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A Negotiation Strategy for Change

Keith Stacey
A Negotiation Strategy For Change

Familiar scenes are being played out in Paris as the French government pushes through changes to the pension age from 62 years to 64. Given that the pension age in Australia is now 67 and that the French are considered a healthy nation, the proposal seems reasonable. However, that is not how the protesters see it.


What we have is a demonstration of the endowment effect. This is the fact that people value something they already have more highly than if they didn’t own it – something many negotiators know from firsthand experience. University trials have shown that people will ask between 2.5 and 3 times the price to sell an item than they would pay to buy the same item. The reform is obviously necessary, and the benefits will be spread over the entire population. However, the losses by the few about to retire are large and immediate hence their mobilisation of 1.28 million people on the streets on March 7th.


The French are not the only nation to suffer from low productivity growth, in Australia the Productivity Commission has just handed down their 5 yearly review and have outlined 29 reforms for government to implement. Tom Dusevic writes in The Australian “Here’s a road map for revival, but will the nation be too meek to put the pedal to the metal.”


Niccolo Machiavelli’s writings from 1657 also offer some profound insight around change: “There is nothing more difficult to take in hand, more perilous to conduct, or more uncertain in its success, than to take the lead in the introduction of a new order of things. For the innovator has enemies in all those who profit by the old order, and only lukewarm defenders in all those who would profit by the new order, this lukewarmness arising partly from fear of their adversaries … and partly from the incredulity of mankind, who do not truly believe in anything new until they have had actual experience of it”.


During the pandemic, people were forced to work from home. Having adjusted to the benefits of these new arrangements many are reluctant to return the office at all. Dramatic changes are only possible when there is a shared sense of crisis and no rational alternative available. Desperate times call for desperate measures - it is not possible to jump a 20 metre chasm in two 10 metre jumps.


Our recommended strategy for negotiators seeking to introduce change would be:


  • Create a sense of urgency - time for action!
  • Be honest with the facts - explain the situation and consequence of no action
  • Make a proposal for the change which provides options for those impacted
  • Create some early success to increase confidence in process


Remember that change is inevitable - better to be an agent of change than a casualty.


Happy negotiating!

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