SECTION I: INTRODUCTION

Real-Life Negotiation Situations
You feel you’ve been had. Sucker-punched. Taken for a ride. Why? You’ve been talking to your next-door neighbors about their cell phone service, and you find out that they are paying roughly half the monthly rate that you are paying! To make matters worse, you learn that their phone has text-messaging, a camera, no roaming charges, AND e-mail capability! Your cell phone does not have these functions. And the final insult? They didn’t have to sign a contract— and you still have 18 months left on yours. At first you get mad, thinking the phone company made a mistake that is costing you money. After all, you pride yourself on being an informed consumer— how else could this have happened? Then you ask your neighbor how he got such a good deal. He tells you that he and his wife simply negotiated the agreement when they switched providers. Boy, do you feel frustrated and foolish. You realize how easy if would have been for you to have negotiated the same deal, if only you had tried. The fact is that most people miss many opportunities to negotiate in their professional and personal lives. Negotiating is a critical ability that many of us lack, yet anyone can become a competent negotiator. It simply requires (1) knowing when a particular situation is ripe for negotiation; (2) knowing who is able to make a decision for the other party (you often need to ask to speak with the supervisor or manager in charge); and (3) knowing how to negotiate. Read this easy-to-follow book, and learn how to negotiate by practicing a few tactics presented here. As you read, you’ll be amazed at all the everyday situations in which having the ability to negotiate effectively can enrich your life.

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Practical Tactics for Work and Life
In this book, we provide the reader with 50 proven, practical, and easy-to-apply negotiation tactics. We minimize the jargon and long-winded stories so you can quickly learn how to use each tactic (usually in less than a day!). You do not need to wade through hundreds of pages to find a single useful tactic. In fact, most people find a few interesting tactics right away, and try them out immediately. Each tactic is briefly defined and used in work and life examples—no lengthy anecdotes and no wordy theoretical discussions. Each is written to stand alone; the reader does not have to read and retain many pages of discussion just to understand how to use the tactic.

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50 Practical Negotiation Tactics

Tips on Getting the Most Out of This Book
Read the book through, from start to finish. It only takes about two hours. Read all 50 tactics and flag the ones you believe you can use immediately and in what situations. (Or use the Notes pages in the back). For example: • Nickel and Diming (Tactic #43) – Use with copier vendor to reduce toner cost. • Commit the Offer to Paper! (Tactic #50) – Use with kids for household chores and driving privileges. Keep it handy. This book, as the title states, is a resource book. After you have familiarized yourself with the content, keep the book on your desk or shelf next to the dictionary, encyclopedia, and other reference books. Use the tactics! Practice makes perfect. Start with the ones you flagged or recorded in the Notes section. The next time you are about to enter a negotiation situation, refer to the notes you made, and try the tactic. It won’t cost you anything to prepare ahead, and the experience of trying it out will build your confidence. Everyone can negotiate, once they know the tactics and practice them. The first time you realize that using a tactic gave you a significant gain, you will be ready to try more of them. Develop your own style. The fifty tactics presented in this book are not intended to be recipes for success in any negotiation situation. Instead, they are general methods that should be adapted to fit one’s personal style or negotiation circumstance. As you use a tactic, record the results in the back of the book so you can recall how it worked the next time a similar situation comes up. Use the exercise forms in Section IV. They will help you think about how you can use these tactics. On the form, briefly describe the situation; list the parties involved (including the people who can make a decision); describe the issue to be negotiated; and finally, list the tactics that you believe might be especially helpful. Take the Quiz! Can this book help you? Circle yes or no next to each of the ten quiz questions on page 7. Score your answers: one point for each “no” on questions 1, 6, 7, and 10 and one point for each “yes” on questions 2, 3, 4, 5, 8, and 9. Total your points. If your total score is a 9 or 10, you are already a successful

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or engage in an unproductive argument. but many of us miss the opportunity to bargain in other situations. 4 50 Practical Negotiation Tactics . start reading! Most people come face-to-face with a negotiation situation of one type or another on a daily basis: on the job. such as these: • You receive the wrong order at a restaurant. But if you scored 8 or less. are the negotiators most people deal with each week in their work and personal life? The list will be long: • • • • • • • • a neighbor a spouse a child other family members a supervisor a co-worker a salesperson a boyfriend/girlfriend • • • • • • a home builder a hotel clerk an electrician/plumber a lawyer a vendor/buyer a human resource director (who might make a job offer) • a manager Most people expect to have to negotiate when buying a car or purchasing a home. • A child wants a new toy now. This book is designed to give the reader an understanding of the negotiation process by presenting fifty proven. at a flea market. few people understand that normal interactions represent bargaining opportunities.negotiator! Pass this book on to someone else who needs it. Learning how to use these tactics and knowing when to apply them will make you a more skilled negotiator when you are faced with the opportunity to strike a favorable agreement. Most readers will no doubt recognize some of these strategies. Unfortunately. Who. accept what is given. some will in retrospect even remember being the victim of one or two of them. Instead. with neighbors. • A co-worker asks for volunteers for a new project. with family members. they pay the sticker price. practical tactics useful in real-life situations at work or at home. exactly.

or items of value. All of these situations are opportunities to negotiate. The parties are interdependent: what one party does affects the other. Two or more sides are involved. Your boss reviews your past year’s performance.” When you recognize that something can be negotiated. and I don’t have time to wait for another. 2. one party is only allowed to follow policy or must wait “until the manager arrives. and each side can involve one person or several people (each representing one “side” of the issue). For example. such as price. Your spouse wants to buy new furniture. There must be a conflict in the sense that what one wants is not what the other wants. be prepared to bargain. A service repair person gives you an estimate on some work. condition. Both sides want a settlement. “Well. The parties involved can make a decision by themselves. Therefore. 5. perhaps the employee can say. time. The parties involved are interested in reaching a common goal. “I’d like Introduction 5 . A friend is about to select the movie he/she wants everyone else to see. Each one has the five key characteristics necessary for bargaining: 1.• • • • • • • A hotel clerk tells you that your reservation was lost. Multiple parties. that can be negotiated. Decision-making ability. what can you do for me?” Or this to a restaurant manager: “This food order is wrong. 4. some resolution must be negotiated. Interdependency. you must advise the other party of your intention to negotiate. 3. In some circumstances. A teenager wants to buy his/her first car. Flexibility. Mutual goals. What are my alternatives?” During an employee evaluation. since you lost my reservation. In some situations. A neighbor wants to remove an old tree on your property line. perhaps you can say to a hotel clerk. There are flexible elements to the situation.

the facts. You might need to follow with a statement that clarifies your desire for a settlement but indicates that you are flexible and you do intend to negotiate. 6 50 Practical Negotiation Tactics . Keep this book handy when preparing for any type of negotiation. “I see why you want to cut down the tree. and the tactics that might move the negotiations along. negotiations can be concluded with a written or oral agreement. Choosing and applying the appropriate tactic to a particular situation will become easier as you begin to use them.” To a neighbor you can say. How can you compensate us for our loss?” Once you’ve suggested that you see the situation as something to be negotiated. Once a settlement is reached.time to look over this performance review and respond point-by-point. the other party will realize that you intend to negotiate and do not accept the situation. You can then use one or more of the tactics presented in this book to achieve the best possible settlement. and use the forms in the back to identify the issues. but I believe it adds value to our house. Scenarios based on actual real-life situations are used to show how each tactic can be used in business or everyday situations. the parties and their interests. and meet with you again.

