Coalitions in Negotiations

Alekh Shah I021

Arunabha Das E023
Devansh Chhabria I005
Kirandheep K G029
Kislay Sinha G046
Siddhartha Tibrewala J059

August 2021

Submitted to
Dr. Madhavi Gokhale
Professor, Communications
School of Business Management

Submitted in partial fulfillment for the course requirements in

Advanced Negotiation Skills (Trimester IV)

School of Business Management

NMIMS UNIVERSITY
Summary
Coalitions in Negotiations has been researched extensively over the years. Coalitions
can be shaped and reformed in order to achieve desired choices and agreements. The
report focuses on researching on the importance of Coalitions and the benefits of
bargaining and negotiating together as opposed to individually. In coalitions, the
members have a common objective and interests which leads to a less complex
scenario. Using Descriptive and Analytical research methods, an online questionnaire
was distributed that consisted of 7 questions. 21 respondents participated in the
study. Following our primary research, we conducted secondary research where
Peer-reviewed research papers were studied to understand the concept in depth and
aid our analysis. We were able to gain insights into the finer details of the subject
matter with regards to Coalition formation for Negotiations such as the ideal size of a
coalition, opportunity cost for formation, among others. We were also able to discern
how various schools of thought perceived and proposed the factors affecting the
success of such coalitions.
Table of Contents
1 Introduction ........................................................................................................... 3
1.1 A brief background ........................................................................................ 3
1.2 Overview ....................................................................................................... 6
2 Methodology ......................................................................................................... 7
2.1 Research Design ............................................................................................ 7
2.2 Expert’s Interview ......................................................................................... 7
2.3 Sources of Secondary Research..................................................................... 7
3 Facts/Findings: ...................................................................................................... 8
3.1 Results of the Survey ..................................................................................... 8
3.2 The Experts Comments ............................................................................... 10
3.3 Contemporary Example – Street Vendors of Monrovia, Liberia ................ 11
3.4 Secondary Research..................................................................................... 12
4 Conclusion .......................................................................................................... 14
5 References ........................................................................................................... 15

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1 Introduction
1.1 A brief background

Negotiation is a technique for resolving disagreements. It is a method of reaching a

compromise or agreement while avoiding conflict and disagreement.
Individuals understandably seek the greatest possible solution from their perspective in every
dispute (or perhaps an organisation they represent). The values of impartiality, mutual gains,
and preserving a relationship, on the other hand, are critical to a successful resolution. Certain
specific forms of negotiations are required in certain scenarios such as international affairs,
the legal system, government, industrial issues, and family relationships, to name a few. One
such scenario is when multiple parties gather to come to an agreement over an issue or a set
of issues. In such cases, formation of coalitions among various parties is one form of
negotiation. Coalitions bring together, stimulate, mediate, and move agendas forward.
Coalitions, like neurons in a network, are junctures of communication and data processors
that become nodes of control and decisions through their exchanges, linkages, and field
effects.
Coalitions play an important role in public policy talks as well as organisational and
professional decision-making in political bodies. Alliances, groupings, and federations
participate in political and quasi-political talks in legislative politics at all levels, from
informal to official, and from spontaneous to planned. Coalitions of nations, as well as
coalitions of groups inside and across nations, shape and establish the terms of important
multi-national treaties like the Law of the Sea Treaty and the GAT at the international level.
Coalitions also shape and influence international decision-making in other areas. The recent
efforts to end the Serbian-Bosnian-Croatian problem is an example of these big united
endeavours; the activities of commercial multinational enterprises seeking business,
government contracts, or favours abroad. Coalitions influence and frequently dominate the
internal and external choices of a variety of corporate entities, ranging from boards of
directors and faculties to corporate committees, task forces, and working groups, or gangs, in
more private domains.
Both how and what choices are made are influenced by alliances and alliance activities.
Effective and efficient negotiating can be enabled or inhibited by alliances. Alliances may
either facilitate or prevent accords. Alliances and coalitions, on the other hand, are neither
permanent nor constant formations. Coalitions can be shaped and reformed in order to
achieve desired choices and agreements. Understanding coalitions and coalition bargaining
dynamics gives the "focal-negotiator" the cognitive schemata he or she needs to build, track,
and re-configure coalition pathways and plays.
The how of coalitions in negotiations are based on “winning coalitions” which, in theory,
refer to the only possible coalition in order to reach an agreement. In contrast, the concept of
“dominant coalitions” are less stringent and leave the possibility of “minority coalitions”.
There are two distinctive schools of thought which suggest a rigorous and generalised
definition of “winning” or “effectively winning” coalitions. The first of these suggests a

