world is how to persuade others to come around to their way of thinking. Many people who attend Stitt Feld Handy Group online conflict resolution training ask about effective ways to bring other people around to their way of thinking. This can be especially true in negotiations, or simply in disputes that people are having where they feel like the other person is not capable of seeing things from their perspective. In our virtual instructor-led conflict resolution training, we offer many pieces of advice on how to persuade others and below are four tricks that you can use.

One important way to persuade others is to listen. We often hear from participants in our online conflict resolution training that they talk to other people but the other people don’t listen to them. When people aren’t listened to, it is bothersome to the person speaking. There is a reason they are talking and generally a talker wants someone to listen to them. This is certainly the case when we are running our virtual instructor-led conflict resolution training and speaking to our participants. When we speak, we feel a lot better when people are listening. The real goal is to get the other person to listen to you and the number one way to get someone to listen to you is to listen to them.

We strive to implement different things from our mediation and negotiation teachings into our online conflict resolution training, and we implement the listening strategy to get participants to listen to us. In the virtual instructor-led conflict resolution training the interactive nature of the workshops allows us, as teachers, to listen to what the participants have to share. We have found that by demonstrating to the group that we are listening to them, our participants are happy to listen to us and to what we have to say.

A second method used to persuade others is demonstrating that you are open to being persuaded. In our online conflict resolution training we are often asked for quick and easy tricks to use to persuade others and this is the one that I give. We often go into a difficult conversation or a negotiation with a desired outcome in mind and are unwilling to be persuaded that we are wrong by the other person. As we discuss in our virtual instructor-led conflict resolution training, this creates problems with the other person because when we demonstrate that we aren’t likely to be persuaded by them, they are likely to demonstrate the same thing back to us and show that they are unlikely to be persuaded by us.

This unwillingness to be persuaded can be harmful to anyone attempting to persuade another person. The online conflict resolution training therefore gets to the issue and offers the idea that when we show the other person that we are willing to be persuaded by them, they are more likely to follow suit and demonstrate that they are willing to be persuaded by us. This is also why in our virtual instructor-led conflict resolution training we are open to hearing different thoughts from different people in our workshop. We are open to be persuaded by participants and it seems that the openness makes participants more willing to be persuaded by us.

The third way to persuade someone, as discussed in our online conflict resolution training is to use objective criteria. This involves taking factual information from outside the dispute or negotiation and using it to demonstrate that what you are proposing is in line with the norm. In our virtual instructor-led conflict resolution training we demonstrate the importance of having real factual information to stand behind, because that will be much more effective in persuading others rather than trying to persuade them subjectively.A challenge that is currently facing many people in the world is how to persuade others to come around to their way of thinking. Many people who attend Stitt Feld Handy Group online conflict resolution training ask about effective ways to bring other people around to their way of thinking. This can be especially true in negotiations, or simply in disputes that people are having where they feel like the other person is not capable of seeing things from their perspective. In our virtual instructor-led conflict resolution training, we offer many pieces of advice on how to persuade others and below are four tricks that you can use.

Our experience teaching online

2020-05-20 11:33 am Comments Off

As an instructor who is used to teaching workshops in-person, I initially had some concern about transitioning to Internet-based teaching. When making the decision to take the workshops in that direction, my colleagues and I wanted to make sure that the classroom experience could be effectively replicated in an online conflict resolution training platform. As instructors, we wanted to make sure that we were able to connect as effectively with our participants as we do in-person and that the programs would be engaging and as effective in developing dispute resolution skills. The idea of virtual instructor-led conflict resolution training may sound impersonal but luckily we have found this not to be the case. Not only have we found ways to build the personal connection we like to have with our in-person participants, we have also been able to identify some specific benefits to teaching online.

We have developed a number of strategies to develop the personal connection with participants. One strategy that we use to build connections is taking time to talk to participants individually or in small groups throughout the workshop. We set aside specific times during the online conflict resolution training to allow individuals to raise questions or make comments privately as they would be able to do quite naturally during breaks or over lunch during in-person training. We save comments made in the chat area and track who said what, so that we can refer back to a comment a participant made earlier in the program. Lastly, one of the topics discussed in the virtual instructor-led conflict resolution training is how to resolve conflicts using web-based platforms.

Another benefit of online conflict resolution training is the time saved by the participants. With the ability to attend the workshop from their home or office, virtual instructor-led conflict resolution training allows participants to simply turn on their computer, tablet or phone and be in the classroom. Not having to travel to the workshop venue provides participants with additional time to complete other tasks. Historically, participants have struggled at times to carve out the time necessary to attend a workshop in-person when they have other work and personal responsibilities to manage. Many participants have shared with us that not having to travel to a workshop venue has made attending workshops much easier and allowed them more time in the evening to prepare for the next day.

Something else that we noticed while providing virtual instructor-led conflict resolution training is the need for some additional breaks. We know that it is not easy or good for anyone to spend too long staring at a computer screen. Based on this, our online conflict resolution training includes additional short breaks that we did not have in our in-person workshops. The breaks give participants the ability to step away from their computers for a few minutes to rest their eyes and gather their thoughts without missing any content. Our experience has been that this is a great time for participants to reflect on the most recent exercise or lecture and to determine if they have any comments or questions.

One additional benefit of virtual instructor-led conflict resolution training is that it allows a much larger and more diverse group of participants to attend the workshops. In the past, unless the workshops were offered in their location or the participant could afford the time and money to attend a program away from their home, they were unable to access live workshops. With online conflict resolution training those participants can now attend the workshops, and all participants can benefit from participating in a program where they are drawn from a larger demographic area. We have run small workshops that included participants from three or more countries at a time, which enhanced the opportunity to learn in a cross-cultural setting.

Overall, as instructors we have been quite pleasantly surprised by how well our virtual instructor-led conflict resolution training has gone. We were confident in the value of the content that we were teaching and that we could address many of the same learning objectives from the in-person workshops. What we couldn’t know was how the transition to web-based training would impact the experience of the participants. The feedback we have received from the participants in our online conflict resolution training has been overwhelmingly positive and, as instructors, that is what we are always hoping for.

Having meetings that work

2019-08-03 12:02 pm Comments Off

Have you ever walked out of a 2 hour meeting with the feeling that you’ve just wasted two hours of time and accomplished next to nothing, or that something was accomplished but no-one is sure what? Even when we pride ourselves on being effective or experienced negotiators, we may be less successful than we’d like, particularly in contexts where we don’t necessarily see ourselves as negotiators. Other than our ‘negotiations’ at home, a perfect example of this problem is a typical meeting.

Now that time is increasingly at a premium, we can all benefit from a few simple guidelines on how to make meetings more effective. There are steps that we can take both before and during meetings to better use that time and better satisfy our goals. An effective encounter will not only make you feel better, but others in the meeting as well. You will present more effectively and accomplish more.

Meetings come in all shapes and sizes, from the single person being called into your office to discuss a particular issue, to the production line chat, to the room full of characters formally assembled to deal with a complex variety of topics (a kickoff meeting, for example). In many cases, the problem is that we spend time thinking about what we want to accomplish in these sessions, but not about how to get there.

Here are some common sense tips to assist in preparing for a meeting. Use them as a guide or even a checklist for the conduct of meetings, whether you are running them or just attending. Although not an exhaustive list, it provides a good overview of many key issues to consider. I deal first with issues concerning preparation and then with issues that arise at the meeting.

