X. Conclusions

The authors have presented a new negotiating process made possible with the SmartSettle negotiation support system. Preliminary research shows significant potential for negotiating parties to gain from using such systems. In a Cornell study (footnote 25) with a similarly complex case, the average gains were 16% for each party. In the authors’ opinions, this process will reduce time, cost, and stress if parties pay attention to avoiding the pitfalls that often exhaust conventional negotiators (footnote 26).

The facilitated negotiation described in this paper is intended to both (1) encourage mutual gains bargaining and (2) to work toward the goal of Pareto efficiency in negotiation. The SmartSettle process, when used with a skilled neutral, can encourage both goals. As with any technology, it cannot be mechanically applied to complex situations. The effective use of this process involves many of the principles underlying mutual gains bargaining, and effective mediation/facilitation. The software is no substitute for proper preparation and thoughtful participation in negotiation. However, the structure proposed and SmartSettle software work in synergy with, rather than supplanting, those basic negotiation principles. Multi-party and multi-issue negotiations are frequent and usually complex. These tools and processes can take parties to a place of effectively viewing their options, and making the best possible decisions in negotiation.


  • Economists sometimes use the term “Pareto Optimal” to describe an outcome that cannot be made better for any party without making some other party worse off.
  • In dynamic real world cases, the location of the efficiency frontier is actually a function of an evolving problem description and constantly changing party preferences. This makes it a moving target in contrast to the static representation in the example of this paper.
  • For more information about Smartsettle, visit the website.
  • By default, SmartSettle treats all parties equally. However, parties may agree ahead of time to change the default by setting levels of relative influence for each party.
  • This case is used here with permission from the Program on Negotiation at Harvard Law School (www.pon.harvard.edu). It is an adaptation of, “DEC v. Riverside Lumber” written by David Lax, James Sebenius, Lawrence Susskind, and Thomas Weeks. For the purposes of this paper, and to conserve the uniqueness of the PON case, details of the case have been substantially changed. Copyright is held by the Program on Negotiation from which “DEC v. Riverside Lumber” and other teaching materials may be purchased for a nominal fee.
  • H. RAIFFA, Lectures on Negotiation Analysis (1996)(“Lectures”).
  • J. HANSEN, Round Table Manners for Facilitators (1998).
  • D. Brin, Avoiding Fatal Errors, The Future of Civilization and the Internet, __ OHIO ST. J. DISP. RES. (1999)
  • In “Lectures”, Raiffa (cited above), on p. 50, uses the term “Template” where “Single Negotiating Form” is used in this paper.
  • Normally, only one party or the facilitator will enter the Shared Information and then give the access codes to other parties. Thereafter, linked by the SmartSettle neutral site on the Internet, the Shared Information is available to all parties.
  • In an actual case, the parties may have further joint sessions or teleconferences from time to time to better define the problem and modify/improve the SNF.
  • In the remainder of the illustration, the process is described from Riverside’s perspective. All screen shots show how SmartSettle appears on Riverside’s computer monitor.
  • The reader might look at the values on the right-hand side and recognize that it would be impossible for DEC to guarantee a scrubber if the no scrubber option was chosen. Parties can teach SmartSettle about such infeasible conditions with constraints. Detailed discussion of constraints is beyond the scope of this paper.
  • How a party becomes satisfied on a particular issue often depends on outcomes for other issues. How SmartSettle deals such interdependencies is not dealt with in this paper.
  • Hammond, Keeney, and Raiffa, Even Swaps: A Rational Method for Making Trade-offs, HARV.BUS. REV. 137-149 (March-April 1998) (Hammond, Keeney, and Raiffa state that making wise trade-offs is one of the most important challenges in decision-making.)
  • quoted in the SmartSettle User Guide (1999).
  • Thiessen and Loucks, Computer-Assisted Negotiation of Multi-objective Water Resources Conflicts, WATER RES. BULL., Am. Water Res. A., 28(1), 163-177, Feb.(1992).
  • Hammond, Keeney and Raiffa (1998) (cited above). (These authors use the term “even swaps” to describe a similar methodology for simplifying tradeoffs that can be employed without computer assistance.)
  • The term “optimistic” as used here means that the party making the proposal doesn’t really expect it to be accepted, and is prepared to make further concessions.
  • By definition, a complete package is composed of a set of issue values. An issue value is a possible decision for the subject issue.
  • The white dot is a private marker, indicating acceptance. It may be put on any package, whether private or published. By definition, a proposal will always have a white dot.
  • Thiessen , Loucks & Stedinger, Computer-Assisted Negotiation of Water Resources Conflicts, GROUP DECISION AND NEGOTIATION. 109-129 (March 1998).
  • Id. Shell reports from his own research that when most negotiators had finished “a hotly contested, complex deal, they were tired and wanted to stop” rather than participate in a post-settlement settlement exercise.