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NEGOTIATIONS AND CONFLICT MANAGEMENT IN ORGANIZATIONS - STRATEGIC NEGOTIATION CONCEPTS
Anthony Wanis-St.John

Introduction to The Workshop

We are going to learn some skills of successful negotiation by doing, rather than by talking. I will give some brief presentations on analytical concepts and tools. These are the heart of the approach and skills that are to be developed in this workshop, but we will concentrate on experiencing negotiation as a skill we can use in all contexts; interpersonal and organizational. Therefore we will use experiential, practical negotiation exercises that can be evaluated, scored, debriefed and analyzed. This is how workshop participants can all work on the same case, and directly compare procedures and results and most importantly, experiment with new methods of negotiation that we recommend. The most important thing for us during these two days is to practice new approaches. We will learn how to diagnose what is happening in any particular negotiation relationship, and when needed will try to fix it or change it to the extent possible. By engaging in large and small group facilitated discussions, participants 'deepen' their learning experience in the exercises and their reactions to the presentations by exploring their practice, questions and insights with each other, and so help each other to learn.

The field of conflict resolution has developed a series of exercises designed to teach the necessary skills. You will each be asked to play a role in these exercises, and I ask you to try to be faithful to the role even if it involves something that is not familiar to you. I have chosen exercises that I believe to be interesting, and that involve a broad selection of people from different backgrounds. In two of the exercises you will be given confidential instructions, and I ask that you not share these instructions with anybody until after the exercise is over. This is a realistic situation, for during negotiations we do not always have perfect information about the other parties involved. We have to determine the truth from the limited information we are given.

This is not an acting class, and I am not asking you to be false to yourself. Be yourselves, but also feel free to practice something new and to take a risk, perhaps in an environment where the costs of making a mistake are very low.

We will start by talking about some of the dilemmas faced by managers inside an organization. One dilemma involves being caught in the middle where you have clients, customers and constituents outside the organization as well as superiors inside who make demands from you. To the side you have colleagues of more or less equal strength, power and access to information and resources as you do. Below you perhaps have subordinates who have to do work for you. Typically, managers do not have all the resources they need to do their job. They are given a task that requires them to go out and find resources, convince people and persuade people to change their priorities. If you consider managers to be negotiators, then we can call this 'the negotiator's dilemma.'

The Negotiator's Dilemma

We overcome these dilemmas by:

- Learning and practicing negotiation skills: My fundamental assumption is that these skills can be learned. Others, however, assume that diplomacy and negotiation are things that can never be learned or taught. They believe that you are either born a negotiator or you are not. Unfortunately, this is a very shortsighted assumption. We have been working and enhancing people's skills in the field of negotiation for a long time.

- Understand the pervasiveness and complexity of negotiations: Negotiation is everywhere in your life. You are constantly engaged in trying to influence others and trying to manage them, while at the same time they are attempting to do the same thing. However, we harbor a lot of assumptions about these negotiations that I think are inaccurate.

- Understand our own and other people's style of negotiation: This scale can range from individual stylistic differences to things as broad and deep as culturally specific ways of managing conflicts. It is important to understand where we come from and where the people with whom we negotiate are coming from.

Exercise: Oil Pricing
Negotiation exercise based on a variation of the so-called "prisoners' dilemma" from game theory, which illustrates that under certain conditions of interdependence, we are tempted to make unwise moves which, though meant to defend our interests, end up defeating them.

The exercise is designed to test the assumptions we bring to our negotiations and offer a different vision of what it means to negotiate -to move from an unprofitable, adversarial relationship that involves neither trusting nor being trustworthy, to a healthy competitive relationship in which cooperation and trustworthiness rewards the parties greatly. The exercise involved participants joining the Oil Pricing Board of the Ministry of Oil in either country Alba or country Batia. These two countries sell all their oil to country Capita. Price per barrel determines market share and profitability for each country. Economic and political shocks create new opportunities for learning and negotiating differently, leading some to better outcomes for their oil-producing country, which do not cost anything for the other producing country.

