NEGOTIATION S P E C I A L R E P O R T

Program on
Negotiation
at Harvard Law School

Helping you build successful

agreements and partnerships

Crisis Communication
How to Avoid Being Held Hostage by
Crisis Negotiations

In this Special Report, we offer advice from the Negotiation newsletter

to help you and your organization communicate effectively during times
of crisis. You will learn to:
■ Apply lessons from hostage negotiators.
■ Avoid disasters through careful planning.
■ Negotiate productively with an angry public.
■ Head off impasse through open communication.

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 Program on
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In this Negotiation Special Report, we offer expert advice selected from the Negotiation
newsletter to help you and your organization communicate effectively during times
of crisis. In this report, you will learn to apply the lessons of professional hostage
negotiators, avoid disasters through careful planning, diffuse tensions with angry
members of the public, and break through impasse with open communication.

Apply lessons from hostage negotiators

Upset by a delay in the delivery of one of your products, a longtime buyer
threatens to turn to the media unless you meet his extreme demands. Not only is
the relationship in jeopardy, but your company’s reputation seems to be as well.
What should you do?
In Negotiation, we typically offer a variety of perspectives for coping with
tense bargaining situations and disputes such as this one, based on experts’
observations of executives and students, both in the real world and in the lab.
These perspectives generally assumes that negotiators behave lawfully and with a
certain degree of civility and rationality.
By contrast, a parallel realm of negotiation advice assumes the presence of an
unlawful, unpredictable, and irrational counterpart: hostage negotiation. Before
you dismiss such life-and-death situations as irrelevant to your professional
career, consider three lessons that hostage negotiators have derived from their
experiences—lessons they believe can help us settle less violent, but still vexing,
negotiation crises.
1. Contain the situation. Police teams typically refuse to engage in dialogue
with a hostage taker until the situation has been contained. This means closing
off escape routes and minimizing hostage takers’ contact with third parties.
Why is containment so important? Information from outside parties could
undermine the chief negotiator’s message and power. In addition, restricting
interactions to a two-person negotiation helps build trust and cooperation.
Once the situation is contained, hostage negotiators often begin their
communication with a hostage taker by laying down ground rules. According to

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PRO GR A M ON N E G O T I AT ION

retired lieutenant Hugh McGowan, the New York Police Department (NYPD)
hostage team’s former commanding officer, they might start with this simple
question: “Do you want me to lie to you?” Invariably, the hostage taker responds
by insisting on straight talk from the police negotiator.
“We earn their respect by being honest,” explains FBI crisis negotiator Richard
J. DeFilippo. This commitment to honesty not only establishes a foundation for
trust and respect but also gives hostage negotiators room to refuse a criminal’s
demands. If a hostage taker believes a negotiator is speaking truthfully, he’ll be
more willing to take no for an answer.
In everyday negotiations, it’s not always wise to negotiate exclusively with one
party. Yet sometimes, disputing parties make progress only after agreeing to
deal one-on-one with each other, as in the case of a couple trying to save their
marriage after a breach of trust.
2. Expand the “emotional pie.” In Negotiation, we often encourage our
readers to address the emotions at stake in a negotiation before tackling
substantive issues. If your business partner threatens to leave the company and
take her clients with her, for example, you’d be wise to question her about her
feelings before beginning to discuss a possible dissolution.
Similarly, research suggests that the majority of hostage situations are driven
by emotions or relationships. Hostage takers may claim they want money, a plane
ticket, or some other instrumental reward, but these demands typically mask a
greater underlying emotional concern, such as a desire for respect or attention.
This is why Lieutenant Jack J. Cambria, commanding officer of the NYPD’s
hostage-negotiation team, stresses the importance of listening carefully to the
hostage taker’s demands with the goal of identifying his primary underlying
problem or motivation. Rather than engaging the hostage taker in a rational
debate about his feelings (“But you have your whole life ahead of you!”), police
negotiators seek to manage the hostage taker’s anxieties. They demonstrate
concern through active-listening techniques—for example, self-disclosure,
paraphrasing, and supportive remarks, such as “It sounds like you feel very
lonely.”
The lesson for business negotiators? Time spent exploring the emotions
behind a counterpart’s stated positions is never time wasted. For further

