L5 Expanding the pie

Question 1

What is the mixed-motive nature of negotiation?

Answer 1

Negotiation requires balancing between:

Motive 1: Cooperation with the other party to reach settlement.
Motive 2: Competition with the other party to maximize own surplus.

Question 2

What is the fixed myth?

Answer 2

It is a very common negotiation myth in which you assume that:

• Negotiation is a fixed-sum game
• One party’s gain, is the other party’s loss
• One party’s interests are opposed to the other’s interests

“Pie slicing mindset”

Question 3

Which are the three mindsets you can adopt when assuming a fixed-sum game?

Answer 3

1. Soft bargaining: capitulating (giving up) to other side
2. Hard bargaining: attacking the other side
3. Compromise: reach midpoint between opposing demands

Question 4

What is the main difference between expanding and slicing the pie?

Answer 4

Slicing the pie: claiming value (distributive negotiation)

Expanding the pie: creating value

Question 5

If both parties work together, they create more value than if they are purely combative.

True / False

Answer 5

True

Question 6

Any value that is created does not have to be claimed by some of the negotiators.

True / False

Answer 6

False: The challenge when expanding the pie is that any value that is created must ultimately be claimed by someone at the table.

Question 7

What are the possible signs of potential to “enlarge the pie”? (integrative potential)

Answer 7

• Multiple issues in negotiation
• Possibility to add issues
• Different preferences (maybe on different issues)

Question 8

Give some examples of multiple-issue negotations.

Answer 8

House chores distribution
Job offer (which consists on salary, vacation days, pension, travelling time, etc.)
Teamwork

Question 9

What is (not) a win-win negotiation?

Answer 9

Win-win is NOT:

• Compromise (= make concessions / ceder)
• Even split
• Satisfaction
• Building a relationship

Win-win is: all creative opportunities are leveraged, and no resources are left on the table.

Question 10

Which are the main “pie expanding” strategies?

Answer 10

1. Put yourself in the other’s shoes
2. Ask questions about their interests
3. Reveal information about your interests and priorities (not your BATNA), and capitalize on the principle of reciprocity
4. Unbundle (separar, desglosar) the issues
5. Make package deals, not single-issue offers
6. Make multiple offers simultaneously (power of dominated options - Decoy effect)