Presentation and Discussion after the Oil Pricing Exercise:

- Common assumptions about negotiations:

1. Negotiation is weakness: force and power are preferable.
2. Negotiation is a zero-sum game, which implies
· What I win, you lose
· Values are narrowly defined and fixed, neglecting the opportunity for maximization.
3. The process is fixed: 'we can only do this one way'.
4. Competition is the rule.
5. Trust and trustworthiness are unwise.
6. Alternatives are fixed; either very good or very bad.
7. Time is unimportant as the relationship exists only in the short term.
8. Everything that matters is visible, while communication, culture and experience do not matter.
9. My adversary's intentions are always negative and mine are positive.
10. Negotiators have to exaggerate and perhaps lie in order to succeed.
The Context of Negotiations

- Elements that determine the complexity in negotiations include:

· Number of issues
· Number of parties
· Time
· Iterations
· Kinds of issues
· Kinds of parties
· Party unity and stability
· Intra-organizational negotiations
· Culture
· Emotions
· Prior commitments
· Power asymmetry
· Audiences
· Intangible subjects

- Reasons why we resort to negotiations:

· We seek to gain more than the alternatives offer.
· We understand our interests and perceive an opportunity to satisfy them by interacting with the other parties involved.
· We detect an ability for all sides to gain something from an agreement.
· But: is there a ZOPA (Zone of Possible Agreement)?
· We try to envision efficiency and fairness, we try to create value instead of limiting it and we move towards efficiency.

- Where and with whom do we negotiate?

· Where were the negotiations in the Oil Pricing exercise?
· Externally, across the table.
· Internally, with our side.
· With ourselves; tradeoffs, priorities, goals, principles.
· With constituents, for consent, interests, ultimately for agreement.
· With superiors, for authority, resources, mandate
· With colleagues, for cooperation
· Are they linked?

Pareto-optimality

Pareto-optimal points are those at which no party can increase its own satisfaction without also decreasing the satisfaction of the other party. They are efficient but not necessarily fair. Point 'd' is the point where we move towards greater value creation.

Exercise: Diego Primadonna

The second exercise that participants negotiated was a modified version of an exercise known as "Sally Soprano" or "Sally Swansong." These exercises are designed to help participants learn several key points about negotiations: Negotiations are opportunities to create value by different means, not simply agreeing on a price for a good or service. Many low-cost solutions can be created so that parties end up more satisfied than they would be by agreeing on a price. This refers to the many dimensions a creative solution can have for a shared problem. This requires parties to thoroughly understand the interests they have, whether shared or complementary, in order to propose such solutions. The exercise also explores some of the aspects of negotiating on behalf of another party, such as when you are an agent negotiating for a client or principal.

Learning Elements of the Diego Primadonna Exercise:

- Process of Negotiation:

· Is it fixed? Or variable? Process can be designed explicitly
· Are we internally prepared?
· Who is invited? Not invited? Implications?
· Does anything have to happen before or while we negotiate? CBMs, North Korea
· What are the issues? What is not to be discussed? Why?
· In what order are issues addressed?
· What is the goal of our meeting?
· Do we need further information? How will we get it?
· Are we communicating well? Can we improve?
· When will we meet again?
· Multiple tracks or channels?

- If I do not negotiate:

· What is my alternative?
· What is their alternative?
· Can I improve mine or worsen theirs?

- The dimension of time:

· Can we really achieve our goals at one meeting?
· Do we need to work together in the future?
· Will I ever see you again?
· Negotiation can be seen as an investment in managing an ongoing relationship well
· People are interdependent within organizations
· Organizations that work together are also interdependent. They usually cannot ignore each other or impose solutions on each other
· Each negotiation can be a pattern for a future negotiation

Fisher's Analytical Elements

· Relationship is preserved or improved, survives difficult times.
· Communication is clear, or can be clarified.
· Interests are satisfied (multiple parties).
· Options are invented that create value.
· Criteria measure the options and offers for legitimacy.
· Commitments are understood, enforceable.
· BATNAs are exceeded.

- Preparing to negotiate:

· Is there a ZOPA?
· What are the alternatives and can they be altered? Test/weaken their perception of theirs?
· What are all the parties' interests? Are they at least complementary?
· What options can be created at low cost to me and high value to them? Can we invent without deciding?
· What external criteria will persuade us to accept an agreement?
· What internal agreements are necessary for external agreement? How will I persuade my client?

- Managing common dilemmas:

· Valuing a good relationship vs. valuing material gains.
· Assertiveness and empathy: do you tend to demand what you want from people, or do you seek to preserve relationships and avoid conflict? Does it depend on who you negotiate with? Issue being negotiated?
· Be aware of your tendencies, take small steps to change.
· Creating value vs. claiming value.
· Moves to claim may prevent moves to create.
· Strategic manipulations: bluffing, lying, etc.
· Role of information: how much do we share and when? [BATNA, interests]
· Focus on options for joint gain.
· Insist on legitimate standards.
· Make yourself understood, actively listen.

