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NEGOTIATION/BARGAINING

NEGOTIATION/BARGAINING. VIEWS. DISTRIBUTIVE BARGAINING DIVIDE A FIXED AMOUNT WIN-LOSE INTEGRATIVE BARGAINING TRY TO CREATE WIN-WIN. NEGOTIATION SKILLS. REMEMBER, IT IS NEGOTIATION NOT WAR! WE ARE OPPONENTS NOT ENEMIES. RESEARCH THE OPPONENT. GOALS INTERESTS STRATEGY

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NEGOTIATION/BARGAINING

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  1. NEGOTIATION/BARGAINING

  2. VIEWS • DISTRIBUTIVE BARGAINING • DIVIDE A FIXED AMOUNT • WIN-LOSE • INTEGRATIVE BARGAINING • TRY TO CREATE WIN-WIN

  3. NEGOTIATION SKILLS REMEMBER, IT IS NEGOTIATION NOT WAR! WE ARE OPPONENTS NOT ENEMIES.

  4. RESEARCH THE OPPONENT • GOALS • INTERESTS • STRATEGY • PREDICT RESPONSES • FRAME SOLUTIONS IN TERMS OF HIS/HER INTERESTS

  5. BEGIN POSITIVE • BEGIN WITH SMALL CONCESSION • CONCESSIONS USUALLY RECIPROCATED

  6. ADDRESS PROBLEMS • FOCUS ON THE PROBLEM • DO NOT FOCUS ON PERSONALITIES • “MANAGE” EMOTIONS • MAY “WIN THE BATTLE BUT LOSE THE WAR”

  7. FIRST OFFER IS JUST BEGINNING • INITIAL OFFER IS POINT OF DEPARTURE

  8. EMPHASIZE WIN-WIN • LOOK FOR INTEGRATIVE SOLUTIONS • USE ABUNDANCE MENTALITY

  9. ACCEPT THIRD PARTY ASSISTANCE • IF STALEMATE, USE NEUTRAL 3RD. PARTY

  10. HINDERANCES TO NEGOTIATION • Robbins, S. (1994). Management, 4th. Ed. Englegood Cliffs: Prentice Hall, 555-556.

  11. ESCALATION OF COMMITMENT • WON’T PULL OUT OF A “BAD DEAL” • “SUNK COSTS” CAN’T BE RECOVERED • SHOULD NOT BE CONSIDERED

  12. FIXED PIE • WIN-LOSE • MISS TRADE-OFFS THAT COULD BENEFIT BOTH SIDES

  13. ANCHORS • GET “HUNG UP” ON SOMETHING • INITIAL OFFER • HAVE TO “WIN” • SET ON A SOLUTION • SET ON A CERTAIN PROCESS • “PUBLIC” STATEMENT

  14. FRAMING THE NEGOTIATIONS • FRAME OF REFERENCE • A SEEKS $4 RAISE • B OFFERS $2 • IS THIS A $2 GAIN OR LOSS TO A? • B SHOULD TRY TO FRAME AS $2 GAIN.

  15. AVAILABILITY OF INFORMTION • READILY AVAILABLE = IMPORTANT? • “EXPERIENCE” IS READILY AVAILABLE • VIVID EVENTS READILY AVAILABLE, I.E. REMEMBER • MUST DISTINGUISH BETWEEN EMOTIONALY FAMILIAR AND RELEVANT/RELIABLE

  16. WINNER’S CURSE • REGRET FELT AFTER CLOSING • COULD YOU HAVE GOTTEN BETTER DEAL? • PAY TOO MUCH? • REDUCE BY GETTING MORE INFORMATION BEFORE YOU BEGIN

  17. OVERCONFIDENCE • IN JUDGMENT, CHOICE • “EXPERIENCE,” MENTAL SETS • ARE SURE • IGNORE CONTRADICTORY INFO ------------------- • LESSENS INCENTIVE TO COOPERATE

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