Negotiation Strategy and the Piracy Market

"To negotiate or not to negotiate, that is the question"

Ransom payments have reached a new peak. A few days ago, Somali pirates received a total of $12.3m in ransom money to release two ships (the Samho Dream and the Golden Blessing). We are dealing with highly sophisticated and organized criminals.

Pirates are getting better at what they do. The international effort which sought to combat piracy has failed.

What's going on?

Let's look at the mechanics and incentives behind piracy. A major incentive is clearly economic gains. When pirates hold property and/or crew hostage, it's difficult for shipowners/insurers/lawyers/law enforcement authorities to keep their heads cool. So how is the release of crew/property negotiated?

The fact is that little attention has been paid to this practical concern of the piracy problem. Can negotiation strategy help? What are the negotiation strategies employed with pirates? Are these the right ones? Perhaps part of the problem is how we negotiate with pirates.


States usually refuse to negotiate with terrorists for policy reasons. So why do we allow ourselves to negotiate with pirates?

We should recognize that ransom payments are counter-intuitively part of the problem.

The Piracy Market's logic is clear:

• Ransom payments = incentive for pirates;
• Incentives create and formalize the market for piracy;
• The "Piracy Market" attracts new market participants;
• The new market participants perpetuate piracy.

It's a vicious cycle that's getting worse.

But what is the alternative?

I'm trying to explore these issues in more detail. The scarcity of information and the relatively secretive nature of ransom negotiations complicates research in this area but it is hoped that I'll be able to hypothecate on what information is available so as to help stakeholders better deal with pirates in these delicate situations.

It may be that we should re-consider not only whether current negotiation strategies are effective, but - perhaps more controversially - whether we should negotiate with pirates at all.

Any contributions from lawyers/negotiators/law enforcement agents are highly welcome.

Negotiating Styles

ON NEGOTIATING STYLES:

Are you the shark or are you the fox?

Have you let down you inner box?

There is one party, and one party alone,

That can vindicate your lonely soul.

Step in, step out.

And let there be no doubt.

That in agreement we find ourselves,

But in discord there is nothing else.

A man whose job was to negotiate the price of fate,

And who had spread love without debate,

Was found dead.

Castrated.

300 AD but possibly undated.

Reach agreement! Or else perish alive,

Not to negotiate is to take a long, lonely, dive,

“Believe me!” a tough man says, “this is my last offer”,

But the only tough negotiator is La Mort,

And there cannot be anything tougher.

Magic wounds, early concessions,

Not to make any is a hard learned lesson,

But in the world of business,

Just like in the world of love,

Not to give in,

Is a price above.

Step in, step out.

And let there be no doubt,

That it is together that the wound magically heals.

That I will never,

Negotiate,

The way for you I feel.

The Cardinal Principles of Negotiation

1. Argue over interests, not positions.

2. Consider all options.

3. Use objective standards.

4. Be soft on the people but tough on the problem.

For a more detailed overview of these principles, click here.