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guidance on addressing other parties’ core emotional concerns during a

negotiation, consult Beyond Reason: Using Emotions as You Negotiate (Viking
Penguin, 2005), by Roger Fisher and Daniel Shapiro.
3. Build a relationship. When a police negotiator says, “We’re in this together”
to a hostage taker, he’s not just paying lip service, insists retired NYPD police
commander Robert J. Louden. Rather, the negotiator is trying to create the kind
of bond that psychologists develop with their patients—a bond that will allow
them to find a solution to the crisis together.
How do police negotiators encourage hostage takers to collaborate with
them? Here again, active listening is key. “Talk to me,” the motto of the NYPD’s
negotiation team, serves as a constant reminder to officers that they need to
listen carefully as they communicate both with the hostage taker and with
members of their team.
The next time you have trouble establishing a trusting relationship with a
difficult counterpart, consider that police negotiators often succeed at connecting
with desperate, threatening criminals. That knowledge should encourage you
to redouble your efforts to find common ground and explore the possibility of
making minor concessions.
Adapted from “When a Crisis Reaches the Breaking Point,”
first published in the Negotiation newsletter (September 2008).

Avoid disasters through careful planning

In the midst of the financial crisis that began in 2007, accusations of greed on
Wall Street have sounded across the globe. Greed may be a significant factor
in the collapse of credit markets, but it’s not the only one. Overlooked in cries
to punish the “bad apples” is the role of a mistake that virtually all negotiators
make: ignoring how our short-term decisions will affect us and others in
the future.
In their book Predictable Surprises: The Disasters You Should Have Seen Coming,
and How to Prevent Them (Harvard Business School Press, 2008), Max H.
Bazerman and Michael D. Watkins describe the financial scandals of 2001 and

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PRO GR A M ON N E G O T I AT ION

2002 that led to the fall of Enron, Arthur Andersen, Tyco, and other companies.
They label such crises “predictable surprises”—disasters that shock those
involved even though they had the information needed to anticipate them.
The Enron-era crisis, Bazerman and Watkins argue, was rooted in a conflict
of interest that could cause auditors to make compromised judgments. Looking
at the more recent credit crisis, an unprecedented demand for affordable
mortgages prompted banks, unhindered by significant regulations, to make risky
lending decisions and equally risky investments. Defaults and foreclosures by
overextended homeowners led to a credit crunch that brought down financial
institutions and triggered a $700 billion taxpayer-funded Wall Street bailout
package.
The two crises share a common thread: the desire to maximize short-term
returns blinded decision makers to predictable surprises lurking down the road.
In both cases, warning signs went unheeded. Here are some suggestions for
injecting more forward thinking into your negotiations.
1. Weigh long-term matters. As you prepare for your next negotiation,
take time to think about how the issues at stake could play out down the road,
advises professor Kimberly A. Wade-Benzoni of Duke University. Bring up
these concerns when you meet with your counterpart, and remind her of the
value of reaching an agreement that will stand up over time. At any point in the
negotiating process, you might also make a decision tree that charts the likely
long-term results of various options.
2. Challenge broken systems. Simply talking about future concerns isn’t
enough to ward off predictable surprises. You’ll also need to evaluate whether
certain groups and structures in your organization are promoting short-term
thinking at the expense of the future. Perhaps your company’s board of directors
focuses myopically on short-term earnings reports. Maybe your company spends
too much on lavish retreats. Brainstorm ways to fix the system and then lobby
influential others to support your ideas.
3. Negotiate in stages. Negotiators often get into trouble when they
implement long-term contracts for complicated, risky ventures. That was the
case in 1998 when the U.S. spy satellite agency, the National Reconnaissance

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Office (NRO), awarded Boeing a $5 billion, five-year contract to build two

different complex satellite systems. Six years later and billions of dollars over
budget, NRO fired Boeing for failing to deliver. The lesson: Negotiate one project
at a time, and insist on incremental progress before awarding additional work.
Adapted from “How Short-Term Focus Contributes to Future Disasters,”
first published in the Negotiation newsletter (December 2008).