- Elements of Negotiations

Most of the time we do not think that we can design a process of negotiation that can meet our interests, i.e., finding the means by which people can talk to each other, what they talk about, when they talk, what sequence they put the items in, what ending they have in mind, how they close the agreement, whether they end with a handshake or with a written contract, and whether they rely on a pre-agreed written agenda or allow for a general open conversation. These are all elements of the process of negotiation. They do not relate to the topic of negotiation, but rather to the general procedure. The process of negotiation is variable, not fixed. For example, purchasing a car does not involve a written agenda with the seller of the car. If you have a more complex human resource problem in your organization, however, you hold several meetings that follow a written agenda in which you talk about the different positions that must be filled, what requirements you have for the candidates, the salaries, how long the contract will last, etc. You have to be internally prepared. You cannot approach negotiation with only minimal preparation.

- One needs to be able to answer the following questions before entering a negotiation:

1. Are we internally prepared?
2. Who is invited? Not invited? Are their any implications?
3. Does anything have to happen before or while we negotiate?
4. What are the issues? What is not to be discussed? Why?
5. In what order should we address the issues?
6. What is the goal of our meeting?
7. Do we need further information? How will we get it?
8. Are we communicating well? Can we improve the quality of communication?
9. When will we meet again?
10. Do we have multiple tracks or channels?

By answering these questions you will be prepared for what you are going to face in the negotiation. Instead of thinking of the process of negotiation as just something that happens, you can actually design these elements.

Another element to be considered is the BATNA (Best Alternative to Negotiated Agreement), which is a point of self-analysis in the stage of preparation; it is not fixed and it can be improved. Before entering into negotiation you should know what is going to happen if you fail to reach an agreement. What you are going to do afterwards is typically your BATNA. The better the best alternative, the more leverage and power one has. For example, if you go to a job interview with another offer already in your pocket, this gives you power to impose your will to a certain degree. Therefore it is important to understand what your alternative is, and to take action to improve it. If you sense that the other side's BATNA is weak, you have to subject it to a test of reality and try to reduce their reliance on it.

The following qualitative measures can be used to weigh the effectiveness of a negotiation by checking whether each of them is present or not:

1. Will the relationship be preserved, improved or worsened? A good outcome would be if the relationship is preserved sufficiently for it to able to survive a conflict in the future. Every marriage, business relationship, international relationship, etc. has to anticipate difficult times in the future. A good relationship enables parties to survive.
2. Is communication clear or not? If not, can it be clarified? Unclear communication is a bad outcome of negotiation, for you do not know what people mean or what they are offering, and you will not understand their reactions.
3. Are interests satisfied where multiple sides are concerned? This point is illustrated by the case in which two sisters have one orange and both want it. Finally they decide to cut the orange in half, and each takes a half. One sister eats the fruit and throws away the peel, while the other sister throws the fruit away, takes the peel and makes jam. If they had understood each other's interests, each one could have obtained 100 percent of what they wanted. This story very simply illustrates the power of interest. If you understand your side's interest very well and the other sides' interests reasonably as well, you will be able to present more substantial options for an agreement. Our information is usually not perfect, so we have to discover some things within the negotiation.
4. People can invent options that create value. Sometimes in a more complex negotiation a third or fourth or fifth party has to be brought in to add resources in order to add value to the agreement if the parties are not able to do it on their own.
5. External standards or external criteria can be used to measure the options offered, after which the best option(s) can be chosen.
6. Commitments should be understood and enforceable according to the context. Everybody should leave the room knowing what they have to do next.
7. BATNA should be exceeded. The most important thing about the agreement you reach is that it should be better than your BATNA. You must not say yes to agreements that are worse than your BATNA.

This seven-element approach is a good start where negotiations are concerned in terms of preparation, diagnosis, action and learning.

Dilemmas

There are two common dilemmas that negotiators face:

- Valuing a good relationship vs. valuing material gains:

Some people tend to value a good relationship outcome, and then suffer when it comes to obtaining a material outcome. Others value the substance gain and are ready to sacrifice the relationship. Good relationships and material interest do not necessarily have to be a trade-off, for you do not have to sacrifice one to obtain the other. If you are a person who prefers a good relationship outcome you have to dare yourself to say 'no' to people who might abuse your good will to fulfil their interests. Those who tend to sacrifice the relationship for material gain have to take steps to preserve the relationship while continuing to meet your interests. Each side has to be aware of their tendencies, and take small steps toward change.