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formal theory based on mathematical models, whereas the other talks about
descriptive/inductive theories. The formal theories tend to focus on few key factors, like size
and distance, while the descriptive/inductive school considers a large number of variables and
sub variables in order to define a “wining coalition”.
Game and decision theory form the basis of the formal school and talk about coalitions as a
typical n-persons game. In such a case, the “payoff” plays an integral role in explaining a
coalition structure. The core issue lies in hoe these payoffs are obtained and subsequently
distributed. On the other hand, descriptive school considers the maintenance of coalitions as
dynamic and continuous. It proposes that the coalitions are subject to constant adjustments
depending on the expectations and behaviours, and contextual conditions impact the relations
strongly.
Other relevant approaches propose an inclination towards cognitive and decision theories,
which emphasize that rationality is limited and biases in judgment impact group negotiations.
Personality traits like overconfidence, emotional quotient, risk averseness, etc also dictate a
group’s ability to negotiate and form “winning negotiations”.
While it is difficult to link the theories with practice in coalitions since parties may be averse
to applying the theoretical models due to a lack of clarity about the preferences and traits of
the other practice; there seem to be some common issues that arise when following any
theory, even partially, with regards to a winning coalition. These are listed below:
1. Optimal Size: Determining the apt number of coalition members poses a challenge in
all negotiations and generally plays a very important role in resolution of issues.

2. Trust and Temptation: Members' trust and commitment to the coalition are also
concerns that hinder coalitions. A few such issues are:
o Coalitional integrity: The tendency for parties to stay loyal to a coalition
despite having access to larger resources outside of it.
o Status-quo bias: A preference for present conditions over suggested new ones
in decision-making and negotiation.

3. Division of the Pie: Division of the benefits within the coalition members is another
major issue hampering multilateral negotiations.
The planning process requires attention to the following issues in order to form a winning
coalition:
1. It's critical to consider both the advantages and expenses of coalition participation, as
well as the opportunity cost of establishing or joining a particular coalition among a
plethora of options. The appraisal work will most likely be easier the smaller the
coalition is. Many multilateral international discussions have a low degree of
tangibility and divisibility when it comes to rewards and expenses. While preference
analysis might help solve this problem, the gap between abstract calculations and
reality should not be overlooked.

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 2. The problem of resources cannot be divorced from asserting the opportunity costs of
forming, joining, or leaving a coalition. The easiest way to think about this is in terms
of power. To join a coalition, an actor must be ready to provide some resources to the
organisation. These resources might include its ability to vote, persuade or influence
its network of contacts, as well as its financial and economic capabilities. Because
becoming a part of a coalition entails the transition of individually owned resources
into a communal form, this is connected to opportunity costs. It is necessary to strike
a balance between the sacrifice of individual liberty and the benefits of communal
action.
3. Another essential requirement for effective coalitions is size. Neither theory nor
practise can provide clear on this issue. There are some instances when being big is a
must for success. If there are enough neutral or passive followers and irresolute
opponents, small coalitions can occasionally achieve their goals. In some situations,
though, modest size may be the key to success.
4. Another important aspect in evaluating effectiveness is leadership, which should be
addressed as part of the planning process. Strong leadership is frequently a necessity
for effectiveness, but it may also be counterproductive since it can trigger defensive
emotions, weaken group cohesiveness, and open the door for the formation of new
coalitions. Furthermore, strong leadership may cause conflictual components in the
talks to escalate. Because of its ability to organise coalition members, leadership is
critical. Leaders may frequently identify members' actual deep-seated interests, ignite
their motivations, and take action.
5. The requirement for coalition members to be close is a last component that is closely
related to the preceding ones. Proximity, or at the very least compatibility, is linked to
material interests, but it may also be linked to shared beliefs or philosophies. The
criteria for partner selection, whether based on an actual evaluation of the situation or
a more ambitious study of interests, values, and ideological proximities, require
information, experience, and judgement on the side of negotiators.
A deeper analysis of coalitions in negotiations points towards a close connection with power
dynamics. Multilateral negotiations can be thought of as a “network of actors” where the
subsections are the coalitions. The power dynamics within the network have a strong impact
on the behaviour and strategies of various parties. The most common categories of networks
include either a dominant coalition, or one where were multiple coalitions compete with one
another. In the latter case, the groups compete for specific concerns without seeking an
overall unanimous agreement. Whereas, in dominant coalitions, the coalition may generally
sway the negotiations, except when there are provisions of veto rights for the parties, or when
a unanimous agreement needs to be reached and the will of the coalition is no longer enough
to dictate the terms.
Even within the group, although not that explicit, power dynamics play an integral role. The
bargaining power of each member of the coalition is directly proportional to the sway he/she
has within the coalition. Furthermore, personal relations with the coalition members also goes
a long way in shaping the coalition’s strategies to benefit the individual agenda; someone
with background knowledge of members may easily manipulate everyone to his/her own