PREPARATION

a) Conceptual Issues
• Identify the purpose of the meeting.
• Identify what product is desired.
• Think about your role in the meeting.

b) Substantive Issues
• What are the interests (wants, needs, concerns, desires), which you would like to satisfy as a result of the meeting? Consider the interests of the other participants.
• Get the necessary facts;
– do you need advance submissions?
– do you need to interview anyone?
– review/research/find relevant documents.
• Research any policies, rules, or regulations applicable to the meeting issues.
• Does information need to be exchanged in advanced? Do views? How?
• What are the expectations of the other participants and do those expectations need to be addressed?
• What background information and objective fair standards need to be present to make the necessary decisions (financial projections, experts, photos, quotes, etc.)

c) Physical Issues
• What is the location that would work best for the meeting (neutral/your place/theirs)?
• Consider the environment for the meeting, including such issues as formality, the impact on parties, the physical setting of tables, chairs, windows, food, etc.
• What resources need to be present (e.g. overheads, powerpoint projector etc.)?
• Who should attend or be available by phone? Ensure all necessary parties are at the table.

d) General Issues
• Consider relationship issues (What is the relationship going into the meeting? What do you want it to be? What can you say to get it there?)
• Consider whether the meeting may need ground rules for procedure.
• Consider and design the process for the meeting (Who needs to be heard? How and for how much time? Which issues need to be addressed as priorities?).
• Draft an agenda (How formal? How do you get buy-in to the agenda? Input?).
• How do you communicate your ideas effectively (Presentation? Notes? Visuals? Order of issues? etc.)?
• How do you get others to contribute effectively (e.g. Do you give advance notice of the agenda so they can contemplate the issues and amend the agenda?)

DURING THE MEETING

Even when you’re in a meeting, there are many things you can do to move the meeting in a productive direction, whether you’re running the meeting or not. In my experience, if direction is lacking, most participants in a meeting will ultimately appreciate having a good structure developed for the meeting.

Among the issues to consider in terms of making the meeting more effective when you’re actually in the fray are:

a) Conceptual
• Identify and clarify the purpose of the meeting and any agenda up front without generating hostility. For example, you can encourage participation and buy-in by proposing an agenda, then asking for comments, changes, and additions, listening to and acknowledging the concerns of the others present.
• Clarify the interests (wants, needs, concerns, desires) of the parties present.
• Clarify the roles of the parties present.
• Maintain focus.

b) Substantive Issues
• Are the necessary materials, documents and information present?
• See items under (b) for Preparation.
• Don’t forget closure:
– summarize what’s been done;
– identify and outline the steps to be taken after the meeting (be specific);
– clarify expectations: who is to take what steps and on what time schedule;
– complete whatever you can while all are together (set the next meeting date and time, don’t just say, “we’ll meet later”);
– complete any necessary documentation; and
– take notes of necessary information.

c) Physical Issues
• Does the room environment need to be changed?
• Are the right people present and do they have authority?
• Are there agency/representation issues?

d) General Issues
• Are Ground Rules needed?
– Timing (of meeting, individual submissions)
– Respect / no personal attacks
• Clarify chair / facilitator role if appropriate
• Appoint chair/facilitator (should it be you?)
• Role of parties/ introduction
• Timekeeper?
• Are minutes necessary- who keeps them?
• Decide on how to structure the process (it may be the first, though hopefully not the only, thing the participants agree on).
• Manage the emotion; you can:
– Take breaks
– Acknowledge and deal with concerns
– Actively listen
– Remind of the ground rules if necessary

At the end of the day, many of these tips can be summarized simply as the 4 P’s:

• People – are the right people there?
• Purpose – why are you meeting?
• Process -how do you structure the meeting to achieve the purpose?
• Product – what do you hope to obtain?

A little time thinking about how you hold a meeting, particularly in advance while there is still flexibility, can reap tremendous rewards in terms of what you cover in that meeting. As an example, I was able, in one thirty minute meeting, to solicit two ideas each from 15 people, then spend 20 minutes on analysis of those ideas. How? By spending 3 short minutes at the beginning, outlining and clarifying the purpose and process of the session. Simply by spending five minutes thinking about some of the concerns listed above, you will see benefits in productivity, in morale, and in creativity.

Use of Alternative Dispute Resolution for marketing board decision making

2019-03-16 12:05 pm Comments Off

INTRODUCTION and BACKGROUND

Marketing boards and their counterpart in the U.S.A., co-operative associations, are constantly subject to political review, administrative tinkering, litigation, and challenge. Their existence confronts many assumptions that are made unconsciously in a society that values private enterprise and private ordering. The way marketing boards make decisions on terms and conditions of commodity pricing is often assumed to have a negative impact on market freedom. Dealing with this idea is obviously beyond the scope of this paper, and I encourage you to rely on Adam Smith and Karl Marx to get a sense of how broadly arguments about marketing boards are framed. The issue I want to consider is how best to make decisions, and how parties to negotiations and their advisors should approach decision making, based on the current context.

The current general structure of marketing boards in Ontario is the outcome of a long debate about re-balancing negotiating power between producers and processors. The basic thesis behind joint action by producers in Canada is the same as the argument set out in an American Supreme Court judgment by Justice Harry A. Blackmun, who stated:
Few farmers, however, so long as they could only act individually, had sufficient economic power to wait out an unfavorable situation. Farmers were seen as being caught in the hands of processors and distributors who because of their position in the market and their relative economic strength, were able to take from the farmer a good share of whatever profits might be available from agricultural production. By allowing farmers to join together in co-operatives, Congress hoped to bolster their market strength and to improve their ability to weather adverse economic periods and to deal with processors and distributors.
National Broiler Marketing Assn v. U.S. 436 US 816, 825-26 (1978)

Anthony Winson, in his book The Intimate Commodity: Food and the Development of the Agro-Industrial Complex in Canada (1993, Garamond Press, Canada, at pp. 87-88) argues that the negotiating objectives of producers have not been fully achieved, although negotiating power has been changed because of legislation that supports orderly marketing.

Negotiation is of course, the most widely used consensus-based decision making method, and negotiating processes can range from amicable to bitter. In my view, many of the negotiation techniques and styles that create extreme positions and damage stability are both unnecessary and dangerous in the context of commodity pricing. Breakdowns in negotiation are often a result of lack of preparation and planning over negotiation goals, and therefore ineffectiveness at the table, rather than lack of power. Such negotiations are often marked by too much emphasis on the distributive aspects of the situation (i.e. seeking to obtain all possible monetary benefit from the other side), and too little thought to the implication of the distributive approach on the industry as a whole (i.e., ensuring stability and long term survival of the market). (See Fisher and Ury’s Getting to Yes Toronto: Penguin, 1981 for a description of these styles and benefits and drawbacks associated with them.) This tension between integrative bargaining and distributive bargaining gets reflected in negotiation style and process as well as outcome, and the failure to reach an agreement that would be better for the subsequent loser in the arbitration process often reflects a failure to resolve this tension.

In Ontario in the last decade, processors have argued that negotiation rules and powers need to be revised. As examples, there have been calls to disband marketing boards, to amend the regulations to allow opting in by producers instead of compulsory membership, to exempt producers who are also processors from paying fees to marketing boards, and to require individual processors to negotiate specifically with those producers from whom they buy.

None of these requested changes has occurred, but there have been variations in the manner and scope of negotiations over time. My experience with various entities as a facilitator, mediator, and arbitrator in the agricultural commodity industry leads me to believe that additional negotiation training, more effective use of bargaining opportunities, increased use of neutral parties as mediators and facilitators, and judicious use of arbitration as a limited and informal method to resolve only distributive disputes, should allow the complex set of relationships in this sector to be maintained in a relatively stable yet flexible form.

Given the pressures in these industries, maintaining relative stability is no mean feat. When the wrong weather system can fundamentally change the quality and supply of product in a matter of hours, stability is hard to come by. When capital consolidation can shift the number of producers or processors, and sometimes both, significantly from year to year, relationships are easily upset. Finally, with domestic and international markets subject to enormous variations in accessibility, there is significant risk for processors who make pricing and volume arrangements in February for products that will be delivered in late August, processed and then sold later.

