III. Quantify Satisfaction

In this phase, only private discussions between Syria and the Facilitator are recorded. Similar discussions between Israel and the Facilitator are left to your imagination.

Facilitator: Syria, the first private data that we will enter will be bargaining ranges for each issue based on our preliminary communications with Israel.

Syria: But what if my bargaining ranges are not the same as those entered by Israel?

Facilitator: If Israel makes proposals that fall outside your currently defined private bargaining ranges SmartSettle can still display them. You may choose to adjust your ranges at that time. We also need to create some reference packages within the defined bargaining ranges. Two imaginary packages will be your least preferred, which we will name Worst and your most preferred, which we will name Best. Another reference package needed is your Walkaway level.

Syria: I do not have enough information on which to specify a Walkaway level.

Facilitator: In that case, make a conservative estimate. It is rarely necessary to define an absolute minimum in negotiations like this that have so much opportunity for mutual gain.





          Green = Best

          Brown = Worst

          Red = Walkaway






 Figure 2 Private Bargaining Ranges and Walkaway Level

This screen shot comes from the Syria’s private Graphic View. Three packages are displayed. The green and brown packages are imaginary extremes displayed here in order to illustrate the bargaining ranges created by Syria. Since Smartsettle, by default, orients bargaining ranges so that a party’s most preferred values are displayed on the right-hand side, we can immediately see that, if they were possible, relative to everything else, the green package would be Best and the brown package would be Worst (from Syria’s point of view). Syria has set the issues for the red package on a set of values that would yield a level of satisfaction barely be satisfactory to Syria, given current information. If Israel makes a proposal worse than the red package in current negotiations, Syria will “walk away” from the table to gather more information or make a decision that their resources would be better directed towards other prioities at this time. It is important to note that the individual values in the red package are not “bottom lines” for each issue. Rather, the package as a whole represents a mimimum required satisfaction level.

Facilitator: We will now associate the issues with satisfaction graphs that define in detail how Syria becomes satisfied on each issue. You can define virtually any shape for your satisfaction functions.

Figure 3 Satisfaction Graph for Syrian Investment

The bargaining range for Syrian Investment extends from a least preferred value of $600 (US million) to a most preferred value of $300 (US million). Parties may define virtually any shape for their Satisfaction Graph. In this case, the satisfaction graph for Syrian Investment has a slight concave shape. This indicates that the opportunity cost of a dollar is greater for Syria near the left end of the range. Issue Importance is defined as the difference in satisfaction between the least and most preferred values for the issue. In this case, with a relatively simple relationship between dollars for Syrian Investment and satisfaction, Syria decides to measure their satisfaction in millions of dollars. In this way, issue importance for this issue is set at 300.

Syria: Suppose that the importance of an issue depends on the outcomes of other issues?

Facilitator: Very good point. We call that an interdependency. There are a number of ways of handling interdependencies. One good way is with constraints. Smartsettle allows parties to define their model to any level of complexity. For example, consider the relationship between Syrian Workers and Syrian Contracts. You have told me that the importance of Syrian Workers depends on the level of Syrian Contracts. To address that, we have agreed with Israel that contracts awarded to Syria may not be more than twice the percentage of workers. This constraint prevents the combination of very low percentage of workers with a high percentage of contracts. Similarly, we have also defined a constraint that prevents combinations of low investment and high ownership and vice versa.

Syria: Are there also other ways to prevent Smartsettle from generating undesireable extreme solutions?

Facilitator: The best way to prevent undesireable extreme solutions is with properly defined preferences. This includes both relative importance and satisfaction graph shapes. For example, let’s look at the Construction Time issue. Tell me. All other things being equal, what does Syria think would be the ideal construction time period?

Syria: Well, we know that Israel is pushing to construct the park more quickly but we feel the optimal time for us would be four years.

Facilitator: In that case, the satisfaction graph for Syria will be a convex curve with a peak at four years. With a curve shaped like this, to satisfy Syria, Smartsettle will try to get close to four years but will never suggest a construction time greater than four years.

Figure 5 Construction Time

The optimal construction time from Syria’s point of view would be four years. The curve for values greater than four years would drop down again. However, this portion is not defined since it is known that Israel prefers a shorter time period.