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tune. Interpersonal skills like mediation, patience, leadership, etc. help out in impacting the
coalition’s general behaviour. All these skills are very influential in maintaining the group’s
cohesion which plays an important role in deciding the group’s overall success.

1.2 Overview

Moving forward, we discuss how the literature analysis was tested and cross examined with
day-to-day practice in forming coalitions for negotiations. A primary research was conducted
in this regard. 21 responses were recorded to a survey conducted over google forms to discern
people’s inclination towards forming coalitions for negotiations, the tactics they preferred,
their perception of threats with regards to distrust, conflict, and overall breakdown of the
coalition. We were able to analyse the preference and priority of individuals with regards to a
coalition’s size, opportunity cost involved in coalition formation, the importance of
leadership, unit cohesion, and proximity with the members.
We were also able to connect with an industry expert who has had experiences in negotiating
with vendors and also with his company’s upper management. He was further able to shed
light upon the various intricacies of negotiating as a coalition. Over a telephone call, he gave
us insights into the prerequisites of forming coalitions, how relevant these coalitions were in
the industry to reach a successful agreement which benefitted all the parties involved. He also
spoke about the opportunity cost involved in forming and negotiating as a coalition and how
in certain cases, the results were more beneficial when negotiations were done by a coalition
instead of an individual.
In order to gauge the responses of a wider set of people, secondary research was done. We
referred to a few research papers and case studies, followed by a few articles online in order
to gain more insights into the subject matter. Moreover, we analysed how such negotiations
were prevalent in the industry.
Following this we were able to arrive at a conclusion to the case at hand.

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2 Methodology
This chapter is concerned with the methodology used to conduct this research and
undertaking the survey. It shows the unique qualities and characteristics of the method, which
must be kept in mind while a person interprets the findings of the following research. The
research includes collecting, organizing, and evaluating data, interpreting the evaluated data,
and deriving conclusions from such interpretation.
To aid our analysis, we distributed an online questionnaire that consisted of 7 questions. 21
respondents participated in the study. The average sample age was 27.3 years; 12 were Male
and 1 respondent preferred not to reveal their gender. The survey revolved around asking
their opinion on the various factors of Coalitions, the level of importance these factors play in
their prior negotiations.

2.1 Research Design

• Descriptive Research: Related to describing each attribute of a population or sample.
However, it cannot be used to find the cause-and-effect relationship between two
variables
• Analytical Research: Used to find a causal relationship between two variables and to
identify and quantify associations.

2.2 Expert’s Interview

To validate our research and its output, we interviewed Mr. Vineet Agrahari, Assistant
Manager at a Public Sector Company. Mr. Agrahari has been a part of several negotiations
on both sides of negotiations related to worker's compensation, rights, among others. The
rationale behind the interview was to improve our insights and understand the factors at play
when you are a part of a coalition or otherwise.

2.3 Sources of Secondary Research

We found various Scholarly journals and research reports relating to Coalitions in
Negotiations that have been published. We used two journals for our report:

• Negotiation as Coalition Building by Christophe Dupont, 1996: Coalition building

sheds valuable light on all types of negotiations, especially those in an international
setting. Indeed, close similarities in concepts and language, variety of approaches,
identification of major forms, determinants, and process and outcome variables are
found in both activities
• Interest Alignment and Coalitions in Multiparty Negotiation by Jeffrey Polzer,
Elizabeth Mannix, and Margaret Neale, 1998: Discussed the importance of
integrating negotiation and coalition research in a way that incorporates the social
dynamics of the negotiation interaction.