I have done work in several commodity sectors at the provincial level, and I will show why consensus-based decision making processes–i.e, negotiation and mediation with specific disputes, and facilitation with multi-party sector participants–are to be generally preferred over arbitration and adjudication, despite the legal power that certain boards or the Farm Products Marketing Commission may have. In addition, I will show how these sectors’ characteristics mean that even when arbitration is required, the adjudication process should be more informal and less adversarial than what would typically occur at a hearing. In short, consensus should be the preferred method of decision making in these sectors at all times, even if the power to adjudicate issues is available and may seem enormously attractive–or dangerous, depending on one’s perspective. We should keep sight of these characteristics in giving advice and assisting clients in these sectors with their disputes.

Factors Encouraging Consensus-Based Commodity Pricing and Sector Management.

Despite the battles that have raged over boards and their powers, there are numerous factors that encourage consensus based decision making, and should make participants in the negotiation process more able to use integrative bargaining methods.

A: Negotiation is mandated by the legislative scheme
First, of course, the regulatory structure allocates the power and the obligation to negotiate to these Boards. I do not intend to debate here the merits of marketing boards in general, or the intentions of the previous governments that set up these structures. Rob Wilson has given you some detail about the structures, and for my purposes I need only point out a few specific items. My point is that the legislation exists and creates a context in which all law-abiding entities must act. I will use the example of the Processing Vegetables sector, the one with which I am most familiar, to illustrate these points. I will be focussing on those items related to negotiating authority.

The Farm Products Marketing Commission in Ontario Regulation 440 (R.R.O. 1990, Reg as am.) has delegated its authority to manage producers by requiring them to be licensed by the Ontario Processing Vegetables Growers (the “local board”) “before commencing or continuing to engage in the producing or marketing of vegetables” (para. 10(a)). Processors are prohibited from commencing or continuing to engage in the processing (a broadly defined term) of vegetables unless they are licensed by the Commission (ss. 3(1)); in addition, the local board can prohibit any person from processing vegetables that have not been sold by or through the board.

The board also has the power to provide for “the control and regulation of agreements entered into by producers of vegetables with persons engaged in marketing or processing vegetables and the prohibition of any provision or clause in such agreements” (para. 10(j)).

Read out of context, this seems like a power that allows the board to set the terms that it wants. However, the Regulation also permits the Ontario Food Processors’ Association to appoint members to entities defined as “negotiating agencies”, which are “empowered to adopt or settle by agreement . . . minimum prices, terms, conditions and forms of agreement, charges, costs or expenses” [related to the production or marketing of vegetables].

Here then is the first characteristic: negotiation is a matter of regulation, and producers and processors are required to negotiate. If processors and the local board do not appoint members to the negotiating agency, the commission has the power to make the appointment, and if no settlement is reached, has the power to trigger arbitration or enforce a final offer. Industry members are therefore in the position of taking the negotiation opportunity or having a result imposed on them; i.e., of complying with the law or not being able to carry on their enterprises. Because the law reflects the state’s decision on how these relationships should be managed, then the legislation itself can also be seen as a statement of expectation. The expectation of the government should be that this negotiation process will be fair, or fairer to all parties than the alternative.

Whether this fairness is achieved in practice is another question, of course, and depends on the ability and resources of the negotiators themselves. (I leave aside for the moment, but will come back to whether granting a local board the power to negotiate on behalf of all producers as opposed to having each producer negotiate individually is the fundamentally unfair change in negotiating power.) The significant point from a negotiation theory standpoint is that the parties have a chance here to fashion their own negotiated result, and not have it imposed. The compulsion to enter into negotiations is different than a compulsion to settle. Here the parties have the opportunity to settle, and if they cannot, the dispute is resolved by a third party.

While a default to a timely arbitration process is necessary, especially in the context of annual crops, a negotiated decision is more acceptable and considered more legitimate to parties than adjudication. This opportunity is especially significant when the arbitration procedure is final offer selection. Parties who have a decision imposed do not often accept that their position was wrong (or at least more wrong than the other side’s) when an arbitrator rules against them. Instead, they often argue that the arbitrator made an error, that the evidence wasn’t given the proper weight, or that the lawyer did a bad job, and that the other side’s position is still unacceptable.

Giving up the power of joint decision making is a strategy that can lead to feelings of coercion and unfairness, even if the adjudication resolves the dispute for the present. Over time, the failure to reach a negotiated settlement leads to frustration, breakdowns in relationships, a waste of resources, poor communication, and instability in the industry.

From a dispute resolution systems design perspective, therefore, the legislation mandates
a) the requirement to negotiate,

b) the opportunity (but not requirement) to settle, and

c) access to a neutral third party in the event settlement cannot be reached.

This structure maximizes the opportunity for the parties to reach their own agreement, and creates risks if they do not, or if they refuse to participate. In my view, this approach also limits the power of parties to act unreasonably, and tends to create a climate in which a negotiated result is far more attractive and likely for the parties to pursue. In addition, this approach limits the otherwise potentially coercive power of the local board or commission, keeping these entities’ ability to prohibit processors from carrying on their business without approval distinct from setting contract prices and conditions. Setting contract price and conditions is therefore not an unfettered power, but is a process in which each entity has identical authority to participate and faces the same risk if settlement is not achieved.

In some sectors, conciliation or mediation is possible as an interim step between negotiation and arbitration. This step is consistent with the general goal of facilitating negotiation, for mediation allows the parties to negotiate with the aid of a neutral third party.

An interesting amendment to the processing vegetable regulation now allows the parties to settle at any time up to and including at the arbitration. Previously, there was a date on which the parties were required to tender final offers and after which they were not permitted to change their positions. Since the parties exchanged their offers simultaneously, this limitation had the effect of leaving the parties with new positions to which they were unable to respond. This adjustment, which allows the negotiation process to continue until absolutely the last opportunity, is a positive one.

B: The Negotiations occur annually

The second point is that this opportunity is of course repeated every year. The Regulation has a schedule of dates for completion of negotiation for each crop. The impact of repetition between the same parties in negotiating situations has been clearly demonstrated in game theory and negotiation training. The conduct of a party that knows it will be facing future negotiations with the same party opposite is usually different than that of a party facing a one-time only negotiation.

While on reflection this point seems obvious, it is often overlooked during negotiations. Parties are caught up in the moment, and lose perspective, competing over the limited margins that are available at the moment. However, the negotiations from one year are well remembered the next, and therefore completely competitive approaches, including threats to break off for instance, or strongly positional bargaining, are not sustainable over time; these tactics eventually become barriers to negotiating effectively. The annual occurrence of negotiations tends therefore to constrain such tactics within a more limited range than in single occurrence negotiations. This is not to say, of course, that positional bargaining does not occur, because some distributive bargaining is inevitable, but merely that completely competitive approaches have a limited utility in annual negotiations, and the opportunity for consensus should generally be more attractive than breaking off negotiations.

C: Interdependence

A related point encouraging consensus is the long term interdependence of producers and processors. Producers today have generally made significant capital investments in land, and equipment, and have significant annual expenditures in seed, fertilizer and labour in a high risk industry. The location of production is fixed by geographic and climatic conditions, with long term storage or long range shipping of raw product not being feasible for producers. This set of conditions demonstrates the reliance of producers on local processing capacity. However, the same limitations on storage and shipping create significant limitations on the ability of processors to source raw product, and processors also have major investments in processing capacity in their physical plant, transportation and storage systems for processed product, and labour. Each sector needs the other to be viable in the long term in order to maintain their own viability. The ability to force economic resources out of the other sector through price negotiations needs to be balanced against the need to protect the other’s survival. This interdependence should also increase the attractiveness of consensus based approaches to decision making. The arbitration process tends to push parties to the extreme position that they think can be achieved, while the risk of not achieving this goal makes a negotiated result more attractive.

