F05SENG411 L19

From Craig

Negotiations

• Negotiations typically start at the beginning of the project
  • The project is just an abstract idea
  • Abstractions are, by definition, lacking details and the complexity of the problem is therefore hidden
  • There is little incentive for the project manager to make unpleasant counter-offers to the project's owner.
  • It's easier to get forgiveness than to ask for permission

More rational negotiations typically take place a month or two before the deadline after the first project manager has quit or has been fired. The new project manager is in a position of power from which he/she can negotiate.

The question becomes: is it possible to negotiate a reasonable set of conditions at the start of a project?

In the text Death March, Edward Yourdon is not very optimistic about our chances of success. His position is that you are going to lose no matter what, but let's explore the various ways in which you will be out-manouvered. Do you share the same opinion?

Rational Negotiations

• Do we know how to estimate accurately?
• There have been cases where development teams have set their own schedules and proposed it's own budgets and still failed to deliver anything on time and within budget
• Management tends to avoid negotiations and now typically imposes "do or die" budgets and schedules

There do exist some useful tools which can be employed as part of the negotiation process:

• Commercial estimating tools/Well known estimating processes. While they are not fool-proof (garbage in/garbage out), they can help to give a project manager credibility when entering negotiations. Even though we don't necessarily know how to do estimation well, we do know that we can get better.

• Systems dynamics models: Discussed earlier in the course, the notion that developing software involves a complex set of processes which interact with each other. Small changes in one part of the system can lead to large, unanticipated effects in other parts of the project. Using tools which help to model these effects (or just knowing that they exist) can help to mitigate the effects as long as appropriate action is taken when needed.

• Prototyping can also be used can be used in an attempt to gain a more complete understanding of the realities of the project. Prototyping can be used to calibrate a rough estimate of the team's productivity.

Negotiations... What are they all about?

Negotiations occur when there is a conflict of interests (one side wants something the other side doesn't want) and both sides prefer to search for solutions rather than breaking contact. Negotiations are inherently a conflict situation and most people don't don't enjoy dealing with conflict. (This fact can be taken advantage of by some negotiators)

Resolution of conflict isn't necessarily a positive thing. There can be both positive and negative results. When conflict arises, the important point is not to suppress the conflict, but instead to manage the conflict so that it doesn't get out of control.

Responding to Conflict

Any response to conflict can be viewed in 1 or 2 categories:

• How important or unimportant is it to satisfy our needs
• How important or unimportant is it to satisfy the other party's needs?

Categorizing our responses in these ways shows the five modes of conflict resolution:

Most successful negotiations start off assuming that a win-win position is possible. If that is not possible, Collaborative negotiations are most useful if one wishes to have a continued relationship with the other party. Competative negotiations can be useful if not long-term relationship is expected (ie. buying a used car).

Collaborative negotiations

• Variable amount of resources to be divided between the sides. Both sides can "win"
• Dominant concern is to maximize joint outcomes
• Dominant strategies include cooperation, sharing information, an collaborative problem solving.

Competative Negotiations

• One side wins and one side loses
• Fixed resources divided such that one side gets more than the other
• Dominant concern is maximizing ones own return
• Dominant strategies include manipulation, forcing, and witholding information

Negotiating games

• Doubling and then adding some: Double the "rational" estimate and then add some safety. Attempts to address schedule compression
• Reverse doubling: Attempt to remove padding from estimates. Divide by two
• Guess the number I'm thinking of: The manager has an acceptable figure in his/her mind but refuses to articulate it. When the project manager offers an estimate, the response is simply "no, that's too much". Eventually, the project manager will guess the number and because the project manager "came up with it", the senior manager will be more determined to hold the project manager accountable to the estimate.
• Double Dummy Spit: Senior manager erupts into a fit of rage when the project manager makes his/her first proposal. When the project manager comes back with a new estimate, the senior manager erupts into a fit of rage again. Eventually, the project manager will do anything to avoid another temper tantrum.
• Spanish inquisition : Project manager walks into a meeting completely unaware that he/she will be asked for an "instant estimate". The project manager is put on the spot and asked to commit to an estimate for which he/she has no basis for evaluating.
• Low Bid: The customer tells the project manager that another bidder has a lower estimate. Another variant is that the customer makes it known that he/she is considering not doing the project at all.
• Gotcha: Project manager knows that the project proposal is unrealistic but accepts it anyways relying on the probability that by the time reality sets in, it will be too late for the client to back out.
• Water torture: Bad news is brought to the customer in small doses.
• Smoke and mirrors: Use of statistical methods or estimation techniques that no one understands. Similarly, stats or estimation techniques can be used by persons who have an agenda.
• Hidden variables of maintainability/quality: Premise: I can deliver an infinite amount of functionality in minimal time provided it doesn't have to work and doesn't have to be maintained.

Negotiating Strategies

• Orient yourself to a win-win result. Reinforce your interest in the others side's concerns
• Plan a strategy. Know what is important to you. Know what has more value to your customer than to you.
• Know your alternatives. What is your walkaway price?
• Separate people from the problem.
• Identify underlying issues/interests. You need to know your own interests as well as the other party's interests.
• Use objective standards when possible
• Pay attention to the flow of the negotiations as it can reveal important information about what the issues are for the other party
• Watch body language and other "intangible" aspects of communication
• Use active listening techniques

• When trading off, offer something which is less value to you, but is of more value to the other party.
• Look for differences. Price may be of little consequence to a used car salesman if he/she needs the sale today (the last day of the month).
• Create additional resources so that both sides can obtain their goals
• One side gets what it wants and the other party is compensated on another issue
• Each party makes concessions on low-priority issues in exchange for concessions on issues it values more highly
• One party gets what it wants and the costs to the other are reduced or eliminated
• Neither party gets what it wants but a new option is identified which satisfies the major interests both sides

Types of Negotiators

• The Agressor: attempts to unsettle the other negotiator
• The Long Pauser: listens but doesn't answer immediately; appears to give issues considerable thought hoping the silence will get the other side to reveal information
• The Mocking Negotiator: attempts to upset the other negotiator so that they say something they will regret later
• The Interrogator: meet all proposals with probing questions in an attempt to imply that the other side is not prepared. Challenges answers in a contronting manner
• The Cloak of Reasonableness: appear to be reasonable while making impossible demands
• Divide and Conquer: Invoke division within the other party so that they have to pay more attention to their internal disagreements than to the negotiations
• The "Act Dumb" negotiator: Playing dumb so that the other party reveals information in an attempt to find simplified ways to describing proposals.

References

• Death March, Edward Yourdon
• Negotiations and Resolving Conflicts: An Overview, E. Wertheim