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3 Facts/Findings:
This section of the report focuses on the insights gathered from the research conducted using
the surveys, interviews, questionnaires, expert interactions, and other secondary research
conducted.

3.1 Results of the Survey

A survey was floated among the respondents over the internet using Google forms. The
survey primarily focussed on the significance of coalitions in a negotiation and the factors
which lead to effective coalition building for a negotiation.

• Out of 21 participants in the study, 16 of them had experienced a Coalition

Negotiation in their careers. It is always different for a company or an individual to
negotiate with a coalition and not an individual. It is often recognized as being
complex as the number of parties is higher which increases the number of issues as
well. The goal of a coalitions negotiation is to fulfill the requirements of the coalition
using collective power and efficiency while making the complexity as low as
possible.

• 57% of the respondents reported that they found coalitions to be effective in

negotiations. This shows that the importance of coalitions is essential to the corporate
framework. 9.5% of the respondents
believed that coalitions did not play
a huge role when negotiating.
Coalition Negotiations provides its
members with the power to achieve
the objectives of the common
platform. Coalitions can make an
agreement or can prevent an
agreement from being signed.

When some people are not qualified enough to negotiate on their own against a
common opponent, they can either hire an advisor who would help them negotiate
like a lawyer or an agent, or they can join a coalition and bargain collectively and in
an organized fashion.

• When asked about the importance of factors in Coalition Negotiations. The table
below shows the average score of each factor:
Size of the Group 3.95
Opportunity Cost of Organising or joining a coalition 3.57
The leadership of the Coalition 3.47
Interacting with the leadership 3.67
Need for proximity among members 3.71

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 o Size plays an important role in negotiations. Large sizes are beneficial for
some situations where there is voting which needs to be conducted, small is
beneficial when efficiency and effectiveness are required and there are many
neutral followers.
o The opportunity cost of organizing a coalition brings with it some resources to
the table. When we join a coalition, we bring financial capabilities, voting
capabilities. However, these individual resources are converted into a
collective resource which has an opportunity cost attached to it.
o Strong leadership helps in making negotiation and the planning behind it more
effective. However, if the leadership is too strong, it may become
counterproductive and reduce the cohesiveness of the group and create more
coalitions in the future. Using leadership, we can find the true interests of the
members in the coalition and take necessary actions to fulfill those interests.
o To improve cohesion in the group, we need to ensure there is an interaction
among the group members. If there seems to be tension or friction between the
leadership and the members, it can lead to some serious issues and ineffective
planning.
o Compatibility or proximity among the members is one of the highest-rated
factors in the coalition. If the ideas of the members are similar, the bargaining
power of the coalition increases.

• When asked about whether the effectiveness of a coalition depends on the type of
coalition, a clear majority of respondents replied affirmatively to it.
The type of negotiation
could be a majority versus
minority negotiation or a
general versus issue specific
negotiation. The nature and
precision of the objectives
and goals have an impact on
the success of the coalition.

A cooperative negotiation has different goals from that of a competitive negotiation

and helps in analysis. Cooperative negotiations are those which have mutually
decided outcomes that need to be influenced by both parties. On the other hand,
competitive negotiations are confrontational which have a minimum outcome that
needs to be achieved by the members and the group as a whole.

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 • 80% of the respondents believed that behaviors, powers, and circumstances either
shifted from one group to another or changed in between the negotiation.
These changes can have an
impact on the decisions that
need to be taken and the
conditions surrounding them.
The changing postures,
positions are a good indicator
of noticing the change in
powers.

• Minority Coalitions need to negotiate on issues that have usually been decided on by
the majority counterpart. To prove their point, they need to come up with
innovative and sustainable ways
of deciding on a common goal.
To do this, they come up with
ways which include foot
dragging, using and analysing
previous year’s norms and
precedents, and threatening
breakdowns and impasses as
well.

