James K. Sebenius
Gordon Donaldson Professor of Business Administration
JAMES K. SEBENIUS specializes in analyzing and advising on complex negotiations. He holds the Gordon Donaldson Professorship of Business Administration at Harvard Business School. In 1993, he took the lead in the School's decision--unique among major business schools--to make negotiation a required course in the MBA Program and to create a Negotiation Unit (department) which he headed for several years. The Negotiation Unit grew to several full-time negotiation faculty teaching the required course to over 800 students per year as well as offering advanced dealmaking and negotiation courses to MBAs, doctoral students, and executives. The Negotiation Unit subsequently merged with the School's Organization and Markets Unit to form a new Unit, "Negotiation, Organizations, and Markets (NOM)." Formerly an Associate Professor on the faculty of Harvard's Kennedy School of Government, Sebenius also currently serves as Vice Chair and as a member of the Executive Committee of the Program on Negotiation (PON) at Harvard Law School. At PON, he has taken the lead role in the University's annual Great Negotiator Award program, which has intensively engaged with and brought negotiators such as George Mitchell and Richard Holbrooke to campus.
Early in his career, he co-founded the Negotiation Roundtable, an ongoing forum in which hundreds of varied negotiations have been examined to extract their most valuable lessons. In 2008, Sebenius succeeded Roger Fisher as Director of the Harvard Negotiation Project, which currently focuses on China-related negotiations, the Middle East Negotiation Initiative, and the Great Negotiator Study Initiative. Drawing on this and extensive advisory experience, summarized below, he co-authored (with David Lax) 3-D Negotiation: Powerful Tools to Change the Game in Your Most Important Deals (HBS Press). A previous collaboration with Lax produced The Manager as Negotiator (The Free Press). He is also the author of Negotiating the Law of the Sea (Harvard University Press), co-editor of various works, and author of a number of academic and popular articles as well as many field case studies and multimedia teaching materials.
Sebenius left Harvard in the mid-1980s to work full-time for investment banker Peter G. Peterson, co-founder with Stephen Schwarzman of the New York-based Blackstone Group, now one of the world's leading merchant banking and private equity firms. For several years following Blackstone's launch, Sebenius worked closely with Peterson and Schwarzman, initially as vice president, and later as Special Adviser to the firm after returning to Harvard. In its first year, Blackstone announced transactions valued at over $11 billion and advised over a dozen major corporate clients (including Squibb, American Can Company, American International Group, Inc., Armco Inc., COMSAT, CSX Corp., Eaton Corp., Firestone Tire and Rubber, Saatchi and Saatchi Company PLC, and Sony Corporation) on a wide variety of financial and strategic negotiations including mergers and acquisitions, joint ventures, recapitalizations, and divestitures. During Sebenius's active involvement with the firm, Blackstone raised almost $1 billion in equity for Blackstone Capital Partners and acted as primary financial advisor on three of the largest U.S.-Japanese deals to date. In earlier professional roles, Sebenius served from 1976 to 1977 as assistant to Robert White, Administrator of the National Oceanic and Atmospheric Administration in Washington, and from 1977 to 1980 with the State Department on the U.S. Delegation to the Law of the Sea negotiations led by Elliot Richardson.
Among various awards, the Japanese Junior Chamber of Commerce (Osaka) selected Sebenius as one of the Ten Outstanding Young Persons (under 40) from around the world, an honor that involved an extended visit to Japan culminating in an audience with the new Emperor and Empress. He was elected a term member of the Council on Foreign Relations in New York. He also served as advisor to the Select Automotive Panel, a joint U.S.-Canadian body, established following the U.S. Canadian Free Trade Agreement to deal with outstanding auto trade issues; the Panel consisted of the heads of the three major auto companies, the heads of the United Auto Workers and the Canadian Auto Workers, as well as numerous auto industry representatives. He was a member of the Auto Parts Advisory Committee, United States Department of Commerce (appointed by the Secretary of Commerce).
