Let us begin anew, remembering on both sides that civility is not a sign of weakness, that sincerity

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• Let us begin anew, remembering on both sides
  that civility is not a sign of weakness, that
  sincerity is always subject to proof. Let us
  never negotiate out of fear, but let us never
  fear to negotiate.
• - John F. Kennedy

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Negotiation for the Web ProfessionalTutorialltWe
b2008gt

• Steven Lewis
• Web Manager Information Security Coordinator
• The College at BrockportState University of New
  York

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Introductions

• Name
• Title
• Campus
• Define negotiation
• Describe your last negotiation

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Overview of Tutorial

• Strategies for Slicing the Pie
• Preparation for Negotiation
• Strategies for Expanding the Pie
• Human Nature vs. Rational Decision Making

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Negotiation Scenario 1
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Negotiation Scenario 1

• How did you divide the 500?
• How important was last years spending?
• What have you learned about your own approach to
  negotiation situations?

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Slicing the Pie

• Claiming your share is the most common activity
  employed in all kinds of negotiations.

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Slicing Strategies

• Know your BATNA
• Research others BATNA
• Set high aspirations
• Make the first offer
• Counteroffer immediately
• Avoid stating ranges
• Make bilateral concessions
• Use objective-appearing rationales
• Appeal to norms of fairness
• Dont fall for an even split

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Fairness Types

• Equality (same for all)
• Equity (proportional to contribution)
• Needs-based (proportional to situation)

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Fairness Context

• Parking
• Court
• Grades
• Allocation of Benefits
• Allocation of Costs
• Dinner on one Check

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Attendee Poll 1

• Company A
• Your offer 75,000
• Friend offer 95,000

• Company B
• Your offer 72,000
• Friend offer 72,000

In both cases, you perceive that your classmates
have similar background and skill. All other
things equal, which offer do you prefer?
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Fairness In Comparison

• Self-enhancement
• Self-improvement
• Accurate self-evaluation
• Professional Athletes Example

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Fairness People Seek Equity

• Options
• Alter Inputs
• Alter Outcomes
• Distort your inputs or outcomes
• Leave the situation
• Distort others inputs or outcomes
• Change comparator

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Negotiation Scenario 2
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Negotiation Scenario 2

• What was the subject of this negotiation?
• How did the two individuals perceive the
  situation at the beginning?
• How did you overcome this perception?
• How might the preparation for the situation been
  improved?

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Preparation for Negotiation

• Self-analysis
• Analysis of Others (fairly similar)
• Assess Situation

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Analysis BATNA

• Best Alternative to a Negotiated Agreement
• If you cant resolve your differences, where does
  that leave you?
• You can improve your negotiation outcomes by
  improving your BATNA

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Analysis Focal Points

• Reservation Point !important
• Target Point !less-important
• Sunk Costs
• Others
• Round numbers
• Last years prices on last years product
• Someone elses similar experience somewhere else
• Dont get distracted! Ensure validity.

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Analysis Issues and Alternatives

• Seldom need a negotiation be limited to a single
  issue
• Up-front cost, maintenance fees, time to
  agreement, duration of agreement, training,
  support, division of revenues, addition of goods
  or services, etc.
• Consider a package of initial offers of equal
  value to you

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The Other Party

• Are they all represented at the table?
• Their BATNA
• Issue preferences to them
• End of fiscal quarter
• Break into new sector, geographic area

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Situation Relationship

• How are these situations different?
• Buying a Car
• Negotiating a Starting Salary
• Does Negotiation start a relationship?
• Will you be back at the table again?
• Does this establish a precedent?
• Will this Negotiation affect relationships with
  others?

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Situation Conflict Potential

• Scarcity of Resources
• Differences of Firmly-held Opinions
• Subject Matter of Negotiation
• BATNA for a dispute is often court
• Are there alternatives to agreement?
• Reagan fired Air Traffic Controllers in 1991

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Situation Legality

• Laws vary in states, countries
• Cultural norms
• Farmers market vs. Grocery stores
• Formal vs. Informal agreements
• Public vs. Private Negotiation, Terms
• Ratification of deal required

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Situation Environment

• Location of Negotiation
• Intervention of Third Party
• Time-related Costs
• Number of Offers
• Power Differential between Parties
• Communication Styles

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Negotiation Scenario 3
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Negotiation Scenario 3

• How much did you communicate with each other
  about the situation?
• How might the web team improve its BATNA?
• How might IT manager better prepare for meeting?