3.2 The Experts Comments

We had a telephonic interview with Mr. Vineet Agrahari, Assistant Manager at a Public
Sector Company. He has been a part of the labor union at his organization, his years of
experience and anecdotes helped us in understanding the impact of Coalitions in Negotiations
and the strategies adopted by both parties to shift the outcome to their benefit.
The main goal of a Coalition is to connect people who have the same issues and interests but
have no way of knowing it. To be a part of a Coalition, members usually have to pay a small
financial transfer, which is used for the expenses of the coalition.
Building coalitions is very relevant in the business scenario. It can include decisions relating
to deciding on the ideal location for a new office building or a technical one which includes
deciding on an organizational structure that could be centralized or decentralized.
To build a coalition, one needs to make sure that the other participants of the coalition know
that the goals of all parties are similar to each other or at least compatible. The more general
the goals of the coalition are, the more efficient it would be. If it has a very detailed goal, it
can give rise to conflicts within the coalition. Deciding on a broad outline is easy for a
coalition, however finalizing the detailed plan of action to fulfill the broad objectives is the
difficult part.

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It is imperative to ensure that the other party knows that it is in the best interest of both of
them to work together sustainably to grow and achieve their targets or goals. This is the
rationale behind the workers union. Joining the union makes the workers aware of the
policies of the management and gives them extra power which is lacking when they stand
individually. The benefits of working together are greater than the costs incurred.
The management at some of the most profitable companies employs practices to squash the
efforts of the Labour Unions. Mr. Agrahari called them “Lala Companies.” These practices
can include delaying promotions of employees beyond stipulated time or inadequate
compensation which lawfully should be higher.
Coalitions help in magnifying the issue by making the quality of the arguments richer and
substantial. Labour Unions are like watchdogs who keep an eye on the work of the
management.
We should focus on having a Win-Win negotiation, where parties on both sides of the table
walk away from the negotiation feeling they have gained something and have a lasting
relationship.

3.3 Contemporary Example – Street Vendors of Monrovia, Liberia

Monrovia, the capital of Liberia is run by the Monrovia City Corporation (MCC). MCC is
headed by a president-appointed mayor and a supporting council. The mayor was given a
mandate to “clean up” the city. As a result, street vendors faced repeated raids by police, who
justified the raids using an old ordinance from 1975 that outlawed selling food on streets and
restricted the hours that markets could operate and a second ordinance that made it illegal to
trade without a permit that cost $20. This was despite the traders’ argument that they were
selling non-perishables.
As a result, the traders marched to Monrovia City Hall in protest. The mayor and council met
with the traders’ team and agreed on a verbal mandate in a meeting with 1000 representatives.
The protesting traders soon registered themselves as the Protesting Traders Association. The
previous year, another organization called the Small Business Alliance (SBA) had also been
formed supported by an NGO. The MCC declared that they would not deal with two separate
organizations. So, after extended negotiations, the associations merged to form the National
Petty Trade Union of Liberia (NAPETUL).
NAPETUL agreed that traders would register themselves and pay a registration fee and asked
that the MCC use the proceeds from the fees to compensate for the stalls and tables the police
had broken and allot spaces to the traders to trade. They also submitted a draft MOU to the
MCC on the same and several rounds of negotiations followed without conclusion. Finally,
NAPETUL wrote a letter to the Presidents’ Office, requesting the personal intervention of the
President. The NAPETUL leadership met jointly with the mayor and president and it was
concluded that the money from registration fees will be used to replace the tables and stall
that the police had broken or damaged.

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Discussions on allotting the vendors a place to trade remained inconclusive. In the following
months, NAPETUL held a series of meetings with the MCC and Police and temporary areas
were given to the vendors to trade. Further, the MCC agreed that remaining funds from
registration fees would be kept in an escrow account until further negotiations concluded.
Thus, we see that, through collective bargaining and forming a coalition in negotiations, the
trading vendors were able to safeguard their interests. They formed a collective strong voice
and engaged with the highest levels of political brass in Liberia for their issues. They
continue to work for the welfare of street vendors in Monrovia.

