professor laura kray 2010 achieving negotiation success

Professor Laura Kray 2010

Achieving Negotiation Success


Negotiations and Conflict Resolution, MBA 257

Professor Laura [email protected]

Office: F591

Meeting times: Tuesday & Thursday, 2-4/4-6Office hours: Wednesday, 2-3 or by appt

Welcome!

You are about to embark on a journey of self-discovery Challenge assumptions Navigate tricky situations Develop skills Gain experience Give and receive feedback Increase confidence



About the course

Fast paced Limited time for discussion relative to other classes Take offline some pressing questions/comments

(index cards, office hours, email) Experiential and interactive

Other students highly dependent on your attendance and preparation

Need reflection to reap the benefits of experiences Feedback intensive

You are strongly encouraged to think through how you approach a wide variety of conflicts in life

Ultimately what you get out of it is up to you!

Negotiating is like…



Goals for the course

Learn to depersonalize and enjoy conflict

Overcome common negotiator traps Cognitive biases Ethical traps

Develop a framework for approaching any negotiation

Transactional Dispute resolution Multi-party

Take risks to facilitate learning Improve communication skills Have fun!


About your professor

Beginning my 9th year at Haas Psychologist (social, non-clinical)

How do thoughts, goals, and emotions influence behavior?

Primary research and consulting areas: Negotiations

Gender stereotypes Growth versus fixed mindsets

Reflection on past experiences Analytical problem solving Meaning construction Learning


Course assignments

Preparation and participation (30%) Participation in debriefing discussions Remember you must be present to participate! (2 absence max)

Negotiation journal entries (20%) Two entries submitted for grading Reflect on in class negotiation, readings and course themes

Peer feedback and self-analysis (20%) Online surveys after each negotiation to provide feedback Self-analysis of feedback received

Real world negotiation (20%) Apply course concepts to negotiate something of real value to

you Red paper clip option

Negotiation cheat sheet (10%) Development of your own personal toolkit


Negotiation exercises

Provide safe environment to experiment Compare and contrast your behavior

with the behavior of your classmates Understand that there is no “cookbook”

solution Expect reputational consequences for

your actions Get feedback on your interactions with

others

Miscellaneous course details

Volunteers for course representative? Green class: no printouts of slides Slides will be posted on bspace AFTER lecture Use of phones and internet in class is

prohibited Laptop use discouraged generally; prohibited

with guest lecturers Individual assignments should be done

independently


Negotiations

A decision making process by which 2 or more parties agree how to allocate scarce resources Information exchange, not debate Satisfy other party’s interests to improve your

own outcome Both an art and a science

Art: a soft skill influenced by relationship building Science: develop an analytical framework to

devise a strategy and apply tactics



The defining characteristics of a negotiation situation

Belief that conflicting interests exist Communication between parties is possible Intermediate solutions/compromises are

possible Offers and proposals don’t determine

outcomes until accepted by both parties Parties have incomplete knowledge about

each other’s interests Parties seek to maximize their utility

Competitive Market

The market has roughly an even number of buyers and sellers. You can complete as many transactions as possible in 30

minutes. You can only complete one transaction with any given party. You must complete an agreement form for each completed

transaction before proceeding to the next transaction. Your goal is to earn as much profit as possible. Make contact with a negotiating partner in the market area

(front of room near chalkboard) and then proceed to negotiating area (student seat area).

You are free to share information verbally about your profit schedule, though under no circumstances should you physically show your counterpart your profit schedule.


Good luck!

5 minutes preparation 30 minutes to negotiate Submit all agreements after market closes Reflection

How to gauge negotiation success? What factors contribute to success? What types of issues exist in negotiations?


Competitive Market

Maximum individual gain: $8,600 Model: $800 Delivery/Financing: $5,600 Volume Discount: $2,400

Maximum joint gain: $11,200 Model: $800 X 2 = $1,600 Delivery/Financing: $4,000 X 2 = $8,000 Volume Discount: $2,400


Types of negotiation issues

Compatible issue: Both parties want the same thing

Distributive issue: Zero sum, win/lose Parties have opposing preferences and care

equally about issues Integrative issues

Parties have opposing preferences but different strength of preferences (priorities)


Model


OPTION BUYER SELLER

A $0 $0

B $100 $100

C $200 $200

D $300 $300

E $400 $400

F $500 $500

G $600 $600

H $700 $700

I $800 $800

Volume Discount


OPTION BUYER SELLER

A $0 $2,400

B $300 $2,100

C $600 $1,800

D $900 $1,500

E $1,200 $1,200

F $1,500 $900

G $1,800 $600

H $2,100 $300

I $0 $2,400

Delivery Time & Financing


ISSUE OPTION BUYER SELLER

Delivery Time A $0 $4,000

B $200 $3,500

C $400 $3,000

D $600 $2,500

E $800 $2,000

F $1,000 $1,500

G $1,200 $1,000

H $1,400 $500

I $1,600 $0

Financing A $0 $1,600

B $500 $1,400

C $1,000 $1,200

D $1,500 $1,000

E $2,000 $800

F $2,500 $600

G $3,000 $400

H $3,500 $200

I $4,000 $0

How to measure negotiation success?

Performance Individual gain Joint gain

Effect on relationship Transaction costs Will the deal stand the test of time?


Laura Kray, Haas School of Business (c)

What makes a good negotiator?

1. Preparation and planning skill2. Knowledge of subject matter being negotiated3. Ability to think clearly and rapidly under pressure

and uncertainty4. Ability to express thoughts verbally5. Listening skill6. Judgment and general intelligence7. Integrity8. Ability to persuade others9. Patience10.Decisiveness

professor laura kray 2010 achieving negotiation success

Documents

negotiation success

appt slide

class negotiation

negotiation exercises

personal toolkit slide

course representative

course concepts

course themes peer feedback