Sebenius is a founder and principal of Lax Sebenius: The 3-D Negotiation™ Group LLC, a firm that provides negotiation advisory services to corporations and governments worldwide. Private clients of the Negotiation Group have included large corporations such as American International Group, American Express, AT&T, Lederle Labs, Sandoz, Lucent Technologies, Glaxo, Banamex, GE, GTE, Hewlett Packard, Northwest Water PLC, Novartis, Reuters, Shell, USWest, Time Warner, and Estée Lauder; financial firms such as the 3i plc, Blackstone Group, Charterhouse International, Warburg Pincus, and Exeter Capital; small companies such as American Research and Development, Fusion Systems and Peak Health; as well as government agencies such as the National Science Foundation, the Veterans Administration, the Foreign Ministry of Venezuela, and the Governments of Malaysia and Indonesia.
Sebenius holds a Ph.D. from Harvard in business economics, a masters degree in Engineering-Economic Systems from Stanford's Engineering School, and an undergraduate degree (summa cum laude) from Vanderbilt in mathematics and English.
In articles and books, often with David Lax, I have been developing a broad approach to effective negotiation that encompasses three "dimensions." In this "3-D" approach, our first dimension — "tactics"-- is the most familiar territory. Tactics are the persuasive moves one makes and the process one chooses for dealing directly with the other side, at the table. To most people and most researchers, "negotiation" is synonymous with this first dimension.
Where one-dimensional negotiators hone their back-and-forth tactics, we also focus on underlying value, which often means more than just price. Our second dimension—"deal design"—systematically probes that value and develops principles for crafting agreements that unlock it for the parties. For example: should the prospective agreement really be a pure price deal? Does some sort of trade between sides make sense and, if so, on what terms? Can we unbundle different aspects of what looks like a single issue, and give to each side what it values most? Should it be a staged agreement, perhaps with contingencies and risk-sharing provisions? If there’s a contract involved, should it be an unusual kind of contract – one with a more creative concept and structure than we’ve used before? One that meets ego, needs as well as economic ones?
Where one-dimensional negotiators mainly focus on actions at the table, we also analyze moves away from the table, designed to shape the situation advantageously. Our third dimension – "setup" – flows from our observation that, once the parties and issues are fixed, and once the negotiating table has otherwise been set, much of the game has already been played. Therefore, before even showing up at the conference room, 3-D Negotiators act away from the table to set up the most promising possible situation, ready for tactical interplay. This means ensuring that the right parties have been approached, in the right sequence, to deal with the right issues, that engage the right set of interests, at the right table or tables, at the right time, under the right expectations, and facing the right consequences of walking away if there is no deal. If the setup at the table isn’t promising, this calls for moves to re-set it more favorably. A superior setup can enable tactics at the table to achieve otherwise impossible results.
In practice, a 3-D negotiator first does an "audit" of barriers to agreement—tactical and interpersonal challenges, deal-related problems, or setup flaws—then crafts a 3-D strategy: an aligned combination of setup, deal design, and tactical moves designed to overcome the barriers.
Dealing with Hard Bargainers
In this line of research, I have been developing effective approaches to negotiating 1) with hard bargainers, 2) in difficult situations, and 3) from positions of perceived weakness. Through field study and theoretical inquiry, I have been developing classes of moves, both at and away from the table, to constructively handle these challenges.
While most negotiation research focuses on specific transactions, many important negotiating situations can better be understood as elements of larger "campaigns." By this term, I mean a series of related negotiations and other away-from-the-table moves, carefully orchestrated to build toward success in an ultimate "target" negotiation. Examples of negotiation campaigns include very large-scale sales, efforts to gain approval among many internal parties for major initiatives, as well as actions to build support and secure permission for a controversial project such as a dam, pipeline, or real estate development. Through field investigation and analytic modeling, this line of research investigates the consequences of shifting the unit of analysis from the individual negotiation to the campaign. Further, it seeks to characterize and define negotiating campaigns more precisely, crystallize the most important questions about them (e.g., inter-related questions of sequencing and framing), and develop grounded diagnostic and prescriptive theory.
Cross-border negotiations, emphasis on China
For several years, I have been interested in the special challenges of cross-border negotiations. I am now working with colleagues on this topic, but with an emphasis on negotiations involving Chinese parties. In particular, through the Harvard China Negotiation Initiative, I have been doing research and casewriting on effective China-related negotiations.
