Negotiation Techniques – Public Private Partnerships

Benchmarks – Negotiation Techniques

Find a situation (a real-world situation or a fictional situation) with two or more parties of jurisdiction or interest over a specific project or policy (public/private partnership, intergovernmental). At least one of the parties needs to be a governing board or elected officials.

In 750-1,000 words, do the following:

  • Explain the participants in the situation. (power involved, interest, requirement)
  • Explain the difference between influence and negotiation among the parties.
  • Recommend strategies to build the relationship between the parties in preparation for negotiation (at least one of the parties needs to be elected officials or a governing board)
  • Recommend different techniques of negotiation the parties can utilize to get their interest or requirements met.
  • Discuss how each party determines the value of what they are negotiating for and what they are willing to give up.
  • Discuss what would make each party agree to a decision within a negotiation or leave the table (how much leverage does each party have).

Federal Highway Administration and Lane Construction – Public Private Partnerships Negotiation Techniques Sample Paper

Public private partnerships are cooperative ventures where the public sector agrees to work with a private company in order to achieve efficient production of public goods and services. These ventures usually serve the interests of both the government and the private agency (Delmon, 2017). In such partnerships, the public sector is interested in providing goods and services to the public at an affordable price, while the private company focuses on making reasonable profits from the common venture. These partnerships are usually formed out of elaborate negotiations that seek to meet the interests of each party. A possible public private partnership can be exemplified by the Federal Highway Administration; and the private company, Lane Construction, in a common project of constructing a highway.

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The Federal Highway Administration (FHA) is responsible for the construction and maintenance of highways in the United States. The agency is responsible for identification of areas where highways need to be constructed, as well as takes care of the highways that are already in place. Lane Construction, on the other hand, is a private company that specializes in the actual construction of highways and roads. The FHA is an influential agency as it is the one that is publically mandated to handle contractual issues in construction of highways. It is in the agency’s interest that public highways are constructed in a timely manner, and at a cost-effective price. Lane Construction is one of the leading construction companies in the country, and it is in the company’s interest that it makes good profits on each project it handles.

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Influence and negotiation play an important part in all public private partnerships. The FHA has a significant influence in a possible deal between the two parties because the agency is the sole contactor for federal highways. Lane Construction also has significant influence because of its reputation in the market. As regards negotiation, the FHA would like the construction to be done at the lowest price possible, while Lane Construction would like to construct at the highest price possible in order to maximize on profits. Due to these differences, it is imperative that the two entities build a relationship between embarking on negotiations. This relationship can be built through maintaining constant contact, as well as seeking to understand the concerns and interests of each party.

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The parties can engage in different negotiation techniques to achieve their set goals and objectives. One of the most important techniques that the two parties can use in their negotiation is by trying to be inventive in finding win-win situations in all circumstances (Schachter et al., 2017). This approach is crucial as it alls both sides to find amicable solutions in areas where they find difficulties in reaching straight-forward agreements. Parties can also identify possible common ground before starting their negotiation. This step helps in finding alternative solutions, and aids in creating common areas where both parties can be happy about.

The primary factor that negotiating parties usually consider during business-oriented negotiation is the monetary gain they will derive from the transaction. In this case, the FHA is a governmental organization, which implies that they will be looking to minimize their expenditure as much as possible (Wang et al., 2018). On the other hand, Lane Construction will judge the value of the negotiation by how much profit they will be able to make from providing their services to the government. Therefore, the FHA will be willing to give up on all additional factors that do not affect the quality of the structures that will be constructed, such as decorations. Similarly, the Lane Construction will be willing to giving up on installing features that do not compromise the durability of the structures they construct, as long as it helps them to maximize their returns.

            The factor that would make both parties agree to a decision is the willingness to compromise on each one’s part. Essentially, everyone in a negotiation has their own demands but not all of them can be met by the other party. Accordingly, in order for the deal to be feasible for either the FHA or Lane Construction, each of them must be willing to relinquish some of their requests that might be too harsh for the other side; otherwise, it will be almost impossible to agree to a mutually beneficial deal. One thing that might make either party to leave the table is the realization that the costs of undertaking the project outweigh the benefits that they will gain. In such a case, it will not make sense to push through with the negotiation. In conclusion, negotiations play an integral part in striking of effective public private partnerships. These negotiations should be based on elaborate preparations that consider the interests of each party. Such techniques as identifying common grounds and creating win-win situations are essential in such partnerships. Possible partners should at all times reach agreements that meet the interests of each other, based on reasonable benefits and compromises.

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