PROGRAM ON NEGOTIATION AT HARVARD LAW SCHOOL

AN INTER-UNIVERSITY CONSORTIUM TO IMPROVE THE THEORY AND PRACTICE OF CONFLICT RESOLUTION

HARBORCO

TEACHER’S PACKAGE

PROGRAM ON NEGOTIATION AT HARVARD LAW SCHOOL
AN INTER-UNIVERSITY CONSORTIUM TO IMPROVE THE THEORY AND PRACTICE OF CONFLICT RESOLUTION

HARBORCO
Teaching Notes This is a six-party, multi-issue, scorable negotiation game involving a dispute over the building of a deep-water port. It introduces and explores the uses of principled negotiation and coalitions. Scenario Harborco is a consortium of development, industrial, and shipping concerns interested in building and operating a deep-water port. The consortium has already selected a site for the port, but cannot proceed without a license from the Federal Licensing Agency (FLA). The FLA is willing to grant Harborco a license but only if it secures the support of at least four other parties from among the environmental coalition, the federation of labor unions, a consortium of other ports in the region, the Federal Department of Coastal Resources (DCR), and the governor of the host state. The parties must deal with several issues: (1) Industry mix - what kinds of industries will be permitted to locate near the port? (2) Environmental impact - to what extent will potential environmental damage be mitigated? (3) Employment rules - will organized labor be given preference in hiring for construction and operation of the port? (4) Federal loan assistance - will the DCR provide a federal loan to Harborco? (5) Compensation to other ports - should other ports in the region receive compensation for potential economic losses? Background Readings Fisher, Roger and William Ury, Getting to Yes (New York, NY: Penguin Books, 1983), pp. 17-99. Bacow, Lawrence, and Michael Wheeler, Environmental Dispute Resolution, (New York, NY: Plenum Press, 1984), pp. 21-41, 56-75. Raiffa, Howard, The Art and Science of Negotiation (Cambridge, MA: Harvard University Press, 1982), pp. 251-274.

These teaching notes were written by Lawrence Susskind and Eileen Babbitt, based on a case was written by Denise Madigan and Thomas Weeks under the supervision of Professor Lawrence Susskind (M.I.T.), Assistant Professor David Lax and the Negotiation Roundtable. Copies are available online at www.pon.org, Telephone: 800-258-4406, Fax: 617-495-7818. This case may not be reproduced, revised or translated in whole or in part by any means without the written permission of the Director of Curriculum Development, Program on Negotiation, Harvard Law School, 518 Pound Hall, Cambridge, MA 02138. Please help to preserve the usefulness of this case by keeping it confidential. Copyright © 1984, 1988, 1989, 1994, 1995, 1996, 2007 by the President and Fellows of Harvard College. All rights reserved. (Rev. 3/07)

(This does not include bonus points). When handing out the role-specific Confidential Instructions. make sure that everyone understands the General Instructions and the mechanics of the negotiation. In addition. In particular. distribute the General Instructions at some point prior to the time of the game to give each player an opportunity to think about the scenario and consider the interests of the other negotiating parties. the following points are important to stress: . These votes are required by FLA rules to help monitor the progress of negotiations. 1989. but you must conduct the formal votes. if no alternative proposal is on the table at the time of a vote. . Explain your role as FLA scorekeeper in the context of the story. remind the players that two parties have certain veto power. Hand out Confidential Instructions ahead of time. 1988. All rights reserved. . 1994. Game instructions require at least 30 minutes to read. 1995. in separate rooms). more preparation time is helpful. the game manager should meet with each group separately to welcome them and start the meeting. DCR must be among the supporters of a proposed agreement if any federal subsidy is included. too. Before starting the game. Additional informal votes may be carried out by the groups. If possible. If there is more than one group. Harborco can veto any Copyright © 1984. (You are there to observe the progress of negotiations on behalf of your superiors at the FLA.Harborco must be a party to any agreement.In order for a party to vote "yes" on any package. After these initial discussions. 1996. Confidential Instructions can be distributed just before the game begins. Negotiations require a minimum of 1½ hours. A game manager is needed to conduct periodic votes and to answer questions. You will call for a formal vote after the first 15 minutes. indeed. 2007 by the President and Fellows of Harvard College. explain to players that there is a confidential one-page score sheet attached to the back of their instructions. 7/07) 2 . You may want to have players in each role caucus with others in similar roles to discuss strategy before the actual negotiations begin.) Explain the voting procedures. the vote will be taken on the original Harborco proposal or the previous proposal. and every 40 to 45 minutes (or so) thereafter.Three formal votes will be taken during the course of the negotiation. Otherwise.Only four additional parties (in addition to Harborco) are needed for agreement.HARBORCO: Teaching Notes Logistics This game can be played with either 12 players (two per role) or six players (one per role). to ensure that all the roles are filled in each group. Explain that the FLA will accept no proposal unless at least five of the six parties are on board. . the negotiating group(s) of six or 12 should convene (ideally. (Rev. it must be the proposer of any package. if you can be reasonably sure that all the participants will be present for the play of the game. the proposal must meet or exceed the minimum number of points assigned to that party in his or her Confidential Instructions. No vote is final until you have conducted it.

each person receives his or her walk-away.after 30 to 40 minutes.if the proposal failed. and the Federal DCR can veto any proposal requiring FEDERAL funding. 2007 by the President and Fellows of Harvard College. Compute two sets of points: a) the points each party would have earned with the last proposal. call for a vote on Harborco's initial proposal. (Rev. NEGOTIATION ENDS IF NO AGREEMENT IS REACHED: Write down the last proposal and the votes for and against. You are not there to facilitate or participate in the meeting in any way. (You may suggest.) BEGIN THE NEGOTIATIONS.) FORMAL VOTE #1: Ask Harborco if it has a proposal it would like to submit for a vote. Remind the groups to calculate their score for each proposed package very carefully before voting. Players are free to run the meeting as they wish. Copyright © 1984. write the proposal on the flip chart and ask for a simultaneous show of hands: IND 1 ECOL 1 EMP 2 LOAN 2 COMP 5 Write the If no new proposal is submitted. (This means that you are a SILENT. 1996. original proposal on the flip chart and ask for a simultaneous show of hands: IND 1 ECOL 1 EMP 4 LOAN 2 COMP 1 FORMAL VOTE #2 . 1995. ask the parties to try to come up with a six-party agreement. that players begin by introducing themselves in their roles and by making brief statements. 1989. 1988. 7/07) 3 . or minimum.after 30 to 40 minutes. All rights reserved. IF A FIVE-WAY AGREEMENT IS REACHED in any round. and b) the final scores . except for those times when a formal vote is being taken. score. before moving on to the next group. If a new proposal is submitted. 1994.HARBORCO: Teaching Notes proposal (because it is the developer). PASSIVE observer. FORMAL VOTE #3 .

It is better to believe the arguments made by the other parties. This is what makes the game similar to real life. The highest score possible for each party is circled. Be insistent about taking the formal votes during negotiations. ask the following: 1. All rights reserved. only nine are six-way agreements. by number of the option in each issue category. but you should remind them that the scores are in some way an evaluation of their personal performances. as reported by the groups. Typically. Adding mistakes can lead to a group thinking it has an agreement when it really doesn't. Be sure to check the final scores. Commonly Asked Questions Q: Are the parties allowed to take votes in between the formal voting? A: Yes .HARBORCO: Teaching Notes Notes to Instructor It is important to stress that the purpose of the game is to get the highest possible individual score. It then lists the points that each party will receive for that particular package. 1995. The reason for doing this is for them to get an idea of how positions are changing. 7/07) 4 . 2007 by the President and Fellows of Harvard College. Even if the group doesn't want to vote. versus the groups that did not reach agreement? 2. The debriefing should begin with a posting of scores from each group. 70 percent are 5-way. The score sheet lists each of these possible agreements. is not the best outcome. to be sure there are no miscalculations. We don't advise you to base their grades on those scores. These are all listed in the attached Solution Set. Settling for a score you're not happy with. Identify the people who got the highest score for each role. 1989. push them to put a proposal on the table. 1988. this is closer to a real-life situation. 1994. What happened in the groups that reached agreement. based on the numbers. 10 percent are 6-way.but these are informal votes and not recorded by the game manager. (Rev. You might want to create an incentive for students to maximize their scores. and 20 percent reach no agreement. 1996. Simply comparing the numbers makes it seem too much like a mechanical process. Debriefing There are 55 possible agreements. or to vote on Harborco's original package. What were their strategies? Copyright © 1984. To begin the debriefing. just to reach a six-way agreement. Q: Can we show our score sheets to each other at the end? A: Preferably not.

Few coalitions were stable. It sought to build a package incrementally. 1994. in the face of increasingly attractive offers from Harborco. The other negotiators protested. What happened? 4. Groups opposed to the port caucused simultaneously. attempting to pyramid proposals responsive to each group's concerns. (Rev. 1988. All rights reserved. seeking to block any pro-Harborco agreements. but also working to block packages that offered too few points. Blocking coalitions dissolved. Harborco. What was the negotiation process in the groups reaching five-way agreement? Typically. Often. They also may have been attempting to deprive others of what they presumed would be unduly large gains. Often it is left out of an agreement after failing to construct Copyright © 1984.not wanting to be left out of any settlement that might emerge. offering various concessions. the exchanges in the groups that fail to reach agreement become quite heated. they were holding out for more than their minimum scores). however. 7/07) 5 . Harborco began by asking each group to express its concerns. The following is an example of a five-way agreement that leaves out the Environmental League: • • • • • Industry mix: primarily dirty Ecological impact: maintain or repair Employment rules: unlimited union preference Federal loan: $1 billion over 20 years Compensation to other ports: $150 million This package yields the following scores: Harborco 56 Environ 25 Unions 75 Ports 40 DCR 72 Governor 76 The Environmental League has little room to maneuver in the negotiation. tried to forge a winning coalition with at least four other players. Sometimes agreement eluded the players even when the proposed package permitted five of the parties to vote “yes” (i. What did the participants learn from the game? Commonly Asked Questions 1. Some players. and a series of caucuses began.. had preempted discussion by proposing a package designed to ensure the greatest return on its investment.e. 1989. aimed at meeting the demands of both the union and the environmentalists. unions. Each player was in something of a bind -. Everyone stayed at the table. held out for no project at all since their Best Alternatives To a Negotiated Agreement (BATNA) were high. and the environmental coalition. 2007 by the President and Fellows of Harvard College.HARBORCO: Teaching Notes 3. 1996. usually the other ports. there was very little caucusing. as instructed. thus forming a blocking coalition. 1995. What happened in the negotiations in the groups that reached "no agreement"? Usually Harborco. The representative of other ports continued to vote no. 2. because it scores points on only two of the five issues. Identify the person who got the lowest score for each role.

3. What if a party or parties aren't truthful (i. Lessons can also be learned from six-way agreements.HARBORCO: Teaching Notes a blocking coalition with the other ports. agree to vote a certain way. 4. you may want to caucus with someone to form a blocking coalition. which will be discussed more in a later game. 1996. In effect. Joint gains were possible because each player attached different importance to the various issues being negotiated. while developing packages that allocate these joint gains. What strategies could have led the "no-agreement" groups to agreement? The first step would have been to realize that this was not a zero-sum negotiating situation. 7/07) 6 . Copyright © 1984. as parties may be more protective of their interests in the presence of many would-be adversaries. Consensus agreements are reached only when the parties dedicate themselves to building consensus. 1988. 1994. (Rev. All of these scores are only possible with five-way agreements (one group is always left out).. if not impossible. A BATNA may not be as easy to assess.e. multi-issue game are the elements of principled negotiation and the importance of coalitions. does someone have to play a mediating role? Not necessarily a mediating role. Could we have invented other options? No. 8. 7. 2007 by the President and Fellows of Harvard College. The scoring system is set up to handle only the options described in the game. and then don't)? Aren’t they required to live up to their agreements? There is no such requirement. Such gains could have been realized if they had listened to each other more carefully. But if it looks as if you may not get your BATNA. Is it better to caucus or not? For this game. While forbidden from revealing his or her confidential point allocations. Usually. It is difficult. one player functions as a process manager even though he or she is an interested party. each party must find a way to communicate his or her true interests in a manner that is believable to the others. Explain that negotiation becomes more complicated as more parties and more issues are added. working hard to respond to each other's concerns. the parties create joint gains by trading across issues they value differently. What are the highest possible scores for each role? Harborco: 77 Environmental League: 100 Unions: 90 Other Ports: 64 Federal DCR: 100 Governor: 77. Integrative bargaining may be more difficult to establish. 1989. to find the means to hold someone to such an agreement. 5. it's better to work together at the table. but someone does have to perform a facilitative function. The significant issues to discuss after playing this multi-party. which is a problem with coalitions. 1995. All rights reserved. 6. To get a six-way agreement.