Negotiate productively with an angry public

When negotiators get along well, creative problem solving is easy. When they
become upset, however, they seem to forget everything they know about finding
joint gain, to the point of giving up tangible wins simply to inflict losses on the
other party. This is especially true in high-profile negotiations that turn nasty.
Confronted with negative publicity, executives become so focused on controlling
public relations and managing the crisis that they lose sight of the fact that that
they are even in a negotiation.
Many public relations experts would argue that negotiations have no place in a
crisis. Reveal as little as possible, they say, deny liability, and avoid all forums that
could legitimize your adversaries’ views. This advice ignores the fact that what an
angry public wants most is to be heard.
Experts in conflict management point out that if the only communication
that does occur consists of both sides asserting their positions and demanding
that the other side take certain actions, little progress will be made. Instead, try
construing exchanges with angry parties as negotiations in which the primary
goal is to search for tradeoffs that will lead to a mutually beneficial agreement.
Even when agreement seems impossible, parties often can work together to
create value.
Acknowledging the other side’s concerns can be difficult, especially when
lawyers worried about liability are involved. But organizations that take the time
to acknowledge the concerns of others will often be able to avoid making large
concessions. For instance, a company that wants to build a controversial factory

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might meet with angry residents to acknowledge their concerns about possible
adverse impacts. The company might also commit to ensuring that all relevant
federal, state, and local regulations will be met if the factory is built.
Those who have been hurt by a corporation in the past (by an environmental
disaster, for example) might begin their public campaign by demanding an
apology. In many parts of the world, indigenous people involved in current
disputes about the use of their land have opened negotiations by demanding
apologies for generations of hardship. Typically, corporate executives and
governmental officials react by denying personal responsibility for past events.
A better strategy might be to express empathy for the group’s past struggles
via a public statement that stops short of an apology. It is often possible to
acknowledge the public’s concerns without accepting responsibility and
generating exposure to liability.
Adapted from “When an Angry Public Wants to Be Heard,” by Lawrence Susskind
(professor, Massachusetts Institute of Technology),
first published in the Negotiation newsletter (November 2003).

Head off impasse through

open communication
What happens when people think they’ve invested too much in a dispute to back
down from their entrenched positions? This question rose to the fore as the Writers
Guild of America (WGA) West and East’s strike against the Alliance of Motion
Picture and Television Producers (AMPTP) dragged from weeks into months.
Following three months of bitter negotiations with the AMPTP over a new
contract, the writers closed laptops on November 5, 2007. In addition to seeking
an increase in their residual pay for movies and TV shows released on DVD,
writers insisted on a contractual guarantee for residuals on shows and films aired
on the Internet and other “new media” outlets. The AMPTP argued that more
time was needed to find out whether new-media revenues would be significant
before reaching a profit-sharing agreement.

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As the two sides took turns angrily rejecting each other’s proposals, television
network ratings slumped, and AMPTP member companies laid off support staff.
The Los Angeles County Economic Development Corporation estimated that the
strike was costing the regional economy $220 million per month.
On February 12, 2008, the writers and producers announced they had reached
a new three-year deal that would end the 100-day strike. Both sides expressed
satisfaction with the new contract, which granted the writers their key demand:
a percentage of revenues generated by digital formats such as the Internet. Here
are three factors that made a difference in the final days of resolution:
1. A looming deadline. A deadline, whether real or self-imposed, can offer
disputing parties a real incentive to break through impasse. Both sides in the
WGA strike were motivated to come to agreement before the end of the spring
television season and before the February 24 Academy Awards show, which the
writers were expected to picket.
2. A useful precedent. In mid-January, as the WGA strike dragged on, the
AMPTP reached a tentative agreement with the Directors Guild of America for a
new three-year contract. The directors’ new gains in DVD and Internet residuals
offered a template for the WGA and spurred the writers to negotiate even better
terms for themselves.
3. Improved communication. Lack of communication and a public war of
words deepened tensions and distrust between the WGA and the producers.
Negotiations finally got serious after company executives reached out to the
WGA. Under cover of a media blackout, the two sides met in small groups and
got to know each other. The talks “started off cautious but gradually warmed up
and became very productive,” WGA lawyer Alan Wertheimer told Variety.
The most important take-away from the costly strike? It might have been
avoided if parties had gathered regularly between contracts to discuss their
concerns and plan for the future. “The lesson is, we shouldn’t meet every three
years,” CBS chief executive Leslie Moonves told the New York Times.
Adapted from “How the Writers Got Back to Work,”
first published in the Negotiation newsletter (May 2008).

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