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Expanding the Pie

• Negotiation is about more than a fixed division
  of a single resource (Pie)
• Better deals are when both sides get what they
  want --- a win-win situation
• Make the Pie bigger so that you both get more
  than half
• A.k.a. Integrative Negotiation

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Clear Opportunities for Win-Win

• Negotiation on more than one issue
• Possibility of side deals
• Different issue preferences between parties

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Obstacles to Win-Win

• False Conflict
• Fixed-pie Perception
• Illusion of Transparency

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False Strategies

• Commitment to Win-Win Outcome
• Compromise (concession for concession)
• Focus on long-term relationship
• Cooperative orientation
• Taking extra time

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Good Strategies

• Build trust and share info
• Ask questions about preferences
• Give information about preferences
• Unbundle the issues
• Make package deals on gt1 issue
• Make multiple offers simultaneously
• Pre-Settlement Settlements
• Post-Settlement Settlements

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Contingency Contracts

• Take advantage of differences
• Issue valuation
• Predictions of the future
• Risk attitudes
• Time preferences
• Capabilities

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Negotiation Scenario 4
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Negotiation Scenario 4

• How much did you communicate?
• Do you feel either side won?

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Rational Decision-Making

• Evaluate options based on expected outcomes
• The sum of the probability of each outcome times
  its value
• P(A)V(A)P(B)V(B)

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One Quick Example

• New York State Lottery Odds
• New York State Lottery Payouts

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OK, One More Quick Example

• Deal or No Deal
• 25 briefcases with dollar values
• You pick one
• You open x briefcases, removing dollar values
  from play
• Banker makes an offer that is almost always lower
  than your current expected outcome

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Attendee Poll 2

• I give you 5,000
• You flip a coin onto the floor. If it lands
  heads, I give you 10,000. If it lands tails, I
  give you nothing.

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Risk-avoiding Behavior

• Fundamental Negotiation Behavior
• Faced with good options, we tend to risk a sure
  thing to take a change for even a better thing.

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Attendee Poll 3

• Pay 20,000 to cover drink tickets
• Cover all drinks on consumption, whose expected
  outcome is 20,000, weighing all probabilities

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Risk-seeking Behavior

• Fundamental Negotiation Behavior
• Faced with bad options, we tend to risk seeking
  an option with the potential for a less painful
  outcome, even if we could end up worse

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Risk and Uncertainty

• At the end of an agreement, future conditions are
  not known.
• Both parties enter a negotiation with assumptions
  about the future, good or bad
• Parties with negative outlooks (risk-seeking)
  tend to be more willing to make integrative
  agreements, since they often involve
  contingencies.

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Choosing versus Rejecting

• Consider an enriched and an impoverished
  choice
• Enriched More positive and negative
• Impoverished fewer positive and negative
• Asked a sample to choose the better option, they
  chose Enriched
• Asked a sample to reject the worst option, they
  chose Enriched!

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A Quick Negotiation Process

• People, not the challenges
• Interests, not positions
• Create new options for mutual gain (expand the
  pie)
• Avoid subjective criteria
• From Getting to Yes

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A Definition of Negotiation

• An interpersonal decision-making process by
  which two or more people agree how to allocate
  scarce resourcesThe Mind and Heart of the
  Negotiator

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Sources Resources

• Thompson, L. (2001) The mind and heart of the
  negotiator. Upper Saddle River, NJ
  Prentice-Hall.
• Fisher, R., W. Ury B. Patton. (1991) Getting
  to yes Negotiating agreement without giving in.
  2nd ed. New York Penguin Books.
• Nierenberg, G. I. (1968) The art of negotiating.
  Rpt (1995) New York Barnes Noble Books.