Trademarks: Wiley, the Wiley Publishing logo, For Dummies, the Dummies Man .. book that would eventually become Negotiating For Dummies and to find. Negotiating For Dummies [Donaldson, David Frohnmayer] on ichwarmaorourbia.ml * FREE* shipping on qualifying offers. People who can't or won't negotiate on their . Negotiation is the process of evolving communication to get from opposition to consensus, manage conflict and reach agreement. ▫ Negotiation principles apply.
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People who can't or won't negotiate on their own behalf run the risk of paying too much, earning too little, and always feeling like they're getting gypped. Successful negotiation requires compromise from both sides. Both parties the power of your negotiating skills or the compelling force of your logic. This is not. Identify and discuss individual sources of negotiating strength. Practice skills that can influence the outcome of the negotiation. Develop an awareness of the.
The U. In short, doing so would have created the equivalent of a simultaneous four-party negotiation structured as one U. This more promising 3-D setup would have greatly enhanced whatever 1-D cultural insight and tactical ingenuity the U. Swiss banking executives saw no reason to be forthcoming with Bronfman; they believed they were on strong legal ground because the restitution issue had been settled years ago.
But after eight months of lobbying by Bronfman, the World Jewish Congress, and others, the negotiations were dramatically expanded—to the detriment of the Swiss. The bankers faced a de facto coalition of interests that credibly threatened the lucrative Swiss share of the public finance business in states such as California and New York. They faced the divestiture by huge U. It was, however, an almost unimaginable outcome at the beginning of the small, initially private game in which the Swiss seemed to hold all the cards.
Another way for negotiators to claim value is to shift the issues under discussion and the interests at stake. Consider how Microsoft won the browser war negotiations. In , AOL was in dire need of a cutting-edge Internet browser, and both Netscape and Microsoft were competing for the deal. The technically superior, market-dominant Netscape Navigator vied with the buggier Internet Explorer, which was then struggling for a market foothold but was considered by Bill Gates to be a strategic priority.
In the book aol.
They were dominant. We needed to get what the market wanted. Most important, we saw ourselves as smaller companies fighting the same foe—Microsoft.
The software giant would provide Explorer to AOL for free and had promised a series of technical adaptations in the future. Microsoft had also agreed that AOL client software would be bundled with the new Windows operating system.
In effect, Bill Gates sacrificed the medium-term position of MSN to his larger goal of winning the browser war.
These examples of 3-D value-claiming moves conflict with the standard 1-D interpersonal approach to negotiation. Actions taken away from the table—sharply altering parties and issues, restructuring and resequencing the process, changing BATNAs—are not primarily about 1-D interpersonal skills but rather about enhancing the underlying setup of the negotiation itself.
Creating Value. By adding complementary parties or issues to the negotiating process, 3-D negotiators can not only claim value for themselves but also create more value for all parties involved.
In Co-opetition, their influential book on business strategy, Adam Brandenburger and Barry Nalebuff explored the concept of the value net, or the collection of players whose potential combination and agreement can create value.
3-D Negotiation: Playing the Whole Game
They scan beyond their specific transactions for compatible players with complementary capabilities or valuations, and they craft agreements that profitably incorporate these players. The world of foreign affairs offers many examples in which potentially valuable bilateral deals can be impossible unless a third party with complementary interests is included.
In a issue of Negotiation Journal, University of Toronto professor and international negotiation specialist Janice G. Egypt improved the image of the United States in the Arab world, especially among the oil-producing states; the United States gave Israel large amounts of military and financial aid; and Israel supplied Egypt with territory.
Indeed, a bilateral exchange between Egypt and Israel would not have succeeded since each did not want what the other could supply.
Instead of mainly working with its bankers to make the case for a higher valuation and to refine its at-the-table tactics with each packaging industry player, the niche player took a 3-D approach. The move uncovered a completely new source of potential value—and a much higher potential selling price.
It also increased the pressure on the larger packaging companies: They would face more competition and might not be able offer the same kind of exclusive, customized packaging service to their customers. The potential elements of a value net are not always obvious at the start of a negotiation. For example, a U.
From membership contributions and foundation support, the conservation group had U. The owner of the land and the conservation group negotiated hard and tentatively agreed on an amount of rain forest to be protected and a price per hectare based on local currency. But 3-D thinking ultimately improved the deal for all sides. The country had to use scarce dollar-export earnings, needed for many pressing domestic purposes, to keep its debt-service obligations current; of course, interest payments were determined by the face value of the debt, not the bond discount.
These facts suggested that more value could have been created by adding two other sets of players to the initial negotiation between the landowner and the conservation group.
The conservation group then used this greater quantity of local currency from the Central Bank to download more development rights from the landowner at a somewhat higher unit price.