- Creating Value vs. Claiming Value:

Creation of value can mean adding to that which is subject to negotiation or meeting your interests better, among other things. However, sometimes people create value well but then do not know how to claim it. You have to take into consideration the following:

- Moves to claim value may prevent moves to create value:
Moves to claim value that come too early can prevent moves that create value. You should keep to the sequence of creating first and claiming later.

Strategic manipulations such as bluffing or lying can be used to claim value.

- Role of information: how much do we share and when? (BATNA, interests)
Sharing a lot of information early might not serve your interest well because others might claim value from you unless you do it very skillfully. You have to know how much information you should share and when to share it. If you do not share any information then the other side does not know anything about your interests and can not meet them. If you share a weak BATNA, this might be manipulated if you are not very assertive.

- Focus on options for joint gain:
You have to focus on options that meet both of your interests fairly. Eliminate the problem of choosing between two things.

- Insist on legitimate standards:
This means involving outside standards or rules that help you make the right decision.

- Make yourself understood and actively listen

Exercise: HARBORCO

General Information
A newly formed national consortium, Harborco, is interested in building and operating a deepwater port off the coast of Seaborne. The consortium's members are drawn from a variety of enterprises, most of which are diversified among a number of commercial activities. Harborco is prepared to participate in the financing, construction, and operation of the port. It has already engaged in some preliminary planning and design work, but cannot proceed without a license issued by the Federal Licensing Agency (FLA).

The Project
The deepwater port proposed by Harborco would be the first of its kind on the East Coast. It would be located in Seaborne at the estuary of the Banksedge River. Like the European seaport Rotterdam, it would accommodate a new generation of large cargo ships and supertankers- ships believed to be especially cost-effective in transporting raw materials and goods.

The deepwater port would be based on an artificial island of roughly 9 square miles created with fill from the dredging of an access channel. The island would be connected to the shore by a network of highways, railroads and pipelines. On-shore, an Air-Sea-Cargo Center (ASCC) would be developed, along with major connections to existing highways, railroads, and pipeline networks. Substantial infrastructure would be needed to accommodate an inter-modal freight terminal of this sort. Most of the industrial plant and ancillary facilities would be located on the island. While components of the port could be operational as early as five years after construction begins, the port's full development might not be completed until 20 years later. The projected cost of the port is roughly $4billion (in current dollars).

The Parties
Harborco is excited about the prospect of a deepwater port on the East coast. It believes such a port could generate substantial profits within ten years after operations begin. (Harborco bases its projections on an independent study by Transport Associates, Inc., which concluded that such a port could be economically viable under several possible scenarios.) In addition, Harborco believes the local, regional and national economies could benefit from a port which would dramatically reduce the transport costs of imports and exports.

Several other parties, however, have an interest in the deepwater port and Harborco's application for a license.

The Environmental League: This coalition of environmental interest groups is generally opposed to any "development" of coastal areas, especially development which threatens fragile ecosystems, adds to air and water pollution, and increases health and safety risks. The league is worried that Harborco's proposed port would seriously damage the environment of Seaborne and destroy the basic Banksedge River ecology.

Local Federation of Labor Unions (The Union): The Union is generally pleased that new development is being considered for Seaborne. It anticipates the creation of hundreds of new jobs in both the short-run and long-run. It will argue strongly, however, that these jobs should be reserved for local union members. (This local federation is affiliated with the National Federation of Labor Unions.)

Other Ports in the Region: The four other ports in the region are not pleased with Harborco's proposal. They expect to lose a substantial amount of business to the new port if it is constructed. They are extremely skeptical of Harborco's claim that all regional ports will share in the economic benefits generated by the new port.

Federal Department of Coastal Resources (DCR): This Cabinet-level agency created during the Reagan Administration has a dual mandate: (1) to help realize the economic potential of the nation's coastal resources and (2) to preserve the environmental integrity of the nation's coastal areas. The DCR would like to see a deepwater port established somewhere on the East Coast, and has the resources and authority to subsidize such a port if it chooses.

Governor Sherwood (of Seaborne): Governor Sherwood is in her second gubernatorial term and is eager to promote development in her state. She is sensitive, however, to the needs of organized labor, a powerful political constituency, and is therefore anxious to see that unions share in the benefits of the port.

The Licensing Process:
Harborco submitted an application just one month ago for FLA review. While aware of other parties' interest in its proposal, Harborco expected little difficulty in the licensing phase of this project.

