#60 Intangible Interests – Why They Are Important And How To Identify Them

The interests of negotiators can be divided into substantive interests such as low cost, a strong product, or a flexible contract; and intangible interests, which tend to be more subjective and psychological in nature, such as an interest in honest communication.

Photo of hand representing intangible interests

 

Since intangible interests may remain hidden and often block resolution, a general practice of ‘peeling the onion’ or ‘taking the discussion to a deeper level’ has evolved. Chapter Four of Lax & Sebenius’ under-acknowledged 1987 book The Manager as Negotiator, develops six categories of intangible interests.

Lax and Sebenius first identify three types of intangible interests:

Process – to do with the character of the negotiation procedures and communication

Relationship – to do with the nature of the past, present, or future relationship

Principle – to do with values and other principles that may guide a negotiator

Lax and Sebenius then explain how each of these three can in turn be intrinsic or instrumental, where intrinsic means having worth in an agreement, while instrumental means having value in other dealings outside the agreement being negotiated. Three by two makes six possible categories of intangible interests in this analysis. An example of each of the six follows.

 

– An intrinsic process interest: A need to complete a negotiation by a particular date

– An instrumental process interest: A need to establish a complement of participants who will attend a negotiation, knowing that the complement formed will affect who attends future negotiations

– Examples of two different intrinsic relationship interests:

  1.  A hope for an apology from the other negotiator;
  2. A desire to have no further dealings with the other negotiator once an agreement is reached.

– An instrumental relationship interest: A concern about acrimony in the future (due to dissatisfaction with the terms of settlement)

– An interest that is an intrinsic principle: An interest in a fair agreement informed by objective standards

– An interest that is an instrumental principle: An interest in financial transparency during the operation of an agreement because it will impact financial transparency in matters outside the agreement

 

Since unmet intangible interests (which may be difficult to articulate) probably lead to no agreement as frequently as unmet substantive interests, it is helpful to have a system for identifying their presence. You could create a handy 2 x 3 graph of the six categories to refer to when preparing for negotiation.

 

 

In the next blog, I plan to write about a systematic way of assigning value to intangibles that allows them to be directly compared to monetary values.

 

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