D: Consistency

In light of the ongoing relationships that exist, despite changes to specific participants, the annual negotiations build the potential for achieving long term benefits, including realistic pricing expectations, and a consistent approach to pricing. For instance, parties can invest in obtaining strong market information, can develop independently verifiable data, and can agree on parameters and issues that would be persuasive and are therefore worth developing information about. Consistency also permits clear communication on issues, in that there are opportunities to correct and clarify problems over time, even if in a particular year some price factors are not completely agreed upon.

Consistency leads to more informed decision making based on objective information that is widely known, and reduces both the attractiveness and efficacy of extreme positions. Parties with experience negotiating with each other are less likely to try or be able to take advantage of temporary inequalities in information or opportunity because they are likely to be found out over time, and there will be repercussions in the next round.

E: Flexibility

Use of consensus based decision making also means greater flexibility exists to fashion detailed responses to specific industry or party issues. A final offer selection arbitration or imposed decision will generally be a precedent industry wide, and different terms are then difficult to manage and agree to. A negotiated agreement, however, can bargain around all issues at once, and develop a more refined solution; therefore, accommodation on issues of relatively different significance to parties is possible.

F: Stability

Parties to pricing agreements want to achieve as much industry stability and predictability as possible. Wild swings in prices can have devastating impacts in the short term, and lead to relatively permanent and unnecessary negative impact. Decision making by third parties reduces stability and predictability. However, where changes in regulations, treaties, price inputs, or markets can be anticipated by parties, allowances can be made over time to reduce the negative impact of sudden changes. In addition, even if allowances are not made in a particular year, potential impacts can be discussed and the parties can thus be better prepared to negotiate when changes actually occur.

Factors Leading to Ineffective Bargaining and Unnecessary Third Party Decision Making
Despite the factors that tend to produce incentives to bargain effectively and reach a consensus decision that is in the overall interests of all sectors, there are still significant breakdowns, too frequent resort to arbitration, and dissatisfaction within industry sectors. One philosophical factor is the general perception of unfairness or constraint on the part of processors who are required to negotiate or sell through a board. Again, this argument is beyond the scope of this paper, and I leave it aside for others to argue. Even accepting the current context, there are other factors that drive parties toward positional bargaining and a zero-sum approach to commodity pricing; a summary of them is set out below.

A: Distributive Aspects of Negotiation

The key point about the negotiation of commodity pricing is of course, that there is an unavoidable distributive aspect to it. A purchase and sale is better for a buyer at a lower price and better for a seller at a higher price, no matter how the remainder of the transaction is handled and no matter how amicable the process of negotiation has been. This transfer of resources generates significant pressure in the negotiation, and the impact of moving a price point is undeniable. The key issue then is how can this pressure best be handled so as to minimise the negative impact of this pressure.

B: Relationship Pressures

Although no longer as significant an issue in the Processing Vegetable sector, one of the key problems in commodity decision making generally is that parties tend to come together only when negotiating must take place, and when the pressure to deal with distributive issues is highest. The immediacy of pricing issues tend to distort both the willingness and ability of negotiators to take a longer term view of the industry as a whole. Relationships are not easily developed or maintained when distributive bargaining is taking place, and damage to relationships requires significant time and effort to repair. This concern may seem less significant than establishing a price, but negotiations among acrimonious parties are difficult and time consuming to conduct; in addition, settlements are likely to be less creative, more difficult to sustain over time, and more subject to suspicion and criticism that requires excessive effort to manage effectively. Parties who are suspicious are likely to engage in “reactive devaluation”, or immediate criticism of the other side’s proposal, just because it comes from the other side. Relationship breakdowns lead to negative interpretations and assumptions about the other side’s motives and statements, tend to make parties hide or limit the information that will allow effective decision making, and undermine the ability to take advantage of future opportunities or to deal with future problems.

C: Time Pressure

Although annual negotiation may limit the ability of parties to be extreme, the tight time frames also limit the ability of parties to manage the negotiation for maximum benefit. Time is at a premium in most negotiation situations, but the deadlines in agricultural commodities are especially significant. First, negotiations must be completed for the industry so that contractual arrangements can be made among individual producers and processors, and production commenced. This schedule has no flexibility in it. Second, there is often no chance to go back for more or better information, or to re-analyze a problem in light of information from the other side, or even to have an adequate opportunity to persuade the other side. Third, the trust required to change a position based only on the other side’s assertion (usually a rare occurrence anyway) is very difficult to generate and maintain in tight time frames.

D: Communication/Information Breakdowns

Since competitive markets are doing their negotiations at about the same time (Canadian and Ontario negotiations may trail the more southerly U.S. comparables slightly, but the information transfer is not instantaneous), rapidly changing information is gathered and processed while negotiations are occurring. Not all information will be revealed during negotiations, since all information about prices and growers in other markets cannot be divulged to competitor processors. In addition, complete information about a competitive market will usually not be available until some time after negotiations are finished.

This pressure can lead to last minute or new information being produced in circumstances that tax the ability of parties to handle it, and raise suspicions about its credibility and therefore persuasiveness. Parties under time pressure often have breakdowns in communication because they attempt to be fast, rather than efficient or clear.

Some information is easily and objectively verifiable, such as exchange rates, while other information is subject to significant differences in interpretation. As in all negotiations, creating the most persuasive argument about information can lead parties to feeling that they are being manipulated, with the predictable negative result in the negotiation.

E: Volatility of Conditions

Processors face large risks in buying at a fixed price today and selling at an unknown price in the future. Producers have some level of certainty about pricing when they start production, but face the risk of not being able to deliver in the proper volume or quality if growing conditions are not appropriate. Both parties understandably try to minimise these risks, and one way to do so is to have the price move to the “safest” point possible. All such attempts to bargain for factors that are not within the control of the parties tend to lead to arbitrary positions, anchoring, and equally stubborn resistance, for two reasons: first, since it is not possible to predict with certainty that a negative impact will occur, and because a negative impact for one party may well be neutral (or even a potentially beneficial bargaining point) for the other, there is no incentive to share any risk; second, there is no mechanism to “return” a concession in the event the negative event does not occur. Parties are therefore left to manage and spread risk as much as they can by negotiating cushions into pricing that can only hurt the other side.

F: Processor Position in Food Chain

Food processors bargain with the collectivity of producers through the marketing board, and sell processed product into a highly concentrated food retailing industry. Although there are processor collectives for price bargaining for raw product, processors are competitors. They cannot unify to the same extent that producers can, and they have a very limited market power to command an adequate return for their finished product.

Anthony Winson’s Intimate Commodity, which I have referred to above, reproduces a chart based on Michael Porter’s work on analyzing competitors in industries. He sets out the following summary of relative bargaining power:

Determinants of the Relative Bargaining Power of Buyers v. Sellers

A buyer group is powerful when a supplier group is powerful when

•it is concentrated or purchases large volumes relative to seller sales

•it is dominated by a few companies and more concentrated than the buying industry

•products purchased are standard or undifferentiated (i.e. commodities)

•it sells products with few substitute products for sale to buyers (highly differentiated products)

•buyers incur few costs when switching to alternative suppliers

•buyer is not an important customer of the supplying industry

•buyer poses a credible threat of backward integration

•supplier’s products are an important input to the buyer’s business

•supplier’s product is unimportant to quality of buyer’s products or services

•supplier group poses a credible threat of forward integration

•buyer has more complete information

•buyer can influence consumers’ purchasing decisions

Using these criteria, Winson’s conclusion is that food retailers are enormously powerful in Canada. He also cites the “index of concentration” test, used to assess mergers for anti-trust purposes in the U.S.A., and finds that the index of concentration in the Canadian food retailing industry is eight times greater than in the United States, far beyond levels that would trigger anti-trust review of the industry. Processors clearly have significant difficulty therefore, in managing both input costs of raw product and the processed product sale price. Pressure from retailers to lower prices creates pressure to lower prices at the raw product phase, regardless of the potential impact on the producer. A distributive approach to bargaining is a natural result.