This expanded four-party negotiation—sequentially involving the conservation group, international bondholders, the Central Bank, and the landowner—benefited everyone more than the best result possible in the initial negotiation between just the landowner and the conservation group.
The bank was able to retire debt and cancel dollar-interest obligations, which were very costly to the country, using cheaper to it local currency without exporting more or diverting scarce export earnings.
The conservation group was able to save more rain forest at the same dollar cost, and the landowner got a higher price in a currency it was better positioned to use. To find complementary parties and issues, as the conservation group did, you should ask questions that focus on relative valuation. What uninvolved parties might highly value elements of the present negotiation?
What outside issues might be highly valued if they were incorporated into the process? Are there any parties outside the immediate negotiations that can bear part of the risk of the deal more cheaply than the current players?
On the other hand, it is sometimes necessary to shrink—or at least stage—the set of involved issues, interests, and parties in order to create value. For example, rather than enter into a full multiparty process at the outset, an industry association that wants to negotiate a certain set of standards may benefit from first seeking agreement between a few dominant players, which would then serve as the basis for a later deal among the wider group.
Or, negotiations to forge a multi-issue strategic alliance between two firms may be dramatically simplified by one side which instead proposes an outright acquisition. Certainly, the form chosen for a transaction can dramatically affect the complexity of negotiations and the value to be had.
The planned merger of equals by Bell Atlantic and Nynex would have required separate negotiations with regulatory authorities in each of the 13 states served by the companies.
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To avoid having to undergo politically charged negotiations at 13 different tables, the parties changed the game by creating a functionally equivalent structure in which Bell Atlantic was the nominal acquirer. Indeed, it can be necessary to change the process, rather than the substance, of a negotiation. For example, two partners seeking to terminate their relationship may have difficulty determining exactly who gets what. Often, changing the form of a negotiation by bringing in a skilled third-party mediator creates value.
For example, two intensive mediation efforts by outside parties helped to finally thaw the frozen negotiations between Microsoft and the Justice Department. Many fundamentally different variants of mediation, arbitration, and other special mechanisms exist, but all are options to change the game itself rather than efforts to negotiate more effectively by purely interpersonal means.
Implementing a 3-D Negotiation Strategy Sophisticated negotiators act in all three dimensions to create and claim value. While 3-D negotiators should play the existing game well, as tacticians and deal designers, they should also act as entrepreneurs, seeking to create a more favorable target game. Mapping Backward to Yes What does a sophisticated 3-D strategy look like? All company names and details have been disguised.
After the basic deal was done, they needed additional financing to make profitable improvements at CPP. Federal Street Bank FSB turned them down flat, even after they had used such 1-D tactics as persuasive appeals and elegant lunches.
It was time to move into the 3-D realm. But first, some background. So Iverson used 3-D negotiating tactics to scan widely and map backward from his current predicament to establish the prior agreements with as-yet uninvolved parties that would maximize the chances of an ultimate yes from the bank. Involve UIC. Iverson approached two insurance companies for takeout financing.
Involve the EDA.
The rest of the required system would be complex. Local and regional contractors were in no position to guarantee the overall project. And there was no LDA to certify the jobs or provide matching funds.
Involve the Town of Concord. Undaunted, Iverson approached the Concord Town Council and proposed that it form an LDA, which could raise matching funds, to facilitate the recovery boiler project. The council received these arguments favorably but, before committing, wanted assurances that the project would actually work. Involve Derano. In great need of some plausible guarantee of project success, Iverson approached Derano, a large, national bondable engineering, design, and project management firm.
Derano expressed serious doubts about managing an already-designed project with BFE and local contractors in place. Go back to Concord with Derano deal. As a government entity, the LDA would also formally certify the expected successful job-creation impact of the recovery-boiler project.
And the project was launched. Scan widely. To act outside the box, one must first look outside the box. By searching beyond the immediate deal on the table for elements of a potential value net, 3-D negotiators can retrain their focus on complementary capabilities and valuations that other players might add. Useful game-changing questions include: Who outside the existing deal might most value an aspect of it?
Who might minimize the costs of production, distribution, risk bearing, and so on?
Which issues promise mutual advantage? What devices might bring such potential value-creating parties and issues into the deal? And at what point does complexity or conflict of interest between parties call for shrinking the scope of the negotiation? Scanning beyond the current game to claim value normally focuses on a parallel set of questions: Are there additional bidders or parties who could favorably alter BATNAs in other ways?
Can certain issues be linked for leverage? Such scanning should result in a map of all the actual and potential parties including other interested groups within an organization, if necessary.