The FLA, however, has recently been criticized by several Congressmen for failing to consider the "broader public interest" in its previous licensing determinations. Consequently, the FLA is now very sensitive to the level of political support surrounding each application it reviews.

In this case, the FLA will not approve Harborco's application unless it is clear that there is substantial support for the project. It has therefore decided that it will approve Harborco's proposal only if Harborco can muster the support of at least 4 other parties. (The FLA would prefer to see all 5 parties support a Harborco application, but it will grant a license even if only 4 lend their support).

Two parties, however, can exercise some veto power. Harborco can veto any proposal in this negotiation (since no other party is capable of initiating the development). In addition, the Federal DCR can veto any project that requires a federal loan or loan guarantee.

The Issues:
Preliminary discussions have taken place between Harborco and representatives of the five key parties. As a result of these conversations, Harborco has identified five issues which seem to be of concern to all or some of the parties. A general description of the issues is provided below; more detailed information is provided in each party's confidential instructions.

Issue A: Industry Mix
The deepwater port itself is only part of the development Harborco has planned. With the construction of the port will come a variety of industries seeking access to the port. These industries will either lease or purchase land on the artificial island and on-shore, and will eventually generate the bulk of the revenues associated with the new port.

Harborco has initially requested the freedom to develop any industry mix it chooses. This means that it could choose to develop (or encourage) any type of industry or plant, including oil refineries, steel mills, or a resource recovery plant. The environmentalists, however, have argued that strict limits should be placed on the industry mix allowed in the area; they are asking that only relatively "clean" industries such as high-tech production plants be allowed.

As a result of this controversy, three options have surfaced in the discussions between Harborco and the environmentalists.

Option A1: Primarily dirty: no industry would be excluded, but the mix would probably be dominated by oil refineries, petrochemical plants, steel productions plants and a resource recovery plant.

Option A2: Clean/Dirty: would exclude the "most dirty" industries, but would allow a limited number of moderately dirty plants (including food processing plants).

Option A3: All clean: would be limited to only "clean" industries such as high-tech production industries; "dirty" plants would be excluded.

Air pollution, water pollution and waste disposal would vary with the industry mix selected. Regardless of the "industry mix', all industries would conform to existing federal and state pollution regulations.

Issue B: Ecological Impact
The dredging of the access channel, the creation of the island, and general construction activity could seriously disrupt existing "ecologically delicate" areas both on and off-shore. The damage would include the alteration of nesting habitats, a reduction in natural tidal flushing, the destruction of wetlands, serious land erosion, adverse impacts on existing fisheries, and substantial subsurface geological impacts (caused by drilling and dredging).

Harborco admits that the new deepwater port would create some damage to the ecological setting, but also claims that such damage would be within the limits defined by federal and state regulations. Environmentalists, however, counter that the damage would be excessive, and that Harborco has no right to disrupt the area.

In light of these arguments, three outcomes are possible:

Option B1: Some harm to ecology: This would involve unremedied disruption to the ecology. Fish and animal nesting habitats would be altered (or effectively destroyed), valuable wetlands would disappear, water temperatures and currents would change, and certain types of aquatic flora and fauna would be destroyed. All this would take place within Federal and Sate impact mitigation guidelines.

Option B2: Maintain or repair ecological balance: This would involve special precautions to divert construction and dredging activity (where possible) from the most ecologically delicate or important areas. It would also include the relocation or recreation of habitats destroyed by unavoidable dredging and construction.

Option B3: Improve the ecological setting: Like the previous option, this would include special efforts to bypass delicate areas during construction and dredging. It would also include a variety of other efforts to improve the local environment. Environmentalists propose ongoing fishery management and wildlife protection, the creation of new and larger protected wetland areas, an active anti-erosion program, and the construction and operation of a small waste treatment facility to treat effluents flowing into the estuary from the Banksedge River.

Issue C: Employment Rules
Construction and operation of the deepwater port is expected to generate hundreds of new jobs in the community in both the short-run and long-run. These jobs can be distributed among potential employees in one of three ways:

Option C1: Unlimited union preference: Jobs would be reserved for local union workers, where appropriate. This would enable local union members to claim as large a share of the new jobs as possible.

Option C2: Union Quota of 2:1: Limited preference could be given to union members where the ratio of union to non-union workers would not fall below 2 to 1.

Option C3: Union Quota of 1:1: The ratio of union to non-union workers would not be less than 1 to 1.