3.4 Secondary Research

Coalitions or Collective Negotiations are scenarios where two or more parties come together
and join their resources to negotiate the outcome in a mixed-motive situation. There are a
couple of advantages offered when negotiating as a collective unit. Firstly, by becoming a
part of an informer organised group, individual negotiators can fight a lowball offer from the
other party. Secondly, they can avoid any destructive competition with similar parties
negotiating for the same outcome. By pooling their resources together, weaker parties can
negotiate with much stronger adversaries. It also weakens the adversary ability to institute
infighting among the weaker parties. In total, coalitions or collective negotiation led to a
more efficient process, which benefits the constituents involved in the negotiation.
From, labour unions to coalitions in government, there are certain tactics one can employ to
maximise the effectiveness of negotiating as a coalition:
• Making contacts early: Early alliances can all the more adequately adjust asset
allotment and interests.
• Looking for verbal responsibilities: Seeking verbal responsibilities to a reason or
game plan improves the probability of accomplishment by adjusting interests and
limiting the probability of deserting.
• Staying away from predisposition: Coalitions are for the most part worked around a
shared characteristic of comprehension. Utilizing fair-seeming reasoning to partition
the pie.
• Sharing all pertinent data: Coalitions are based upon common agreement. Sharing
all data applicable to all gatherings interests and destinations will support this
agreement.
• Zeroing in on interests, not positions: Focusing on positions establishes a fierce
climate. This can decrease participation and lead to absolutely aggressive strategies.
• Testing presumptions: Validating key suppositions around one position can help
people all the more completely comprehend and articulate their position.
• Looking for agreement: Try to make sure there is agreement among individuals
about the plan and procedural targets and in dynamic
• Clarifying one's self: It can be exceptionally valuable to clarify the explanations for
one's activities and articulations. It expands upon the shared characteristic of
understanding vital for successful alliances.

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 • Looking for support: The head of the alliance should try to have all individuals take
an interest in all periods of the cycle.
• Dealing with struggle: Jointly plan approaches to test conflicts and arrangements.
This might incorporate fostering a way or interaction for talking about undiscussable
issues.
• Staying away from interruption: There are quite a few interruptions that can crash
an exchange including an alliance. Attempt to keep the conversation centred.
As a party facing a coalition one can follow certain principles to void getting outnumbered if
the coalition is a bigger one with strong members. This includes understanding the key reason
behind these negotiations. At times, certain topics that may not be in the agreement points to
be discussed may be entered as a bargaining chip. It’s always important to prepare the facts
of the case properly and judiciously. Not only facts and figures but also, ways to meet the
desired outcome in a manner that is feasible to both parties. If negotiating with Unions or any
such sanctioned groups, it is important to understand that complex negotiation will take time,
and the deal needs to be presented to the whole union members from the representative of the
Union and then accepted. There will also are moments where the opposite parties’ demands
cannot are met, instead of dismissing their concerns, understand their position may help in
selecting an alternative not negotiated before.

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4 Conclusion

Our research shows that more than 75% of our survey respondents have experienced a
negotiation as a coalition. The most agreed point was that it increased the power of the
coalition while also making the negotiation easier. Around 60% of our respondents believe
that a coalition is an effective way to negotiate. A similar figure of respondents also agrees
that collective bargaining increase the range of the final agreement in any negotiation. A
higher number of parameters are discussed and 80% of the respondents agree that negotiating
as a coalition impacted their behaviour. As per the industry insight, it's important to
understand the interest of both parties and achieve a goal that is sustainable and also
desirable. The coalition with a more detailed purpose is harder to maintain, with inner
conflicts arising between the members. There are define benefits to negotiate as a coalition as
it not only increases the resources available but also because any cross members conflicts.

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5 References

Budlender, D. (October 2013). Informal Workers and Collective Bargaining: Five Case Studies.
Women in Informal Employment Globalising and Organising.

Coalitions in Negotiations. (n.d.). Retrieved from The business professor:

https://thebusinessprofessor.com/en_US/communications-negotiations/coalitions-in-
negotiations

Dupont, C. (1996). Negotiation as Coalition Building. Kluwer Law International.

Making the most of multiparty negotiations. (n.d.). Retrieved from HBS:

https://hbswk.hbs.edu/archive/making-the-most-of-multiparty-negotiations

Polzer, M. N. (1998). Interest Alignment and Coalitions in Multiparty Negotiation. Academy of

Management Journal.

Six Steps negotiations terms conditions trade union. (n.d.). Retrieved from Personnel Today:
https://www.personneltoday.com/hr/six-steps-negotiating-terms-conditions-trade-union/

Win Win Negotiations cant beat them join a coalition. (n.d.). Retrieved from Harvard:
https://www.pon.harvard.edu/daily/win-win-daily/win-win-negotiations-cant-beat-them-
join-a-coalition/

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