G: Criteria for Pricing

Another issue that tends to create distributive, rather than integrative bargaining, is using a cost of production approach to pricing. While this approach is not typical of the Processing Vegetable board, cost of production has been used in the potato industry and has been argued by processors in the grape industry as a pricing tool. That it has been used on both sides of the fence approach shows that this approach is used when it is seen to be advantageous, and when the commodity is considered only as an input cost, rather than a marketable product in itself. The difficulty with cost of production pricing, however, is that there is no incentive for efficiency on the part of the producer, and no or only a very indirect relationship to changes in the market value of the product. Both these problems tend to make negotiations using this approach excessively detail oriented and, over time, somewhat parochial. Negotiations over changes to an industry and the value of the product in the market are not adequately dealt with, because the processor’s relationship to the final market has no bearing on pricing for the producer.

H: Bargaining Teams and Multiple Parties

Although there is safety in numbers, there are also logistical problems associated with negotiating in teams. Teams are more difficult to manage than individuals, and decision making can be bogged down. Boards have a democratic structure that may require ratification before offers can be accepted, while processors may have differing particular objectives within a generally agreed negotiating framework.

Varying priorities among different parties on the same side can get traded off in ways that are individually problematic, even if they are acceptable overall. For instance changing prices based on production methods can shift returns for producers, while adopting premiums for certain characteristics may have significantly different impacts on total expenditures for processors with different needs.

Also, while producers and processors may have concerns for the industry as a whole, there may not be concern for individual producers or processors. Changes that may not be bad for the industry as a whole could have a significant negative impact on an individual grower or processor, and the negotiation process will break down as the parties look to their individual interests and survival, regardless of what might be reasonable across the sector.

Responses to Tendency to Bargain Distributivity

As can be clearly seen, as many or more pressures to bargain distributivity exist as pressures to bargain integratively. If however, the long term difficulties of distributive bargaining create problems, waste resources, lead to breakdowns and ultimately damage the industry, how can these pressures be handled more constructively?

First, naturally, there must be recognition that some of these negative impacts are unnecessary; more explicit regard for negotiation process helps parties define their goals more clearly, and adapt the process to achieve those goals more explicitly. For each of the factors listed above, effective negotiators can limit the negative impact of distributive bargaining and maximize the opportunity for integrative bargaining.

A: Distributive Aspects of Negotiation

Clearly, there must be some distributive bargaining to set prices. However, the issues where distributive bargaining should be clearly defined. Since distributive bargaining techniques such as anchoring on positions, establishing “bottom lines” for bargaining, and setting final positions on a “take it or leave it” basis may be accepted and used by all parties for pricing issues, there may be opportunities to ensure that these techniques are limited to those issues for which distribution is necessary, and not used in those areas where parties can establish more creative options, develop mutually beneficial strategies, and increase the value of the industry as a whole.

Where distributive bargaining reaches an impasse, there are of course many techniques such as splitting the difference, flipping a coin, and trading concessions, that can be used to preserve certainty and achieve a result that may be better than a loss at final offer arbitration. However, even if arbitration is used, it should be limited to those distributive issues that parties have been unable to resolve, for two reasons. First, on integrative issues no arbitrator is likely to be able to establish a decision that would be accepted as legitimate, nor is an arbitrator likely to be able to satisfy the goals of the parties by choosing one from among a variety of options. On distributive issues, objective criteria will help to establish a framework that will allow the arbitrator to be confident in reaching a decision, and the parties will not be required to give in on the distributive point.

However, in light of all the factors that affect bargaining, it clearly is not useful to engage in a price setting adjudication that eats up resources out of proportion to the process and damages relationships and future negotiations unnecessarily. The price setting process is still subject to all the timing and information constraints that affect the industry generally, and is meant to be a relatively summary and informal process. Parties generally do not exchange information until the day of the arbitration and have limited time to review and respond to it. Arbitrators are subject to strict time limits for hearing the case and issuing a decision, which reduces the opportunity and scope for excessive weighing of detail. Finally, the use of final offer selection with parties who conduct repeat negotiations leads to presentation of relatively reasonable positions, rather than to having extreme positions presented in the hope of a windfall.

Therefore, the arbitration, although distributive in nature and conducted as a hearing, should also retain a perspective on the purpose and goals of the overall process: to establish a price for product for the year, in an industry where the parties have long term relationships and recurring negotiations. This should result in the arbitration being considered as one of many annual steps that will continue to occur, and the arbitrator should try to ensure that the decision will re-inforce as much as possible the approach and objectives of the parties in those cases where they have reached a negotiated settlement.

B: Relationship Pressures

Another way to manage these integrative issues is to develop good rapport among representatives, by developing relationships away from price negotiation settings, in order to create realistic expectations, and to develop knowledge of each other’s goals and constraints. These investments will allow the negotiation to be conducted more effectively and efficiently. During the negotiation process, effective listening techniques can maintain relationships by demonstrating understanding (not acceptance) of the other’s perspective, thereby avoiding unproductive rehashing of opposed positions. Maintaining some of the same people on negotiating agencies for several years can develop consistency and rapport that will make negotiations more efficient, and transfer that efficiency to subsequent bargainers.

C: Time Pressure

When parties can develop relationships outside of the regulated negotiation process, they can do preliminary work on negotiation rules outside of critical times. For instance, they might agree on the form of documentation, on issues that should be addressed, on locations for meetings, on ways to manage the time available, on ways to efficiently exchange information, on sources for certain information. All these steps can be taken even if the substantive information will not be available, so they can manage the available time most effectively.

Despite these efforts, however, there will always be time pressure, and explicit recognition of this pressure should also create a level of tolerance, allowing the parties to give each other the benefit of the doubt, so they can focus on substantive issues rather than the lack of time available to deal with them. Tolerance of course requires discipline, rapport, and effort to implement.

D: Communication/Information Breakdown

Again, planning and preparation, ground rules, and an agreement before the process commences about what will be acceptable and useful information can reduce or eliminate unnecessary conflict during negotiation. Communication is often the first skill to break down under pressure, because anger, frustration or fear of losing can take command of the situation. In these situations, there is no substitute for listening effectively, not in order to change one’s position, but in order to demonstrate that the other side has been heard. This breaks the impasse cycle of repetition at a higher volume, and allows the parties to move on to other issues or resolve the one at hand.

E: Volatility of Conditions; and F: Processor Position in Food Chain

There is no effective way for parties through negotiation on product prices to change external conditions or the underlying structure of the industry. Assuming that on reflection the parties agree that these items are not properly part of pricing, then they should be excluded from the negotiations, and be part of the ongoing dialogue about industry matters that can lead to joint actions in support of each other. Making these issues explicit for all parties, will keep them in proper perspective.

G: Criteria for Pricing

Because pricing is usually more market than cost oriented, formula pricing is not attractive to most parties. Therefore, establishing strict criteria for pricing is resisted. However, a list of price issues can often be developed that will allow parties to prepare effectively and have an efficient process. Priorities and emphasis may change over time as market pressures shift, but if the type and sources of information available are well known, the disputes associated with using them will lessen over time. If possible, parties can seek to reach agreement on how to manage items that are not controlled by either but that do affect pricing (e.g., exchange rates), to develop consistency in pricing and save time.

H: Bargaining Teams and Multiple Parties

There is no substitute for training and preparation. A thorough internal negotiation should be completed before the price negotiation commences, so that negotiators understand their various interests and goals completely and can work with them. Many tools can be used to ensure effective management of the situation, such as a plan for dealing with disputes that may arise during the negotiation, including ground rules to avoid committing unless all are agreed, an agreement to give an opportunity for the teams to meet separately, and an agenda (including timeframes) in order to ensure all issues are adequately explored.

