1. 9-1 Preparation: What to Do Before Negotiation CHAPTER 9

2. 9-2 Exhibit 9-1: SCO-IBM Negotiation Structure CHAPTER 9 Instructor’s Manual with Overheads to accompanyCopyright ©2012 Pearson Education, The Mind and Heart of the Negotiator 5/e (Thompson) Inc. publishing as Prentice Hall

3. 9-3 Exhibit 9-2: Levels of Analysis in Multiparty Negotiation P, principal; C, constituency group; M, group member; A, agent CHAPTER 9 Instructor’s Manual with Overheads to accompanyCopyright ©2012 Pearson Education, The Mind and Heart of the Negotiator 5/e (Thompson) Inc. publishing as Prentice Hall

4. 9-4 Key Challenges of Multiparty Negotiation Dealing with coalitions Formulating trade-offs Voting and majority rule Communication breakdowns Private caucusing Biased interpretation Perspective-taking failures (curse of knowledge) Indirect speech acts Multiple audience problem CHAPTER 9 Instructor’s Manual with Overheads to accompanyCopyright ©2012 Pearson Education, The Mind and Heart of the Negotiator 5/e (Thompson) Inc. publishing as Prentice Hall

5. 9-5 Key Strategies for Dealing with Multiparty Negotiation Know who will be at the table Manage information and systematize proposal making Use brainstorming wisely Develop and assign process roles Stay at the table Strive for equal participation Allow for some points of agreement, even if only on process Avoid the “equal shares” bias Avoid the agreement bias Avoid sequential bargaining CHAPTER 9 Instructor’s Manual with Overheads to accompanyCopyright ©2012 Pearson Education, The Mind and Heart of the Negotiator 5/e (Thompson) Inc. publishing as Prentice Hall

6. 9-6 Coalitions Key challenges of coalitions Optimal size Trust and temptation Dividing the pie Strategies for maximizing coalitional effectiveness Make your contacts early Seek verbal contracts Use unbiased-appearing rationale to divide the pie CHAPTER 9 Instructor’s Manual with Overheads to accompanyCopyright ©2012 Pearson Education, The Mind and Heart of the Negotiator 5/e (Thompson) Inc. publishing as Prentice Hall

7. 9-7 Advantages to Using Agents Expertise Substantive knowledge Networks and special influence Emotional detachment Ratification Face-saving CHAPTER 9 Instructor’s Manual with Overheads to accompanyCopyright ©2012 Pearson Education, The Mind and Heart of the Negotiator 5/e (Thompson) Inc. publishing as Prentice Hall

8. 9-8 Disadvantages to Using Agents Shrinking ZOPA Incompatible incentive structure Communication distortion Loss of control Agreement at any cost CHAPTER 9 Instructor’s Manual with Overheads to accompanyCopyright ©2012 Pearson Education, The Mind and Heart of the Negotiator 5/e (Thompson) Inc. publishing as Prentice Hall

9. 9-9 Exhibit 9-8: Bargaining Zone, Maximum Surplus, and Agent Commission Rates for a House Sale CHAPTER 9 Commission Seller RP* [adjusted from $410,000/ (1 – c)] Bargaining Zone [Buyer RP ($440,000) – Seller RP*] Buyer Maximum Surplus Seller Maximum SurplusAgents’ Surplus Range 0% (for sale by owner) $410,000$30,000 $0 2%$418,367 $21,633 $21,200 $8,367–$8,800 4%$427,083 $12,917 $12,400 $17,083–$17,600 5%$431,578 $8,422 $8,000 $21,579–$22,000 6%$436,170 $3,830 $3,600 $26,170–$26,400 Bargaining Zone Instructor’s Manual with Overheads to accompanyCopyright ©2012 Pearson Education, The Mind and Heart of the Negotiator 5/e (Thompson) Inc. publishing as Prentice Hall $30,000

10. 9-10 Strategies for Effectively Working with Agents Shop around Know your BATNA before meeting with agent Communicate interests without giving away your BATNA Capitalize on the agent’s expertise Tap into your agent’s sources of information Discuss ratification Use your agent to help save face Use your agent to buffer emotions CHAPTER 9 Instructor’s Manual with Overheads to accompanyCopyright ©2012 Pearson Education, The Mind and Heart of the Negotiator 5/e (Thompson) Inc. publishing as Prentice Hall

11. 9-11 Constituents Challenges for constituent relationships Identification Accountability Conflicts of interest Strategies for improving constituent relationships Communicate with your constituents Do not expect homogeneity of constituent views Educate your constituents on your role and your limitations Help your constituents do horizon thinking CHAPTER 9 Instructor’s Manual with Overheads to accompanyCopyright ©2012 Pearson Education, The Mind and Heart of the Negotiator 5/e (Thompson) Inc. publishing as Prentice Hall

