L6 Principled negotiation (I)

Question 1

What is positional bargaining?

Answer 1

Each side takes a position, argues for it and makes concessions to reach a compromise.

Question 2

Why is positional bargaining most often not a good idea?

Answer 2

• It can produce unwise outcomes
• It can be inefficient
• It can endanger an ongoing relationship

Question 3

How can positional bargaining produce unwise outcomes?

Answer 3

Positional bargainers lock themselves in their positions and their ego becomes identified with the position.
Then, their main interest is “saving face” (reconciling future actions with past positions) and they give more attention to the position rather than meeting their underlying concerns.

Question 4

How can positional bargaining be inefficient?

Answer 4

It is often inefficient because both parties:

• start at extreme positions
• don’t share true views
• make small concessions

Question 5

How can positional bargaining endanger an ongoing relationship?

Answer 5

Positional bargaining can turn into a battle of willpower: you either try to force the other party to comply with your position or bend to the rigid will of the other.

Result: other’s interests are not addressed and it damages the relationship`.

Question 6

What are the main differences between a soft and a hard negotiatior?

Answer 6

SOFT:

• participants are friends
• the goal is agreement
• make offers
• disclose your bottom line
• accept one-sided losses
• insist on agreement

HARD:

• participants are adversaries
• the goal is victory
• make threats
• mislead as to your bottom line
• demand one-sided gains
• insist on your position

Question 7

(example) Suppose a Bargaining range of 20M to 30M.

- What will be the outcome in a negoatiation with a Soft Seller vs. a Soft Buyer? Why?

Answer 7

Probably 25M, because both are very transparent and they would reach an agreement that favours both of them.

Question 8

(example) Suppose a Bargaining range of 20M to 30M.

- What will be the outcome in a negoatiation with a Hard Seller vs. a Soft Buyer? Why?

Answer 8

Around 28M, because the hard negotiatior would “win”.

Question 9

(example) Suppose a Bargaining range of 20M to 30M.

- What will be the outcome in a negoatiation with a Soft Seller vs. a Hard Buyer? Why?

Answer 9

Around 22M, because the buyer would “win”.

Question 10

(example) Suppose a Bargaining range of 20M to 30M.

- What will be the outcome in a negoatiation with a Hard Seller vs. a Hard Buyer? Why?

Answer 10

They probably won’t reach a deal, because no one wants to make concessions so they do not reach a common point.

Question 11

Negotiation is faster when one of them is hard and the other is soft, rather than when both of them are hard / soft.

True / False

Answer 11

True

Question 12

What is better: a soft or a hard negotiation style?

Answer 12

Neither. The best negotiation method is the “Principled Negotiation”.

Question 13

Which are the 4 main principles of Principled Negotiation?

Answer 13

1. Separate the people from the problem
2. Focus on interests, not positions
3. Invent options for mutual gain
4. Insist on using objective criteria

Question 14

Principle #1 Separate people from the problem

What do you have to put first during a negotiation: the people or the problem? Why?

Answer 14

You have to put the people first, because it is important to take into account that you are dealing with human beings (with deeply held values, unpredictable behavior, ego…) before negotiating.
Trust and respect are crucial in every negotiation.

Question 15

Principle #1 Separate people from the problem

How can be the relationship affected when you don’t separate the people from the substance?

Answer 15

• The relationship can become entangled with the problem

- Positional bargaining puts the relationship and substance in conflict

Question 16

Principle #1 Separate people from the problem

How can you use your PERCEPTION to deal with the “people problem”?

Answer 16

• Put yourself in their shoes
• Discuss each other’s perceptions (people can have totally different perceptions of the same situation)
• Don’t deduce their intentions from your fears (worst interpretation)
• Don’t blame them for your problem
• Give them stake in the outcome (participation): make sure they participate in the process (e.g., ask them for adjustments)
• Make your proposal consistent with their values

Question 17

Principle #1 Separate people from the problem

How can you use your EMOTIONS to deal with the “people problem”?

Answer 17

• Recognize and understand emotions (theirs and yours) to avoid, for example, spillover effects (e.g., a fight with your wife in the morning can make you agressive in a negotiation that same day)
• Allow them to let off steam
• Pay attention to “core concerns” (autonomy, appreciation, affiliation, role, status)
• Make emotions explicit (in case of an emotional conflict during a negotiation, talk about it to get it out of the way)
• Do NOT react to emotional outbursts (arrebatos emocionales)
• Use symbolic gestures (e.g., send a bottle of wine to build the relationship)

Question 18

Principle #1 Separate people from the problem

How can you use your COMMUNICATION to deal with the “people problem”?

Answer 18

Communication problems: not talking, not hearing, not understanding

• Listen actively and acknowledge what it is being said
• Speak to be understood
• Speak about yourself, not about them (e.g., “I feel discriminated” instead of “you are racist”)
• Speak for a purpose (adding value, if not stay quiet)

Question 19

Principle #1 Separate people from the problem

How can you prevent the “people problem”?

Answer 19

1. Build a working relationship before negotiation
2. Face the problem, not the people: treat “adversaries” as human beings (negotiation is not a face-to-face but a side-by-side)