do you believe that you negotiated the best possible deal? 4. In the past. Yes No Self-Assessment Quiz 1. have you routinely resolved differences with a neighbor or a friend through a negotiated agreement? 5. In the past.How good are your negotiation skills? Place a check in the box that applies to you. but you did not? 8. have you ever felt that you were not adequately prepared to negotiate a job offer? 2. Do you routinely negotiate for better accommodations when you check into a hotel? 3. spouse. or division of household duties. etc. have you ever required a written agreement covering chores. or child.? 10. allowance. Do you often refrain from negotiating a better price or service because you believe that you do not have good negotiating skills? Introduction 7 . The last time you received sub-par service or food in a restaurant. did you request appropriate compensation? 6. do you routinely negotiate a last add-on before you close the deal? 9. Have you ever found yourself in a negotiation situation in which your best alternative was to walk away. When you purchased your last home or car. Do you wish you could negotiate a change in your job duties or salary? 7. When making a major purchase. As a parent.

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Examples: • office location (city. decide how complicated the issue is. including those that are less obvious. They’re referred to as “win-win” because each side can achieve their goal. If it is a relatively informal situation. The Quick Model The easiest way to prepare for a simple negotiation is to identify all the issues. The Negotiation Process 9 . Examples: • a signing bonus (employee goal) traded for an annual travel budget (employer goal).) • primary sales territory • a starting date Exchange Issues: Those issues that might be traded. Then classify each one into one of three categories: Compatible (Integrative or Win-Win) Issues: Those issues for which both parties might have the same desirable outcomes. • an allocation for moving expenses (employee goal) traded for a set number of travel days per month (employer goal). the process will be fairly straightforward. if the situation involves a number of detailed or complicated issues or the stakes are relatively high. state. On the other hand. the process will probably take several weeks or months as the parties move through all the stages. thus allowing each side to achieve one of their goals. The “Quick Model” approach outlined below is good for simple negotiations.SECTION II: THE NEGOTIATION PROCESS Before you begin the process of negotiation. etc. one for another.

but feel free to try them when they seem most appropriate to your specific circumstance. the other side loses. stages can be combined.Distributive (Win-Lose) Issues: Those issues that the parties are directly at odds with. or even skipped altogether. What one side gains. The Comprehensive Model Negotiation is more of an art than a science. Examples: • an item sold by one party and bought by the other • wage increases won by one side. The most typical stages are Preparing to Negotiate Planning a Strategy Exchanging Initial Offers Making Counteroffers (the Give and Take) Applying Pressure Making Progress Reaching Agreement The tactics are organized according to the stage at which they can be used to best advantage and listed as such in the Table of Contents at the front of the book. 10 50 Practical Negotiation Tactics . rearranged. Depending on the situation and the parties involved.

The Negotiation Process Table 1: The Negotiation Process: Seven Basic Stages Stage 1 Identify situation as one for negotiation Preparation: Key Factors – Time. Information. Power #1– #6 Stage 2 Strategy: Choose Overall Approach to the Process #7– #14 Stage 3 Initial Offer: Getting Started Stage 4 Counter Offer: The "Give & Take" Stage 5 Pressure Bargaining: Striving for Conclusion Stage 6 Key Methods: Achieving Progress Stage 7 Reaching Agreement: Settlement of Impasse Tactics to Consider #15– #21 #22– #31 Negotiation Phase #32– #38 #39– #46 #47– #50 Initiation Phase Resolution Phase 11 .

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SECTION III: 50 TACTICS FOR SUCCESS

Stage 1: Preparing to Negotiate
n many negotiation situations, the parties have time to prepare for the actual bargaining. In other situations, such as when you’ve been served something at a restaurant that you did not order, there is no time to deliberate. You have to be prepared to instantly recognize that the situation can be negotiated, and begin to bargain. You can have time to prepare if you simply ask for it. For example, at the end of an employment interview for a management position, the candidate was surprised to receive a job offer on the spot. The candidate wanted the job, but wisely recognized that she could negotiate the contract. She said that she was very interested, but needed forty-eight hours to make up her mind. She used the time to talk to current employees, and developed a list of perks and conditions that she then negotiated, before accepting the position. To prepare for a negotiation, do as many of the following activities as you can: 1. Have realistic objectives. Identify everything that can be negotiated, and set realistic objectives for each item. If, for example, price is a factor, determine the desired outcome and set a minimum (or maximum) acceptable outcome, beyond which you will walk away and choose another alternative (see Tactic #1: Know Your BATNA). Also determine your opening offer in light of your desired and your minimum outcomes. It is often helpful to list each specific item to be negotiated and your minimum acceptable offer for it, as well as your desired goal and an acceptable opening offer (see Tactic #5: Listing Items). Thus, for each factor, write down and stick to three figures:

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Preparation

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1. An opening offer. 2. The desired “best” offer. 3. A minimum (or maximum) “worst” offer. 2. Learn about your opponent. By whatever legal and ethical means possible, learn everything you can about your opponent. Talk with friends, neighbors, co-workers, past negotiation foes, even family members. If you are able to guess or find out about your opponent’s real objectives and/or limitations, you can gain an invaluable edge (see Tactic #2: Know Your Opponent’s Real Objectives). 3. Gather all the facts. During the heat of negotiations, presenting critical facts or objective criteria can turn the tide in your favor. You can usually anticipate and collect this critical information in advance during the preparation phase (see Tactic #4: Use Objective Criteria). 4. Set ground rules. In labor negotiations, the parties first agree to ground rules such as where, when, who, and how often the negotiation sessions will occur. Detailed ground rules are not needed in most everyday negotiation situations, but there are times when they help people come to agreement. Agreeing in advance on the location for discussions can give one side an advantage (see Tactic #3: Control the Setting), but in other situations, the critical ground rule will be about timing (see Tactic #6: Timing is Everything), forcing both sides to reach agreement faster. In negotiating with family members, friends, or neighbors, one well-advised ground rule is to stop the talks as soon as anyone raises his/her voice, curses, or makes a threatening comment.

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50 Practical Negotiation Tactics

Tactic 1: Know Your BATNA
At what point will you walk away from the negotiation? You improve your position in any negotiation if you can walk in already knowing your BATNA—your best alternative to a negotiated agreement. The BATNA is the outcome you prefer over what the other party has proposed; if you define it at the outset, you are less likely to agree on something during an emotionally charged discussion and regret it afterward.