Mediation

Despite all of the planning and preparation listed above, there can still be breakdowns in negotiation. Parties who are directly affected by the outcome of the negotiation can lose perspective, or become focussed on particular goals rather than an overall result. In these situations, a mediator can help the parties by managing the exchange of information, by ensuring effective communication, by keeping parties focussed on their goals, and by establishing and enforcing ground rules to keep the process moving.

A mediator or facilitator is often used when parties are facing conditions that can affect price, such as storage, quality, or handling, while there is still room to bargain. In these situations, the mediator can help by managing exchanges to avoid the risk for parties who would be uncomfortable making unilateral offers.

Conclusion

Both producers and processors must negotiate in a particular framework mandated by the marketing board legislation and regulations in Ontario. The annual repetition of the process leads to opportunities for real gains, relative stability, and efficient allocation of resources in the agricultural sectors. However, these opportunities will only be realized if negotiators work effectively. When they do not distinguish between distributive and integrative bargaining, negotiators can unnecessarily damage future negotiations and miss opportunities for gain.

Avoiding this unnecessary damage should be a primary goal for negotiators and their advisors, even if they must use arbitration to set the terms of agreement. As consensus based decision making techniques improve, there should be fewer unnecessary disputes, and increased stability and predictability in the industry, to the benefit of all involved.

Written by Frank Handy.

The warning signs of a difficult employee

2018-12-10 11:57 am Comments Off

Published by Human Resource Director

Written by Emily Douglas

Dec 10, 2018

https://www.hrmonline.ca/hr-news/corporate-wellness/the-warning-signs-of-a-difficult-employee-251679.aspx

The workplace is a rainforest – a delicate ecosystem that needs to maintain a balance in order to flourish. If one element is out of sync with the rest, the whole environment suffers and may collapse.

Difficult employees are the bane of any civilized office. The snarky remarks, the lack of discipline and the general unease which difficult employees create can make even the most professional of managers snap.

HRD spoke to Elinor Whitmore, Vice President of Stitt Feld Handy Group, who detailed some warning signs of a potentially problematic employee.

“First, it’s essential to distinguish between a difficult employee and an employee who may be currently struggling with a personal issue or other challenge” prefaced Elinor.

“HR leaders should watch out for employees who’re unwilling to accept or act upon feedback or are continually blaming others for their short comings. If you find that their colleagues are complaining or gossiping about them, this could also signify that trouble is brewing. Employers should also monitor workers who show uncivil behaviour towards their colleagues. These are all signs that you may have a difficult employee on your hands.”

There are also more subtle signs that are often attributed to more passive-aggressive behaviours. For example, Elinor mentioned the following examples: “Raising their eyebrows when a colleague is speaking, appearing to go along with a request but then not following through and generally making up excuses,” she told HRD. Elinor recommends being alert to passive-aggressive behaviour or any other behaviour that requires an HR leader to spend a disproportionate amount of time managing an employee or the fallout of that employee’s behaviour.

However – a word of caution. Just because employers have spotted and diagnosed these signs of a difficult employee doesn’t mean they should rush in all guns blazing and tear up their contracts. The legal ramifications of firing a worker for just being annoying or troublesome could culminate in a costly lawsuit.

“Mishandling a difficult worker could end in being sued,” added Elinor. “Or the employee in question could file a formal grievance, take you before a labour board or even before a Human RightsTribunal. Getting the disciplinary action wrong is risky even with a well-mannered worker – the situation is exacerbated when it comes to a difficult one.”

But it’s not all about the legalities. Elinor was quick to point out that even if the employee isn’t successful in their lawsuit or other claim, the damage has already been done.

“The amount of time and money spent defending a formal complaint is monumental,” she explained. “However, the damage to an organization’s brand is equally, if not more, costly.”

Turning Conflict into Collaboration

Conflicts are part of almost every interaction, be it between individuals or businesses. The differences in habits, attitudes, convictions and individual preferences ensure that no two entities

operate in the same way.

The usual outcomes of conflict

Depending on the importance of the relationship between the parties, the possible outcomes of conflicts include:

• Avoidance: Pretending that an issue does not exist. This common mistake negates the opportunity for conflict resolution. The conflict may fester and spread to other areas.

• Competition: In workplaces, instead of facing the issue and resolving the conflict, people may suppress it. Unnecessary competition and mistrust resulting from this can lead to loss of communication, team dynamics and even jobs.

• Compromise: If a business relationship is important to one of the partners, conflicts may be resolved by giving in to the demands of the other party. These compromises are often grudgingly made, and the underlying dissatisfaction may lead to the breaking up of the association later.

• Accommodation: Both the parties may give in to each other’s demands when the association is equally important to their businesses. While it may seem like a fair deal, constant disagreements and blame-games may decrease productivity.

Why collaboration is a better alternative

The usual outcomes of conflicts have negative connotations. No constructive growth can result from negativism. It’s a temporary truce at best. The usual outcomes may be sufficient to meet short-term goals, but not to achieve lasting peace and progress. On the other hand, collaboration is a long-term solution. It brings in the synergies of common goals and creative inputs from everyone.

How to turn conflict into collaboration

The first step in turning conflict into collaboration is education, through conflict management training or a conflict management workshop. Some major points are outlined below.

• Change the attitude: Conflict is normally seen as a minor war in which both the parties try to hold on to their weapons and one-upmanship. It should be ideally viewed, however, as an opportunity for greater growth. This change of attitude is the first step to collaboration.

• Listen to all: When people sit across a table to discuss issues, often everyone is too busy expressing their own views and opinions to listen to what others have to say. An attempt at collaboration should ensure that all the issues, facts and viewpoints are brought to the table, and all are heard.

• Remove the emotions: Conflicts are more often than not emotionally charged. People feel threatened when their ideas are rejected and their suggestions are opposed. They react with anger, resentment and frustration. Objectivity is lost when emotions are present. Separate the issues from the emotions and give full attention to the facts.

• Search for common ground: When free exchange of aspirations and ideas takes place, you may come across some common ground that can be the basis for the journey forward. Identify common goals and areas that can benefit from cooperative effort. Make a note of resources that can be shared and people who can work together.

• Reach an agreement: All the discussions during the search for common ground are geared towards reaching an agreement that is in the best interests of all the parties involved. Marsha Shenk, a pioneer in Business Anthropology, calls it the “agreement for results”.

• Set goals: To bring a collaborative effort to fruition, words should be translated into actions. Setting short-term and long-term goals within a framework of time and achieving milestones is very important.

Collaboration is an ongoing process. For it to be successful, the exercise of finding common ground, making agreements, and setting goals should be repeated over and over again until it becomes a habit. It takes mindfulness about the common goals and strong commitment to follow through. These tips can help, along with courses in conflict management training or at the least, a conflict management workshop.

Why Role-Play Based Training is Highly Effective

2017-04-13 12:10 pm Comments Off

Stitt Feld Handy Group provides training and education for busy professionals in the areas of negotiation, mediation, arbitration, alternative dispute resolution, and communication skills. Several key methods have been developed for teaching this material, however, experience has proven that courses offering interactive education provide the most applicable skills. Through the use of role-play exercises, students engage in a simulation of a conflict or problem, and work through that problem with the guidance of their instructor. This method facilitates cooperation amongst students, and provides the best possible environment to learn how to resolve conflicts. Here are some of the top reasons why role-play methodology is so effective:

1. It is Engaging: Every executive, manager, and employee of a company knows that continuing education can sometimes be a challenge. Through the use of role-playing exercises, people work in groups, move around the room, engage in discussion with instructors and with other students, and utilize their time engaging in the educational activity, leaving no room for loss of interest or attention.

2. It Provides Retention: When training employees, it is important to utilize time wisely and effectively, to ensure retention of the knowledge and skills learned. Role-play exercises are far more memorable for students, and more likely to help them retain the central tenets of the seminar. Furthermore, role-play exercises are tailored to suit specific training needs. Addressing real-world problems with role-play, and placing the students in simulations of real-world situations, is the best way to get the material to stick with participants long after they have left the classroom.