2007 by the President and Fellows of Harvard College. and no incentive to explore each other's interests. This type of bargaining builds little trust between the parties. each party typically identifies bottom line. 2. Concessions are made grudgingly. Positional bargaining occurs when parties do not focus on interests. Sometimes Copyright © 1984. Know your BATNA. based on his or her fallback strategy. Sometimes such criteria are principles that the parties can agree should govern the outcome. In order to explore the interests of parties at the table. rather than adversarial positioning. such as fairness or efficiency. 3. 1996. 4. The endeavor becomes one of joint problem solving. until a compromise position is found or until the parties reach an impasse. This encourages the creativity and joint problem solving so essential to integrative bargaining. 7/07) 7 . agreement. Invent options without committing. rather than constant." which are the underlying concerns of each party. (Rev. and "positions. Most distributive bargaining follows this positional approach. 1989. resulting in a positive-sum. In a scorable game. by contrast. Fisher." which are the stands taken by each party on the issues being negotiated. compels the parties to listen carefully to each other to discover what each feels is really important. and Patton expand the idea of integrative bargaining to include a checklist of principles. so each party feels his or her interests are being protected. 1995. These principles are designed to move any negotiation away from distributive bargaining to one in which all parties are made better off. Focusing on interests. These scores are based on estimates of preference and on expected value of various outcomes.– Fisher. the negotiating process should include the opportunity to brainstorm possible approaches to problems. Parties are more likely to engage in this process if it doesn't tie their hands and lock them into agreements before they are ready. 1988. as there is no opportunity to develop a relationship.HARBORCO: Teaching Notes Elements of Principled Negotiation In Getting to Yes. The main elements are the following: 1. Ury. each party makes small concessions. et al. Interests define the problem in a way that allows for collaboration and creativity in fashioning a solution. After the opening position is offered. All rights reserved. 1994. rather than upward toward a creative outcome. He or she can evaluate options more critically and be clearer with other parties about what he or she needs to be part of any agreement. Knowing one’s BATNA gives each player more power at the negotiating table. the parties using this approach can explore possibilities for trade offs and joint gains. and fallback positions before negotiation begins. the BATNA is given to each player. parties can engage in integrative bargaining and find creative ways to make all parties to the negotiation better off. Insist on objective criteria: Criteria to evaluate proposed options should be objective. In positional bargaining. They argue that by focusing on interests rather than positions. The result is a process that moves backward from an opening position. This principle was explained in the Teaching Notes to the Redstone game. opening. Distinguish interests from positions. distinguish between "interests. Thus the understanding should be that parties will not be held to options they propose during the inventing period. As discussed in integrative bargaining.

rather than getting stuck on differences in style and tactics. Importance of Coalitions In a multi-party negotiation. A very stimulating class discussion can focus on these critiques and the pros and cons of principled negotiation in a variety of real and hypothetical cases." Journal of Legal Education. in which shifting allegiances dominate the play. work has its limitations. et al. The objective criteria themselves can be the subject of much negotiation. 1. and this process can highlight the underlying aspirations of each party. parties can more easily collaborate on joint problem solving." Negotiation Journal. Fisher. 2007 by the President and Fellows of Harvard College. 7/07) 8 . 1 (March 1984). "The Role of Power and Principle in Getting to Yes. Roger. No. to effective coalition building is to find a way to bind the parties together so that shifting is less likely to occur. Sometimes this appeal to principles of fairness can persuade reluctant coalition members to structure their agreement along mutually beneficial lines. No. 1. No. Who are the most likely parties to share your interests? If such a coalition were to form. 5. it's usually easier to deal with attacks on ideas than to handle personal confrontations. 1995. such as when technical models are used. would it be strong enough to block agreements that aren't in accord with its interests? How stable is such a coalition likely to be? Are there other potential coalitions whose interests are in opposition? The stability of a coalition is always quite fragile. 1996. Additional Articles: White. McCarthy. 1988. Vol. The Fisher. There's the possibility that an outside party may be able to lure a coalition member away by offering a bit more than the coalition can provide. (Rev. (January 1985). Vol. Separate the people from the problem: By focusing on the problem rather than on the individuals and personalities at the table." Negotiation Journal. 252) illustrates this dynamic with a coalition game. Copyright © 1984. William. knowing that the final evaluation will winnow out those that don't meet the agreed-upon criteria. The key. "Beyond Yes. 1 (January 1985). All rights reserved. p. 34. therefore.HARBORCO: Teaching Notes objectivity is insured by outside expertise. This approach can also keep the emotions of the negotiation from getting out of control. Vol. one must really understand the interests of each party and be creative about appealing to those interests. "The Pros and Cons of Getting to Yes. 1. Raiffa (Art & Science. the analysis of coalitions becomes crucial in developing strategies both before and during the negotiation itself. An agreement on such criteria can free up the parties to invent options more creatively. Or one can step back from the negotiation a bit and ask what an impartial arbitrator might award to each coalition member. 1994. Parties can work to identify common interests related to the problem. 1989. and there are several good articles that critique the "principled negotiation" approach. To do this. James.

The legitimacy of arguments (and ultimately agreements) is enhanced if supported by objective and respected sources of data. 2. 3. What are some of the limitations of Fisher and Ury's approach? What additional principles would you add to the original list to address these limitations? 3. 1994. especially blocking coalitions. Unfettered brainstorming often yields creative and surprising solutions. This game provides an instructive context for exploring coalition strategies. The importance of pre-negotiation analysis in evaluating options is illustrated. 4. How can coalitions help and hinder potential agreement in a multi-party negotiation? Copyright © 1984. The advantages and disadvantages of revealing all of one's concerns are worth pursuing carefully. Multi-issue. Try to suggest "yes-able" propositions. multi-party negotiations tend to involve the formation of coalitions. Inventing options before committing to them is critical to achieving mutually beneficial outcomes. 2007 by the President and Fellows of Harvard College. Players are exposed to elementary utility analysis in the point-scoring scheme. It almost always pays to maintain cordial working relations with adversaries. That way. Exam Questions 1. 1995. bargaining? 2. 1988. 7/07) 9 . 7. (Rev. 1989. The players can then explore how and why different negotiating strategies led to different outcomes.HARBORCO: Teaching Notes Summary of Lessons 1. 6. It almost always pays to be honest about the "interests" behind your positions. 1996. What are the key elements in "principled negotiation"? How does each element move a negotiation away from distributive. and toward integrative. Parties who reveal their true interests do not necessarily do better than those who remain silent or bluff. other parties will have an easier time constructing proposals that satisfy your most important interests. Focus your energy on solving the problems. even in the face of substantial disagreement. 5. not on beating the other side. All rights reserved.

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). 2007 by the President and Fellows of Harvard College.org.T. Program on Negotiation. 1995. 513 Pound Hall. or translated in whole or in part by any means without the written permission of the Director of Curriculum Development. All rights reserved. This case may not be reproduced. 1996. Cambridge MA 02138. Please help to preserve the usefulness of this case by keeping it confidential. Harvard Law School. 1989. revised. 1994.I. telephone: 800-258-4406 or 617-495-1684). 1988. Copies are available at reasonable cost from the Clearinghouse for the Program on Negotiation at Harvard Law School (Web site: www.pon.PROGRAM ON NEGOTIATION AT HARVARD LAW SCHOOL AN INTER-UNIVERSITY CONSORTIUM TO IMPROVE THE THEORY AND PRACTICE OF CONFLICT RESOLUTION HARBORCO GAME REVIEW FINAL PROPOSAL GROUP Industry Mix Eco Impac t Employee Rules Federal Money Money to Other Ports Harborco (55) Environment (50) FINAL VOTES/SCORES Union (50) Other Ports (31) Federal (65) Government (30) Review Copy Do Not Reproduce This case was written by Denise Madigan and Thomas Weeks under the supervision of Professor Lawrence Susskind (M. Assistant Professor David Lax and the Negotiation Roundtable. (Rev. 2002. 3/07) . Copyright © 1984.

Copies are available at reasonable cost from the Clearinghouse for the Program on Negotiation at Harvard Law School (Web site: www. Assistant Professor David Lax and the Negotiation Roundtable.org. This case may not be reproduced. Please help to preserve the usefulness of this case by keeping it confidential.PROGRAM ON NEGOTIATION AT HARVARD LAW SCHOOL AN INTER-UNIVERSITY CONSORTIUM TO IMPROVE THE THEORY AND PRACTICE OF CONFLICT RESOLUTION HARBORCO GAME VOTING SHEET INDUSTRY MIX VOTE 1 ECOLOGICAL IMPACT EMPLOYMENT RULES FEDERAL LOAN COMPENSATION TO PORTS VOTE 2 Review Copy Do Not Reproduce VOTE 3 This case was written by Denise Madigan and Thomas Weeks under the supervision of Professor Lawrence Susskind (M.). 2007 by the President and Fellows of Harvard College. 1989. Harvard Law School.T. Program on Negotiation. revised. 1994.I. 1996. 1988. 1995. 2002.pon. 3/07) . Copyright © 1984. All rights reserved. or translated in whole or in part by any means without the written permission of the Director of Curriculum Development. Cambridge MA 02138. telephone: 800-258-4406 or 617-495-1684). 513 Pound Hall. (Rev.

and 50-55). 13.e. even though Other Ports receives more than its 31-point minimum. 15. the 35 5-way agreements in which a party other than Other Ports withholds agreement are strategically foolish from Other Ports' perspective. PARTIES (min required points in bold brackets) [55] Har 56 56 61 70 56 61 66 57 68 73 62 73 68 69 67 65 70 56 61 59 59 64 59 59 64 55 59 64 69 55 60 [50] Env [25] [25] [25] [25] [25] [25] [25] 55 55 55 55 55 55 55 55 55 55 55 55 [50] Uni 75 66 68 66 54 56 58 67 76 78 60 66 68 58 50 [39] [41] [29] [31] 73 61 63 [31] Por 40 51 36 44 64* 49 34 [25] 46 31 [21] 44 [29] 34 [19] 53 38 58 43 40 53 38 39 50 35 40 63 48 33 53 38 [65] 72 77 74 65 72 79 76 65 68 65 67 70 67 81 69 68 75 82 89 65 70 67 69 74 71 85 69 76 73 90 87 [30] # 32 33-U 34 35-U 36-U 37-U 38 39 40-U 41 42 43 44 45 46-U 47 48-U 49-U 50 51 52 53 54 55 76 67 70 68 59 61 64 71 66 69 65 60 63 56 59 46 48 39 41 68 59 62 DCR Gov PARTIES (min required points in bold brackets) [55] COM 3 4 5 3 3 4 5 5 3 4 2 3 3 4 4 5 3 4 2 3 4 4 3 4 Har 77* 67 56 73 67 72 70 61 80* 75 59 64 55 60 66 55 66 71 58 63 68 59 56 61 [50] Env [47] 77* 77 77 77 77 77 77 77 77 77 77 77 77 70 70 70 70 70 70 70 70 [50] Uni 56 83 65 81 71 73 65 55 56 58 [44] [46] [36] [38] 63 [45] 51 53 [24] [26] [28] [18] [26] [28] [31] Por 34 35 [25] 40 48 33 [18] [23] 34 [19] 57 42 47 32 41 31 54 39 63 48 33 38 48 33 [65] DCR 65 76 78 65 81 78 66 80 70 67 79 86 100* 97 65 67 70 67 68 75 72 86 80 77 [30] Gov 60 63 59 64 54 57 60 53 52 55 40 42 35 38 63 59 54 57 40 42 45 38 34 37 TOT 339 401 360 400 398 390 356 349 369 351 356 357 350 342 368 327 365 357 323 324 316 309 344 336 max points IND 2 2 2 2 2 2 2 2 2 2 2 2 2 2 3 3 3 3 3 3 3 3 3 3 EC 2 3 3 3 3 3 3 3 3 3 3 3 3 3 2 2 2 2 2 2 2 2 3 3 EMP 4 2 2 3 3 3 3 3 4 4 4 4 4 4 2 2 3 3 4 4 4 4 4 4 FL 1 2 3 1 2 2 2 3 1 1 2 2 3 3 2 3 2 2 2 2 2 3 2 2 Review Copy Do Not Reproduce [22] [22] [22] [47] [47] [47] [47] [47] [47] [47] [47] [47] 90* 81 83 73 69 71 73 61 63 77* 68 71 64 60 62 65 55 58 100* 100* . 38. In those cases (i. 39 & 41). 42-45. So.HARBORCO SOLUTION SET: 55 Possible Agreements* • 12 6-way agreements (marked with U) ISSUES (outcomes) # 1 2 3 4 5 6 7 8 9-U 10-U 11 12-U 13 14-U 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 IND 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 2 2 2 2 2 2 2 2 2 2 2 2 EC 2 2 2 2 2 2 2 3 3 3 3 3 3 3 3 3 3 3 3 1 1 1 2 2 2 2 2 2 2 2 2 EMP 1 2 2 3 3 3 3 1 2 2 2 3 3 3 3 4 4 4 4 2 3 3 1 2 2 2 3 3 3 3 3 FL 3 3 3 2 3 3 3 3 2 2 3 2 2 3 3 2 2 3 3 3 3 3 2 2 2 3 2 2 2 3 3 COM 4 3 4 3 2 3 4 5 3 4 5 3 4 4 5 2 3 2 3 4 3 4 4 3 4 4 2 3 4 3 4 • Max points for each party are asterisked (*) • Points below party minimum are in brackets [25] ISSUES (outcomes) TOT 344 342 334 338 330 331 323 340 379 371 330 368 350 353 319 326 327 319 320 327 324 316 381 379 371 364 367 368 360 361 353 * Note: While all 55 agreements technically are possible. 47. 11. there are only 8 possible 5-way agreements (8. with Other Ports as the lone holdout in each. and thus scuttling the entire deal. 34.. Other Ports would have received even more points (150) by withholding its consent along with the other nonconsenting party. 1-7. 16-32. assuming Other Ports plays its role strategically and never consents to a 5-way deal.

Review Copy Do Not Reproduce .

1994.T. an Air-Sea-Cargo Center (ASCC) would be developed.org. It has already engaged in some preliminary planning and design work. Please help to preserve the usefulness of this case by keeping it confidential. The projected cost of the port is roughly $4 billion (in current dollars). 518 Pound Hall. The deep-water port would be based on an artificial island of roughly nine square miles. but it cannot proceed without a license issued by the Federal Licensing Agency (FLA). (Harborco bases its projections on an independent study by Transport Associates. and operation of the port.I. It believes such a port could generate substantial profits within ten years after operations begin. (Rev. created with fill from the dredging of the access channel. Program on Negotiation. a newly formed national consortium. MA 02138. Substantial infrastructure would be needed to accommodate an intermodal freight terminal of this sort. Copies are available online at www.pon. Telephone: 800-258-4406. Review Copy Do Not Reproduce The Parties Harborco is excited about the prospect of a deep-water port on the East Coast. 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.. and pipelines. Harvard Law School. Assistant Professor David Lax. the port's full development might not be completed until 20 years later. construction. 1989. Copyright © 1984. Onshore. The consortium's members are drawn from a variety of enterprises. railroads. most of which are diversified among a number of commercial activities.PROGRAM ON NEGOTIATION AT HARVARD LAW SCHOOL AN INTER-UNIVERSITY CONSORTIUM TO IMPROVE THE THEORY AND PRACTICE OF CONFLICT RESOLUTION HARBORCO General Instructions Harborco.) In addition. 1996. This case may not be reproduced. is interested in building and operating a deep-water port off the coast of Seaborne. Like the European seaport Rotterdam. revised. Cambridge. All rights reserved. along with major connections to existing highways. While components of the port could be operational as early as five years after construction begins. Harborco is prepared to participate in the financing. and the Negotiation Roundtable. which concluded that such a port could be economically viable under several possible scenarios. or translated in whole or in part by any means without the written permission of the Director of Curriculum Development. These case was written by Denise Madigan and Thomas Weeks under the supervision of Professor Lawrence Susskind (M. 1995. Fax: 617-495-7818. The Project The deep-water port proposed by Harborco would be the first of its kind on the East Coast. railroads. Most of the industrial plant and ancillary facilities would be located on the island. Inc.). and pipeline networks. 1988. 3/07) . The island would be connected to the shore by a network of highways. 2007 by the President and Fellows of Harvard College. It would be located in Seaborne at the estuary of the Banksedge River.

