Transcript Principled Negotiation: “Getting to Yes”

Distributive Negotiation
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Single issue
Your loss is my gain
Slicing the Pie
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How do you get the biggest piece?
Preparation
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Offers
Alternatives
Concessions
Offers
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Folklore says to let the other party
make the first offer
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Is that a good idea?
Anchoring
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People tend to focus heavily on the first
offer
First offer correlates .85 with the final price
Offers (continued)
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What if the other party makes the first
offer?
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Immediate counteroffer
Take away the psychic hold of the 1st offer
Offers (continued)
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How do you feel when the other party
accepts your first offer?
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I should have asked for more
Maybe I just got into a bad deal
Less satisfaction
Do not accept first offers
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They are just that – an opener
Expectation to negotiate
BATNA
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Best Alternative to a Negotiated Agreement
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The lowest acceptable value to an individual for a
negotiated agreement
Develop alternatives so you know at what
point to stop negotiating
Gives you the POWER to walk away
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If we cannot receive an offer of X-amount for the
house, then what will you do?
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Rent it out?
What’s your bottom line?
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“Tell me the bare minimum you would
accept and I’ll try and throw in
something extra”
“Why don’t you tell me the very
maximum you are willing to pay, and I’ll
try and I’ll see if I can shave off a bit”
Concessions
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Need some cushion (Target price versus
reservation price)
Make the first concession
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Why?
Norm of reciprocity
Positive feelings
Magnitude of concessions
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Less and less to signal you are reaching the end