3. It is Instantly Applicable: For training to be successful, the information given needs to be instantly applicable when the student returns to work. Using role-play techniques in the classroom takes the material off the page, and manifests it as a real skill that students can use effectively by the time the seminar is completed. Whether they encounter their first conflict the next year or the next day, they have already tested the concepts and skills in the classroom, and will be prepared.

Mediation 2017: Roundtable

2014-05-22 9:00 pm Comments Off

This article was originally published in Who’s Who Legal: Mediation 2017. For the original post, please visit http://whoswholegal.com/news/features/article/33990/mediation-2017-roundtable/

Who’s Who Legal brings together Alan Limbury at Strategic Resolution, Rosemary Jackson QC at Keating Chambers, and Allan Stitt at ADR Chambers to discuss recent developments in the field of mediation, including its increasing popularity, the future for younger practitioners, and potential challenges facing the practice area.

Roundtable

Mediation remains an increasingly attractive form of dispute resolution for businesses – what would you say are the main driving factors behind this trend?

Alan Limbury: While judges, politicians and litigation lawyers tend to value mediation for its speed, confidentiality and efficiency in achieving “settlement”, businesses, for which disputes are a regular by-product of doing business, increasingly recognize the value of mediation as a way to explore creative solutions that lead to “resolution”. By this, I mean an outcome that:

meets the underlying interests of the disputants (rather than the positions over which the law encourages them to fight);
Supports the restoration of relationships where appropriate; and
may be achieved early in the dispute because it is unnecessary to complete the pretrial processes before the
Dispute is considered “ripe” for mediation.
Indeed, with advice from mediation-savvy lawyers, even businesses not accustomed to handling disputes are discovering this attraction of mediation.

Rosemary Jackson QC: Undoubtedly, the costs of litigation and arbitration continue to be one of the main driving factors, as businesses begin to see mediation as a speedy and cost-effective way of resolving disputes. I mediate many disputes where, despite cost-budgeting being controlled by the court, each party has projected costs of £1 million or more (sometimes much more). In comparison, the costs of a mediation are modest. In addition, I think many decision-makers welcome the opportunity to take back control and resolve their disputes face-to-face, having seen what happens when the legal process takes control and drives them further apart rather than closer together.

In construction disputes, I think businesses are finding mediation particularly attractive because of the ability to agree to carry out, complete, or rectify works as part of the settlement – things a judge or arbitrator cannot order.

Allan Stitt: Business people aren’t in business to fight lawsuits. They’re in business to provide products or services, and to make money in the process. And never does the business plan treat costs spent on unpredictable litigation as positive. So, business people want to resolve their conflicts if they can do so on a reasonable basis.

Mediations produce settlements when parties can look at arguments, assess risks, and make decisions that factor in the benefits of avoiding the risks. Business people are used to that. They assess risks every day and see the benefit of focusing on making profits rather than on proving that they are “right”. So business people increasingly see mediation as a way to resolve disputes and stay focused on what they do best.

Have there been any sectors in your jurisdiction that have witnessed a significant growth in mediation being used as a form of dispute resolution?

Alan Limbury: The passage of state legislation in areas of perceived power imbalances has created schemes requiring use of mediation before litigation may be commenced. This has produced significant growth in mediation in areas such as family law, farm debt, small business, and retail tenancy disputes, to name a few. Federal legislation requires applicants to file a statement of what “genuine steps” were taken to propose or use ADR techniques before commencing proceedings, and respondents are required to state whether or not they agree with the applicant’s statement. Lawyers are required to advise their clients of this regime or personally have to pay costs. Busy trial schedules are an ongoing incentive for commercial judges to pressure or be willing to order parties into mediation. All of these measures have seen growth in the use of mediation over the last 25 years.

Rosemary Jackson QC: The growth of mediation in construction and engineering disputes in the UK has been phenomenal. Cost budgets filed with the Technology Court for approval by the judge routinely include the anticipated costs of a mediation. The question is now at what stage the mediation will be most effective, rather than whether to mediate.

Public finance initiative (PFI) projects are increasingly turning to mediation or assisted/facilitated negotiation to seek to resolve disputes. As many school and hospital projects have moved into their operational phases, parties find themselves dealing with disputes relating to the construction work as well as the provision of facilities. Given the length of many PFI projects, I am finding that parties are willing to explore whether they can reset their relationship to enable them to work together for the operational period rather than endure serial adjudications and bad relations for the next 20 or 25 years.

Allan Stitt: There are several sectors that have seen significant growth in mediation over the past decade. One of the big growth areas is estate disputes.

Resolving conflict around the interpretation of wills is often contentious, emotional, and costly. One of the challenges is that, because costs of litigation are often paid by the estate, those fighting sometimes don’t feel as though the process is costing them anything. And family fights are often personal.

A skilled mediator can help feuding family members see that the costs are real, and that there are benefits to putting the grievances behind them and moving forward with their lives. The mediator can help family members see that they don’t have to agree to be best friends, but that they can agree to move forward in ways that make sense for everyone

Sources have noted that the market remains tough to get into as better-established and well-known mediators tend to secure the majority of the large mandates. Is this the case in your jurisdiction? Is there a place for younger practitioners in the field?

Alan Limbury: It is said that the hallmark of a profession is: “There are 2,000 members, there is work for 200 and it is all done by 20.” In Australia, well-known mediators certainly do secure the majority of the large mandates. However, I believe strongly that there is a place for younger practitioners, including non-lawyers. There are already instances of this happening. Community justice centres and community legal services provide opportunities for younger practitioners, and some pro bono mediation services provide experience to younger mediators through a co-mediation model. The key to building a mediation practice for young practitioners seems to be having had some sort of previous life experience, and reputation, preferably in a field in which disputes are common, so that there is an existing network familiar with the new practitioner from which work can be sourced. International mediation competitions in which students participate also provide opportunities to build skills and networks.

Rosemary Jackson QC: Mediation is such a personal skill that I believe parties (or more usually their lawyers) are unwilling to take a risk on a mediator they have not used previously, or who has not been personally recommended to them. This does mean that the same mediators are used time and again, and newcomers struggle to establish themselves. I suspect that the problem may get worse for younger practitioners in the future. This is because I anticipate an influx of soon-to-retire lawyers who are thinking of becoming mediators. The wisdom of age, the fact that they are known in their fields, and their experience in dispute resolution may mean they are perceived as a safer bet than young entrants.

Allan Stitt: It is true that there is a 90/10 rule in mediation: 10 per cent of the mediators do 90 per cent of the work. That is true in most Canadian jurisdictions (and most jurisdictions around the world). The reason is that the people who are choosing their mediators generally prefer an experienced mediator (and someone they know or have experience with) over someone who has little or no experience. And that makes sense.

Younger practitioners need to gain experience and develop a reputation in a field that interests them so that those choosing mediators will want to select them to mediate. It may take some time to develop the reputation but that is what is usually required.

What do you envisage to be the biggest challenges facing mediation over the next few years?

Alan Limbury: The biggest challenge will be to resist pressures on the flexibility of the mediation process, which should be designed, in each case, to meet the needs of the decision-makers, as distinct from the needs of courts or lawyers, well-intentioned though they are. Those pressures include misguided moves to define mediation as a process “entered into voluntarily” instead of a process designed to produce an uncoerced outcome. Such thinking precludes court-ordered mediation, which has been operating successfully in Australia since the early 1990s, and precludes mandatory mediation before litigation in cases of perceived power imbalance. Another pressure is the prevalence of former judges (often untrained in mediation) engaged by litigation lawyers as mediators because of their “gravitas” and ability to force “settlement” without regard for the prospects of achieving “resolution”. These mediations are often no more than facilitated settlement conferences, which pay no attention to the interests of the parties or the value of their relationships.