1988. the FLA is now very sensitive to the level of political support surrounding each application it reviews. 1989. They are extremely skeptical of Harborco's claim that all regional ports will share in the economic benefits generated by the new port. 1994. regional. All rights reserved. if it is constructed. increases waste disposal problems. a powerful political constituency. They will argue strongly. Consequently. 3/07) Review Copy Do Not Reproduce 2 . (This local federation is affiliated with the National Federation of Labor Unions. 2007 by the President and Fellows of Harvard College. Governor Sherwood (of Seaborne): Governor Sherwood is in her second gubernatorial term and is eager to promote development in her state. Local Federation of Labor Unions (The Unions): The Unions are generally pleased that new development is being considered for Seaborne. While aware of other parties' interest in its proposal. 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. have an interest in the deep-water port and Harborco's application for a license. especially development that threatens the fragile ecosystems. They anticipate hundreds of new jobs will be created in both the short and long run. that these jobs should be reserved for local union members. The Licensing Process Harborco submitted an application just one month ago for FLA review. Harborco expected little difficulty in the licensing phase of this project. The League is worried that Harborco's proposed port would seriously damage the environment of Seaborne and destroy the basic Banksedge River ecology. to the needs of organized labor. Copyright © 1984. however. however. and has the resources and authority to subsidize such a port. and (2) to preserve the environmental integrity of the nation's coastal areas. The Environmental League: This coalition of environmental interest groups is generally opposed to any development of coastal areas. adds to air and water pollution. and is therefore eager to see that unions share in the benefits of the port. 1995.) Other Ports in the Region: The four other ports in the region are not pleased with Harborco's proposal. however.HARBORCO: General Instructions Harborco believes the local. has recently been criticized by several members of Congress for failing to consider the "broader public interest" in its previous licensing determinations. The DCR would like to see a deep-water port established somewhere on the East Coast. and increases health and safety risks. however. The FLA. which would dramatically reduce the transport costs of imports and exports. She is sensitive. and national economies could benefit from a port. (Rev. They expect to lose a substantial amount of business to the new port. 1996. Several other parties.

the Federal DCR can veto any project that requires a federal loan or loan guarantee. 1994. Copyright © 1984. These industries will either lease or purchase land on the artificial island and onshore. dirty plants would be excluded. ISSUE A: Industry Mix The deep-water port itself is only part of the development Harborco has planned. The Issues Preliminary discussions have taken place between Harborco and representatives of the five key parties. have argued that strict limits should be placed on the industry mix allowed in the area. steel productions plants. can exercise some veto power. Option A1: Primarily dirty. Therefore. 1996. As a result of these conversations. and they will eventually generate the bulk of the revenues associated with the new port. steel mills. and a resource recovery plant. Option A3: All clean. however. This means that it could choose to develop (or encourage) any type of industry or plant. (The FLA would prefer to see all five parties support a Harborco application. more detailed information is provided in each party's Confidential Instructions. they are asking that only relatively "clean" industries such as high-tech production plants be allowed. Option A2: Clean/Dirty. Harborco has identified five issues that seem to be of concern to all or some of the parties. The environmentalists. 1995. but it will grant a license even if only four lend their support. Would exclude the dirtiest industries. three options have surfaced in the discussions between Harborco and the environmentalists. As a result of this controversy. In addition. the FLA will not approve Harborco's application unless it is clear that there is substantial support for the project. All rights reserved. The construction will attract a variety of industries seeking access to the port.) Two parties. including oil refineries. 3/07) Review Copy Do Not Reproduce 3 . (Rev.HARBORCO: General Instructions In this case. Harborco has initially requested the freedom to develop any industry mix it chooses. or a resource recovery plant. 1988. Harborco can veto any proposal in this negotiation (since no other party is capable of initiating the development). No industry would be excluded. petrochemical plants. 2007 by the President and Fellows of Harvard College. however. 1989. — Would be limited to only clean industries such as high-tech production industries. but the mix would probably be dominated by oil refineries. A general description of the issues is provided below. but would allow a limited number of moderately dirty plants (including food-processing plants). the FLA has decided that it will approve Harborco's proposal ONLY IF Harborco can muster the support of at least four other parties.

1988. 1995. and constructing and operating a small waste-treatment facility to treat effluents flowing into the estuary from the Banksedge River. (Rev. The damage would include the alteration of nesting habitats. counter that the damage would be excessive and that Harborco has no right to disrupt the area. and certain types of aquatic flora and fauna would be destroyed. Like the previous option. Harborco admits that the new deep-water port would create some damage to the ecological setting. 1994.HARBORCO: General Instructions Air pollution. this would include special efforts to bypass delicate areas during construction and dredging. an active anti-erosion program. water pollution. and substantial subsurface geologic impacts (caused by drilling and dredging). 1996. All this would take place within federal and state impact mitigation guidelines. three outcomes are possible: Option B1: Some harm to ecology. But it would also include the relocation or recreation of habitats destroyed by unavoidable dredging and construction. All rights reserved. a reduction in natural tidal flushing. and general construction activity could seriously disrupt existing ecologically delicate areas both onshore and offshore. adverse impacts on existing fisheries. Option B3: Improve the ecological setting. 3/07) 4 . all industries would conform to existing federal and state pollution regulations. Fish and animal nesting habitats would be altered (or effectively destroyed). Issue C: Employment Rules Review Copy Do Not Reproduce Construction and operation of the deep-water port is expected to generate hundreds of new jobs in the community in both the short and long run. 2007 by the President and Fellows of Harvard College. valuable wetlands would disappear. Regardless of the industry mix. Issue B: Ecological Impact The dredging of the access channel. 1989. the destruction of wetlands. But it would also include a variety of other efforts to improve the local environment. and waste disposal would vary with the industry mix selected. but it also claims that such damage would be within the limits defined by federal and state regulations. Option B2: Maintain or repair ecological balance. Environmentalists. Environmentalists propose ongoing fishery management and wildlife protection. This would involve unremedied disruption to the ecology. water temperatures and currents would change. This would involve special precautions to divert construction and dredging activity (where possible) from the most ecologically delicate or important areas. however. In light of these arguments. These jobs can be distributed among potential employees in one of three ways: Copyright © 1984. serious land erosion. creation of the island. creating new and larger protected wetland areas.

Harborco estimates that the total cost of developing the port will be roughly $4 billion. Jobs would be reserved for local union workers. expect to suffer a substantial loss of traffic once the new port begins Copyright © 1984. No federal loan. Issue E: Compensation to Other Ports in the Region Harborco believes the new port will generate significant economic growth both inside and outside the state. enabling Harborco to maintain its hiring flexibility and to reduce its expected wage costs. most workers would probably be nonunion. and it has requested $3 billion in guaranteed loans. where appropriate. A $2 billion loan (at 15% interest) over the next 20 years. Four options appear possible: Option D1: Option D2: Option D3: Option D4: Review Copy Do Not Reproduce A $3 billion loan (at 15% interest) over the next 20 years. 2007 by the President and Fellows of Harvard College. Option C2: Union quota of 2:1. The other ports. 1988. 1994. Limited preference could be given to union members where the ratio of union to nonunion workers would not fall below 2 to 1. Option C3: than 1 to 1. It contends that the entire regional economy will be improved by the port. 1995. while preserving their environmental integrity. (Rev. and that the other four major ports on the Eastern Seaboard will benefit from this growth. However. the DCR will insist on certain aspects of port design before it will contribute to the port.HARBORCO: General Instructions Option C1: Unlimited union preference. 1989. however. 3/07) 5 . In addition. It can provide a substantial loan (or guarantee private borrowing) to help cover construction and operating costs of the port over the next 20 years. new workers might be drawn from outside Seaborne. Harborco would be free to hire whomever it chooses. Issue D: Federal Loan The newly created Federal Department of Coastal Resources (DCR) has a mandate to promote economic use of coastal areas. In this scenario. The ratio of union to nonunion workers would not be less Option C4: No union preference (unrestricted hires). Union quota of 1:1. 1996. All rights reserved. This would enable local union members to claim as large a share of the new jobs as possible. A $1 billion loan (at 15% interest) over the 20-year period.

The Negotiation Harborco has already submitted a license application to the FLA. five possible options are up for consideration. They have estimated the present discounted value of their losses to be roughly $600 million. 1994.) Mechanics of the Negotiation All five parties have agreed to attend the meeting. 2007 by the President and Fellows of Harvard College. In light of this conflict. representing losses for 10 years after the new port begins operation. (Of course. Its stated objective for the meeting is to seek a negotiated agreement among all parties to ensure unanimous support for its proposal. Option E4: Harborco pays $150 million (or 25% compensation). Option E5: Harborco makes no compensation to the other ports. and No compensation payments to other ports (Option E5). No special preference for union workers (Option C4). (Rev. which proposes the following: * * * * * Review Copy Do Not Reproduce A primarily dirty industry mix (Option A1). The Copyright © 1984. Option E1: Harborco pays $600 million (or 100% compensation) in current dollars to the other ports. Though the ports would be free to spend this money as they wished. and are seated at the negotiating table. A $3 billion loan from the DCR (Option D1). but it is anxious to have its application approved as is. 3/07) 6 . In an attempt to muster support for its current proposal. 1989. 1988. They think Harborco should compensate them for these losses. Option E3: Harborco pays $300 million (or 50% compensation). they could use these funds to make changes that would enable them to serve more effectively as feeder ports for the new deep-water port. 1996. Harborco has invited all the key parties to a meeting at the Ritz-Carlton Hotel. Harborco is free to submit changes to its proposal at any time during the licensing review process. Option E2: Harborco pays $450 million (or 75% compensation). All rights reserved. Some harm to the ecology (but within federally and state-prescribed limits) (Option B1). 1995. Harborco needs the support of only four other parties in order to secure a license.HARBORCO: General Instructions operation.

HARBORCO: General Instructions

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 discussion may progress in any direction, but Harborco will be searching for a proposal that will win enough votes for FLA approval. Anyone can suggest alternative 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 85 minutes of 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 a show of hands. Once a proposal is passed (i.e., receives supporting votes from at least four of the five 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 that either benefit the supporting parties or entice the non-supporting party to vote for the agreement. If the parties to the original agreement do not unanimously support proposed improvements, 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 four votes in addition to Harborco's), the FLA will reject Harborco's application for a license.

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Copyright © 1984, 1988, 1989, 1994, 1995, 1996, 2007 by the President and Fellows of Harvard College. All rights reserved. (Rev. 3/07)

7

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P ROGRAM

O N N EGOTIATION AT H ARVARD L AW S CHOOL AN INTER-UNIVERSITY CONSORTIUM TO IMPROVE THE THEORY AND PRACTICE OF CONFLICT RESOLUTION

HARBORCO
Confidential Instructions for the Federal DCR Negotiator (From the Secretary of Coastal Resources) Harborco's recent application to build and operate a deep-water port in Seaborne is very intriguing. We are certainly interested in seeing a deep-water port finally developed on the East Coast. Unfortunately, some of our lower-level staff appeared over-eager in initial discussions with Harborco and would have gladly committed our entire budget to this venture had my deputy secretary not stepped in! This meeting seems a perfect opportunity to test the strength of Harborco's commitment to the project, and to wrangle some concessions in return for funding. Scoring. In order to help you plan your negotiating strategy, our policy shop has constructed a special 100-point scoring scheme to illustrate which negotiable outcomes are of greatest and least importance to us. Under this scheme, the most-preferred set of outcomes is worth 100 points to us; the least-preferred is worth zero. You can earn up to 100 points depending upon how each of the five issues is resolved. The use of points may seem a bit artificial and awkward. But for the purposes of this negotiation, it enables us to combine our several interests -- developing the coastline, appeasing our Congressional oversight committee, retaining control over important projects, etc. -- into a single "currency." This, in turn, allows us to compare the gains and losses associated with different issues. Your task is to try to earn as many points as possible in this negotiation. This is not being greedy -- it simply means that we want to further our legitimate interests as far as possible. We will support any project worth at least 65 points, but that is the bare minimum we can accept. We certainly hope you will do much better. Federal Loan. This issue is obviously of paramount importance to us. We would prefer to have at least some financial involvement in the project in order to retain some control over its operation. If we support this port and it turns out to be successful, our institutional credibility will improve dramatically. In addition, the current administration would like to claim credit for helping to establish the East Coast's first deep-water port.
This case was written by Denise Madigan and Thomas Weeks under the supervision of Professor Lawrence Susskind (M.I.T.), Assistant Professor David Lax, and the Negotiation Roundtable. Copies are available at reasonable cost from the Clearinghouse for the Program on Negotiation at Harvard Law School (Web site: www.pon.org; telephone: 800-258-4406 or 617-495-1684). This case may not be reproduced, revised, or translated in whole or in part by any means without the written permission of the Director of Curriculum Development, Program on Negotiation, 513 Pound Hall, Harvard Law School, Cambridge MA 02138. Please help to preserve the usefulness of this case by keeping it confidential. Copyright © 1984, 1988, 1989, 1994, 1995, 1996, 2002, 2007 by the President and Fellows of Harvard College. All rights reserved. (Rev. 3/07)

