Sunday Scribblings
The Deal‘s the Thing
Most of the readers of this Scribbling will not be familiar with the ins and outs of Irish politics. To tell the truth, most Irish people are not familiar with the ins and outs of Irish politics. Personally, I lost the plot a long time ago.
Politicians and commentators always overestimate the time and attention people pay to politics. The honest answer is, not a lot. In fact, very little. And not just in Ireland.
But this piece is not really about Irish politics. It just uses Irish politics as a hook on which to hang a few comments about negotiations. In particular, how not to do things. The piece was sparked by this article in the Irish Times, here which is about a political deal not living up to expectations.
First, however, a little background on Irish politics. Ireland has a multi-seat, proportional representation system. When people go to vote they mark their ballot papers 1,2,3, etc., in order of their choice. There is a quota that candidates have to reach before they are elected. Candidates with low votes are eliminated and their votes are given to the remaining candidates. Candidates with more votes than the quota see their surplus distributed. Counting in an Irish election is not a game for the squeamish. It is done manually. Over days.
Because of the changing nature of Irish society, the two big parties that dominated the 20th century, Fianna Fail and Fine Gael, have become less dominant. Smaller parties and independents have broken through. Coalitions need to be put together to form governments. Unlike Belgium where it took seven months, the Irish do it in weeks. Then again, unlike Belgium, none of the Irish political parties are looking to break up the country. The Belgians now have a prime minister who does not believe in the existence of Belgium.
The last election was in November. Fianna Fail and Fine Gael, combined, fell a few seats short of a majority. To make up that majority, they turned to a group of 9 independents who had come together to maximise their leverage.
A deal was done. Five of the independents would get government positions, in return for the support of the group. It looks to me, from the outside, like a bit of a costly deal, but then I was not at the table.
Almost immediately, those members of the group who did not get positions announced that while they would support the government they would sit on the opposition benches and demanded opposition speaking rights. Only in Ireland, could a political group claim to be both in government and opposition at the same time.
According to the Irish Times, three of the group said, “they could not be considered Government backbenchers in any circumstances, and would cast their votes on a “case-by-case” basis.”
The Irish Times article continues:
There is also annoyance as the negotiators who represented the Independents in government formation talks did so on the basis they represented a total of nine votes between the regional Independents...
Sources in Fianna Fáil and Fine Gael said that five ministerial jobs were given to members of these groupings on the basis of nine votes being secured for the Government. “We have five Ministers and five votes,” one said.
The five votes get them over the majority line, but it is not the deal they thought they had done. They thought they had nine, gave away five jobs and ended up with the votes of the five people they gave jobs to.
There does not seem to be a written agreement between the parties, or if there is one, it is not in the public domain.
Agree what has been agreed
I have been involved in labour relations negotiations for over 50 years.
One thing I have learned is that you need to agree what you have agreed before a negotiation concludes. “OK, I think we have an agreement. Let me go over it one more time. We have agreed the following”. Then list what has been agreed. “Are we agreed that this is what we have agreed? If so, let’s take a break and I will write them down and then we can all sign off. Better to get any misunderstandings out of the way now, than have problems down the road”.
Over the years, I have come to realise that precision in agreements is better than vagueness. I know the argument that agreements should always have some built-in “wriggle room” to allow the parties to weave and dodge if and when necessary, but it is not an argument that I have ever found persuasive. I do accept that in certain, fraught international situations ambiguity may be the only option, but in ninety-nine per cent of commercial and labour negotiations, precision is to be preferred.
Clearly, this did not happen in the Irish government negotiations. A deal was done and the two sides left the table with a different interpretation of the parameters of the deal. Given this, there was always going to be trouble ahead.
Implementation
The Fianna Fail/Fine Gael negotiators it seems to me are guilty of a second mistake. Did they stop to ask, “How is this going to work in practice?”. “Walk me through it. Who exactly is going to do what, how and when?”
In other words, a deal is only as good as its implementation and the implementation process needs to be understood and agreed before the deal is closed.
Want an example?
Look at the Brexit negotiations and Northern Ireland. Boris Johnson, then British prime minister, swore his Brexit deal would not create a border in the Irish Sea. He may have believed that, but that is exactly what it did, create a border between Northern Ireland and the rest of the UK. The implementation details of Johnson’s Brexit deal for Northern Ireland are still being worked out today.
Take time before the negotiations wrap up to talk through implementation. It is important to have an agreed implementation roadmap, especially if those who have to implement the deal are not the same people as those who negotiated it. You can’t just toss a deal over the fence to colleagues and say: “Up to you now to run with it”, with no guidance as to how to do so.
It can’t always be “win-win”
There is a school of thought which holds that with the right approach, every negotiation can be “win-win”.
I don’t believe that to be true. Much as all as I like the insights in Getting to Yes, the idea that everyone will always be happy with the deal is just not the way things are.
Sometimes there are losers. As the Rolling Stones put it: You can’t always get what you want.
I may be wrong, but I think it is in Getting to Yes they tell the story of the two, old spinster sisters fighting over an orange, which they resolve by cutting it in two. Then it turns out one wanted the peel, and the other wanted the flesh. As the authors point out, they both would have been better off if they had discussed what they wanted with one another beforehand. Indeed, they would have.
But what if both of them wanted the peel or both of them wanted the flesh? What if one of them was bigger and stronger than the other and able to dictate terms?
Is this not the way President Trump is now behaving? Trump is not a brilliant negotiator or dealmaker. His business history shows that, bankrupt six times. He is just the biggest guy on the block, because he is the president of the US.
If you are driving a little Fiat Topolino and you see a 30-ton Volvo truck coming at you your options are limited. Get out of the way, and fast. It is not that the guy in the Volvo is a better driver than you. He just has more tonnage, a lot more. If he hits you, there will be only one outcome.
As the legal commentator David Allen Green pointed out this week, although Trump is often described as ‘transactional’, his approach to deal-making is actually “anti-transactional”, so that “an agreement offers an opportunity to gain leverage, for a new negotiation, for a new exertion of power.” An agreement with Trump has no lasting value. Here today, gone tomorrow. Agreements with Trump are always signed in “Trump ink”. It disappears off the page 24 hours later.
For most of us, however, in the ordinary mundane commercial or labour relations world, the deal‘s the thing. Get it right or live with the consequences. Don’t be under the illusion that everything can be “win-win”. It can’t.
Here is a Reuters report on the recent deal between IG Metall and Volkswagen. 35,000 jobs to go by 2030, no pay increases for the next two years, and the future of some plants still uncertain. Here is the company comment on the deal. Is this a “win-win” deal? I remain to be convinced. It looks to me like what the Americans call “concession bargaining”. Probably the right deal in the circumstances because VW has got its EV and China strategies wrong, but it can hardly be marked down as a victory for Metall and VW workers.
So, don’t be under illusions that there is always a deal available where “everyone’s a winner”. Maybe in Havard textbooks, but not in the real world.
Agree what has been agreed and write the deal down. Discuss and agree implementation. Avoid wording that cannot be precisely defined.
Remember, there will always be someone who wants to unpick the deal. It is just one of those things. Don’t give them the chance to do so. Get things right from the get-go.
There is no “art” to the deal. Just hard work.