Rosemary Jackson QC: Parties, and more particularly, their lawyers, are becoming so experienced at mediation that they begin to use it as a tool, rather than a means of achieving settlement. Unwillingness to engage in any negotiation at all sometimes results from the need to go away and digest information learnt at the mediation, but sometimes it seems as though a party attended solely to gather information, without any intention of trying to reach settlement.

Allan Stitt: Commercial mediation has seen huge growth over the last 25 years. In many jurisdictions, it is now part of mainstream litigation and is accepted as part of the “system”. That is both good and bad. It is good because it means that mediation is being used. But it is bad because being part of the system inhibits creativity.

Too often, mediation is becoming an exercise in shuttle diplomacy, where the mediator is just the messenger who just passes offers back and forth. That may be good and necessary in some cases, but in others, the mediator needs to be more creative and to assist the parties to overcome challenging obstacles. The challenge for mediators is to stay creative and not just mediate a particular way because that is what they are used to.

Seven Tips for In-house Counsel for Faster, More Cost-Effective Arbitration

2012-12-07 12:12 pm Comments Off

This article was originally published in the December 7, 2012 issue of the Lawyers Weekly published by LexisNexis Canada Inc.

Barry Leon & John Siwiec

In this, our companion piece to “Seven tips for faster, more cost-effective arbitration” (The Lawyers Weekly, September 14, 2012, page 13) we focus on what in-house counsel who negotiate arbitration clauses or manage arbitrations can do to achieve faster, more cost effective arbitrations.

Our first article focused on procedural approaches used in international arbitration that can lead to faster and more cost-effective arbitration in Canada: an early procedural hearing; empowering and trusting the arbitrators; limiting document production; limiting oral discovery; submitting witnesses’ evidence efficiently, and agreeing on specifications for awards.

Here are seven tips to help in-house counsel realize the benefits that arbitration offers by making more informed and effective decisions both when negotiating arbitration clauses and managing an arbitration.

1. Understanding the features of arbitration

Understanding the features of arbitration and how it differs from court litigation is integral to achieving the advantages it can offer. With the growing use of arbitration, today’s in-house counsel need a basic understanding of arbitration that can be applied to negotiating arbitration clauses and managing an arbitration when a dispute arises. An understanding of arbitration should be acquired in advance, not by learning on the job.

2. Negotiating dispute resolution provisions

Because arbitration’s key feature is “party autonomy”, there is an opportunity to agree with the opposite party on almost every aspect of the arbitration. In contract negotiations, tactical advantages can be gained by taking time to consider the company’s dispute resolution objectives. Too often the dispute resolution clause is left until the eleventh hour. Consideration should be given to the types of disputes likely to arise in relation to the contract, and which dispute resolution process(es) would fit the company’s interests and objectives. If arbitration is chosen, consider the appropriate seat of arbitration, the appropriate number of arbitrators, arbitrator qualifications, the scope of confidentiality, and the use of administered arbitration.

3. Choosing arbitration counsel

The assistance of experienced and knowledgeable arbitration counsel, both when drafting an arbitration clause and for a dispute can reduce the time and costs of an arbitration. It is essential to engage outside counsel who understand arbitration and are not wedded to court rules and procedures. Outside counsel need to be open to working with the arbitral tribunal and other counsel to develop efficient procedures. Also, it should be determined beforehand whether outside counsel will have sufficient time to devote to the case.

4. Choosing the arbitral tribunal

A major benefit of arbitration is that parties have a say in the choice of their adjudicator. It begins with the arbitration clause, when the number of arbitrators and arbitrator qualifications may be fixed. The opportunity arises again when an arbitral tribunal – whether one or three arbitrators – is chosen. While tribunal selection procedures vary, in-house counsel should be involved in the opportunities available to choose the arbitrator(s).

5. Choosing procedures and timetables

In-house counsel need to stay involved and informed so that the arbitral procedures and timetables align with company priorities and objectives. Too often outside counsel are reluctant to risk “giving up rights” available under court rules and procedures when adopting arbitration procedures and timetables. In-house counsel should be present at procedural hearings to appreciate the arbitration’s dynamic, to get a feel for the tribunal, and to instruct on decisions affecting speed, cost-effectiveness, confidentiality and relationship preservation.

6. Coordinating between in-house and arbitration counsel

Once the arbitral tribunal is selected and a case timetable established, in-house counsel should coordinate with outside counsel to understand what input will be needed and when. Outside counsel need in-house counsel’s involvement when important tactical choices are being made and to ensure the availability of company personnel (as witnesses or otherwise). Coordination between in-house and outside counsel will help ensure that deadlines are met and the case proceeds as scheduled.

7. Settlement procedures

Although arbitration proceedings may have commenced, settlement procedures – negotiation or mediation – can occur at any time. Settlement is often the best outcome, saving time and saving costs. As arbitration proceedings progress, parties get a better sense of the case and the arbitral tribunal’s reactions (arbitrators live with the case throughout, unlike in court where a different judge may hear each pretrial matter), interests may change and opportunities to settle may increase. With outside counsel, in-house counsel should continually re-evaluate the case and determine whether settlement should be pursued.

The bottom line is that for a company to realize the benefits that can be achieved in arbitration, in-house counsel need to be informed and involved, starting with an understanding of arbitration, then in the negotiation of arbitration clauses, and later if a dispute arises.

ADR Training in the Caribbean

There is something surreal about delivering a training workshop with the sound of the ocean in the background and the participants role-playing negotiation and mediation scenarios by the pool. As a new facilitator with the Stitt Feld Handy Group, I have had the opportunity to conduct conflict resolution workshops with Peter Dreyer in both Trinidad and Barbados. Location aside, however, I found that there were many wonderful things about our Caribbean clients that enriched my experience as a facilitator.

The participants, although keenly interested in learning about alternative dispute resolution, were also intent on enjoying themselves at the workshop. Whether it was a local expression that went over my head (but made everyone else in the room smile) or a hint of self-deprecating humour about their own cultural tendencies, there was always time for a quick laugh. These interludes were often quite helpful as they allowed the participants (and myself) to take a break from the material and come back more focused. Moreover, as a new facilitator, I was truly grateful for the relaxed environment.

The participants’ responses to questions that at first glance would appear to be relatively straightforward were also thought provoking. When asked, for example, what types of logistical arrangements would be important in a negotiation (the typical answers being things like fax machines, telephones, and seating arrangements), one participant commented that in some circumstances it might be necessary to check the parties for weapons before allowing them to enter into the room. Another participant explained the cultural importance of food to people from the Caribbean and how sharing a meal was a social activity that brought people together. A third participant responded that sometimes it is best to get away from all of our modern technological distractions in order to have a more focused one-on-one dialogue.

It was also interesting to observe how cultural issues and legislative developments influenced the participants. In Barbados, for example, a new law that would make it easier to prosecute sexual harassment cases was on the verge of coming into force when we delivered our workshop. This backdrop filtered into how the participants acted in one of our role plays that involves the sexual harassment of an employee. During this particular debrief, there was a heated debate about how the mediators felt compelled to be extra sensitive to the “victims” and how the “offenders” felt the need to continuously apologize for their behaviour, even though according to their instructions the facts were relatively benign. Other participants commented that physical contact, such as a pat on the back or an arm around the shoulder, was a part of their culture and they were concerned about the implications of the new law in this regard. It was inspiring to see the participants become so engaged in a debate about the challenges of mediating sexual harassment cases within the context of this new legislation.

Personally, I have found the opportunity to train clients from another cultural background to be both enlightening and humbling. Listening to a completely different perspective has been a wonderful way to engage myself in critically thinking about my own understanding of conflict resolution and I look forward to continuing to do so throughout my career in ADR.

Written by Nayla Mitha.

Author Archives: Lovisha Arora