CHESTNUT VILLAGE NEGOTIATION

CHESTNUT VILLAGE NEGOTIATION

Bunyon Construction, a famous construction company, was negotiating with the residents of Chestnut drive with respect to the ongoing construction of a new residential complex. In the role game, I was the Vice President for Marketing and development and with the Senior Vice President, the Vice President for construction and the Company General Counsel, we were discussing strategy for meeting with the neighborhood negotiating committee. Before starting the negotiation, we had a very helpful preparation time to define which issues to discuss, the order in which to talk about them, the different positions and interests and the general attitude and strategy we should adopt to deal with the residents. We highlight various concerns about the relationship with the residents, the security of the building site, the budget, legal aspect concerning the building permit and the reputation of the company affected by all the previous issues. As representative of Bunyon company, our major concern was to finish the construction on time, developing at the same time the city, improving the living conditions by offering more services and boosting the reputation and the image of the company after the last shopping mall project failure. Our BATNA was to continue in any case the construction and reach agreement with the residents on security without going above our budget. Our last reservation price was $185,000 which was a part of the global budget allocated to the additional contingencies.

We start the negotiation after a short presentation of each participants and members of the company, discussing the major concerns for both side, which was security. The residents ask for a fence and more infrastructures to protect their children from the building site. In that point, every member of the counter side of the negotiation used emotional arguments to affect our positions and make them changed. Some of them were a little bit aggressive and they based their arguments mainly on the children security, the lack of sidewalks and the too fast driving trucks. They also pointed out a problem of communication saying we were never answering their complains when they were trying to call us. We took a break in the negotiation to discuss the different issues to be sure to speak at one voice and presenting the same opinion and solutions to the residents to secure our reputation. We took several breaks during the negotiation to recalculate the different issues. But we were very lucky because all what the residents ask for us was included in our budget and was possible to implement. We didn’t have to make concessions, only to accept to build a fence to protect the site in partnership with the carpenter who was negotiating with us, put lights to secure the building site and make inspection for crack in construction of some residents. 

These were the major issues we discussed and the agreement we reached at the end:

• Fence construction, with lights 1500 $
• Within two weeks the City council will talk to other people from the village to calm them
• More control when the construction company hires people
• New meeting in three weeks to see the evolution
• The company commits to organize meetings with the workers and drivers that don’t behave well (and sometimes fire them)
• The no resident of the complex will have no access to the facilities because it’s a private village but it will benefit to the resident in terms of economics development of the region.
• Inspections will be done to examine the problem of crack in houses.
• Writing a letter like a small moral contract to prove our moral commitment.

 In a word, this negotiation was very successful because both side found a win-win agreement and nobody felt disappointed at the end. The residents were surprised we accept all their concerns as fast as we did and were very satisfied by all our solutions. In our team, we decided to have one person speaking for all the group and when it was necessary, on a specific issue, the person concerned could help the spokesperson. On my side, I was in charge of taking notes and showcase our solutions to improve the concerns on security. I intervened few times to help our leader when we were talking about the safety concerns. For instance, I was averse to spending money on things like sidewalks and speed bumps, put a policeman or a flagman at the intersection and restricted blasting on specified times of day. The most important for me, was to develop a good relationship with the neighborhood, be transparent to gain their confidence. In fact, if they feel the company listen and discuss ongoing development with them, they will become less hostile. At the end of the negotiation, I was very happy to see that all the solutions I gave suit the expectations of the residents and participated to reinforce the image of the company. I was feeling very comfortable during the negotiation because our leader (who was the senior VP of Bunyon), established a very trustful and respectful negotiation with the other side. She was always trying to understand their bad feelings and apologized a lot, to show that we were really sorry for the inconvenience caused by the construction project and that we tried to do our best to meet their expectations. As a good result, nobody on the other side was very angry and too aggressive. Only when we had to agree on the small contract we wrote at the end, everybody was speaking at the same time and was not really listening to each other. So, the two spokespersons managed to stop the discussion and explain in a clear voice the demands of each side.

In a word, I found this negotiation very interesting as each members of the company had made a good preparation of their role and that we discuss a lot in the preparation time who was very helpful to determine the BATNA and the positions and interests of the other side. Starting by presenting ourselves was a good idea to determine the role of each person in the debate and make it clearer for the residents. We never met difficult moment where we had to make a big concession but we had to managed issues that we didn’t think of before the negotiation, like the crack in the house for example. As anticipation was not possible, we had to find solutions progressively and we took several breaks to discuss them.

I felt the negotiation very calm and healthy where everybody spoke with a democratic and equal allocation of speaking time.

The very good thing of this negotiation was the fact that, as we accept quite quickly the demands of the residents, they didn’t try to ask us too much. For example, we were concerned about the creation of an alternative access road very costly. Hopefully, it was their last alternative option in case of no agreement. It was good for the company who was open to make more concessions, especially on the security aspect.

For me, I need to be more persuasive, and ask more questions to find the best solutions for the demands of the other side. I noticed it is very important to reformulated and ask the other side if we understand well or not what they said, to be sure to make no mistakes by revealing confidential information or too much details on a specific point.

Using humour can also be risky in a negotiation because if it is not understanding correctly it can really affect the other side and make them totally different on their positions. We had a small stressful moment, when at the end the VP for construction management made a joke on the lawyer saying she was a “middle class lawyer". She starts to get very upset, and I was afraid it could impact in a negative way and change the agreement we have just reached.  

I point out, that negotiation is not an easy process especially in group but it was really interactive and interesting to share our point of view in the team. Presenting our arguments as a team in order to win as much as we can, make us more powerful and in case of threats, we could face the difficulties all together. Personally, negotiation in group make me feel more confident and stronger because I felt supported by my colleagues.

Finally, I think that, everybody in the team need to agree with the general opinion to win the best deal possible.