Negotiation master class part 2 – Danny Alexander versus public sector strikers

We mentioned here the negotiation strategy that the UK Government seemed to be following in their dispute over public sector pensions. We were somewhat surprised that a whole range of concessions were offered by the Government without any apparent movement in return from the Union side.

A strike is planned for this Wednesday now - Danny Alexander, Chief Secretary to the Treasury, has threatened the Unions that the current offer might be withdrawn if they go ahead with the strikes. As the Guardian reports,

Alexander made clear the government would not blink first and insisted that the offer on the table was the best it could make given the money available. In fact, he said, the offer could go backwards if the strike went ahead.

So we're into another golden rule of negotiations (and indeed, a golden rule of management and child-raising as well!)

Don't make promises you're not going to keep, or threats you’re not going to follow through on.

If you don't follow through, the other party in the negotiation (or your employees, or your kids) very quickly learn that you don't mean it. So why take any notice of the next threat, given what happened last time?

Let's see what happens. If the strike does go ahead, and if Alexander and Maude don't pull back on the offer, they will have given further ground in the overall negotiation process and shown further weakness.

And later yesterday, the BBC reported this.

The government has pulled back from threatening new strike laws in its confrontation with the unions over reforms to public sector pensions. Cabinet Office Minister Francis Maude said existing laws could work well and legislation changes were a last resort.

A sign of conciliation and strength? Or a further weakening of the Government's negotiating stance?

We come back to our questions from last time - do they have a negotiation strategy? Have they taken advice from expert negotiators?

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Voices (2)

  1. Udeshi:

    This is very interesting topic. I understand what you’re saying, however I believe that “style” of negotiation is something more driven by personality, than by size of company there are plenty of adversarial negotiators at small companies.Though I work for, I’d say, huge Company and always conduct negotiations in challenging but still positive win-win atmosphere, I often take a second thought what would I do differently if my volumes were ten times smaller, company less famous and the smile at that guy’s face not that warm? Sooner or later every purchaser will find him- or herself in such situation, so it’s better be prepared now.Here’s quick list of things to consider for any negotiations:1.Start with basics: is there really the need to negotiate or I’d better do something else, i.e. RFP or reverse auction?2.Do I need to negotiate with this supplier vs. going to someone more cooperative (producer vs. retailer)3.Gather evidence: what is the industry practice? Are my requests legitimate? Do I need RFI before negotiation?4.Get better understanding of supplier interests and needs & match with mine. How do value components look from their side? Are they in a bad need of something, so I can improve my leverage?5.How can I make my volumes bigger and more attractive? Team-up with other business units (normally a must), external business partners etc.? Consolidate several categories at one more collaborative supplier?

  2. David Orr:

    Have they taken advice from expert negotiators?

    The Government should look no further than the MOD for their £600m in consultancy fees (and £billions of late & over budget private sector projects like the scandalous costs of each Eurofighter/Typhoon) or perhaps the Home Office with their £1.6bn of lost Fire centres or the NHS with £14bn of IT spent with little to show for it.

    Or PFI “the goose that laid the golden egg”.

    Will you address the issues raised in last night’s Panorama?

    Some pretty ordinary people are paying for the mistakes of a greedy & unprincipled few, whilst FTSE 100 CEOs pop a 49% pay rise in the midst of many families facing sharp declines in income.

    Come on Peter – I had expected better from SpendMatters.

    Do we procure goods in isolation from the sort of society & community we want to be part of? No we don’t accept child or slave labour do we? Can we have Fair Trade and effective procurement – YES.

    What sort of world we want our children to inherit, aside from the massive PFI debt (often offshored for tax avoidance) and the huge student loan!

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