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have unlimited funds to bestow on this project. we should be very careful not to alienate members of Congress from these areas. 1994. While we acknowledge the tremendous public benefits associated with a deep-water port on the East Coast. 1989. In addition. we would like to spread our money across as many worthwhile projects as possible. unfortunately. (Rev. 1988. (Congress would also like to see our money spent in as many congressional districts as possible. we are not averse to improvements. we would definitely prefer some financial involvement to none. We can. 1995. after all. But our Congressional oversight committee is anxious to see significant private-sector involvement in all projects we underwrite.HARBORCO:: Confidential Instructions for the Federal DCR Negotiator We do not. On the other hand. All rights reserved. we cannot accept a port that promises to do substantial damage to the environment. Consequently. it will not be impossible for them. 3/07) 2 . (We think they already have almost $2 billion in potential commitments lined up. there are several other projects being planned on both the East and West Coasts. Improvements should be considered icing on the cake. 2002.) Ecological Impact. But we are far more concerned that Harborco at least agrees to maintain and repair the setting. 2007 by the President and Fellows of Harvard College. We would be somewhat reluctant to sign an agreement that specifically excludes these ports from consideration. Copyright © 1984. we do not want to burden Harborco with improving the ecology if such improvement threatens the economic viability of the port. and so we have assigned the following points to this issue: * $1 billion loan * $2 billion loan * $3 billion loan * No loan = = = = 40 points 26 points 10 points 0 points As indicated by the point distribution. Compensation to Other Ports. We have assigned the following points to this issue: Review Copy Do Not Reproduce * Improve the setting = 25 points = * Maintain and repair the setting 20 points * Do some harm to the ecological setting = 0 points As you can see. 1996. While Harborco will have a somewhat difficult time raising the remaining $3 billion. our first choice is to provide just $1 billion.) In addition. many involving improvements to the existing ports. In light of our dual mandate. win some political credibility if improvements take place. This is a tricky issue for us because the four other ports in the region are part of our newly created constituency.

we do not want to jeopardize the economic viability of the port by imposing huge compensation costs on it. 2002. as good Republicans (and former businessmen) we have some Copyright © 1984. it would also unduly limit the profit potential of Harborco's port. The following points are assigned to the various compensation levels proposed: * $300 million * $150 million * $450 million * $600 million * No compensation = = = = = 15 points 12 points 8 points 4 points 0 points Industry Mix. Moreover. We have assigned the following points to this issue: * Clean/dirty * All clean * Primarily dirty = = = Review Copy Do Not Reproduce 11 points 5 points 0 points As you can see. 1995. Harborco should be free to develop a reasonably diverse industry mix.HARBORCO:: Confidential Instructions for the Federal DCR Negotiator On the other hand. 1996. All rights reserved. Employment Distribution. in fact. this is perhaps a minor issue. Too narrow a mix would make the port extremely vulnerable to fluctuations in the economy. we again prefer the compromise position to either of the two extremes. they will undoubtedly gain other business as feeder ports. Consequently. The proposed compensation payments are calculated in current dollars and could prove to be a substantial burden for Harborco. While we agree that the all-clean industry mix would create the least environmental damage. estimates of the value of this new business do not appear to have been included in their projected loss estimates. Compared to the other issues in this negotiation. This issue is moderately important because of its impact on the environment. we need not be overly sensitive. 1989. (Rev. we prefer the compromise solutions to either of the two extremes. While these other ports may lose some business. the other ports have overestimated their projected losses. Nevertheless. Our analysts suggest that. Here we think the environmentalists' demands may be a bit extreme. 1988. clean/dirty industries are much more likely to benefit from access to the port than all-clean industries. We think a fair solution would be compensation of roughly $300 million. 1994. 2007 by the President and Fellows of Harvard College. 3/07) 3 . While our mandate requires us to be sensitive to environmental concerns.

1989. Review Copy Do Not Reproduce I am confident that you will negotiate an extremely valuable agreement for me. 3/07) 4 . 1995. 2007 by the President and Fellows of Harvard College. which summarizes the points assigned to each issue. Copyright © 1984. (Rev. All rights reserved. 1994. This information is CONFIDENTIAL!! Do not show your scoring sheet to anyone.HARBORCO:: Confidential Instructions for the Federal DCR Negotiator private qualms about tailoring a federally subsidized project to help organized labor. Good luck. But you should feel free to lend your support on this issue to any allies whose interests coincide with our own. but do not let him or her actually see your scoring sheet. Publicly opposing the unions on ideological grounds is probably very risky. You may convey some or all of your scoring information to a mediator. The workers haven't even been hired yet and already the unions are involved. 1996. * * * * * We have attached a one-page scoring sheet. 2002. It will also allow Harborco an opportunity to experiment with labor-saving technologies that have historically been blocked by unions at other ports. 1988. The following points are assigned to this issue: * No union preference * Union quota of 1:1 * Union quota of 2:1 = = = 9 points 4 points 2 points 0 points * Unlimited union preference = Keeping the unions out of the port will enable Harborco to keep its wage costs reasonably low.

Harborco pays no compensation Review Copy Do Not Reproduce (15) 4 8 15 12 0 (100) This is also your score if no agreement is reached.HARBORCO:: Confidential Instructions for the Federal DCR Negotiator Confidential Score Sheet for the FEDERAL DCR NEGOTIATOR Issue/Option A: Industry Mix Total Points (11) 0 11 5 (25) 0 20 25 (9) 0 2 4 9 (40) 10 26 40 0 1st vote 2nd vote 3rd vote 1. 1989. All rights reserved. unlimited union preference 2. 3/07) 5 . union quota 2:1 3. all clean B: Ecological Impact 1. no federal loan E: Compensation to Other Ports 1. 2002. no union preference D: Federal Loan 1. maintain & repair 3. primarily dirty 2. $2 billion 3. 1995. (Rev. union quota 1:1 4. 1994. harm 2. Harborco pays $300 million 4. clean/dirty 3. $3 billion 2. improve C: Employment Rules/ Distribution 1. Harborco pays $450 million 3. A through E: TOTAL (your goal) MINIMUM NEEDED FOR AGREEMENT = 65. 1996. Copyright © 1984. $1 billion 4. Harborco pays $600 million 2. Harborco pays $150 million 5. 1988. 2007 by the President and Fellows of Harvard College.

please describe the agreement and identify the number of points it generated: ISSUE: A. Which industry mix was agreed to? B. 1994. 3/07) 6 . How much in loans will DCR guarantee? (amount) E. Will Harborco harm.HARBORCO:: Confidential Instructions for the Federal DCR Negotiator Confidential Summary of Points for the FEDERAL DCR NEGOTIATOR Your name: Group #: Did Harborco get an agreement? (circle one) If "yes" who signed (or voted for) the agreement? YES Federal DCR Other Ports NO Union Governor Environmentalists If your group reached agreement. 1995. How much compensation will other ports receive? (amount) Review Copy Do Not Reproduce TOTAL POINTS GENERATED BY AGREEMENT: (ADD ITEMS A THROUGH E) Copyright © 1984. (Rev. 2002. or improve the ecology? C. Will unions receive preference? How much? Unlimited? 2:1? 1:1? OUTCOME POINTS D. 1989. All rights reserved. 1988. maintain and repair. 2007 by the President and Fellows of Harvard College. 1996.

While your bottom line is 65 points. This means that we would not be too upset if forced to accept the worst possible outcome (unlimited union preference) on this issue. but we also want to minimize unnecessary expenditures for Harborco. An agreement worth zero points would be the worst possible agreement. Several issues are being discussed. Supporting such a project would cost us more than we would gain. do not. Under the 100-point scoring scheme. We might secure environmental reparations. In contrast. 1994.e. show your score sheet to any other player. (Note than an agreement worth zero points may have a "non-zero" effect on us. (Rev. you should examine your score sheet closely when planning your negotiating strategy. but you should not let them see your actual score sheet. i. we have decided to use points in our instructions to indicate how different agreements serve (or harm) our overall interests. Therefore. we are least concerned about the employment issue and have assigned it only nine points. We might even face no agreement at all. We would not want to end up with our worst outcome (no federal loan) on this issue. All rights reserved. or we might face damage to the ecology. but we'd also like to see our resources saved for other projects around the country. It is assigned zero points only because it reflects "zero gains" over the worst possible outcome. They will have to trust you to give them accurate information about your preferences -. under any circumstances. 2007 by the President and Fellows of Harvard College. Finally. an agreement worth 100 points would be the best agreement you could negotiate.HARBORCO:: Confidential Instructions for the Federal DCR Negotiator APPENDIX A Discussion of the Scoring System (For the FEDERAL DCR NEGOTIATOR) We have several interests in today's negotiation. 3/07) 7 .. theirs may be 45 or 85. 1988. Since we will be evaluating you on the basis of your score in this negotiation. Remember. it may involve net costs or net benefits. If agreement is reached. Review Copy Do Not Reproduce Copyright © 1984. and a variety of outcomes are possible. 1995. For example. in this negotiation we are most concerned about the federal loan issue and have therefore assigned it 40 out of 100 possible points. or we might be forced to offer $3 billion. This is clearly a complex negotiation for us. you should not vote for any project worth fewer than 65 points. A score of 75 may mean more (or less) to you than to other parties. we might provide only $1 billion to the project.just as they would if this were a real-world negotiation. We'd like to see the deep-water port constructed with our financial assistance. 1996. 1989.) Differences in points can tell you which issues (or specific outcomes) are worth arguing for. 2002.a psychological factor that makes comparison across parties difficult to interpret. Also. You may wish to express the strength of your interests to other players. resist the temptation to compare your score with the scores of other parties in this negotiation. We'd like to preserve the environmental integrity of the coast. Their bottom lines depend on their valuation of the alternatives to agreement -.

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1996. 1988. -. Harvard Law School. On the other hand. Although we can try to use this meeting to negotiate an improvement in the environment. In this case. The port is not constructed.I. Of the five issues to be discussed at this meeting. Please help to preserve the usefulness of this case by keeping it confidential. and causing serious damage to the ecology. we should prepare ourselves for yet another episode of government-sanctioned degradation of the environment. The use of points may seem artificial and abstract. This development would result in substantial environmental damage. your participation in the meeting may help prevent the worst possible scenario: a deep-water port including primarily dirty industries. 513 Pound Hall. or translated in whole or in part by any means without the written permission of the Director of Curriculum Development. etc.into a single "currency. For the purposes of this negotiation. 1989. we don't want to be seen as lending our support to an environmentally harmful project. the points allow us to compare the benefits (or costs) of a negotiated agreement with our alternatives. telephone: 800-258-4406 or 617-495-1684). This case may not be reproduced.minimizing pollution.pon.P ROGRAM O N N EGOTIATION AT H ARVARD LAW S CHOOL AN INTER-UNIVERSITY CONSORTIUM TO IMPROVE THE THEORY AND PRACTICE OF CONFLICT RESOLUTION HARBORCO Confidential Instructions for the Environmental League Negotiator (From the League's Board of Directors) We are very concerned about Harborco's proposal to construct and operate a deep-water port. We were initially reluctant to send you to this meeting. 3/07) Review Copy Do Not Reproduce . Should Harborco fail to muster enough votes for its project. Cambridge MA 02138. it enables us to combine our several interests -. fine. preserving the credibility and efficacy of our organization. only two are important to us: the industry mix and the ecological impact. Assistant Professor David Lax. In order to help you plan your negotiating strategy. Copies are available at reasonable cost from the Clearinghouse for the Program on Negotiation at Harvard Law School (Web site: www. 2002. revised. 1995. We cannot afford to lend our support to any development project worth fewer than 50 points. and the Negotiation Roundtable. In addition. if we can negotiate some extra environmental protection. This case was written by Denise Madigan and Thomas Weeks under the supervision of Professor Lawrence Susskind (M. All rights reserved. 2007 by the President and Fellows of Harvard College. Scoring. Compromising on one or more issues is worth somewhere between zero and 100 points. we feel it might be worth lending our support.org." This in turn allows us to compare the potential gains and losses associated with different issues. Our most-preferred set of outcomes is worth 100 points. depending upon how each of the issues is resolved. Although it might seem unusual for an environmental group like ours to support a major development project on the coast. After all. we can support the port only if it yields at least 50 points to us. our least-preferred is worth zero points. 1994.T. protecting wildlife and the wetlands. (Rev. Program on Negotiation. we have constructed a special 100-point scoring scheme to illustrate which possible outcomes are of the greatest and least importance to us. Copyright © 1984.).

it may be very hard to repair. however. We also Review Copy Do Not Reproduce Copyright © 1984. in turn. Although we are very concerned about industry mix. Such a mix would wreak continuous and long-term havoc on the environment. If Harborco succeeds in winning approval for an environmentally disastrous project. 3/07) 2 . 2002.) At a minimum. we have assigned the following points to the industry mix issue: * All clean * Clean/dirty * Primarily dirty = = = 45 points 22 points 0 points Obviously. All rights reserved. Ecological Impact. we hope to persuade Harborco to refrain from degrading the ecology. that even if we win this issue we could not sign an agreement without concessions on the ecological impact issue as well. we are even more concerned about ecological impact. We are extremely concerned that Harborco will succeed in introducing a primarily dirty industry mix into Seaborne.HARBORCO: Confidential Instructions for the Environmental League Negotiator and we are no worse off today than yesterday. Though virtually any industry will have some waste to dispose of. and oil spills. but that is the bare minimum we can accept. and once the damage is done. the damage created by the primarily dirty industries will not begin until the plants are in operation. introduce hazardous wastes (including highly toxic dioxins) and threaten worker and community safety. 1994. Ecological settings will be disrupted as soon as construction on the port begins. Note. We will support any agreement that yields at least 50 points of value.it simply means that we want to further our legitimate interests as far as possible. (Rev. Industry Mix. 1996. We must strongly object to any proposal that would permit the introduction of primarily dirty industries into Seaborne. Perhaps by that time we will have stricter regulations in place. want to negotiate major improvements to the area. fires. 2007 by the President and Fellows of Harvard College. Resource recovery plants. Therefore. We can always attempt to delay the project in court. our first preference is for the all-clean industry mix. 1995. 1989. We certainly hope you will do much better. (In contrast. oil refineries introduce the danger of explosions. This is not being greedy -. Oil refineries and steel mills typically discharge vile and hazardous effluent -. we do not want our names attached to it.all perfectly legal! In addition. 1988. Your task is to try to earn as many points as possible in this negotiation. the all-clean industries are the least objectionable.

