Monday, October 3, 2011

Negotiating 101 for Community Associations

Whether we realize it or not, everything we do within the confines of a community association framework boils down to negotiations. An owner wants a second parking space, the board wants the membership to approve a material alteration, the manager wants a good turnout for the annual meeting and the list goes on. Unfortunately most people are not terribly skilled at the art of negotiation.

According to Wharton Professor Stuart Diamond, "Effective negotiations are about perceptions and emotions, not about win-win and threats. It is about valuing others, even people who might hate you. And that is more effective than power which might make the opposing side resentful and retaliatory."

In his book, Getting More, Diamond advises that trading items of unequal value can be one of the best negotiating tools. In our everyday lives this can play out as "you do the wash on Monday and I'll do the shopping on Thursday." This too can have a counterpart in association-land. Perhaps you change the time of the board meeting to a day or hour that is more convenient to the owners in exchange for member cooperation on parking issues? The book outlines hundreds of case studies covering everything from women in certain Third World countries trying to avoid arranged marriages to CEO's trying to close billion-dollar deals. Attempting to get your community issues under control won't seem like such a stretch after reading some of these success stories.

What is the worst negotiating technique? Being a bully. In community associations there are various actors that can fill the bully role. It might be a director who is selectively enforcing the covenants against some owners and not others; it might be the resident who is harassing the association employees or the board; it might be the manager who is blocking an attempt to inspect the association records and it might be the association attorney who is protecting certain members of the board. What all of these folks lose sight of is the fact that successful negotiation will ease their problems much quicker than flexing their muscle ever will but that requires an attitude change.

In his book, Diamond relates the following joke:

A guy goes into a store and buys a lamp. He goes home, rubs the lamp and a genie comes out. The genie says, "I'll give you anything you want but your neighbor has to get twice as much." The guy says to himself, "I want a house-but my neighbor will get two houses! I want a million dollars-but my neighbor will get two million." Finally the guy gets an idea. "I know what I want," he says to the genie. "Put out one of my eyes."

Sadly this is how most people negotiate along the lines of "This will hurt you more than it hurts me." Unfortunately, it usually hurts everyone equally and in a community association where the actors all have to live with each other on a daily basis, the impact will be felt much more keenly.


  1. The joke reminds me of something that actually happened several years ago. I was seeking lost shareholders of a $750MM Drug Wholesaler that had been purchased by a larger entity. Almost all shareholders were individual Drug Store Owners or the small corporations that owned the Stores themselves. Three units worth about $63,000, were in the name of a Partnership in New Jersey. The store had been closed for a long time, the owners had gone their separate ways--and most likely they were not even aware that they owned a piece of Drug Guild. (they had paid about $7500, for the stock and most owners thought it was a guarantee on their accounts.

    I found one partner and called and explained his good luck to him.

    "But, Bob," I said, "I'll need your partner, Herman, also. You both should sign for the money.Can you give me his number?"

    He replied, "Forget it. I'm not giving that S.O.B anything."

    "But if he doesn't sign I can't give you your half. I pleaded...

    Bob said, "I don't care, I'm not giving him nothing, no way, never!"

    A few weeks later someone reached Bob's wife, and, as usual the wisdom and practicality of women prevailed. Herman got his share.

  2. I read this book this summer. Fantastic read and so many practical applications. I had my son who is a junior in college read it as well.