Facilitator: By the way, I’m glad you included the word “undesireable” in your question. One of the things that Smartsettle is good at is finding unexpected solutions that result in mutual benefits for all concerned.

Syria: In our discussions with Israel, we have discussed many Train Line options. A preliminary analysis has eliminated all but four options; Haifa, Beirut, Aleppo, and Damascus. We have agreed with Israel that all of these options are better than no train line at all.

Facilitator: Smartsettle is very flexible in terms of how the satisfaction graphs are displayed. For qualitative issues with options, bar graphs are used. For the Train Line issue, what you have told me is that, although Haifa is the least satisfactory among the available options, it would still bring a positive benefit to Syria. Therefore, you could logically display the bar for Haifa at some positive value.

Figure 4 Satisfaction Graph for Train Line

The bar for each Train Line option, Haifa, Beirut (not labeled), Aleppo, and Damascus, is set at a level relative to the overall importance for the issue. Compared to how much more satisfaction Damascus would bring than Haifa, Aleppo is set at a 35% level. The overall importance of the Train Line issue is set at 400. This is relative to 300 set for the Syrian Investment issue.

Syria: I understand now that our negotiations are really only concerned about the difference between the most and least important options. Therefore, I will accept Smartsettle‘s default, setting a base satisfaction of zero on the Haifa option. However, I don’t feel very confident about the overall level of importance (400 units) that I have set for the Train Line issue.

Facilitator: If the assignment of importance to any issue is not intuitive, another good way to define your tradeoffs is with a procedure called Even Swaps. This idea is not new. Benjamin Franklin wrote a precious letter in 1772 that historians have titled “MORAL OR PRUDENTIAL ALGEBRA”. Over 200 years later, in 1992, Thiessen and Loucks derived mathematical algorithms in “Computer-Assisted Negotiation of Multi-objective Water Resources Conflicts,” Water Resources Bulletin, American Water Resources Association, 28(1), 163-177, February. In 1998, Hammond, Keeney, and Raiffa wrote Even Swaps: A Rational Method for Making Trade-offs. in which they state that making wise trade-offs is one of the most important challenges in decision-making. We will now use a similar procedure to create a set of packages that are equivalent to a reference package. This is a very simple method of defining tradeoffs that any qualified negotiator can readily understand. Let’s define an even swap between Syrian contracts and Train line.

Figure 5 Even Swap

The black flags show the issue values of Syria’s private Reference package. The green flags, comprising a package named Swap7, are under the black flags on all issues except the two issues between which an even swap is being defined. All else being equal, Syria would be just as satisfied with the green values as with the black values. Using the black values as a reference, the satisfaction loss in decreasing Syrian Contracts from 50% to 28% would be equal in magnitude to the expected gain that would be realized if the Train line was built only to Damascus rather than all the way to Aleppo. We say that these two packages are equivalent to Syria because they would both result in the same level of satisfaction to that party. With this information and similar information relating other issues, Smartsettle’s preference analysis routine calculates a relative satisfaction rating around 2777 for each package. Recall that Syria elected to use the Syrian Investment issue as a basis for satisfaction scale, measured in millions of dollars. Hence, the rating of 2777 represents a value of $2777 million relative to some arbitrary zero package, which in this case is all the extreme left-hand values shown in Figure 2. In the same way, Smartsettle can now display ratings for other packages, e.g., Best, Worst and Walkaway. Since the Best and Worst packages represent the most and least preferred values for the bargaining range of every issue, we can see that Syria’s total satisfaction scale ranges from 0 to 5176. Any displayable package will have a rating within this range.

Syria: Now that my preferences have been successfully represented by Smartsettle, I can easily set the issue flags to define any combination of issues and immediately see what that package is worth to Syria and compare it with other packages. But suppose that, later in the negotiation, on the basis of new information or a more thorough analysis, I change my mind about my tradeoffs?

Facilitator: No problem. You may re-define your preferences at any time during the negotiation. Smartsettle let’s you start on the basis of a little information and gradually build a more confident representation of your preferences as the negotiation proceeds.