Role Play : Mouse

The French government has called for a meeting between one of its representatives, the mayors of the four communes and mouse.

As mayor of Magny I am the representative of its citizens. Together with my fellow mayors of the neighboring villages we are working out a strategy before the meeting. We note that we have the following problems:

• As the property values go up with the arrival of EuroMouse the tax burden for the owners get higher. For most of our citizens this is not bearable and and went to avoid that young French people are pushed out the city because they suddenly can’t afford it any more.
• Traffic and construction work
• What is bothering us a lot is the fact that we have not been included in any of the negotiations between the government and Mouse so fare, even tough it has great implications on us. The government has made a great profit with reselling the land to mouse however we are the ones to bear the cost.
• Further we are afraid of the social impact of the new EuroMouse, afraid of losing our cultural and tradition heritage and that the small town life will completely change. We have seen the twins around MouseWorld in Florida, and we do not want to become service stations like them. 
• Finally, it’s an administrative nightmare. Mouse is asking so many permissions and authorizations and with our little staff we do not manage to treat the requests quickly.

So what we want:

• Financial compensation rather than being part of the payroll tax, as we prefer certainty. Amongst us mayors we agreed that we all would get an equal part of the compensation.
• If Mouse insistes on the payroll tax and it turns out to be the only way, we will want at least 1% but are starting with 2%
• If they ask for a positive press release we want to have a voice in return, that is participating in the meetings and have our word to say. Further to assure a smoother change of our environnement we ask the government for a community player. 
• We will address the government to put en effort in lowering the taxes, after all they made a large benefit on our expenses
• In order to create some extra value we ask to include the local farmers, so that they provide the food for the restaurants of mouse

BATNA: our BATNA would be that everything stays as it is and the farmers will block the streets

What we can offer

• Positive press release
• Avoid that the farmers block the street
• Collaboration

THE NEGOTIATIONS

The representatives of the government were leading the negotiation. Joy, representing the Mouse management, asked us what our feelings were towards their project. I found this a very clever way to start the negotiation and I felt immediately that they were open for negotiation. This has proven to be true, as the tone of the whole negotiation was really constructive and consensus oriented. Joy let us know right at the beginning what their most important interest was: to accelerate the treatment of permissions and authorizations as they are already behind on schedule.

We stared by stating the problems we Mayors had encountered. When expressing our irritation and disappointment of not having been involved in any prior negotiation and that the government sold our fertile land to Mouse with a huge benefit, Marina, representative of the government, explained that the money is used to build new and faster access roads passing outside of our town. We started to tackle topic by topic, leaving the financial aspect for the end.

The government turned out to be very comprehensive and cooperative. They agreed to support us with additional staff for the increased administrative burden and to arrange a meeting to discuss lowering taxes with the ministry of economics. What they want in return is that the farmers and citizens of our villages will not block the streets.

In oder to calm the farmers and thus for them not to block the streets we need some security to show them that the government and the management is caring about them and that they will not seen their way of life changed 180 degrees from one day to another. Mouse was open to our suggestion of including the framers by letting them be the exclusive provider for food for the restaurants of EuroMouse.

The next topic addressed was the social impact of the new park on our villages. The Mouse management emphasized that they want to protect the French tradition and that they are well aware of the cultural differences between the US and France. The government agreed on providing a community planner for us in order to assure for a smooth adaption of the villages to the new project.

The management of Mouse demonstrates how their project will create valuable jobs, what we highly appreciate as our unemployment rate particularly amongst the young is quite high.

After having addressed the different little issues we start talking about money. We made the first offer by asking for 3 Mio financial compensations. The Mouse Management was a bit surprised by this huge amount and took a time out. They came back explaining that they honestly could not pay such figure and that we need to distinguish between the government’s duties and the Mouse’s one. In fact, mouse did not know that our farmers were expropriated of their land by the government. Given their constructive attitude and honest interest in finding a fair deal, just as the fact as they had agreed on most of our demands before, we had to realize that 3 Mio was way too much. And to be honest, this never was a realistic goal we aimed, but we thought starting high will allow us to get a high price. We should have taken a time out and rediscussed given how things went during the negotiations.

The Mouse Management proposed 950,000 as a counter offer. This was too low for us. Time was very tight and we had to get to an end. So after considering the option of getting an annual financial compensation of 750,000 and 0.5% of the payroll tax, which would have assured a yearly payment of at least 1.25 Mio, we preferred to agree on 1 Mio financial compensations. Security was for all four Mayors a key element with which we knew we could reassure our voters. Finally we agreed on a positive press release.

We were happy about the negotiation’s outcome as even if the financial compensation negotiated may seem little, we obtained a lot of concessions from the government but especially from the management of mouse. The latter turned out to be very agreeable and comprehensive for our situation. We did not accept that beforehand.

Summary: The hidden chalenges of cross-border negotiations

It is important to understand that national cultures also shape the governance and decision-making process and the way they come to an agreement. Therefore, mapping the players and the process is crucial.

Who are the players?
While you know that in the US extra players beyond those representing the companies influence the deal, abroad it is often less obvious. In China for example, even with „private“ companies there there certainly will be a local party official involved. All these constituencies bring their own interests to the table as well as varying abilities to block or foster negotiations.

Who decides what?
Knowing who is playing is not enough, it is important to know what role they play and who owns the decisions. Failing to do that it can turn out very costly.

What are the informal influences that can make or break a deal?
It is vital to understand which people must sign the contract to finalize the deal. More than that, often there are webs of influence operating that turn out to be more influential than the actual parties making the deal. We must not underestimate the power of informal influences by assuming that foreign legals systems will enforce formal contracts just as they are expected to do at home. Dispute resolution can look very different in different countries.

Therefore, it is crucial to discard home-market presumptions and to develop a clear map of the players who are likely to influence the formal and informal decision process.

Then one has to adapt the approach accordingly. An organizational process can look very different in different cultures and thus ask for different negotiation strategies.

Top Down
The decision will be taken unilaterally. The most effective way is to talk to the boss directly or, if not possible, to connect with people outside the process who have close ties to or influence over the boss.

Consensus
This organizational process is especially common in Asia. Often the consensus cultures focus on relationships rather than deal and the parties involved will often want to take substantial amount of time. It is important to adjust your won expectations (and your organization’s) of how long the deal will take. This negotiation process is however likely to have more staying power.

Coalition building
Sometimes negotiations don’t need the agreement of every player but rather a „winning coalition“. The opposite is a „blocking coalition“. Navigating such coalitions requires an understanding of the likely interests and opinions of the players who will be needed as allies in a winning coalition.

To sum up, assessing the person across the negotiation table is crucial but not enough. It is important to figure ou the intricacies of the larger organization behind her. In order to do that you need to map the governance and decision making process. Then you must design your strategy and tactics so that you’re reaching the right people, with the right arguments, in a way that allows you maximum impact on the process to yield a sustainable deal.