Example 1
Harvey Huff bought a new 1956 Chevrolet from a local dealer. After forty years, he finally decided to sell the car he had loved and carefully maintained in original condition. Harvey did not need the money, but he intended to move three thousand miles away, to a condo in Arizona. The ad he placed in the local newspaper produced only one potential buyer: Patrick Knight. Harvey: Mr. Knight: Harvey: Mr. Knight: Harvey: Mr. Knight: Harvey: Mr. Knight: Harvey: Mr. Knight: Harvey: Well, now that you’ve checked it out, how do you like it? It’s in great condition, just as you described it. Any questions? Will you take less? No. It’s easily worth at least $20,000. That’s the price. $18,000, tops! No thanks. Okay. $20,000. I need it for a new restaurant. Restaurant? Yes. We cut off the top of the vehicle and people sit in it and get served their meals in our “oldies dream car!” Never mind, I’ll keep it. I haven’t maintained it for all these years just so you can destroy it.

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labor contract negotiations between the Jaggers and a local labor union representing the pottery’s craftsmen have stalled. Conclusion Selling their business was the Jaggers’ BATNA. as Harvey had for many years. notified all the employees of their intentions. 16 50 Practical Negotiation Tactics . Example 2 Shari and Jim Jaggers own a successful West Coast pottery company. The threatened strike became a reality. and the Jaggers decided once and for all to sell their business assets and invest the proceeds conservatively. When negotiations with the union became hopeless. his BATNA was not to hold out for more money. and final offer. and it now employs 230 craftsmen.Conclusion Harvey’s best alternative—his BATNA—was simply to hold on to the car for the moment. The union is demanding wage and benefit increases. For the past two months. The $56 million dollar business took them 30 years to grow. selling became an attractive alternative to a strike or prolonged battle. providing them with a very good income for life. the Jaggers decided to seek buyers for their land. was a power play. They told the union that their age and the fact that they had no heirs to carry on the business was leading them to seriously consider selling out and permanently closing the doors. With only two weeks remaining before a threatened strike. The owners. inventory. The Jaggers gave the union their “last. but rather what the buyer planned to do with the car. and either move it with him to Arizona or find another classic car collector who might buy it (perhaps for less) and preserve it. as a last resort. In this case. The union negotiators thought the Jaggers were bluffing.” which was refused. and equipment. which the Jaggers believe will cause them to increase prices to the point where they will no longer be competitive with other West Coast firms. They learned that their assets would be easy to sell and were worth more than originally estimated. best. The union negotiators convinced the employees that this too.

Gosh. it’s still perfect. you know. so Tom was surprised when John called him out of the blue one day with a proposal. John: Tom: John: Tom: Tom. because if the company does not provide relocation benefits. might not be willing to lower her asking price because she knows that her company has agreed to buy the house if she can’t sell it.000? That’s more than I planned. This is a good thing to know.000. Make me an offer. You have an advantage and are in a position to produce a better agreement if you understand what motivates your opponent and what “hidden” interests lie behind their position. It is extremely rare—one of only 100 made with that bore and handle. what the other party’s desired outcome is. If you are the party making the offer on the house. at some point. How much are you thinking it’s worth? John: Well. Tom: $20. it’s to your advantage to know what is behind a seller’s decision to put it on the market. for example. Preparation 17 . you still interested in my rifle? Of course. A person who has to sell her home because her company is relocating her. I’ll have to think about that. I’ve been thinking of getting rid of it for a while.Tactic 2: Know Your Opponent’s Real Objective Each party in a negotiation will know. I think so. right? John: Sure. and told John several times to let him know if he ever wanted to get rid of it. Just as important is the why. sure. Are you finally ready to sell it? Yes. I guess I couldn’t take less than $20. she might have to take a lower offer just to be able to move. What changed your mind about getting rid of it? It is still in perfect condition. Example 1 Tom had always admired John’s 1861 Confederate rifle. John assured Tom that this would never happen. Just running out of space.

we really want to buy your company.000. Well.) Tom: John. but then he will be happy to retire. He is two years away from retiring and does not want his business to fail before he does. and now the two-year requirement has become a stumbling block in the negotiations. John: Well. but I could get the money to you right away.Tom: Okay. Tom now felt comfortable negotiating the price. (Tom investigated the “market” for a restored 1861 Confederate rifle by calling a few other collectors. I don’t think I can go higher than $18. fearing that this will put all of his employees out of work. I’ve been thinking about your offer. When Tom found out why John decided to sell his rifle. let me think about it and I’ll get back to you. Example 2 Rick. One of them mentioned that someone who is negotiating with him to buy a restored Winchester rifle for $18.500—we’d have a deal. has begun negotiations to sell his firm to BigManu Company. we 18 50 Practical Negotiation Tactics . Without some trust. However. No longer worried about John’s motives. The sale price for the company has not yet been agreed to. Conclusion Tom entered into the negotiations suspicious of John’s motives. if you could come up a little—say $18. Rick needs to remain president of the company for the next two years. Tom: Okay. but thought this might explain John’s sudden interest in selling the rifle. let’s do it. parties to a negotiation are not likely to reach agreement. so he is making it a condition of the sale that ALL current employees must be retained for a minimum of two years. Was Tom interested? Tom declined. it made the negotiations easier. and we’re committed to keeping it open as a major division of our company. the owner of a small manufacturing company.500 had an 1861 for sale. He doesn’t want BigManu to know this because he thinks it will hurt his negotiating position. BigManu: Rick.

you will have a say in how the employees are treated. What is it you’re afraid is going to happen? Rick: I am convinced that with a two-year time frame. Without this commitment.cannot guarantee to you that ALL of your employees will be retained for two years. (Between negotiating sessions. Preparation 19 . We just can’t make good operational decisions with our hands tied. my employees will prove to you that they are uniquely able to run this place. The price they gave Rick was actually more than he had expected. and he accepted it subject to agreement on the two-year employment guarantee clause. I just want them to have a real chance to show you how good they are. I just don’t want it to change after I’m gone. and I hired every one of these people. Within the parameters of efficiency and effectiveness. BigManu: We just don’t see a way to give you what you want on this. and we think it’s an odd request anyway. they will make you plenty of money and more than make up for any “operational” difficulties it might cause you. I just can’t go through with this sale. Rick: These people are the best at what they do.) BigManu: Okay. BigManu’s negotiating team concluded that they were in the dark as to why this two-year requirement was so important to Rick. We still can’t find a way to do it. You’ll be in place to participate in our employment decisions. let’s talk about the job guarantee you wanted. Let’s talk later. BigManu: You know we want you to stay on and manage this division for us. In hopes of pushing the deal forward. they decided to put their price on the table and revisit the issue after a price was agreed upon. I need to give them some sense of comfort if this deal goes through. Rick: I built this business from the ground up. Working as a division of your company.

he agreed to allow BigManu to accommodate him without limiting their ability to make business decisions. to tell you the truth. Rick: Well. 20 50 Practical Negotiation Tactics .BigManu: We intend for you to stay and become a big part of our company. Rich almost lost the deal. would it? Rick: Well. Once Rick realized that he no longer risked anything at the negotiating table by making his need known. Conclusion By masking his real objective (giving himself two more years as president before retiring). but we won’t be completely tied to operations as they are now. Surely you’ll be able to “protect” your people if they are as good as you say. I’m hoping to retire in two years. I certainly want to do all I can until then to protect my people. that might work. BigManu: Why don’t we guarantee to you that you will stay for two years? That way. you’ll have a guaranteed “in” to protect your people. Let me get back to you. This wouldn’t have anything to do with your own plans for the future.

