By George J. Siedel, University of Michigan
An ABA Business Law Section task force recently completed a landmark report titled “Defining Key Competencies for Business Lawyers” that was published in 2017 in The Business Lawyer (Winter 2016/2017). The report drew on the framework of the ABA MacCrate Report (“Legal Education and Professional Development–An Educational Continuum”), and is directed toward law schools and law firms.
Both reports emphasize the importance of negotiation as a key lawyering skill. As the MacCrate report notes, “the skill of negotiation is a fundamental part of legal practice….” The reports also discusses the analytical skills that lawyers must have when participating in negotiations. The MacCrate report, for example, emphasizes that all lawyers must be able to (1) determine the bottom line; (2) evaluate alternatives; (3) identify outcomes from the negotiation; (4) analyze whether the negotiation is zero-sum, non-zero-sum, or a mixture of the two; and (5) examine the negotiation from the perspective of the other side.
A Free Teaching Package to Develop Negotiation Skills
I have developed a free teaching package that can be used by professors who want to introduce these skills in their courses. The package includes a negotiation exercise with two roles, a Teaching Note, and Powerpoint slides. The package could be used in a legal skills development course, in a legal writing program that includes negotiation, or (because the exercise is a contract negotiation) in the first-year Contracts course. Here is a link to the package:
The exercise, titled “The House on Elm Street,” involves a transaction that everyone can relate to—the sale of a house. The twist in the exercise is that, unknown to the seller, the buyer is a secret agent representing a company that wants to demolish the house. Students receive a short (two-page) role as either the buyer or seller, and they negotiate for 30 minutes, followed by an instructor-led debriefing.
The exercise is designed to achieve several learning goals that include the analytical skills mentioned in the two ABA reports. Students will learn how to:
- understand the different types of negotiations;
- prepare for negotiations using a negotiation analysis that includes a reservation price, most likely outcome, stretch goal, and zone of potential agreement;
- recognize and decide ethical issues, using law-based standards (fraud, fiduciary duty, and unconscionability) and general ethical standards;
- develop and use their negotiating power through the concept of BATNA (“best alternative to a negotiated agreement”);
- apply contract and agency law concepts to negotiations; and
- create value in a manner that benefits both sides.
The Teaching Note is divided into three sections. Section I explains how to set up the negotiation exercise. Section II provides a script, with slides, for debriefing the exercise. Section III discusses a document titled “Self-Assessment and Feedback for the Other Side” that is appended to the Teaching Note. Students can use this document to evaluate their negotiation skills and develop a plan for skill improvement. In law school courses where legal skills are taught within a legal writing course, the evaluation and plan could be used as a writing assignment.
Feedback from Participants
I have used this exercise in degree courses and in executive seminars in North America, South America, Asia and Europe. In addition to law students, attorneys and judges, other participants in the courses and seminars include athletic directors, engineers, entrepreneurs, managers, and physicians. Organizations in the public sector (for example, the World Bank) and private sector (one of the five largest U.S. companies) have used the exercise for negotiation training led by in-house staff.
Feedback on the exercise has been positive. Here is a comment on the debriefing experience and the plan for improving negotiation skills.
What a great learning experience! [T]he ability to get feedback and actually debrief a negotiation is really powerful! I considered myself rather self-actualized, but some interesting things came to light in the class discussions. I know that if I make a concerted effort to work on [my plan for skill improvement] it will certainly serve me well in my career—both now and in the future.
I have also received considerable feedback regarding the impact of the learning from the exercise. Here is a comment from a participant who used a planning checklist based on skills covered in the exercise.
I received a quote from a key supplier a few weeks back that was very good and I was just going to accept it as is. [But first I decided to complete the] planning checklist and called in the supplier. We had a great meeting, expanded the pie, learned tons about what each other wanted. In the end we renegotiated everything, set up yearly pricing reductions and a 2 tier pricing schedule that allows me to cover depreciation expenses on any expansion and provides my supplier the long term commitment from me he wanted. Win-Win. The projected savings over the next 5 years is over $4M ….
If you decide to use the exercise, I would appreciate your comments and recommendations for improvement of the materials. Thank you.
George J. Siedel is the Thurnau Professor of Business Law and the Williamson Professor of Business Administration at the University of Michigan. He can be contacted at email@example.com.