You need to assess their actual and potential interests and BATNAs, as well as the difficulty and cost of gaining agreement with each party and the value of having its support. Your map should also identify the crucial relationships among the parties: who influences whom, who tends to defer to whom, who owes what to whom, who would find it costly to oppose an emerging agreement with key parties on board, and so on. The founders of new ventures almost always need to scan widely in order to construct the most promising sequence of deals that lead to a self-sustaining company.
He had obtained seed funding, developed the technology to bring the Web to ordinary television sets, created a prototype, and hired his core team.
Running desperately low on cash, Perlman scanned widely and discovered an array of potential negotiating partners—ISPs, VCs, angel investors, industrial partners, consumer-electronics businesses, content providers, manufacturers, wholesale and retail distribution channels, foreign partners, and the like.
He needed to engage in 3-D analysis to determine the right subset of potential partners to create the most promising deals to build his company. While 3-D negotiators should play the existing game well, as tacticians and deal designers, they should also act as entrepreneurs.
Map backward and sequence. Rather than look for mutual gains — which would benefit both parties — people focus on defending their position.
Both parties eventually receive a worse deal. And this section will give you a few tactics that can help. Tactic 7: Avoid Negotiation Terminology Be careful when planning the negotiation with your counterpart. Your wording can play a powerful role. To prevent aggressive behavior from your counterpart, avoid negotiation terminology. Always use words that depict cooperative behavior e.
You should also incorporate 1st person plural pronouns e. Tactic 8: Schedule a Future Interaction When possible, break up the negotiation into separate meetings. Why do people behave less aggressively? If you plan that second meeting beforehand, your counterpart will behave more cooperatively during the initial negotiation.
Starting the Negotiation All prepared? Build Some Rapport Next to power, rapport is also crucial. Here are two tactics that can help you build rapport. Tactic 9: Start With Schmoozing Morris et al.
Participants gained better deals when they spoke with their counterpart on the phone for 5 minutes before the negotiation. When you disclose personal information to other people, you build greater rapport with those recipients.
When you disclose unrelated personal information, your counterparts negotiate less aggressively, giving you a better overall deal Moore et al. Before the negotiation starts, always mention unrelated tidbits about yourself, such as interests or hobbies. Those tidbits —albeit small and innocent — will make the negotiation more successful. When you bring pastries and coffee to the negotiation, you accomplish four important tactics described in this section. Mimicry can also explain another finding: negotiators gain better outcomes when they eat together.
This unconscious mimicking of each other may induce positive feelings towards the other party and the matter under discussion. Tactic Provide an Unsolicited Favor In his book, Influence , Cialdini proposed that reciprocity is one of the six principles of persuasion. For example, Burger et al, hired a student to be a confederate in an experiment. The student asked peers to a complete a survey and b drop it in a box outside the Psychology Department a few days later.
The survey was anonymous, so the student would have no idea if people actually completed it. Despite that anonymity, people were three times more likely to complete the survey if the student had given them a free bottle of water. Even if your counterpart hates pastries and coffee, the mere favor will trigger an inner need to reciprocate. Other research shows that increasing glucose levels can reduce aggressive tendencies Denson et al. Since pastries and coffee increase glucose levels Lane, , they can reduce the amount of aggressiveness in your counterpart.
Those results occurred because of the insular cortex.
Moreover, [this] should then influence, in an unintentional manner, judgments of and behavior toward other people without one being aware of this influence.
This section will give you a few strategies to implement throughout the remainder of the negotiation. Nice weather will trigger a positive mood in your counterpart, giving you a better deal in the negotiation. Since you and your counterpart should be feeling positive, should you outwardly convey a positive mood? Not necessarily. Emotions have always been a tricky subject for negotiation researchers.
Luckily, emerging research has shed some light on the situation. This section explains that research. Why does that happen? If you follow this tactic, be careful. Research also shows that your counterpart will develop a more unpleasant perception of you. Consider using this tactic only for short-term relationships.
This tactic comes with caveats. Regardless of its controversial nature, anger needed to be included somewhere in the article. A ton of research has investigated its role in negotiations. Past research found anger to be harmful. Those emotions can result in worse outcomes for both sides Allred et al. In recent years, however, the tides have been turning. Many researchers are now finding positive outcomes for showing anger.
Always direct your anger toward the offer — never at the person. Demonstrate Your Power You increased your power before the negotiation.James K.
Sometimes, they yield because they realize that their position is in error, so they agree with the viewpoint adopted by others. In a distributive negotiation, each side often adopts an extreme or fixed position, knowing it will not be accepted—and then seeks to cede as little as possible before reaching a deal.
To avoid having to undergo politically charged negotiations at 13 different tables, the parties changed the game by creating a functionally equivalent structure in which Bell Atlantic was the nominal acquirer.
After his first choice, Sony, turned him down, Perlman kept reasoning backward from his target.