2007 by the President and Fellows of Harvard College. (Rev. We have no strong feelings about the other three issues -. 1996. 1995. All rights reserved. 2002. in turn. we may be able to use these issues strategically. 1988. since we do not want to antagonize potential allies. It also reflects our desire to score an immediate and visible victory.HARBORCO: Confidential Instructions for the Environmental League Negotiator We have assigned the following points to this issue: * Improve the setting * Maintain and repair the setting * Do some harm to the ecological setting = = = 55 points 25 points 0 points This point spread reflects the value of environmental protection and improvement. but do not show him or her your scoring sheet. and compensation to other ports -. Our primary concern is with the environment. 1989. since the other parties may not know that they are unimportant to us. This will. Copyright © 1984. you should probably treat these issues carefully. boost morale and (we hope) contributions to the League. federal loans. In addition. Good luck. You may convey some or all of the information verbally to a mediator. 1994. * * * * * We have attached a one-page scoring sheet that summarizes our analysis of the issues. This information is CONFIDENTIAL! You should not show this sheet to anyone. Other Issues. Still. 3/07) 3 .employment. Review Copy Do Not Reproduce We're confident that you will negotiate an extremely valuable agreement for us.up for discussion. Our constituent environmental groups will be impressed by any agreement that generates immediate and concrete improvements to the environment.

Harborco pays $150 million 5. 2002. union quota 2:1 3. unlimited union preference 2. 1988. Copyright © 1984. clean/dirty 3.HARBORCO: Confidential Instructions for the Environmental League Negotiator Confidential Score Sheet for the ENVIRONMENTAL LEAGUE NEGOTIATOR Issue/Option A: Industry Mix 1. 1994. no union preference D: Federal Loan 1. no federal loan E: Compensation to Other Ports 1. all clean B: Ecological Impact 1. (Rev. Harborco pays $600 million 2. 1995. is reached. 3/07) 4 . union quota 1:1 4. 1989. 1996. $2 billion 3. harm 2. $1 billion 4. All rights reserved. Harborco pays $300 million 4. 2007 by the President and Fellows of Harvard College. maintain & repair 3. improve C: Employment Rules/ Distribution 1. primarily dirty 2. Harborco pays $450 million 3. Harborco pays no compensation A through E: TOTAL (your goal) Total Points (45) 0 22 45 (55) 0 25 55 (0) 0 0 0 0 (0) 0 0 0 0 (0) 0 0 0 0 0 (100) _______ 1st vote 2nd vote 3rd vote Review Copy Do Not Reproduce This is also your score if no agreement MINIMUM NEEDED FOR AGREEMENT = 50. $3 billion 2.

2002. Will Harborco harm. 1988. 1996. 1994. Will unions receive preference? How much? Unlimited? 2:1? 1:1? OUTCOME POINTS D. 2007 by the President and Fellows of Harvard College. 1995. or improve the ecology? C. All rights reserved. 1989. (Rev. How much in loans will DCR guarantee? (amount) E. 3/07) 5 .HARBORCO: Confidential Instructions for the Environmental League Negotiator Confidential Summary of Points for the ENVIRONMENTAL LEAGUE NEGOTIATOR Your name: Group #: Did Harborco get an agreement? (circle one) If "yes" who signed (or voted for) the agreement? YES Federal DCR Other Ports NO Union Governor Environmentalists If your group reached agreement. please describe the agreement and identify the number of points it generated: ISSUE: A. Which industry mix was agreed to? B. How much compensation will other ports receive? (amount) Review Copy Do Not Reproduce ______ TOTAL POINTS GENERATED BY AGREEMENT: (ADD ITEMS A THROUGH E) Copyright © 1984. maintain and repair.

Do not. Supporting such a project would cost us more than we would gain. We would not want to end up with our worst outcome (harm to the ecology) on this issue.just as they would if this were a real-world negotiation. resist the temptation to compare your score with the scores of other parties in the negotiation. 3/07) Review Copy Do Not Reproduce 6 .. Under the 100-point scoring scheme described in the instructions. or we may have to settle for a clean/dirty mix. i. We may win improvements in the ecological setting.e. You may try to express the strength of your interests to other players. 1996. show your score sheet to any other player. A score of 75 points may mean more (or less) to you than to other parties. you should not vote for any project worth fewer than 50 points. In contrast. under any circumstances. The outcomes possible in each of these areas would not directly affect us. it may involve net costs or net benefits. but you should not let them see your actual score sheet. In contrast. For example. we are least concerned about the employment. Therefore. We may succeed in limiting Harborco to an all-clean industry mix. federal loan. in this negotiation we are most concerned about the ecological impact issue and have therefore assigned it 55 out of 100 possible points. We'd like to prevent Harborco from introducing nuclear power in the area. We'd like to see improvements made in the ecological setting. Remember. and a variety of outcomes are possible. an agreement worth zero points would be the worst possible agreement. While Copyright © 1984. we have decided to use points in our instructions to indicate how different agreements serve (or harm) our overall interests. 2007 by the President and Fellows of Harvard College. Or. or we may win only maintenance and repairs. there may be no agreement at all. 2002. including ongoing fishery management and erosion prevention. It is assigned zero points in our scoring scheme only because it reflects "zero gains" over the worst possible agreements. Several issues are being discussed. All rights reserved. We may be excluded entirely from an agreement (and be faced with a project that does maximum damage to the environment). 1994.HARBORCO: Confidential Instructions for the Environmental League Negotiator APPENDIX A Discussion of the Scoring System (For the ENVIRONMENTAL LEAGUE NEGOTIATOR) We have several interests in today's negotiation. (Note that an agreement worth zero points may have a "non-zero" effect on us. Finally. This is clearly a complex negotiation. 1995. 1989.) Differences in points can tell you which issues (or specific outcomes) are most worthwhile for us. 1988. and compensation issues and have assigned them zero points. We'd also like to score a major victory in order to improve our organization's credibility with other environmental groups. you should examine your score sheet closely when planning your negotiating strategy. (Rev. Because we will be evaluating you on the basis of your score in this negotiation. They will have to trust you to give them accurate information about your preferences -. an agreement worth 100 points would be the best agreement you could negotiate.

2002. 1996. 1988. 1995.HARBORCO: Confidential Instructions for the Environmental League Negotiator your bottom line is 50 points. theirs may be 40 or 80. Their bottom lines depend on their valuation of the alternatives to agreement – a psychological factor that makes comparison across parties difficult to interpret. (Rev. Review Copy Do Not Reproduce Copyright © 1984. 3/07) 7 . 1989. 1994. 2007 by the President and Fellows of Harvard College. All rights reserved.

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the unions are a major political power in this state and. Scoring. Cambridge MA 02138. The use of points may seem a bit artificial and awkward. 3/07) Review Copy Do Not Reproduce . depending on how each of the five issues is resolved.T. 2002. Please help to preserve the usefulness of this case by keeping it confidential. You can score up to 100 points in the negotiation. telephone: 800-258-4406 or 617-495-1684). 1996. etc. 1994. 1989. growth in the tax base. (Rev. -. Harvard Law School. I would like to see Harborco accommodate at least some of the union's demands. it enables me to combine my several interests -. Copyright © 1984.).I. In addition.org.PROGRAM ON NEGOTIATION AT HARVARD LAW SCHOOL AN INTER-UNIVERSITY CONSORTIUM TO IMPROVE THE THEORY AND PRACTICE OF CONFLICT RESOLUTION HARBORCO Confidential Instructions for the Governor's Negotiator (From Governor Sherwood of Seaborne) I am very eager to see this deep-water port built in Seaborne." This. In this case. or translated in whole or in part by any means without the written permission of the Director of Curriculum Development. All rights reserved.into a single "currency. the points allow me to compare the benefits (or costs) of a negotiated agreement to my alternatives.) I have spent some time with Harborco's people discussing the pros and cons of various design options. As you know. Therefore. if antagonized. and a project the size of Harborco's could provide the stimulus for a dramatic economic recovery. This case may not be reproduced. revised.new jobs for my constituents. Our state has suffered a serious decline in economic activity over the past five years. (Obviously. it is worthwhile for me to support Harborco's proposal only if it This case was written by Denise Madigan and Thomas Weeks under the supervision of Professor Lawrence Susskind (M. I am also concerned that today's negotiations may force Harborco to make concessions on the environment and compensation that could reduce the economic profitability of the port. I could also benefit personally from a recovery introduced during my tenure in office. 513 Pound Hall. So you may find yourself in the position of defending most of Harborco's initial proposal. I generally favor Harborco's proposal. could impede my re-election efforts in two years. Copies are available at reasonable cost from the Clearinghouse for the Program on Negotiation at Harvard Law School (Web site: www. and the Negotiation Roundtable. Program on Negotiation. But for the purposes of this negotiation. 1988. while advocating special consideration for local unions. my most-preferred set of outcomes is worth 100 points.pon. allows me to compare the potential gains and losses associated with very different issues. my aides and I have constructed a 100-point scoring scheme to illustrate which negotiable outcomes are of greatest and least importance to me. re-election. To help you plan your negotiating strategy. My only serious reservation has to do with its provisions for organized labor. in turn. my least-preferred is worth zero. 1995. Assistant Professor David Lax. 2007 by the President and Fellows of Harvard College. Under this scheme.

Thus. Your task is to try to earn as many points as possible in this negotiation. I will support any project worth at least 30 points.) . I firmly believe that the project will not survive in the long run without substantial loans guaranteed or provided by DCR. 1995. In addition. 1988.it simply means that I want you to further my legitimate interests as far as possible. I would like to be able to demonstrate to my constituents that I can bring federal money into this state. 1994. (Rev. even $1 billion in loans would generate significant political benefits for me. 1996. The federal government is unlikely to abandon or over-regulate a project to which it has committed billions of dollars. they should have little trouble consolidating and improving their share of the port's work force. Any proposal worth fewer than 30 points would cost me political credibility and might deter future development in the state. I am very anxious to see that Harborco at least guarantees the union some presence in the work force. any quota would be a major and visible victory for the unions. I certainly hope you can do much better. This issue is particularly important to me because of the political strength of labor unions in this state. 2002 by the President and Fellows of Harvard College. The value of these loans includes more than just the savings Harborco can realize with federally guaranteed loans. It also includes the value of a significant federal commitment to the project. but that is the bare minimum I can accept. Federal Loan. This is not being greedy -. In addition. I would be very reluctant to sign an agreement that deliberately snubbed organized labor. if it does. Once the unions have a foot in the door. I fear Seaborne will be stuck with a partially complete white elephant in five to ten years. Although I would prefer to see the unions get all they have requested. All rights reserved. I have assigned the following points to this issue: Review Copy Do Not Reproduce * $2 billion * $1 billion * No loan = = = 30 points 23 points 0 points Employment Distribution. 1989. Although I doubt Harborco will attempt to construct the port without federal financing. I have assigned the following points to this issue: * $3 billion = 40 points Copyright © 1984.HARBORCO: Confidential Instructions for the Governor’s Negotiator generates at least 30 points. 4/19/02.

I have assigned the following points to this issue: * Primarily dirty * Clean/dirty * All clean = = = 14 points 8 points 0 points Included in these point assessments is my fear that if we impose too many restrictions on this project. Harborco's analysts are convinced that a diverse industry mix. no matter what industries it chooses to develop.HARBORCO: Confidential Instructions for the Governor's Negotiator * Unlimited union preference * Union quota of 2:1 * Union quota of 1:1 * No union preference = = = = 24 points 18 points 12 points 0 points The points reflect the importance of guaranteeing the unions at least some preference. including primarily dirty industries such as oil refineries. 1988. 1994. We want Harborco to be free to pursue as diverse and profitable a mix as possible. They suggest that the narrower the industry mix. Industry Mix. As in the case of industry mix. the more vulnerable it will be to swings in the economy. 1989. 1996. The development proposed by Harborco will be a significant boost to our local economy. but I do think we should avoid forcing developers to bear the cost of such improvements. I am not anti-environment. 2002. I have assigned the following points to the issue of ecological impact: * Do some harm to the ecological setting * Maintain and repair the setting * Improve the setting = = = 12 points 8 points 0 points Review Copy Do Not Reproduce I am not averse to improvements in the environment. steel mills. We should remember that Harborco will have to abide by existing environmental regulations. My analysts agree. 2007 by the President and Fellows of Harvard College. and a resource-recovery plant. Ecological Impact. 1995. I think we should avoid imposing unnecessary costs on would-be developers. but I do think we should avoid placing demands on industry in excess of existing federal and state regulations. could provide the greatest economic stability and revenue over the long run. Copyright © 1984. In no way will the port violate existing state and federal regulations governing the protection of flora and fauna. 3/07) 3 . All rights reserved. we will deter future development in the state. (Rev.

This is a very difficult issue for me. I have assigned it the following points. I am also. 2007 by the President and Fellows of Harvard College. 1996. This information is CONFIDENTIAL! You should not show your scoring sheet to anyone. 3/07) 4 . 1995. and political complications surrounding this issue. quite frankly. The eastern states compete against one another for industrial projects and federal grants on a regular basis. contrast. The environmental costs would be viewed by potential developers as a cost imposed by our state. these payments would not cause as much damage to our state. the compensation costs would be viewed as costs imposed by other states. we are trying to work together on a number of critical issues. professional. 1988. I do not want to appear vigorously opposed to such compensation. I am confident that you will negotiate an extremely valuable agreement for me. I have attached a one-page scoring sheet that summarizes the points assigned to each issue. You may convey some or all of the scoring information to a mediator. Review Copy Do Not Reproduce * * * * * In Copyright © 1984. Given the personal. All rights reserved. I am clearly not anxious to see Harborco's profits diverted to ports in other states. there is never any expectation that the winners should compensate the losers. Good luck. astounded that the other ports expect to be compensated. Nevertheless. The governors of these states are my friends and colleagues. As members of the Coalition of East Coast States. if I can avoid it. 1989. with a request that you treat this issue diplomatically: * No compensation * $150 million * $300 million * $450 million * $600 million = = = = = 10 points 7 points 4 points 2 points 0 points While any compensation could cost Harborco as much as the demands being made by the environmentalists. 2002. but under no circumstances should you let him or her see your scoring sheet.HARBORCO: Confidential Instructions for the Governor's Negotiator Compensation to Other Ports. 1994. I would rather not antagonize these people. (Rev.

