1. Negotiating for Win-Win Interest-Based Negotiation CASFAA Conference, 2008 Anaheim, CA Presented by Natasha Kobrinsky Pepperdine University Graziadio School of Business and Management

2. Do You Negotiate?!

3. Session Objectives  Recognize your negotiation skills  Understand the negotiation process  Enhance your negotiation skills by using the interest-based approach and mediation techniques

4. What is Negotiation? It’s a power imbalance It’s a discussion intended to produce an agreement It’s a process to resolve disputes It’s a process of learning and discovery It’s a process of bargaining for individual or organizational advantages

5. Approaches to Negotiation Positions are tangible items people say they want Interests are the things one cares about and wants

6. Approaches to negotiation Negotiations could be right-based Power-based Interests-based

7. Negotiation Outcomes Win-Lose Lose-Lose Win-Win

8. Criteria to compare negotiation outcomes: Transaction cost Satisfaction with outcomes Effect on the relationship Recurrence of disputes

9. Interest-Based Negotiation vs. Distributive Negotiation Creating a free flow of information Attempting to understand the Other Party’s real needs and Objectives Searching for Solutions that meet the goals and objectives of both sides Crafting an outcome for mutual interests

10. Identify and define the real issues/problems Understand what drives the negotiation and What drives the negotiator Define the issues in a mutually acceptable way

11. Determine your and your opponents’ real interests Substantive interests- economic and financial issues Process interests Relationship interests Interests in principle

12. Establish your goal Best outcome Good enough outcome Tolerable outcome Get ready to compromise

13. Plan & Prepare Determine your walk-away point (resistance point) Determine your BATNA and WATNA (best and worst alternatives to negotiations )

14. Plan & Prepare Learn about your opponents  Their personality  Their background, culture  Their personal situation Look for precedents

15. Plan & Prepare Determine your and your opponents’ strengths Consider your and your opponents’ weaknesses Identify the risk factor and try to remove it Identify the barriers and try to remove them Consider the impact of deadlines

16. Plan & Prepare Develop alternative solutions: Develop alternative solutions Generate as many options & packages as possible to make the pie larger

17. Depersonalize the problem Separate the problem definition from the search for solution Build trust Do not use threats Remove emotional barriers for the opponents Show respect (Lack of respect triggers the majority of legal actions)

18. Propose Try not to go first with an offer Give a reasonable offer Be prepared to change it

19. Propose & Probe What if … Why not … What would you suggest …

20. Ask Questions Use open-ended questions to get more information Use close-ended questions to force the other party into seeing things your way The less you say, the more you hear

21. Influence the other party’s resistance point but … Be ready to change your position Concession-making indicates an acknowledgement of other party and a movement toward the other’s position. Flexibility keeps your negotiation going

22. Listen Use active listening techniques: restate, paraphrase other party’s statements Take notes Discover the other party’s outcome values, resistance point, motives and etc. The opponents’ answers are the best guides

23. Make Counterproposal Try to increase the real or potential rewards of a transaction for opponents Align organizational & personal incentives Motivation & incentives will increase a chances of making a deal

24. Trade Exchange terms or items Trade something you value less for something you value more

25. Factors that facilitate successful interest-based negotiation Some common objective or goal Faith in one’s problem-solving ability Belief in the validity of one’s own position and the other’s perspective Motivation Commitment to work together Trust Clear and accurate communication

26. Achieving closure It’s important to know when to “shut up” and reduce the agreement to written form.

27. Key steps for interest-based negotiation  Identify and define the real issues  Define the problem in a mutually acceptable way for both sides  Depersonalize the problem  Set mutual goals  Separate a search for mutually beneficial solutions from problem definition

28. Key steps for interest-based negotiation Establish trust and positive feeling that are likely to lead to an integrative outcome Advantages of moving beyond positions to real interests Learn to expend the “pie” by looking for alternative solutions Bargain for individual advantages Craft outcomes for mutual interests The best way to get what you want is to give the opponents what they want

29. People say YES to people they like!