negotiation as poker game
TRANSCRIPT
05/03/23(c) Victoria Pynchon, ADR Services, Inc.
bargaining chipspoker face bluffplay cards "close to
the vest”read cuestellsholding/raisingfoldingcards on the table
05/03/23(c) Victoria Pynchon, ADR Services, Inc.
Negotiation, like poker, involves tactical decision-making based on incomplete information, in the face of uncertainty.Prof Steven Lubet, Northwestern University Law School
05/03/23(c) Victoria Pynchon, ADR Services, Inc.
Men initiate negotiations 4x more than women.
Negotiation Metaphors ◦ Men: "winning
ballgame”; "wrestling match"
◦ Women: "going to the dentist.”
05/03/23(c) Victoria Pynchon, ADR Services, Inc.
Men negotiate first salary 4 times more than women
Negotiating MBA starting salary = 7.4 % increase
Women who negotiate salaries earn $1 million more than those who don’t
Women own 40 % US biz but receive 2.3% of available equity capital
05/03/23(c) Victoria Pynchon, ADR Services, Inc.
Rules
05/03/23(c) Victoria Pynchon, ADR Services, Inc.
Folkways
Cognitive Biases
05/03/23(c) Victoria Pynchon, ADR Services, Inc.
05/03/23(c) Victoria Pynchon, ADR Services, Inc.
05/03/23(c) Victoria Pynchon, ADR Services, Inc.
05/03/23(c) Victoria Pynchon, ADR Services, Inc.
What You Need to Know
Influential parties outside the dispute/deal
External MarketForces
“Relevant” Facts
BusinessPlans for AllParties
Business Realities for All Parties
Story and Emotion
05/03/23(c) Victoria Pynchon, ADR Services, Inc.
“The Most Important Factor in Negotiating International Diplomatic Agreements is Being Inside the Other Guy’s Decision Cycle”
General Colin PowellFormer US Secretary of State
05/03/23(c) Victoria Pynchon, ADR Services, Inc.
05/03/23(c) Victoria Pynchon, ADR Services, Inc.
05/03/23(c) Victoria Pynchon, ADR Services, Inc.
•make high initial demands• maintain them• make few (and small) concessions•adhere to a high level of aspiration•obtain as much information as possible•Give away little information•bluff •Mislead•threaten retaliation to gain compliance
Reciprocation Commitment &
consistency Social proof Liking Authority Scarcity
05/03/23(c) Victoria Pynchon, ADR Services, Inc.
05/03/23(c) Victoria Pynchon, ADR Services, Inc.
The Heart and Mind of the Negotiator, Professor Leigh Thompson at the Kellogg School of Management , Northwestern University
In controlled experiments, only seven percent of negotiators sought information from their bargaining partner that would have revealed his/her true goals when it would have been dramatically helpful to do so.
05/03/23(c) Victoria Pynchon, ADR Services, Inc.
Changing the Other Guy’s Mind
05/03/23(c) Victoria Pynchon, ADR Services, Inc.
05/03/23(c) Victoria Pynchon, ADR Services, Inc.
05/03/23(c) Victoria Pynchon, ADR Services, Inc.
05/03/23(c) Victoria Pynchon, ADR Services, Inc.
ANCHORINGANCHORING
The party making the first The party making the first reasonable offer reasonable offer should prevail over his should prevail over his bargaining partner who bargaining partner who must respond in the range must respond in the range set by that party.set by that party.
05/03/23(c) Victoria Pynchon, ADR Services, Inc.
FramingFraming Present Losses as GainsStrong tendency to prefer avoiding losses over acquiring gains
Use language that emphasizes your position & frames information in your favor fewer rather than greater
05/03/23(c) Victoria Pynchon, ADR Services, Inc.
05/03/23(c) Victoria Pynchon, ADR Services, Inc.
Women’s economic performance in negotiations hinges on their ability to harness gender stereotypes in a self-serving direction.
Professor Leigh Thompson, Kellogg School of Management Northwestern University
05/03/23(c) Victoria Pynchon, ADR Services, Inc.
Widen bargaining range by sowing doubt
05/03/23(c) Victoria Pynchon, ADR Services, Inc.
05/03/23(c) Victoria Pynchon, ADR Services, Inc.
05/03/23(c) Victoria Pynchon, ADR Services, Inc.
05/03/23(c) Victoria Pynchon, ADR Services, Inc.
Step One
•Ascertain own interests and reservation point (bottom line) •Ascertain identity of people necessary to obtain best overall deal
Step Two •Ascertain Other’s interests and reservation point• belief about the other side's bottom line powerful effect •Know BATNA•Anchor•Plan # of bargaining moves •BE ALERT TO NEW DATA DURING NEGOTIATION
Step Three : Manipulate Zone of Possible Agreement
•Set high aspirations•Make the first offer•Frame your GAIN and their LOSS•Widen bargaining range by "sowing doubt” •Put more interests on the table
RECAP