) Let’s take all our Beanie Babies to my house to trade! Okay. Inexperienced negotiators fail to realize that the other side has an advantage if the meeting is held on their home turf: they are more comfortable. Mother: Hush. how can you trade the frog—he’s your best one! Dede: (Bailey’s other sister) Yeah. and so on. and go play somewhere! Cybil: Well … Okay. the frog is everybody’s favorite. they have the information they need at their fingertips. but never to THEIR advantage! Example 1 (Two ten-year-old girls are talking. it’s a deal.Tactic 3: Control the Setting There is a logical reason why professional negotiators setting ground rules agree to conduct the talks at a neutral site. they control the breaks and environmental factors. I’ll give you my duck and frog for your whale and horse! Cybil: I already told you that I don’t really like that frog much! Jenny: (Bailey’s sister) What? Bailey.) Prepare for the negotiations by controlling the setting—to your advantage or to mutual advantage. Cybil. (Think of the showroom tactics used by car dealers. too. Bailey: Cybil: Preparation 21 . Make up your minds. such as a hotel conference room. I like the frog. (thirty minutes later) Bailey: So. girls.

was still going strong.Conclusion Bailey. Example 2 Two five-person negotiating teams had been trying to work out a deal for over a month. The chief negotiator for Team A publicly challenged Team B to “negotiate non-stop.” The chief negotiator for Team B agreed. They were blamed for accepting the same deal that had been rejected only days earlier. 22 50 Practical Negotiation Tactics . knew that her sisters liked the frog best and that they would help convince Cybil of its “value” and help Bailey make the trade. having set up beds. The physical and emotional demands of 24-hour. although only ten years old. Team A agreed to a settlement almost identical to the one rejected days before. non-stop negotiations wore down the members of Team A. as long as they met in the boardroom of Team B. and other conveniences in the adjoining room. When negotiations resumed in two months over another piece of property. Both sides desperately needed to settle a property dispute. After forty hours of negotiating. Conclusion Team A did not realize the practical advantage they gave Team B when they agreed to negotiate in B’s boardroom. around the clock. while members of Team B were able to stay fresh. not one member of Team A was chosen to return to the table. Team A was whipped physically and emotionally. Team B had clearly used its home turf to gain a substantial advantage. Team B. They had all been replaced after their decision to negotiate “around the clock” in Team B’s boardroom became known. That’s why she wanted to go to her house. until we have a settlement. About thirty-six hours later. Team A agreed to change the meeting place. meals. in their own familiar setting. The firm deadline was only four days away.

Larry was thrilled. Larry had expected to pay him for his time. rather than give them the “advantage.Tactic 4: Use Objective Criteria Use objective criteria to judge the quality of each side’s proposals—you will probably improve your chances of coming away satisfied. Larry: Well.” This can hold up an agreement and cost you in the end. I would have charged anyone else much more. Things turned sour. If they tell us that they either Preparation 23 . If you think that the other party knows more than you do. you are likely to resent them for it and hold out. It was twice as high as the estimates Larry received from other plumbers before they started the project. and they were much lower than this. though. it became clear that all of those pipes had to be pulled and new ones put in. Will is a licensed plumber. Let’s get the guys back in who gave you estimates. Larry: But Will. when Will presented Larry with his bill. I gave you my “family” rate. This uncomfortable negotiation followed: Larry: Will. these plumbers certainly acted like they understood the work when they gave me their estimates! Will: Tell you what. Will: Larry. I did get some estimates from plumbers. After all. Believe me. Larry: Just make sure you’re comparing apples to apples. When we got into it. Example 1 When Larry’s cousin offered to help Larry finish the renovation on his bathroom. based on objective criteria (think property appraisals in real estate). but was shocked at the amount of the bill. and he and Larry have always gotten along. I anticipated much less work. about your bill. and show them the actual work that got done. When you first told me about your project. Prepare for the negotiations by having an outside authority measure or weigh in on each side’s position. I was kind of surprised at how high it was.

I’ll revise my bill to meet the lowest estimate you get. The estimates would have been higher than what cousin Will charged. she had been investing the college’s endowment funds for many years. they had to agree that their early estimates were low. and decided to bring the matter up at a Board meeting. Had they actually prepared bids on the work. I certainly didn’t mean to offend you. The college’s budget officer was understandably offended. they said. because (as Will pointed out) it wasn’t an apples-to-apples comparison. The chairman of the Board suggested that Stuart and the budget officer meet to discuss the investment policies and practices as they relate to the endowment funds. they would have had to revise the figures. He was disappointed in the performance of the fund. Comparing the estimates to Will’s actual costs would have been counterproductive.disagree on the need for that work or that they would have done it for less. From a look at the portfolio. Conclusion When the other plumbers looked at the work. Larry: That sounds fair. my first reaction was that some of the investments 24 50 Practical Negotiation Tactics . while she wasn’t an expert. I find your suggestion to the Board that I haven’t been doing my job right to be very insulting! Stuart: I’m sorry. he used his financial expertise to analyze the investments of the college’s endowment fund. I have been very diligent about making sure that the fund makes the most money it can without putting us at risk. Budget Officer: I don’t know what your problem is. Example 2 After Stuart was appointed to the college’s Board of Trustees. and no one had ever questioned her performance. Settling on the right objective criteria upon which to base a negotiation requires that both parties think through their options.

I find that a more aggressive investment strategy produces a better return. but some of these stocks have really lost their value. but we can ask them to plan and cost out each move. but such a strategy also increases risk and costs more money to administer. We just can’t make up losses to the endowment fund without considerable impact on our annual budget. but I think they more than offset the gains. the college is a private institution. how can we identify the right parties? Conclusion The two-month experiment did produce the results Stuart had anticipated. Stuart: No problem. and the budget officer was comfortable that the risk and expense of such a strategy was small and worth the effort. Why don’t we ask two investment advisors who have some alumni ties to the college to do a mock investment of the endowment fund for a month or two? We won’t tell them about each other and they won’t actually do any real trades. Now. considering commissions and all.were stale. if both of them demonstrate a similar strategy and produce better results after expenses. Preparation 25 . I have a suggestion. there might be increased risk and some expenses for commissions. I don’t want you directing how they’re going to go. then you and I can talk about changing our investment strategy. Budget Officer: Yes. because she did not have the background in investments necessary to trust such advice. I don’t question that they were sound at one time. At the end of two months. Stuart realized that the budget officer needed very-specific “criteria” (such as the actual experience of investing the school’s endowment fund) rather than relying on an investor’s experience. Stuart: Yes. but I want to be involved in the discussions with them about what we’re asking. As you know. Okay? Budget Officer: Okay. and its resources are limited. In this situation.