Option C4: No union preference (unrestricted hires): Harborco would be free to hire whomever it chooses. In this scenario, most workers would probably be non-union workers, enabling Harborco to maintain its hiring flexibility and to reduce its expected wage costs. In addition, new workers might be drawn from outside Seaborne.

Issue D: Federal Loan
The newly created federal Department of Coastal Resources (DCR) has a mandate to promote economic use of coastal areas while preserving the environmental integrity of these areas. It can provide a substantial loan (or guarantee private borrowing) to help cover the construction and operating cost of the port over the next 20 years.

Harborco estimates that the total coast of developing the port will be roughly $4 billion, and has requested $3 billion in guaranteed loans. The DCR, however, has suggested that there are certain aspects of port design that it must insist on before it will contribute to the port. Four options appear possible:

Option D1: A $3 billion loan (at 15% interest) over the next 20 years.

Option D2: A $2 billion loan (at 15% interest) over the next 20 years.

Option D3: A $1 billion loan (at 15% interest) over the 20-year period.

Option D4: No federal loan.

Issue E: Compensation to Other Ports in the Region
Harborco believes the new port will generate significant economic growth both in and outside the state. It contends that the entire regional economy will be improved by the port, and that the other four major ports on the Eastern Seaboard will benefit from this growth.

The other ports, however, expect to suffer substantial loss of traffic once the new port begins operation. They have estimated the present discounted value of their losses to be roughly $600 million, representing losses for 10 years after the new port begins operation. They think Harborco should compensate them for these losses.

In light of this conflict, five possible options are up for consideration.

Option E1: Harborco pays $600 million (or 100% compensation) in current dollars to the other ports.

Option E2: Harborco pays $450 million (or 75% compensation).

Option E3: Harborco pays $300 million (or 50% compensation).

Option E4: Harborco pays $150 million (or 25% compensation).

Option E5: Harborco makes no compensation to the other ports.

Though the ports would be free to spend this money as they wished, they could use these funds to make changes in their design which would enable them to serve more effectively as feeder ports for the new deepwater port.

The Negotiation
Harborco has already submitted a license application to the FLA, which proposes the following:
1. A primarily dirty industry mix (Option A1)
2. Some harm to the ecology (but within federally and state prescribed limits) (Option B1)
3. No special preference for union workers (Option C4)
4. A $3 billion loan from the DCR (Option D1)
5. No compensation payments to the ports (Option E5)

Harborco is free to submit changes to its proposal at any time during the licensing review process, but it is anxious to have its application approved as is.

In an attempt to muster support for its current proposal, Harborco has invited all the key parties to a meeting at the Ritz-Carlton. Its stated objective for the meeting is to seek a "negotiated agreement" among all parties to ensure unanimous support for its proposal. (Of course, Harborco needs the support of only 4 other parties in order to secure a license.)

Mechanics of the Negotiation
All five parties have agreed to attend the meeting, and are seated at the negotiating table. The FLA representative opens the meeting and explains the procedures that the negotiating session will follow. Each party has seen a copy of Harborco's current FLA application.

The discussions may progress in any direction, but Harborco will be searching for a proposal that will win enough votes for FLA approval. Anyone can suggest alternate proposals, but Harborco's concurrence is needed for any proposal to be adopted.

Three formal voting rounds are scheduled for the meeting. The first will take place 15 minutes after the meeting begins, the second after 40 minutes of discussion, and the third after 1 1\4 hours of the discussion. Additional votes may be taken at any point during the meeting, but at least three voting rounds must take place. (There is of course one exception: if a project receives sufficient votes for FLA approval early in the meeting, the parties may choose to forgo subsequent voting rounds.)

The FLA representative will administer the three scheduled voting rounds. If Harborco cannot decide on a revised project to propose at the time of a formally scheduled vote, the participants must vote on the original Harborco proposal.

Voting is done by hand-raising. Once a proposal is passed (i.e. receives supporting votes from at least 4 of the 5 other parties), the votes are binding and parties cannot renege on their promise of support. The parties are free, however, to explore "improvements" in the agreement which either benefit the supporting parties or entice the non-supporting party to vote for the agreement. But if proposed improvements are not unanimously supported by the parties to the original agreement, the original agreement stands.

Negotiations must stop at the end of the meeting. If no agreement is reached (i.e. if no proposal receives at least 4 votes in addition to Harborco's), the FLA will reject Harborco's application for a license.