Harborco pays $150 million 5. 1994. 1995. 2002. primarily dirty 2. Harborco pays $450 million 3. 1988. $1 billion 4. Harborco pays no compensation Review Copy Do Not Reproduce (10) 0 2 4 7 10 A through E: TOTAL (100) (your goal) MINIMUM NEEDED FOR AGREEMENT = 30. 3/07) 5 . maintain & repair 3. clean/dirty 3. (Rev. harm 2. no union preference D: Federal Loan 1. unlimited union preference 2. improve C: Employment Rules/ Distribution 1.HARBORCO: Confidential Instructions for the Governor's Negotiator Confidential Score Sheet for THE GOVERNOR’S NEGOTIATOR Issue/Option A: Industry Mix Total Points (14) 14 8 0 (12) 12 8 0 (24) 24 18 12 0 (40) 40 30 23 0 1st vote 2nd vote 3rd vote 1. 2007 by the President and Fellows of Harvard College. 1989. all clean B: Ecological Impact 1. $2 billion 3. Harborco pays $600 million 2. Harborco pays $300 million 4. This is also your score if no agreement is reached. no federal loan E: Compensation to Other Ports 1. Copyright © 1984. All rights reserved. $3 billion 2. union quota 1:1 4. union quota 2:1 3. 1996.

1996. Will Harborco harm. 1988. Will unions receive preference? How much? Unlimited? 2:1? 1:1? OUTCOME POINTS NO Union Governor D. maintain and repair. or improve the ecology? C. Which industry mix was agreed to? B. 2002. 1994. All rights reserved. 1989. please describe the agreement and identify the number of points it generated: ISSUE: A. 2007 by the President and Fellows of Harvard College. 1995.HARBORCO: Confidential Instructions for the Governor's Negotiator Confidential Summary of Points for THE GOVERNOR’S NEGOTIATOR Your name: Group #: Did Harborco get an agreement? (circle one) If "yes" who signed (or voted for) the agreement? YES Federal DCR Other Ports Environmentalists If your group reached agreement. How much compensation will other ports receive? (amount) TOTAL POINTS GENERATED BY AGREEMENT: (ADD ITEMS A THROUGH E) Copyright © 1984. (Rev. How much in loans will DCR guarantee? (amount) Review Copy Do Not Reproduce E. 3/07) 6 .

HARBORCO: Confidential Instructions for the Governor's Negotiator APPENDIX A discussion of the Scoring Scheme (for the GOVERNOR'S NEGOTIATOR) I have several interests in today's negotiation. I would not want to end up with the worst outcome ($600 million in compensation payments) on the compensation issue. Supporting such an agreement would cost more than I could gain. (Note that an agreement worth zero points may have a "non-zero" effect on me. (Rev. Remember. We might have to compromise on compensation. under any circumstances. 3/07) 7 . Therefore. You may try to express the strength of your interests to other players. and I'd like to claim credit for helping unions win preferential treatment from Harborco. ecological impact. 2007 by the President and Fellows of Harvard College. 2002. 1994. While your bottom line is 30 points.) Differences in points can tell you which issues (or specific outcomes) are most worth arguing for. you should not vote for any project worth fewer than 30 points. Their bottom lines depend on their valuation of the alternatives to agreement -. 1988. I'd like to see the federal government guarantee billions of dollars of investment in our state. 1996.just as they would if this were a real-world negotiation. I have used points in your instructions to indicate how different possible agreements might serve (or harm) my overall interests. We might win the union issue but lose the industry mix issue. An agreement worth zero points would be the worst. i. There might even be no agreement at all. theirs may be 20 or 80. Since I will be evaluating you on the basis of your score in this negotiation.e. but you should not let them see your actual score sheet. an agreement worth 100 points would be the best agreement you could negotiate. in this negotiation I am most concerned about the federal loan issue and have therefore assigned it 40 out of 100 possible points. Under the 100-point scoring scheme.a psychological factor that makes comparison across parties difficult to interpret. All rights reserved. you should examine your score sheet closely when planning your negotiating strategy. it may involve net costs or net benefits. A score of 75 points may mean more (or less) to you than to other parties. show your score sheet to any other player. 1989. It is assigned zero points only because it reflects "zero gains" over the worst possible outcome.. Do not. For example. I'd also like to prevent the environmentalists from imposing excessive costs on Harborco (and other developers in the future). Review Copy Do Not Reproduce Copyright © 1984. and a variety of outcomes are possible. Finally. This is clearly a complex negotiation. resist the temptation to compare your score with the scores of other players. Several issues are being discussed. 1995. They will have to trust you to give them accurate information about your preferences -. or federal loans.

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into a single "currency. Cambridge MA 02138. depending upon how each of the five issues is resolved (plus a unanimity bonus). we have constructed a 110-point scoring scheme to illustrate which negotiable issues are of greatest and least importance to us. particularly if we can obtain approval on our current license application.P ROGRAM O N N EGOTIATION AT H ARVARD L AW S CHOOL AN INTER-UNIVERSITY CONSORTIUM TO IMPROVE THE THEORY AND PRACTICE OF CONFLICT RESOLUTION HARBORCO Confidential Instructions for the Harborco Negotiator (From the Harborco Board of Directors) This is obviously a very important project to us. 2002. the use of points to summarize our interests allows us to compare the value of negotiated agreements to our other alternatives. Unfortunately. 513 Pound Hall. This is not being Review Copy Do Not Reproduce This case was written by Denise Madigan and Thomas Weeks under the supervision of Professor Lawrence Susskind (M. Copyright © 1984. the least preferred is worth zero points. we should pursue this particular project only if we can secure an agreement worth at least 55 points to us (excluding any bonus for a unanimous agreement). Compromising on one or more issues will earn somewhere between zero and 110 points." This in turn allows us to compare the gains and losses associated with different issues. and by securing substantial federal assistance. All rights reserved. Scoring. In our minds. telephone: 800-258-4406 or 617-495-1684). or translated in whole or in part by any means without the written permission of the Director of Curriculum Development. For the purposes of this negotiation. 1988. federal support. 3/07) . Program on Negotiation. Harvard Law School. It has tremendous profit potential. the public benefits of a deep-water port are so obvious that we are surprised the FLA is hedging on our application.pon. and the entire nation. In addition. The application we have recently submitted to the FLA describes the most attractive project possible. you can score up to 110 points during the negotiation. The most preferred set of outcomes is worth 110 points to us. the region.T.I. -. 1994. we would be better off seeking alternative investment opportunities (such as the new international airport being considered for the Pacific Northwest). Copies are available at reasonable cost from the Clearinghouse for the Program on Negotiation at Harvard Law School (Web site: www. 1996. We obviously want to protect it by keeping our costs low. (Rev. 1989.low costs. In order to help you plan your negotiating strategy. This case may not be reproduced. Yet the project also has the potential to generate significant economic benefits for Seaborne. etc. 1995. Your task is to try to earn as many points as possible in this negotiation. The use of points may seem artificial and abstract. freedom from unions. 2007 by the President and Fellows of Harvard College. Please help to preserve the usefulness of this case by keeping it confidential. For example. Under this scheme.org. it enables us to combine our several interests -. politics forces us to negotiate with parties who have no business interfering in our business. Assistant Professor David Lax.). and the Negotiation Roundtable. revised. Any agreement worth fewer than 55 points would not be worth pursuing.

the project would be in very serious jeopardy. we could probably muster $2 billion should DCR offer us only $2 billion in loans. DCR officials had initially hinted that they would consider underwriting 75 percent of our costs (or $3 billion).HARBORCO: Confidential Instructions for the Harborco Negotiator greedy -. Federal Loan. 2002. If you have additional questions about the scoring scheme. Consequently. we have firm commitments from private investors that should generate at least $1 billion for the project. We have assigned the following points to this issue: * $3 billion guaranteed loan = * $2 billion guaranteed loan = * $1 billion guaranteed loan = * No loan = 35 points 29 points 20 points 0 points Review Copy Do Not Reproduce Copyright © 1984. We have requested a $3 billion loan (at an interest rate of 15 percent) that will secure the investments of our consortium members. we thought the DCR would be more than happy to help finance a deep-water port on the East Coast. the DCR has downplayed its original enthusiasm and has hinted that it will not provide financial support unless certain conditions are met. This is by far the most important issue to us. We will support any agreement that yields us at least 55 points of value. All rights reserved. 3/07) 2 . 2007 by the President and Fellows of Harvard College. we do not yet know what these conditions are. If pressed. (The federal government is unlikely to abandon a project in which it has invested billions of dollars. but that is the bare minimum we can accept. Up until a few months ago. we would probably not have enough political support to win FLA approval. Unfortunately. 1994. we would be faced with the prospect of trying to borrow the money at exorbitant rates. 1989. 1996. There are not enough private investors currently interested in contributing to our project. but only by curtailing certain amenities. But should DCR try to offer us less than $2 billion. probably equivalent to twice the market rate of interest. we might still be able to muster the $4 billion to move ahead. Since then. 1988. we could be in serious trouble. (Rev. increase our ability to attract other investors. We certainly hope you will do much better. and ensure the long-term success of the project.) At present. If we received no federal financial assistance. We might be able to continue with the project. but we could not afford to concede on any issues up for discussion today. please see the Appendix. If forced to raise $3 billion. 1995.it simply means that we want to further our legitimate interests as far as possible. In theory.

because once unions are allowed on site. 1994. Apparently the unions want us to guarantee all new jobs to union workers. In addition. All rights reserved. We had also hoped to keep the unions out of the port for at least a few years so that we could install labor-saving technology into the port (technology that the unions are sure to oppose). We are obviously opposed to paying compensation to other ports. but it is not at all clear to us that they will be hurt by our project. 3/07) 3 . 2002. We have assigned the following points to this issue: * No union preference * Union quota of 1:1 * Union quota of 2:1 = = = Review Copy Do Not Reproduce 17 points 10 points 5 points 0 points * Unlimited union preference = The point schedule reflects. Although some of their traffic may be diverted to our new port. (Rev. We are also afraid that a dangerous precedent could be set if we agree to compensate our competitors. anticipated increases in wage costs associated with different levels of union preference. they will block our attempts to introduce laborsaving techniques (such as large-scale containerization) into the port. they will attract new traffic as feeder ports. 1988. We had hoped to be free to hire the best people to construct and operate the port. Compensation to Other Ports. it reflects our fear that any union preference is dangerous. 1996. in part. Will we eventually have to compensate every party who loses some business to us? Given the cost of actual compensation payments and the dangerous precedent potential surrounding such an arrangement. 2007 by the President and Fellows of Harvard College. These four other ports have submitted wildly unreasonable estimates of their anticipated losses. we have assigned points as follows: * No compensation = 23 points 15 points 10 points 5 points 0 points * $150 million compensation = * $300 million compensation = * $450 million compensation * $600 million compensation = = Employment Rules (Distribution of Jobs). They claim they will lose roughly $600 million after our port begins operating. 1995.HARBORCO: Confidential Instructions for the Harborco Negotiator The distribution of points reflects our belief that the first and second billion dollars are far more important than the third billion. Copyright © 1984. 1989.

not business. would have us limit our industry mix to a narrow base of all-clean industries. because it would enable us to include a highly profitable resource recovery plant.HARBORCO: Confidential Instructions for the Harborco Negotiator Industry Mix. We have tried to be sensitive to environmental concerns by planning construction and dredging so as to avoid unnecessary disruption. In addition to the monetary concerns. The environmentalists. our analysts suggest we could forgo roughly $200 to 375 million in potential profits if forced to limit our mix. if we do all they ask to improve the ecological setting. (Rev. We do not propose to break the law. Ecological Impact. This is a difficult issue for us to analyze. We have also been sensitive to existing federal and state standards. 2007 by the President and Fellows of Harvard College.slightly more than half the points possible. We have assigned the following points to each of the industry mix options up for discussion: * Primarily dirty * Clean/dirty * All clean = = = 14 points 8 points 0 points We've assigned the middle option -. since it could force us to alter our dredging and construction plants in very costly ways. 1995. All rights reserved. Losing this issue could cost us a significant amount of money. those most likely to resist fluctuations in the economy. 3/07) 4 . Common sense suggests that anytime you build anything.clean/dirty -. however. We are not arguing for any fixed combination of industries over another. 1994. 1989. we are arguing for the freedom to develop any combination of industries we choose. 1996. Environmentalists are asking us to foot the bill for improvements that are properly the responsibility of government. the environmentalists' wish list could cost us up to $280 million. Furthermore. we could develop those industries most likely to generate revenues for the region. Under this scenario. This would prevent us from pursuing the most profitable industry mixes and could make the local economy highly susceptible to fluctuations in the business cycle. 1988. rather. Although there is tremendous uncertainty in these forecasts. we have some ideological feelings about this issue. and those most likely to benefit from access to a deep-water port. Review Copy Do Not Reproduce Copyright © 1984. you are probably going to disrupt the ecology. 2002.