(2) a later curfew. a sixteen-year-old who lives with her parents and three younger sisters. Shari: Well. You can’t treat me the same! Mother: Well—so we’re talking about several issues. besides washing the dishes every night and cleaning my room? Mother: You could cook dinners. your little sisters will want equal treatment. what else can I do. and ask the other party to add to the list. It will cost me more than $10—about $35 per week. Mother: But your allowance is based on what you earn in your weekly chores. has asked her mother for a $10/week increase in her allowance. I need more money for clothes and CDs. (3) more chores. baby-sit your sisters. you should each put together a “package” of several items on the list and work out a win–win agreement for these things. if I give you an increase. and (4) different treatment from your sisters! 26 50 Practical Negotiation Tactics . Once you both agree on the list of things to be negotiated. Shari: I’m four years older than the next-oldest. not on what you want to spend. wash the cars. and for going out with my friends. Mother: That’s a large increase—and we just raised it last year! Shari: Well. not just an allowance increase! There is: (1) a $10 increase. This strategy can build trust in the negotiation process itself. Example 1 Shari.Tactic 5: List All Items to Be Negotiated Break down the issues to be worked out into separate items ahead of time. clean the whole house—should I continue? Shari: Whoa! I want to stay out longer—past my curfew of 10:00—not work more! Mother: Well. cut the grass.

while your Dad and I go out. opens by proposing the list of items. Now it is time for each side to list their desired outcome for each item. An allowance increase. Management agrees. Union: We will agree to your proposal on item #6 (the number of paid holidays) and item #14 (the new overtime hourly rate).Shari: Right! Mother: So … I suggest no allowance increase. Example 2 The union and management negotiating teams opened discussions with a list of 48 demands. but unlike your sisters. and item #23 (the wellness program voucher). The union’s chief negotiator. And if you clean the whole house on Saturday. in the first session. Management: (after calculating the total value of the five items during a break period) We agree to your package of five items. Then a “win-win” solution could be determined. you get to stay out an hour later that night. while the mother won a Saturday house-cleaning and a night out each week. if you agree to our proposals on item #3 (the paid vacation schedule). I’ll pay you $10 to babysit every Wednesday night. Shari got the $10 she wanted and a later curfew. Shari: (pause) I like it! Conclusion Shari’s mother helped negotiations along by listing all of the items being discussed. was avoided. since all of their items were included as requested. which the other children would have requested as well. Now we have a package deal to propose … Preparation 27 . The trading of items (where initial demands are discussed and agreed upon) begins. item #11 (the clothing allowance).

thus removing them from the discussion table. Then negotiations can resume on the remaining 43 items. 28 50 Practical Negotiation Tactics . the two sides will at this point sign and date the list of proposed items.Conclusion In most labor negotiations. other trade-offs are proposed and agreed to until only a few items remain.

as he left the supermarket. day. and do your homework. thanks. I live a few blocks from here. Prepare carefully. $12. It was nice meeting you. the following conversation occurred: Bob: Car owner: Bob: Car owner: Bob: Car owner: Bob: Hello. he saw an elderly man get in his dream car and drive away. Would you possibly be interested in selling it? No. just out of curiosity. say. Timing is everything! Example 1 Bob Hillard had been coveting a turquoise 1963 Chevrolet Impala Supersport convertible for several years. Bob made it a point about once a month to go out of his way and drive by the man’s house. Bob followed the man home.Tactic 6: Timing Is Everything The exact month. my name is Bob Hillard. As the man got out of his car. He stopped and knocked on the door. I love this car—restored it myself.) Preparation 29 . One day. but money doesn’t mean anything to me at this point in my life … Well. which turned out to be only a few blocks from his own house. The external pressures put on the parties involved (which might not be related to the issues under negotiation) can sometimes be used to advantage if you know about them. Hi! What can I do for you? I’ve admired your ‘63 Impala for years.000? No. time of day. Not even for. One day. he noticed a FOR SALE sign in the yard. That’s a generous offer. (For the next three years. and general circumstances under which negotiations take place can substantially impact the outcome. on Briarwood Road.

Follow me. I’m moving to California to live with my daughter. as a matter of fact. that’s a fair price. Can I see it? Sure. Can you come back on Monday at 10:00 a. Example 2 It was Sunday. so I guess I will be selling it. the timing of his second effort was perfect and it enabled him to negotiate for the car of his dreams. the proposal would die at midnight. and the vote was a 6-6 tie each time. A majority was needed to pass the partnership agreement. had issued a deadline of December 31st.Bob: Car owner: Bob: Car owner: Bob: Car owner: Bob: Car owner: Hello! I noticed your FOR SALE sign. Well. (after a careful inspection) It’s a very nice car! I’ll give you $12. Then it’s a deal? Yes. and wondered if your ‘63 Impala might also be for sale … (obviously not remembering Bob) Well. if a seventh vote could not be found by the pro-agreement side. resulted in another 6-6 30 50 Practical Negotiation Tactics .m. beyond which the project would have to be abandoned. The board members had met twice before. Conclusion While Bob did not achieve his goal during his first negotiation effort. I’ll see you on Monday. A third vote at 3:00 p.000. I can’t take it with me.m. to seal the agreement at the courthouse? Sure. and I promise to take good care of it. The partner organization. December 31st. and a twelve-member board of a large non-profit organization was holding a special meeting to decide whether or not to enter into a multi-million dollar capital project with a partner organization. for tax reasons.

.. Conclusion The leader of the pro-project group recognized that they might have a unique timing advantage.deadlock. the pro-project leader told his members to filibuster until he gave a signal and called for another vote. because one member of the anti-partnership side had to leave at that time to attend a church service he had not missed in 27 years. in the end. and it worked. When the meeting resumed at 4:00 p. as predicted. At 5:30 p.m. For weeks.. the project had been stalled by 6–6 votes. a member of the anti-project group left the room. the leader of the pro-partnership side heard someone say that the meeting needed to end by 5:30 p.. and the meeting was adjourned. Preparation 31 . The measure passed 6–5 at 5:45 p.m. That effort failed.m. during an hour break in the meeting. Both sides caucused: The leaders on each side met to negotiate a compromise. He planned for it accordingly. timing was everything. Then. A member of the pro-project group quickly called for a vote after the leader gave a signal.m.

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Some of the tactics listed in this book are only suitable for single-session negotiations. A favorite strategy of some successful negotiators is to start with an extremely low or high offer (Tactic #7: Decide How “High” is High) in the hope that the other T Planning a Strategy 33 . such as actively trying to keep one of the two parties from winning a contract or influencing a colleague or spouse to accept an offer for personal reasons. such as a buyer and a seller or a city and its union. In some cases. but in practice it will likely influence the whole process. then Tactic #13: Set a Deadline or Tactic #11: Have an Expert Witness might be helpful. Before you can do this. Look at the personalities of each negotiator and see which side will be more vulnerable to pressure bargaining (Stage 5). A neutral. such as Tactic #19 (Make a First and Best Offer). uncaring approach (Tactic #9: Control Your Emotions. Identify all outside influences and hidden agendas before you develop your strategy. as well as their bargaining history and financial and political positions. might step in and help settle negotiations between a union and administration negotiators. for example. Tactic #43 (Nickel and Diming). you must first evaluate your needs and those of your opponent. After you have evaluated these factors.Stage 2: Planning a Strategy he next stage is critical: Choosing a strategy. Third parties sometimes have their own hidden agendas. Tactic #12: Find Common Interests can be helpful. Tactic #33 (Bluff). If you prefer to take a firm and direct approach. a third party can serve as a mediator (a legislative body. and Tactic #10: Make a Reciprocal Buy-Sell Offer) are also useful alternative strategies. or one-time-only. Be sure you are aware of this at the beginning. or someone’s colleague or spouse? Third parties such as other buyers or governmental agencies might have to approve the agreement before it becomes final. Are there any outside people who might influence the process. For example. such as a third-party negotiator. The overall strategy chosen does not limit the use of other tactics. decide whether the negotiations should be continuous. if you want to begin in a friendly. and Tactic #48 (Walk Away). cooperative manner. as it can substantially alter the negotiations between two primary parties.