12. 9-12 Challenges That Face Negotiating Teams Picking your teammates How many on the team? Communication on the team (information pooling) Team cohesion Information processing (common information bias) CHAPTER 9 Instructor’s Manual with Overheads to accompanyCopyright ©2012 Pearson Education, The Mind and Heart of the Negotiator 5/e (Thompson) Inc. publishing as Prentice Hall

13. 9-13 Strategies for Improving Team Negotiations Goal and strategy alignment Prepare together Plan scheduled breaks Assess accountability CHAPTER 9 Instructor’s Manual with Overheads to accompanyCopyright ©2012 Pearson Education, The Mind and Heart of the Negotiator 5/e (Thompson) Inc. publishing as Prentice Hall

14. 9-14 Exhibit 9-10: Preparing for Your Team-on-Team Negotiation CHAPTER 9 Step 1: Individual preparation Identify the issues. Identify your BATNA. Determine what you believe to be your team’s “worst- case” scenario. Determine what you believe to be your team’s “best-case” scenario. Write these scenarios down and be prepared to share them with the members of your team. Step 2: As a team, decide on your procedures for running the preparation meeting Who is going to run the meeting (i.e., who is going to summarize, synthesize, etc.)? What materials do you need to be effective (calculator, flipcharts, computer, etc.), and who is bringing them? What is your timeline, and who will enforce it so that the team arrives at the negotiation table prepared and refreshed? Step 3: As a team, clarify facts and information Develop a “Positions and Interests” chart. Prioritize your issues. Understand the reasons for your priorities. Identify what you think the other party’s priorities are. Identify what information you need from the other party. Determine your BATNA. What do you know about the other party’s BATNA? Identify your worst-case scenario (reservation price). Identify your best-case scenario (target). As you complete the preceding tasks, make a list of questions to research. Identify information that is too sensitive to reveal at any point under any condition (get clarification and closure within the team on this point). Identify information that you are willing to share with the other team if they inquire (get clarification and closure within the team on this point). Step 4: Strategy As a team, plan your OPENING OFFER. Choose a lead negotiator (speaker). Choose a lead strategist (listener and strategic watchdog). Choose an accountant to run the numbers. Choose a scribe to keep track of offers. Decide on a signal to adjourn for a private caucus. Instructor’s Manual with Overheads to accompanyCopyright ©2012 Pearson Education, The Mind and Heart of the Negotiator 5/e (Thompson) Inc. publishing as Prentice Hall

15. 9-15 Challenges of Intergroup Negotiations Stereotyping Changing identities In-group bias and downward social comparison Extremism and naïve realism CHAPTER 9 Instructor’s Manual with Overheads to accompanyCopyright ©2012 Pearson Education, The Mind and Heart of the Negotiator 5/e (Thompson) Inc. publishing as Prentice Hall

16. 9-16 Strategies for Optimizing Intergroup Negotiations Separate conflict of interest from symbolic conflict Search for common identity Avoid the out-group homogeneity bias Mere contact strategy GRIT model (graduated and reciprocal initiative in tension reduction) CHAPTER 9 Instructor’s Manual with Overheads to accompanyCopyright ©2012 Pearson Education, The Mind and Heart of the Negotiator 5/e (Thompson) Inc. publishing as Prentice Hall

17. 9-17 Exhibit 9-10: The GRIT Model CHAPTER 9 1.Announce your general intentions to de-escalate tensions and your specific intention to make an initial concession. 2.Execute the initial concession unilaterally, completely, and, of course, publicly. Provide as much verification as possible. 3.Invite reciprocity from the out-group. Expect the out-group to react to these steps with mistrust and skepticism. To overcome this, continued concessions should be made. 4.Match any reciprocal concessions made by the out-group and invite more. 5.Diversify the nature of your concessions. 6.Maintain your ability to retaliate if the out-group escalates tension. Any such retaliation should be carefully calibrated to match the intensity of the out-group’s transgression. Source: Based on Barron, R. S., Kerr, N. L., & Miller, N. (1992). Group process, group decision, group action (p. 151). Pacific Grove, CA: Brooks/Cole. Instructor’s Manual with Overheads to accompanyCopyright ©2012 Pearson Education, The Mind and Heart of the Negotiator 5/e (Thompson) Inc. publishing as Prentice Hall

18. 9-18 All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of the publisher. Printed in the United States of America. Copyright ©2012 Pearson Education, Inc. publishing as Prentice Hall CHAPTER 9