1988. the following bonus points have been assigned to this issue: * All five other parties agree to the terms of the port = 10 points 0 points 0 points * Four of the five other parties agree = * No agreement is reached = However. That is. 2007 by the President and Fellows of Harvard College. With Harborco's interest in a successful port in mind. This information is CONFIDENTIAL! You should not show your scoring sheet to anyone! You may convey some or all of the scoring information verbally to a mediator (should one be assigned to your group). Good luck. this bonus does not count toward the minimum 55 points Harborco needs to accept the substance of any proposal. 3/07) 5 . We are confident that you will negotiate an extremely valuable agreement for us. All rights reserved. but the proposal would obviously be much more stable if it is supported by all five other parties. The only way to eliminate the possibility of such suits would be to pass an agreement supported by all five other parties. 2002. 1994. the FLA will agree to a proposal that four of the five parties support. 1996. It has been rumored that certain parties might take legal action against the deep-water port if the FLA accepts a proposal that they did not support. we have assigned the following points to this issue: * Do some harm to the ecological setting * Maintain and repair the setting * Improve the setting = = = 11 points 7 points 0 points The points reflect the fact that the improvements would be more than twice as costly as maintaining and repairing the ecological setting. but you should not let him or her see your scoring sheet. * * * * * We have attached a one-page scoring sheet that summarizes the points we have assigned to each of the five issues. Unanimity Bonus. 1989. Review Copy Do Not Reproduce Copyright © 1984. 1995. (Rev.HARBORCO: Confidential Instructions for the Harborco Negotiator In light of these concerns. This would lead to annoying delays and potentially exorbitant legal fees.

primarily dirty 2. Harborco pays $150 million 5. 1994. all clean B: Ecological Impact 1. union quota 1:1 4. 3/07) 6 . clean/dirty 3. All rights reserved. no union preference D: Federal Loan 1. 1988. 2002. $1 billion 4. 2007 by the President and Fellows of Harvard College. $2 billion 3. Harborco pays $450 million 3. (10) A through E: TOTAL (your goal) MINIMUM NEEDED FOR AGREEMENT = 55. Harborco pays no compensation Total Points (14) 14 8 0 (11) 11 7 0 (17) 0 5 10 17 (35) 35 29 20 0 (23) 0 5 1st vote 2nd vote 3rd vote Review Copy Do Not Reproduce 10 15 23 (100) This is also your score if no agreement is reached. 1996. union quota 2:1 3. 1989.HARBORCO: Confidential Instructions for the Harborco Negotiator Confidential Score Sheet for HARBORCO NEGOTIATOR Issue/Option A: Industry Mix 1. (Rev. harm 2. maintain & repair 3. Harborco pays $600 million 2. Harborco pays $300 million 4. improve C: Employment Rules/ Distribution 1. 1995. $3 billion 2. UNANIMITY BONUS TOTAL POSSIBLE POINTS (110) Copyright © 1984. no federal loan E: Compensation to Other Ports 1. unlimited union preference 2.

add 10 points. 2002. 3/07) 7 . Which industry mix was agreed to? B. 1996. or improve the ecology? C. 1989. All rights reserved. maintain and repair. 2007 by the President and Fellows of Harvard College.HARBORCO: Confidential Instructions for the Harborco Negotiator Confidential Summary of Points for HARBORCO NEGOTIATOR Your name: Group #: Did Harborco get an agreement? (circle one) If "yes" who signed (or voted for) the agreement? YES Federal DCR Other Ports NO Union Governor Environmentalists If your group reached agreement. TOTAL POINTS GENERATED BY AGREEMENT: Copyright © 1984. How much in loans will DCR guarantee? (amount) E. please describe the agreement and identify the number of points it generated: ISSUE: A. 1988. (Rev. 1994. 1995. Will unions receive preference? How much? Unlimited? 2:1? 1:1? OUTCOME POINTS D. How much compensation will other ports receive? (amount) Review Copy Do Not Reproduce SUBTOTAL (ADD ITEMS A THROUGH E): If agreement was unanimous. Will Harborco harm.

Because we will be evaluating you on the basis of your score in this negotiation. 2007 by the President and Fellows of Harvard College. we have decided to use points in our instructions to indicate how different agreements serve (or harm) our overall interests.HARBORCO: Confidential Instructions for the Harborco Negotiator APPENDIX A Discussion of the Scoring System (For the HARBORCO NEGOTIATOR) We have several interests in today's negotiation. an agreement worth 100 points would be the best agreement you could negotiate. 1995. 3/07) 8 . We might not even reach agreement at all. In contrast. 2002. Remember. We'd like to avoid the costs of environmental improvement. We would not want to end up with our worst outcome (no federal loan) on this issue. but lose the employment issue. we are least concerned about the ecological impact issue and have therefore assigned it only 11 points.. it may involve net costs or net benefits. We'd also like to be free to pursue the most profitable industry mix. Under the 100-point scoring scheme described in the instructions. Review Copy Do Not Reproduce Copyright © 1984. i. and a variety of outcomes are possible. 1996. 1989. show your score sheet to any other player. (Rev. We'd like to avoid the dangerous precedent of compensating our competitors. This means that we would not be too upset if forced to accept the worst outcome (improve the ecology) on this issue. We might succeed in keeping the unions out. For example. an agreement worth zero points would be the worst possible agreement.) Differences in points can tell you which issues (and specific outcomes) are most worth arguing for. and union preference. It is assigned zero points in our scoring scheme only because it reflects "zero gains" over the worse possible agreement. in this negotiation. we are most concerned about the federal loan issue and have assigned it 35 out of 100 possible points. All rights reserved. They will have to trust you to give them accurate information about your preferences – just as they would if this were a real-world negotiation. Do not. under any circumstances.e. but do not show them your actual score sheet. but lose $1 billion in federal loans. We might win the industry mix issue. You may wish to express the strength of our interests to other players. Such a project would be worse than no project at all. This is clearly a complex negotiation for us. In contrast. 1994. Therefore. 1988. you should probably examine your score sheets closely when planning your negotiation strategy. Several issues are being discussed. (Note that an agreement worth zero points may have a "non-zero" effect on us. you should not vote for any project worth fewer than 55 points.

Scoring. 513 Pound Hall. it enables us to combine our several interests -. 1994.) Review Copy Do Not Reproduce This case was written by Denise Madigan and Thomas Weeks under the supervision of Professor Lawrence Susskind (M. 1995. 1989. 1988. We do not believe any such project should be allowed to undermine existing port operations. completely opposed to the idea of a deepwater port on the East Coast. If. 2007 by the President and Fellows of Harvard College. Cambridge MA 02138. and the Negotiation Roundtable. Program on Negotiation. All rights reserved. or translated in whole or in part by any means without the written permission of the Director of Curriculum Development. First. in turn. In this case. Secondly. The use of points may seem artificial and awkward to you. Under this scheme. Our total loss will thus be close to $600 million (in current dollars). the largest of our ports will suffer a 25 percent decline in gross revenue while the three smaller ports will each lose about 10 percent of their gross revenue. Please help to preserve the usefulness of this case by keeping it confidential. if Harborco is able to muster enough support for its own proposal. our most preferred outcome (no agreement at all) is worth 150 points. In order to help you plan your negotiating strategy. (We would rather try to sue for compensation later. in principle. however. Harvard Law School.PROGRAM ON NEGOTIATION AT HARVARD LAW SCHOOL AN INTER-UNIVERSITY CONSORTIUM TO IMPROVE THE THEORY AND PRACTICE OF CONFLICT RESOLUTION HARBORCO Confidential Instructions for the Negotiator for Other Ports (From the Association of Eastern Seaboard Ports) We are very dubious about the benefits Harborco claims we will realize from this new deepwater port. Any proposal yielding fewer than 31 points would not be worth our support. an agreement seems imminent. the points allow us to compare the benefits (or costs) of the negotiated agreement to our alternatives. This case may not be reproduced. we have constructed a special scoring scheme to illustrate which negotiable outcomes are of greatest and least importance to us. we hope that your participation may help derail the negotiations and prevent Harborco from securing enough support for its FLA application. revised. preserving opportunities for growth.T.org. securing federal funds for our own projects -. 1996.protecting our current business. telephone: 800-258-4406 or 617-495-1684). Copyright © 1984.into a single "currency.pon. For the purposes of this negotiation." This. you still have an opportunity to score up to 100 points by negotiating certain aspects of the port's design. 3/07) . In fact. Assistant Professor David Lax. We are not. In particular.). We are sending you to this meeting for two reasons. (Rev. our analysts suggest that we will suffer substantial losses over the first ten years of the new port's operation. In addition.I. Copies are available at reasonable cost from the Clearinghouse for the Program on Negotiation at Harvard Law School (Web site: www. it would be worthwhile for us to support Harborco's proposal only if it yields at least 31 points to us. we hope you can increase the costs facing the new port (thus minimizing its competitive advantage) and win some compensation for us in the process. allows us to compare the potential gains and losses associated with different issues. 2002.

Compensation to Us. We certainly hope you will do much better.) The less money DCR spends on this project. 1995. 3/07) .) But 31 points is the bare minimum we can accept. 1994.) Federal Loan. you should vote in favor to insure that the agreed compensation will be paid. but if an agreement seems unavoidable. (Rev.it simply means that we want to further our legitimate interests as far as possible. 1996. the DCR has contributed very little money to our ports. (To date. which are more specialized. 2002. This is not being greedy -. (In fact. (Note: If an agreement worth more than 31 points does seem inevitable.HARBORCO: Confidential Instructions for the Negotiator for Other Ports Your task is to try to earn as many points as possible in this negotiation. 1989. We would like to see Harborco's bid for a license fail. we would support any project worth at least 31 points. All rights reserved. Review Copy Do Not Reproduce Copyright © 1984. Our largest port will lose roughly 25 percent of its business once the new port begins operation. You should therefore argue that DCR would be better off allocating its funds across several projects rather than concentrating its resources on Harborco's one risky venture. will lose 10 percent. The less money DCR contributes to this project. We would like to see little or no federal financing in this project. we are currently in the process of applying for federal loans to finance renovations in our own building and operations.) In addition. (Some compensation is better than none. We would need a total of $600 million (in current dollars) to compensate us for our anticipated losses. the more it will have to spend on other ports like our own. the less likely it is that the project will succeed. This is by far the most important of the negotiable issues. The smaller ports. 1988. We have assigned this issue the following points: * $600 million (100% compensation for our losses) = * $450 million (75% compensation) * $300 million (50% compensation) * $150 million (25% compensation) * No compensation = = = = 60 points 45 points 30 points 15 points 0 points Of course. 2007 by the President and Fellows of Harvard College. Harborco probably cannot afford to go ahead with the port unless there is at least some federal money involved. you should worry about this issue and those that follow only if agreement seems inevitable.

it will face significantly lower labor costs than we face. 2007 by the President and Fellows of Harvard College. We would rather not publicly champion the cause of organized labor. making it even harder for us to retain our own business (or compete for new business). 2002.) If Harborco succeeds in keeping organized labor out of its port. because our arguments may be turned against us later in our own labor negotiations. the new port may be able to install a wide range of laborsaving technologies (including large-scale containerization). 1988. (Our ports are completely unionized. Industry Mix.HARBORCO: Confidential Instructions for the Negotiator for Other Ports We have assigned the following points to this issue: * No loan * $1 billion * $2 billion * $3 billion = = = = 18 points 13 points 8 points 0 points Employment Rules. Furthermore. in the absence of unions. it will only be a matter of time before the bulk of Harborco's work force is unionized. 1995. We have assigned the following points to this issue: Review Copy Do Not Reproduce * unlimited union preference = * union quota of 2:1 * union quota of 1:1 = = = 12 points 8 points 6 points 0 points * no union preference You may note that the difference is greatest between no union preference and the union quota of 1:1. We are not big fans of organized labor. but we do think that any new port should face the same labor costs we face. This is a difficult issue for us to weigh. All rights reserved. This would allow the new port to realize even lower production costs. This is because we feel that once the unions are allowed on site. the less competitive Harborco will be. We would like to see Harborco's freedom to develop industries constrained as much as possible. 1994. On the other hand. (Rev. The more restricted the industry mix. Harborco will have a difficult time introducing large-scale labor-saving technologies. 3/07) 3 . because we have to rely on very uncertain projections. We are therefore in the awkward position of favoring union preference on this project. because we may Copyright © 1984. 1989. we should be wary of advocating these kinds of restrictions. We want to prevent Harborco from realizing any unfair competitive advantage. In addition. 1996.

HARBORCO: Confidential Instructions for the Negotiator for Other Ports wish to expand our own operations in the future. Review Copy Do Not Reproduce Copyright © 1984. we have assigned the following points to this issue: * all clean * clean/dirty * primarily dirty = = = 10 points 4 points 0 points The point spread reflects the fact that we would like to prevent Harborco from developing foodprocessing plants that could compete with our own. relative to the other issues up for discussion. and the fact that compensation is a more important and immediate concern. but do not show him or her your scoring sheet. Good luck. Given our conflicting interests here. 1989. 1996. you should probably treat this issue with caution. Perhaps we can use this issue strategically. All rights reserved. 2002. This last issue is of very minor concern to us. * * * * * We have attached a one-page scoring sheet that summarizes the points assigned to each issue. Though we would like to see Harborco face additional costs associated with improving the ecology. (Rev. since the other parties may not realize that this issue is not important to us. 1994. We're confident that you will either succeed in derailing an agreement. This information is CONFIDENTIAL!! Do not show your scoring sheet to anyone. 1995. 2007 by the President and Fellows of Harvard College. we do not care enough to assign points to this issue. 3/07) 4 . You may convey some or all of the scoring information verbally to a mediator. Ecological Impact. Nevertheless. for we do not want to antagonize potential allies. or negotiate an extremely valuable agreement for us. 1988.

2007 by the President and Fellows of Harvard College. 1996. Harborco pays $450 million 3. unlimited union preference 2. * If negotiations succeed and a port is built.you can still earn 31 points by withholding your support and challenging the port in court. * If a bad port is built (worth less than 31 points) -. primarily dirty 2. $1 billion 4. Harborco pays $150 million 5.8 for uncertainty. union quota 2:1 3.HARBORCO: Confidential Instructions for the Negotiator for Other Ports Confidential Score Sheet for OTHER PORTS Issue/Option A: Industry Mix 1. harm 2. your points for that outcome will be discounted by . you can earn anywhere between 31 and 100 points. Harborco pays $300 million 4. no union preference D: Federal Loan 1. provided you vote in favor. 1994. no federal loan E: Compensation to Other Ports 1. improve C: Employment Rules/ Distribution 1. 1989. all clean B: Ecological Impact 1. 2002. If you vote against a final proposal worth more than 31 points. union quota 1:1 4. clean/dirty 3. $2 billion 3. maintain & repair 3. Copyright © 1984.over your objections -. Harborco pays no compensation Total Points (10) 0 4 10 (0) 0 0 0 (12) 12 8 6 0 (18) 0 8 13 18 (60) 60 45 30 15 0 1st vote 2nd vote 3rd vote Review Copy Do Not Reproduce (100) A through E: TOTAL (your goal) MINIMUM NEEDED FOR AGREEMENT = 31 Remember: * If negotiations fail and no port is built. (Rev. 1995. you earn 150 points. All rights reserved. $3 billion 2. 3/07) 5 . Harborco pays $600 million 2. 1988.

2007 by the President and Fellows of Harvard College. or improve the ecology? OUTCOME POINTS C. Copyright © 1984. 1989. 1995. 2002. All rights reserved.HARBORCO: Confidential Instructions for the Negotiator for Other Ports Confidential Summary of Points for OTHER PORTS Your name: Group #: Did Harborco get an agreement? (circle one) If "yes" who signed (or voted for) the agreement? YES Federal DCR Other Ports Environmentalists NO Union Governor If your group reached agreement. 1994. Which industry mix was agreed to? B. maintain and repair. 1988. 1996. Will Harborco harm. How much in loans will DCR guarantee? (amount) Review Copy Do Not Reproduce E.8: If no agreement was reached. Will unions receive preference? How much? Unlimited? 2:1? 1:1? D. How much compensation will other ports receive? (amount) TOTAL POINTS GENERATED BY AGREEMENT: (ADD ITEMS A THROUGH E) If total exceeds 31 points and Other Ports voted ”no. 3/07) 6 . points = 150. (Rev.” multiply by 0. please describe the agreement and identify the number of points it generated: ISSUE: A.