The buyer loved the location.side is either caught off-guard or (in some rare cases) a negotiator will be able to achieve an unexpected fantastic settlement. The agent explained that the seller was desperate. 34 50 Practical Negotiation Tactics . If there is a significant weakness in your position. the seller’s agent called the buyer about the property. By assuming opposing roles. His teenage sons had “trashed” the house. let’s say a homebuyer new to an area is shown a house that was owned by someone who had been transferred to another country. you should consider disarming the other party by acknowledging the weakness at the start so that you can reduce the impact of the weakness if it is used by your opponent (see Tactic #14: Don’t Always Hide Your Weakness). with “All right. I offer half the asking price. The desperate owner agreed. half-serious. and the buyer was able to completely renovate the house and still have a great deal. but the inside was a complete turnoff.” The agent took the offer to the seller. “Please make any offer—they are motivated!” The buyer responded. two people on the team will be more successful because they evoke different emotions from the other side. The buyer said he wasn’t interested. For example. Weeks later. Another strategy often employed by parents with their children (and investigators with suspects) can be easily used when one side has two negotiators (see Tactic #8: Use the Good Guy/Bad Guy Routine).

with no success. And I don’t see a lot of difference in the neighborhood.Tactic 7: Decide How “High” Is High Your first demand in the negotiation process is the most important decision you will make. Finally. as well. we think $160. but quite frankly. but not so high as to end the negotiations before they begin. but the redecorating is of little value.000.000. your request must not be so low that the other party concludes that you are not negotiating in good faith. but the house has increased in value. Carol: Maybe not.000. However. Buyer: We really like the house. so do not underestimate what you might be able to achieve. but certainly not exceptional in any way. We also think that the neighborhood has improved over the last few years. If you consider the demand ridiculous. Your demand should be high enough to give you room to compromise. Buyer: The air conditioning might have increased the value of the house. Anyone buying the house would want to change wall colors or add new carpets. we’ve put a considerable amount of money into a new air-conditioning system and in redecorating. and then look at the demand from your opponent’s perspective. It’s a good neighborhood. Carol: We really want to sell. Surely there’s some flexibility in your asking price. Planning a Strategy 35 . After all. her real estate agent told her that they were probably not going to get a buyer because she is asking too much. one buyer shows some interest. but we simply can’t take less than $160. Each time.000 is very high. Carol wants $160. and just refuses to reduce it. six years ago you bought it for $60. You are not likely to get more than you request. Be realistic. so think this through well ahead of time. it is likely that your opponent will. Example 1 Carol has been unhappy with the house she and her husband bought six years ago. She has had it on and off the market for the last five years. The market hasn’t gone up that much in six years. First.

Buyer: Good luck!! Conclusion The buyer expected Carol to counter the $100. The firm now had over twenty-five law partners who owned the firm and continued to benefit from the reputation and name recognition of Bits & Bites. though. We’re curious. but they have no idea what the value of their firm’s name might be in this nearby city. Example 2 The law firm of Bits & Bites was a Sioux City institution. enjoying a statewide reputation for quality representation. When Carol refused to budge. Carol drove off a potential buyer by setting an asking price that was just too high.000? Carol: We really can’t take less than $160. we are certainly interested in your request to “buy” our firm name to use in your city. 36 50 Practical Negotiation Tactics . The partners are interested in selling the name. In any event.000 offer by coming down in price at least a little. The other law firm was prepared to pay $100. the founders of the firm. or she has unreal expectations. and then $10.Buyer: What if we offered you $100. the buyer took it as a signal that either Carol didn’t want to sell.000. the transaction also included some degree of consolidation of the law firms involved—not just the use of the firm’s name. Inquiries to other law firms were not very helpful because in almost all of the instances.000 immediately. Here’s how the initial negotiations went: Partners: Well. Neither Edward Bits nor Edmund Bites.000 or 1% of profits (whichever is less) over the next ten years in order to use the name. A new law partnership from a nearby city contacted Bits & Bites and offered to “buy” the rights to the name to use in their law office in their city. as to how you think the name is going to benefit you. were still alive.

Thanks so much for meeting with me. because we were not even close to that number. And we. I guess this is just not something we’ll be able to pursue. I’m kind of embarrassed now. we want $500. Give us some range. (concerned about loosing the opportunity) Wait. What number were you thinking about? Well. that you anticipate to build a very profitable law firm. In every instance. I really don’t feel comfortable doing that now. Partners: New law firm: Partners: New law firm: Partners: New law firm: Partners: New law firm: Planning a Strategy 37 . Let’s just pretend this didn’t happen. starting with the ten partners you describe. we do.000 initially. that is a very high number. we reserve the right to withdraw our permission. because you are in the state capital and your firm has handled a lot of high-profile political cases. that’s just our initial figure. but we get to keep all of the money we’ve received up to that point. and then 10% of your profits each year for as long as you use the name. of course. We should assume. Yes. We weren’t really thinking about that amount of money. you have a very solid reputation there. So. expect to pay for that. (surprised) Well. And even though you don’t have an office in our city. If at any time we feel that you have “harmed” our name. one of these two attorneys carries the surname of the firm they are leaving. Well. it would be impossible to create a new name out of the names of our key partners. then. To offer it now would be an insult. We probably won’t be insulted. Using the Bits & Bites name can only enhance our profitability.New law firm: We are establishing a partnership of ten lawyers—the top two moneymaking attorneys in each of five local firms.

The price they were willing to pay would have indicated what the naming rights were worth. 38 50 Practical Negotiation Tactics .Conclusion Bits & Bites lost an opportunity here because their initial demand was so unrealistic with what the prospective firm thought the “naming rights” should cost. In this situation. It immediately dropped the idea. rather than negotiate. Both parties were probably at a disadvantage. Bits and Bites should have let the prospective firm make the first offer. since they had initiated the contact. Either side could have asked for too much. because there was no “objective” criteria available to help them set a reasonable price.

