experience vlerick day - katia tieleman
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© Vlerick Business School
NEGOTIATING POWER
PROF KATIA TIELEMAN
#EXPERIENCEVLERICK
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1.NEGOTIATION PARAMETERS
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PARKER GIBSON
HALF
LOT
WILLOW STREET
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Negotiaton to create value6 © Vlerick Business School
Consistently outperforms a low aspiration base.
Yet leaves enough room for necessary concessions to achieve a win more-win more outcome.
Promotes positive psychological energy.
Communicates confidence and negates irrational negotiation behaviour.
Pressurises the other party to use more energy to lower your aspirations, so they concentrate less on promoting their own aspirations.
“Anchors" the negotiation.
Beware, an AB could be seen as a position - use a range rather than a firm number.
Parties must aspire to a shared AB that meets their shared interests best.
Consistently outperforms a low aspiration base. Yet leaves enough room for necessary
concessions to achieve a win more-win more outcome.
Promotes positive psychological energy. Communicates confidence and negates
irrational negotiation behaviour. Pressurises the other party to use more energy
to lower your aspirations, so they concentrate less on promoting their own aspirations.
“Anchors" the negotiation. Beware, an AB could be seen as a position - use
a range rather than a firm number. Parties must aspire to a shared AB that meets
their shared interests best.
ASPIRATION BASE (AB) – A HIGH ASPIRATION BASE
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Point beyond which an agreement is no longer meaningful.
If you don’t understand or know your real base: It will most likely lead to a point where a
mutually beneficial outcome is not longer possible.
It makes it impossible to establish the contracting zone because this rests between the RB’s of the parties.
You can be exploited because you don’t know the point where you should withdraw from a negotiation.
Beware, RB can cause thought closure and a positional stance.
REAL BASE (RB) - MINIMUM REQUIREMENT FOR AGREEMENT
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Reduces dependency on the other party’s agreement. Ensures the other party does not over-inflate its position. The stronger the BATNA the greater the negotiating power. The more readily a negotiator can walk away from a
negotiation, if necessary, the greater the negotiator's ability to influence the negotiation.
Knowing the alternatives available to the other side is essential to prepare for a negotiation.
A BATNA protects a negotiator from
accepting an agreement that is unfavourable
accepting an agreement that is only in the counterparty's best interests
Knowing your BATNA is knowing what to do when the negotiation fails.
The decision to reveal or not reveal a BATNA must be based on the strength of the BATNA and whether disclosing it is likely to weaken the counterparty’s negotiation stance.
BEST ALTERNATIVE TO A NEGOTIATED AGREEMENT (BATNA)
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CONTRACTING ZONE
SELLER
BUYER
Contracting Zone / Zone of Possible Agreement (ZOPA)
ABSellers Best
Scenario
Sellers Worst
ScenarioRB
Buyers Best
ScenarioAB
Buyers Worst
ScenarioRB
BATNA Seller
BATNA Buyer
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TAKEAWAYS
Power
- Information is power.
- Time is power.
- First offers act as an anchor.
Relations- Negotiation as an event is different from
the process of the negotiation.- Victims become aggressors- Walkaways are better when soft.
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2.FROM BARGAINING
TO VALUE CREATION
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FROM BARGAINING TO VALUE CREATION
I versus I
Win-Losebargaining
We
Value creation
Win - Win
To achieve value creation one must:
• Verify assumptions• Change positions • Explore interests
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Seemingly opposed positions are not always opposed when it comes to the underlying interests, they could be compatible.
Don’t just split the pie in half. Make concessions on those issues that are not important to you, but valued by the other party.
Joint Problem Solving
Joint Opportunity
Finding
Interests can be:OPPOSITECOMPLEMENTARYSIMILAR
Win more – Win more
We
Value creation Win - Win
TO WIN MORE- WIN MORE: FOCUS ON COMPLEMENTARY INTERESTS
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FEEL LIKE SOME MORE?
Negotiating to Create Value (November 2013)
Executive MBA (September 2013)
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Negotiaton to create value15
THANK YOU!