(Rev. but you should not show them your actual score sheet. you should not vote for any agreement worth fewer than 31 points (if you vote for an agreement at all). under any circumstances. we would like to see Harborco's competitive advantage limited by being forced to hire union workers and restricted to an all-clean industry mix. we have decided to use points in our instructions to indicate how no agreement or different agreements serve (or harm) our overall interests.the best possible outcome. All rights reserved. 1994. In contrast. (Note than an agreement worth zero points may have a "non-zero" effect on us. If agreement is reached. you should examine your score sheet closely when planning your negotiating strategy. in this negotiation we are most concerned about the compensation issue and have therefore assigned it 60 out of 100 possible points. 2002. 1995. then an agreement worth 100 points would be the best we could do. 1989. This is clearly a complex negotiation for us. 1996.. None of the ecological impact outcomes would have much of an effect on us. may involve net costs or net benefits. 1988. and a variety of outcomes are possible.HARBORCO: Confidential Instructions for the Negotiator for Other Ports APPENDIX A Discussion of the Scoring Scheme (For the OTHER PORTS' NEGOTIATOR) We have several interests in today's negotiation. i. if the port were approved. If the other parties appear to be approaching agreement. Under the scoring scheme described in the instructions. 3/07) 7 .e. Do not. But remember. You may try to express the strength of your interests to other players. If agreement seems inevitable. Several issues will be discussed. Review Copy Do Not Reproduce Copyright © 1984. Our first preference is to see the negotiations end with no agreement. In contrast. We would not want to end up with our worst outcome on this issue (no compensation). show your score sheet to any other player. Therefore. We'd also like immediate and full compensation for our projected losses. They will have to trust you to give them accurate information about your preferences – just as they would if this were a real-world negotiation. Supporting such a project would cost us more than we could gain. we may lose or compromise on compensation. we are least concerned about the ecological impact issue and therefore assigned it zero points. For example. no agreement would be worth 150 points -.) Differences in points can tell you which issues (or specific outcomes) are most worth arguing for. It is assigned zero points only because it reflects "zero gains" over the worst possible outcomes. 2007 by the President and Fellows of Harvard College. There may be no agreement. an agreement worth zero points would be the worst possible outcome. Because we will be evaluating you on the basis of your score in this negotiation. or there may be one that gives Harborco its maximum competitive advantage.

Review Copy Do Not Reproduce .

but we certainly hope you will do much This case was written by Denise Madigan and Thomas Weeks under the supervision of Professor Lawrence Susskind (M. and the Negotiation Roundtable. 9/07) Review Copy Do Not Reproduce . Scoring. new members for our unions. or translated in whole or in part by any means without the written permission of the Director of Curriculum Development. allows us to compare the potential gains and losses associated with different issues. depending upon how each of the issues is resolved. and compensation to other ports. revised. We will support any agreement worth at least 50 points. The use of points may seem artificial and abstract. it enables us to combine our several interests -. In this case. This is not being greedy -. Assistant Professor David Lax. 1994. We do not dare support an agreement that does not explicitly benefit our members. Compromising on one or more issues is worth somewhere between 0 and 100 points. 1995. Your task is to try to earn as many points as possible in this negotiation. Cambridge MA 02138. federal loans. In addition. All rights reserved.). 1996. This case may not be reproduced. But any agreement worth fewer than 50 points would be worse than no agreement at all.into a single "currency. Program on Negotiation. we have constructed a special 100-point scoring scheme to illustrate which negotiable outcomes are of greatest and least importance to us. Under this scheme. Harvard Law School. 1988. 1989. Without a major boost in economic activity. telephone: 800-258-4406 or 617-495-1684). and increased credibility for our organization -. Copies are available at reasonable cost from the Clearinghouse for the Program on Negotiation at Harvard Law School (Web site: www.is not of direct importance. however. 513 Pound Hall." This. We must not appear too eager.it simply means that we want to further our legitimate interests as far as possible.org. in turn. As you are well aware. we will face extensive layoffs in the very near future. industry mix. Of the five issues scheduled to be discussed at this meeting. the least preferred is worth zero.PROGRAM ON NEGOTIATION AT HARVARD LAW SCHOOL AN INTER-UNIVERSITY CONSORTIUM TO IMPROVE THE THEORY AND PRACTICE OF CONFLICT RESOLUTION HARBORCO Confidential Instructions for the Union Negotiator (From the Union Executive Committee) We are very excited about the job creation potential of a deepwater port in Seaborne.new jobs for our members. Please help to preserve the usefulness of this case by keeping it confidential.pon.ecological impact -. to support this project. The fifth issue -. For the purposes of this negotiation. it would be worthwhile for us to support an agreement if it yields at least 50 points. Harborco's initial proposal leaves much to be desired from the union's perspective. (Rev. 2007 by the President and Fellows of Harvard College. but may prove instrumental in securing allies. the volume of trade and overall economic activity in this state has declined dramatically over the last five years. four are of direct concern to us: employment rules. the most preferred set of outcomes is worth 100 points to us. In order to help you plan your negotiation strategy. the points allow us to compare the benefits (or costs) of a negotiated agreement to our alternatives. Copyright © 1984.T. 2002.I.

9/07) . We have assigned the following points to this issue: * * * * unlimited union preference union quota of 2:1 union quota of 1:1 no union preference = = = = 42 points 35 points 25 points 0 points Note that winning this issue is worth 42 points -. Federal Loan. The federal loan is important to us for two reasons.) We have therefore assigned the following points to this issue: * * * * $3 billion $2 billion $1 billion No loan = = = = 30 points 20 points 10 points 0 points Review Copy Do Not Reproduce Copyright © 1984. organizing the rest of the port should be less difficult than if we were not on site. We would like to see Harborco guarantee that all jobs for which union workers are qualified will be offered to union workers at union wages. 1995.HARBORCO: Confidential Instructions for the Union Negotiator better. and is therefore likely to argue strongly against any preference for the unions. Harborco probably realizes the same. any union presence will help prevent Harborco from introducing labor-saving technologies into the port over time. (Rev. First. Unfortunately. 2007 by the President and Fellows of Harvard College. We are obviously most concerned about the distribution of new jobs created by the port. We are strongly opposed to letting Harborco sidestep the union by employing non-union or out-of-state workers. 1994. receive FLA approval) if federal dollars are involved. Second.e. First. the long-term success and stability of the project is likely to be enhanced if the federal government makes a substantial investment in the project. 2002.. 1988. 1989. Second. and the federal government may be less willing to abandon the project in the future if it has a great deal of money sunk into the port. no matter how small.almost half of the points possible in this negotiation. (Private investors may be more willing to participate in the project if they see federal involvement. Employment Rules. once the union has a foothold in the port. All rights reserved. We have assigned fairly high values to the two compromise positions for two reasons. 1996. the project has a far greater chance to get off the ground (i.

9/07) 3 . 2002. This mix will probably involve food processing and light manufacturing plants -. we must answer for our conduct to the national union -. It is still preferable to the all-clean industry mix (which would create the fewest number of union jobs). The all-dirty mix is second best in our minds. The national union is obviously concerned about the local unions at the other ports. It would create far fewer jobs for union workers and would involve work environments that are far less comfortable and far more hazardous than those in the clean/dirty industries. We have assigned it fewer points than the preceding two issues because it is based on very uncertain projections. 1989. the clean/dirty mix is the best option from the union's perspective. 1994.HARBORCO: Confidential Instructions for the Union Negotiator Industry Mix. the jobs created by these kinds of plants tend to result in fewer health hazards than posed by dirty-industry jobs. they fear these other local unions will face substantial layoffs if the ports are denied compensation. 2007 by the President and Fellows of Harvard College.an organization which (need we remind you?) provided us with considerable financial assistance during our last strike three years ago. 1988. Compensation to Other Ports. and so we would rather not see the profits of the new port threatened by massive payments to out-of-state ports. On the other hand. All rights reserved. 1996.both of which would create jobs that are typically unionized. 1995. (Rev. * * * clean/dirty primarily dirty all clean = = = 20 points 15 points 0 points Of the three types of industry mix being discussed. This issue is important to us because it will determine the number and types of jobs created for our workers. This is a tricky issue for us. Our first allegiance is to our local members. but with the stipulation that these points remain absolutely confidential: * * * * * $150 million $300 million $450 million $600 million = = = = 8 points 6 points 4 points 2 points 0 points Review Copy Do Not Reproduce No compensation = Copyright © 1984. In addition. We have therefore assigned the following points to the compensation issue.

1988. 1995. We're confident that you will negotiate an extremely valuable agreement for us. Ecological Impact. This information is CONFIDENTIAL! Do not show this score sheet to anyone. Still. You may convey some or all of the information verbally to a mediator. This last issue is not one that concerns us directly. We are willing to let the environmentalists worry about the environment. since our national organization might become very displeased. All rights reserved. you may want to treat this issue with caution. 1989. Review Copy Do Not Reproduce Copyright © 1984. and so we have assigned no points to it. we may be able to use this issue strategically since the other parties do not know that this is not important to us. (Rev. In addition. You should avoid publicly opposing large compensation payments.HARBORCO: Confidential Instructions for the Union Negotiator In short. 1996. 2002. we favor some (but not too much) compensation. 9/07) 4 . 1994. since we do not want to antagonize potential allies. Good luck. * * * * * We’ve attached a one-page scoring sheet is attached that summarizes the points we have assigned to each issue and outcome. 2007 by the President and Fellows of Harvard College. but do not let him or her see your scoring sheet.

no federal loan (42) 42 35 25 0 (30) 30 20 10 0 E: Compensation to Other Ports 1. union quota 2:1 3. harm 2. union quota 1:1 4. Harborco pays $300 million 4. 9/07) 5 . improve C: Employment Rules/ Distribution 1. Copyright © 1984. all clean B: Ecological Impact Total Points (20) 15 20 0 (0) 0 0 0 1st vote 2nd vote 3rd vote 1. $3 billion 2. 1996. 1988. (Rev. $1 billion 4. 2007 by the President and Fellows of Harvard College. Harborco pays $600 million 2. Harborco pays $450 million 3. unlimited union preference 2. 2002. 1989. no union preference D: Federal Loan 1. maintain & repair 3. This is also your score if no agreement is reached.HARBORCO: Confidential Instructions for the Union Negotiator Confidential Score Sheet for the UNIONS Issue/Option A: Industry Mix 1. Harborco pays $150 million 5. All rights reserved. clean/dirty 3. Harborco pays no compensation A through E: TOTAL (your goal) Review Copy Do Not Reproduce (8) 2 4 6 8 0 (100) MINIMUM NEEDED FOR AGREEMENT = 50. $2 billion 3. 1994. primarily dirty 2. 1995.

1994. 2002. 1996. Will unions receive preference? How much? Unlimited? 2:1? 1:1? D. 2007 by the President and Fellows of Harvard College. please described the agreement and identify the number of points it generated: ISSUE: A. How much compensation will other ports receive? (amount) TOTAL POINTS GENERATED BY AGREEMENT: (ADD ITEMS A THROUGH E) Copyright © 1984. All rights reserved. or improve the ecology? OUTCOME POINTS C. Will Harborco harm. (Rev. 9/07) 6 . 1988. Which industry mix was agreed to? B. maintain and repair. How much in loans will DCR guarantee? (amount) Review Copy Do Not Reproduce E. 1989.HARBORCO: Confidential Instructions for the Union Negotiator Confidential Summary of Points for the UNIONS Your name: Group #: Did Harborco get an agreement? (circle one) If "yes" who signed (or voted for) the agreement? YES NO Federal DCR Other Ports Environmentalists Union Governor If your group reached agreement. 1995.

You may try to express the strength of your interest to other players. an agreement worth zero points would be the worst possible agreement. i. Under the 100-point scoring scheme described in the instructions. We'd also like to see the federal government make a major commitment to this project. It is assigned zero points only because it reflects "zero gains" over the worst possible outcome. you should not vote for any project worth fewer than 50 points. 2002. We would not want to end up with our worst outcome (no union preference) on this issue. Do not. In contrast. Review Copy Do Not Reproduce Copyright © 1984. Several issues are being discussed. 1995. 1994. in this negotiation we are most concerned about the employment rules issue and have therefore assigned it 42 out of 100 possible points. resist the temptation to compare your score with the scores of other parties in the negotiation.) Differences in points can tell you which issues (or specific outcomes) are most worth arguing for. We may win unlimited union preference or we may have to settle for special quotas. We'd like to see an industry mix that creates the most union jobs. or there might be no agreement at all. But remember. This is clearly a complex negotiation for us. Finally. an agreement worth 100 points would be the best agreement you could negotiate. show your score sheet to any other player. 1988.a psychological factor that makes comparison across parties difficult to interpret. They will have to trust you to give them accurate information about your preferences -. None of the outcomes described in this issue would have a direct effect on us.e. and a variety of outcomes are possible. We may succeed in negotiating a clean/dirty industry mix or we may face an all-clean industry mix. 1989. Therefore. (Note that an agreement worth zero points may have a "non-zero" effect on us.just as they would if this were a real-world negotiation. Because we will be evaluating you on the basis of your score in this negotiation. All rights reserved. 2007 by the President and Fellows of Harvard College.. but you should not let them see your actual score sheet. 9/07) 7 . Their bottom lines depend on their valuation of the alternatives to agreement -. A score of 75 points may mean more (or less) to you than to other parties. we have decided to use points in our instructions to indicate how different agreements serve (or harm) our overall interests. (Rev. For example. you should examine your score sheet closely when planning your negotiating strategy. While your bottom line is 50 points. theirs may be 40 or 80. 1996. We'd like to see as much union preference guaranteed as possible.HARBORCO: Confidential Instructions for the Union Negotiator APPENDIX A Discussion of the Scoring System (for the UNION NEGOTIATOR) We have several interests in today's negotiation. We may be excluded from an agreement (and end up facing a project with no concession to organized labor). In contrast. under any circumstances. we are least concerned about the ecological impact issue and have therefore assigned it zero points. it may involve net costs or net benefits.

Review Copy Do Not Reproduce .

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