I can use them. I’ll go home and you can call me if you two can reach an agreement. Andy: No. etc. you’re really moving! I hate to see you leave. Example 1 So. not for $1. Andy and Paula. since they are sitting out in the driveway with it. Peggy. Peggy: So. One member of your team acts friendly to people on the other side (the good guy) in order to gain their trust and support. Andy and Paula: Yes. And take the leaf-catcher attachment and the gas can. Peggy: I assumed they went with the mower. They cost about $300.200! We should get $1. so I’ll take it. I don’t know what the deal is now. and I know how you take care of things. what’s your price? Andy: $1.Tactic 8: The Good Guy/Bad Guy Routine The “good guy/bad guy” routine is a useful one. (bad guy) and implies that his or her side will hold firm on their demands. I want to keep those. Half what it cost us new. Andy: No. Paula: Go ahead and ride it home. threatening. only three years ago.400 if the catcher and can are included. while another acts difficult. Andy: I want them… Paula: Go ahead and take them. Peggy: Planning a Strategy 39 . angry. Peggy: That’s fair. Your opponents will want to avoid confrontation and unpleasantness with the “bad guy” and are likely to be more willing to cooperate with you. we won’t need it at the new condo. I heard that you want to sell your riding mower. Peggy: I’m hearing one thing from Paula and another from Andy.200.

40 50 Practical Negotiation Tactics . And cut the training hours from 55 to 20. Miguel: I’ve figured $4. we’ve been fairly happy with your responsiveness. perhaps even unintentionally. She very wisely recognized the routine and forced Andy and Paula to give her a clear. Sandy. Sandy: What? First of all. Example 2 Sandy (business owner): Miguel and Liz (representatives of a computer firm).000 in service calls last year alone because your damn people don’t take care of the equipment. causing our reps to spend hours on the road. For the past three years.000 per month is one of the highest in town.Conclusion Peggy thought she was getting the old “good guy/bad guy” routine. Miguel: Well. She realized that it put her in an impossible negotiating position. and your training programs. Let’s talk. Sandy. Liz: But we still want to renew your contract. We estimated that it has cost us more than $50. firm offer if they decided to continue negotiations. And we need to add a clause that holds your company responsible for machine damages. your account has taken too much time.200 will be about right… Sandy: I can’t begin to pay that! Liz: Calm down. we’re here to negotiate a new service agreement. your rate of $3. And we want to change the 24-hour service response time to 48 hours. the quality of the technicians’ work. You are located outside our primary service area. Miguel: But not at this ridiculous rate.

I’m afraid our relationship is over. Sandy believed that she was able to avoid a terrible deal and negotiate a fairly good one. with a position he knew was unreasonable. I’ll explain on the way back to the office. Sandy. (Three hours later) I’m back. Miguel! We’ve worked out a deal I think you can live with. I’m going on to lunch. and it’s not efficient enough anymore for us to handle smaller firms—especially those outside our region. Liz. you two? Good news. these terms will put me out of business—I’m a small 20-person operation. If not. I’ll stop back about 2:00 p. What can I do? Let’s try to negotiate something reasonable before Miguel gets back. Conclusion Miguel and Liz used the good guy/bad guy tactic in the classic form: Miguel scared and threatened their opponent. even though it was far above the previous contract. Then he left so Liz could convince Sandy that they needed to quietly reach an agreement she could “sell” to Miguel later.m. Planning a Strategy 41 . but Miguel’s right. Sandy. I want to keep you as a customer. Any luck. Sandy. Our customer base has grown.Miguel: Sandy: Liz: Sandy: Liz: Miguel: Liz: No. I hope you can meet my terms.

Tactic 9: Control Your Emotions Stay cool. I have a problem with my recent bill and my billing rate. Your opponent might conclude that they have made a serious misjudgment and want to make a conciliatory move to get you back to the bargaining table. he was very unhappy. This will put you at a distinct disadvantage from this point on. because we have had a sick relative out of town and we used long distance a lot this past month. but I recently was sold a $. A display of temper or frustration can indicate to your opponent that you are uncomfortable with your side’s negotiating position and they will assume that it is weak. The fault was partly his because he did not stay on top of changes. when he discovered that the long-distance company serving his home phone was charging him four times the rate currently being marketed by that company. He decided that the best approach was to act indignant when he spoke to the company representative. So. made some very good purchase decisions for his small business. such as deals on computer packages and phone services. Here’s how the phone conversation went: Customer representative: Mike: Over-the-Air Long Distance. Control your emotions and use them to your advantage! Example 1 Mike prided himself on being an informed and educated consumer. How may I help you? Hello. in fact.00 a minute. 42 50 Practical Negotiation Tactics . It seems that the rate you are charging me on my home phone is $1. Be sure that the emotion you display is calculated and strategic: A strategic flare of temper at an “insulting” offer made by your opponent can buy you time because you can make an abrupt exit from the room without having to respond to it in any substantial way. and might even harden your opponent into an unfavorable position (for you or for both of you).10 a minute rate at my office location. I noticed this. He had.

It hasn’t been increased at any time. we certainly would have discussed your options. I realize that that might be the rate I started paying when I first took your service over eight years ago. but this was quite a shock. to begin now. (beginning to sound irritated. Customer representative: Let me pull up your account. But I am able to offer you a $. how would anyone who might only have residential service even know to ask? Well.I expected the bill to be higher than usual. of course it is not always possible to give existing customers some of the “offers” we have out. Well. The company might have had any number of different introductory rates and incentives for people to buy our service over the course of eight years. But as a very good customer of yours. although he wasn’t really angry) Are you suggesting that it was my responsibility to advise you when one of your “offers” was available to lower my rates? How would such information even come to my attention? More importantly. Had you brought this to our attention before. Mike. and I also realize that if I had examined my bill closely. I would have known I was paying too much. I would think you would have given me the best rate you offer new customers. I see that the rate you are being charged is the rate we offer for the type of service you have with us. Mike: Customer representative: Mike: Customer representative: Planning a Strategy 43 .10 per minute rate on your long-distance service.

Wait—I’ll get my supervisor. a long-time customer of your company. (with a much angrier tone) Madam. But I’m looking at a $500 longdistance bill. there’s no reason for this conversation to continue. He was walking a thin line. Mike’s willingness to show a measured “flare of temper” brought results.10 per minute. In doing so. I would hope that you would credit my account for this better rate for past service. either. Is your supervisor there? I’m certain that he cannot adjust your account retroactively. strategic anger and abusive behavior. The best we can do is fix the rate for the future. but I can’t do that. between controlled. which should rightly be $50. after all. I am. controlled voice) I need to talk to someone who can do it immediately. The latter would not have produced the desired results. don’t think this is directed at you personally. and I want to speak to someone in authority so I can terminate my service. Customer representative: Mike: Customer representative: Mike: Customer representative: Conclusion The supervisor waived the long-distance charges for the $500 bill and adjusted Mike’s rate to $. I … (interrupting and in a stern. and I should be treated with more respect! I’m sorry. We certainly don’t want to lose you as a customer.Mike: I would imagine so. but I am very angry with Over-the-Air Company. If you can’t get me someone to talk to. 44 50 Practical Negotiation Tactics . she kept Mike as a residential customer as well as a business customer. however.

