GASPA

Chapter 9: The Nature of the Relationship in Negotiating and Resolving Disputes

We negotiate with a wide variety of people on a daily basis, from assorted service providers to business associates to close friends and relatives.

NEGOTIATING WITH CONTRACTORS

A “contractor” is anyone you pay to provide goods or services at a certain price or rate. This could be a one-time arrangement (e.g., home or business renovations) or an ongoing relationship

Typically, negotiations with contractors are more formal and legalistic than negotiations with people we know well. There is likely to be a signed agreement that specifies the terms and conditions of the arrangement

LANDLORD/TENANT RELATIONSHIPS

As with contractors, a relationship with a landlord is voluntary, but signing a lease agreement creates a legal relationship.

Landlords have a legal obligation to maintain the property, and if that obligation is not met, a tenant has different options depending on the state in which the property is located.

Obviously, understanding your lease and careful research and preparation are critical in preventing or resolving these types of situations.

IN THE NEIGHBORHOOD

Neighbors, residential or commercial, are those who are geographically close. You don’t choose them—they (or you) simply move in. You also can’t fire them or force them to leave if you don’t like or get along with them,

Sharing resources (e.g., a driveway, parking area) of any kind creates additional opportunities for disputes to arise and makes it very difficult to merely ignore the other party

Whatever the circumstances, it is usually beneficial if you take an integrative approach to negotiating and resolving disputes that may arise.

NEGOTIATING WITH ACQUAINTANCES

Another category of people with whom we have an ongoing relationship are acquaintances. We define acquaintances as people we know either professionally or personally, but whom we either don’t know well enough or are not close enough to consider a friend.

Our primary focus here is on your professional network.

If a dispute arises between acquaintances, it is generally best to try to repair the relationship, because you never know when you might have to deal with the person again.

WHEN THE OTHER PARTY IS YOUR FRIEND

Negotiators may become friends as the parties get to know each other through a series of interactions over an extended period of time, as sometimes happens with attorneys and those who negotiate labor contracts.

The extent to which we like the other party also influences our initial positions and willingness to compromise on a variety of issues.

The Influence of Friendship on Strategy There is not one best approach to negotiations. Instead you must consider both the substantive and relationship outcomes desired and choose an appropriate strategy.

The Role of ScriptsFriendship scripts and event scripts interact17 and clash.18 When negotiating with a friend we almost always approach it differently

The Importance of Maintaining the Relationship. In order for a negotiation to affect an ongoing relationship, the negotiation has to be of some importance to the negotiators

The Challenges of Negotiating with Friends/Family. In an ongoing relationship, the parties may not want to risk the appearance of greed, especially if the outcome is not critical to the individual.

The Cost of Conflict When Negotiating with Friends/Family.The potential cost to the relationship if the negotiation is unsuccessful is likely the reason people are more agreeable

Obviously we deal with close friends and family on a personal basis, but we may also deal with them in a financial or business context.

DOING BUSINESS WITH FRIENDS/FAMILY

When Friends Become Business Partners- An extreme version of close friends working together is when they decide to go into business together.

Once the partnership is operational, the focus turns to managing the ongoing relationship. During this stage the parties need to manage the partnership as a process as opposed to an event

The Family Business- Family firms are the most common form of business organization in the world.

On an individual level, there is the notion of parental altruism, a trait that positively links a parent’s welfare to that of their children and facilitates mutual trust, communication, and reciprocity.

CONFLICT IN CLOSE RELATIONSHIPS

Research has found that family firms can be inundated by conflicts among family employees63 and between family and nonfamily employees.64 Conflict in family businesses also increases across generations.

MANAGING CONFLICT/IMPROVING RELATIONSHIPS

Third-Party Involvement.- This could be another family member who is not involved in the business or someone outside the family. In some cases the third party acts as a “trust catalyst,”

Conflict and Fairness.- As noted earlier, the standards for fairness in the distribution of rewards in families (equality) and business (equity) are generally different and often lie at the heart of conflict in a family business.

Knowing Where to Draw the Line.- Working outside the family business provides an opportunity to learn other ways of doing business, develop skills, and build professional credibility.

Cultural Differences.- Clearly, there is no one-size-fits-all when it comes to negotiating and resolving conflicts in family businesses. In addition to typical differences from one family to another, there are significant differences in negotiation and conflict resolution.