Middle East Negotiation Initiative
The Middle East Negotiation Initiative is a component of the Harvard Negotiation Project that seeks to analyze and develop grounded analysis and advice for complex negotiations in and around the Middle East. Its current focus is on the intellectual and study questions surrounding a) the Israeli Palestinian Negotiating Partners
network and b) the long-term negotiation of the Abraham Path
, a cultural tourism route that retraces the journey made some four thousand years ago by Abraham (Ibrahim) through through Syria, Turkey, Lebanon, Jordan, Israel, Palestine, and elsewhere in the Middle East. In an activity jointly undertaken by the Belfer Center for Science and International Affairs and the Program on Negotiation, I co-chaired (with Graham Allison) a working group on Iran Nuclear Negotiations, which has produced working papers and articles on this subject.
Great Negotiator Study Initiative
What can be legitimately be learned from closely studying great negotiators at work? Since 2000, the Program on Negotiation (PON)—an active inter-university consortium mainly comprised of numerous faculty from across Harvard, MIT, and the Fletcher School of Law and Diplomacy at Tufts--has annually bestowed the “Great Negotiator Award,” a program that I have chaired in my role at PON. Over their careers, the awardees have typically negotiated against great odds in different settings to accomplish worthy purposes. By systematically probing the experiences of this distinguished group of men and women from varied backgrounds (briefly characterized below), I have designed a faculty study initiative (and an exploratory HBS course) to uncover broader lessons and generalizations about effective negotiation and dispute resolution.
This initiative investigates the pedagogical and intellectual challenges associated with what (and how) we can learn from this group. Specifically, this initiative analyzes the Great Negotiators that have been named so far in the context of a few of their key accomplishments: Senator George Mitchell’s work in Northern Ireland leading to the Good Friday Accords; Bruce Wasserstein’s dealmaking at Lazard and elsewhere; Special Trade Representative Charlene Barshefsky’s negotiations with China over intellectual property rights; the efforts of Lakhdar Brahimi, Special Representative of the U.N. Secretary General, to forge a post-conflict government in Afghanistan; Ambassador Richard Holbrooke’s negotiations leading to the Dayton Agreement that ended the Bosnian war as well as his multiparty efforts to deal with unpaid U.S. dues to the United Nations; the Honorable Stuart Eizenstat’s negotiations over Holocaust-era assets in various European countries; U.N. High Commissioner for Refugees Sadako Ogata’s quiet negotiations on behalf of refugees and internally displaced persons in regions from Iraq to the Balkans to Rwanda; as well as the complex negotiations by artists Christo and Jeanne-Claude to erect massive, controversial installations from the Running Fence in California to the Gates in Central Park, New York, and wrapping Paris’s Pont Neuf and the German Reichstag.
James K. Sebenius is examining the most effective ways to generate and sustain cooperation among a corporations many stakeholders. As the number of stakeholders grows, and management actions more often involve players outside the traditional chain of command and organizational boundaries, corporate governance and general management must increasingly take into account the interests and influence of multiple stakeholders. At the public and international levels, effective action almost always involves many players, whether in the financial, economic, or environmental realm-even in the realm of security (e.g., the Gulf War coalition). In these tasks, success involves building and sustaining 'winning coalitions,' in part by dealing with 'blocking coalitions.' Sebenius has developed a series of cases and papers on the fundamental issues of coalitional assessment and action. Using concepts drawn from negotiation analysis, he seeks to discover how to build and sustain winning coalitions and deal successfully with would-be blocking coalitions through the processes of coalition-building and coalition-breaking, in particular, by sequencing choices.
Dealforum Design for Large, Multiparty Negotiations
When large projects such as mines, pipelines, oilfields, or powerplants are proposed, negotiations often commence with many kinds of interested parties. Such 'stakeholders' can range from corporate or government project sponsors to international financial institutions, environmental groups, advocates for indigenous people, and other NGOs. Two very different approaches bracket common approaches to undertaking these kinds of long term negotiations. Caricaturing only slightly, they might be called "decide-announce-defend" ("DAD") and "full consensus" ("FC") models. Both approaches have a high failure rate, even for projects that arguably create value for most stakeholders. By contrasting a variety of field cases utilizing these polar approaches, I have highlighted and investigated the effects of a variety of underlying "dealforum" design choices. Such design choices--sometimes explicit and sometimes implict-- include the auspices, mandate, participation, agenda, decision rules and procedures, staging, external communication, process support, and post-deal arrangements. By tailoring the dealforum design choices to the specific negotiating challenges for a particular project, the odds of sustainable success can be enhanced.