lesssenior employees might be at greater risk of injury because they have to handle explosives. The employees’ negotiator finally decided to use “indignation” to break the stalemate. and you just can’t be too careful. Owner: Now. The owner told the employees that he was worried that during the overtime shifts. They will be putting the plant AND their fellow workers at risk by not being here. and it’s not what we’re even talking about. that’s just not fair. Employees’ negotiator: (with a stern voice) You have been saying this for three weeks. On those overtime shifts. and it’s getting old. I’ve got to have the employees with the most experience to protect this place.Example 2 The contract negotiations between the employees of a fireworks plant and its owner had been stalled for about three weeks over the issue of mandatory overtime. they would become dissatisfied with their pay and want their base pay increased. Just admit that what you really don’t want is for your best employees to realize how much of their pay is from the overtime they work. Where are your managers? Where is the training necessary to make Planning a Strategy 45 . Owner: I’m just not willing to let my best people refuse to work the extra shifts during our busy season. Working with fireworks is working with explosives. The owner was afraid that if the mostsenior employees routinely passed up the overtime and the overtime pay. Negotiator: (now beginning to get irate) You talk about the risk to your plant if the less-experienced workers are there on overtime shifts without the senior employees. The most-senior employees want to have the right to refuse overtime and have those less-senior employees take the overtime. and that they should be asking for a fairer base wage for the work they do for you.

But we protect our people. I’m not coming back. Either they are properly protected. or they’re not. either the employees are properly trained. That’s all. After the employees’ negotiator threatened to walk out. Then you can’t have it both ways. the negotiator would have had to find a way back into the negotiations without losing ground. most of them continued to take all the overtime they could get. don’t be so hasty. not at all. or they’re not. but not all? Conclusion The owner was on shaky ground with this one. All I’m saying is that the most-senior employees have to be on the overtime shifts. The negotiator was also running a risk with his flare of temper. In practice. now. Until you’re ready to talk about that. sit down. You are not addressing the real issue for you: money. But the fireworks business is a business that involves risk. Sit down. The end result was that the most-senior employees did win the right to refuse overtime. he became more reasonable.Owner: Negotiator: Owner: Negotiator: Owner: sure these employees can protect themselves? Are you telling me that your employees are being put in dangerous conditions without adequate training and safeguards? No.) Now. (He begins to walk out. though. What if we were to agree that the senior employees could refuse half of the overtime offered to them. The safety of the plant demands it! (standing up to leave) This is just ridiculous. Had the owner let him leave. No one who takes a job with us can be unaware of that. 46 50 Practical Negotiation Tactics .

The following examples explain how it works: Example 1 Susan and Mary Anne learned from their brother Mike that their recently departed parents’ estate included a somewhat valuable antique coffee grinder. However. the executor of the estate.Tactic 10: The Reciprocal Buy-Sell Offer What do you do when both sides seek to own something when there is only one and it can’t be divided equally? You have three options: 1) Both parties can “bid” to own it. you’re the oldest. A fourth option. you will decide if you want to buy it for that price or receive that amount from Mary Anne (but lose the grinder). Then Susan. with winner taking all. since this one is in perfect shape and it was Mother’s. called the “Reciprocal Buy-Sell Offer. The second party then decides to either buy it at that price and pay the first party. Planning a Strategy 47 . I’m willing to pay or let it go for $800. so you set a price at which you agree to buy or sell the coffee grinder. Both sisters covet it. or sell it to the first party and consequently receive the full amount from the first party—thus giving up the object. All the rest of the estate has been divided among the family. 3) They can agree to sell the object to a third party. my kids and I looked on eBay and everywhere else and found out that coffee grinders in perfect condition sell for about $500. Mike. and split the proceeds. has decided to use the “reciprocal buy/sell offer” process to settle this last piece of the estate. I’ll give you 48 hours to decide the price. The first party decides on a price for which he or she will either buy or sell the object to the second party. Susan. a well-known negotiations professor from Harvard University.” is the recommendation of Howard Raiffa. (two days later) Mary Anne: Well. Mike: Mary Anne. 2) They can flip a coin. with the highest bidder paying the amount to the other side in compensation for their loss.

but each partner had grown to dislike the other and wanted to end the partnership (but continue to own the business without a partner). Thanks for making this last step as easy as possible. They thus were able to determine the highest price each was willing to pay for it or receive for it. Agreed? Abe and Bobby: Sounds good! Let’s draft and sign a written agreement detailing the process. Here is my check for $800. the lower bidder must agree to sell his half-interest to the higher bidder at a price that evenly splits the difference between the two bids. to submit a sealed offer to buy/sell the business sixty days from today. I’ll pick it up tonight. Two business partners had been working together for ten years to build a successful business. (sixty days later) 48 50 Practical Negotiation Tactics . Both sisters felt that the process enabled them to resolve the issue fairly.Susan: Mike: Well. You will both agree. They accepted his suggestion to use the “reciprocal buy-sell strategy. I suggest a slight modification to the process. I choose to buy it. Example 2 Howard Raiffa described a consulting situation in which he used the “reciprocal buy-sell offer” process in his book. Both came to Raiffa to help negotiate a settlement. in writing. Lectures on Negotiation Analysis. and then decide how much more “emotional value” it held. After I open the bids. Conclusion The “reciprocal buy-sell offer” process caused both Mary Anne and Susan to research the market value of the coffee grinder.” Howard: Since in this case you are talking about a multi-million-dollar business. which will bind us to the outcome.

Abe. The reciprocal buy-sell tactic enabled one of them to achieve his goal of sole ownership and allowed the other to feel that he had an opportunity to purchase sole ownership. The partner who was out-bid in a fair process received a fair settlement: $10 million above what he was willing to pay. your bid is $190 million. Agreed. Conclusion Both parties wanted to keep the business. And I will arrange financing to pay you $180 million to become sole owner. and to close within ninety days. Planning a Strategy 49 . and both men had carefully estimated the market value of half the business. your bid is $170 million. but only if they could become the sole owner.Howard: Abe: Bobby: Abe. you agree to sell your half-interest to Bobby for $180 million. I will arrange to sell him my half-interest for $180 million. Bobby. and we close by July 1st. Bobby was willing to pay more than Abe to remain sole owner.

Example 1 A young couple were discussing a possible purchase of new furniture for their living room. When it came to comfort. The husband found the dimensions of the couches in the brochures and Web sites. so when the husband wants them to make an 50 50 Practical Negotiation Tactics . This approach can also be reversed: The wife in this situation is a banker. The wife was determined to buy the least-expensive brand rated excellent by consumer publications. and forcing him or her to control the discussion of the issue. When he showed his wife the detailed spreadsheet. Based on seating capacity. the one he wanted (one of the least-expensive) was superior.Tactic 11: Use an “Expert Witness” Establishing yourself as the expert on a certain topic in order to get what you want can be an effective tactic in the appropriate situation. he decided upon a strategy: First establish himself as the “dimension expert. They both expressed an interest in finding a couch that offered the most “interior” space. They knew that sitting on dozens of couches in a single day would be confusing and would make it difficult to determine which one is the most comfortable and roomy. and created a spreadsheet to compare the five best-rated couches on their list. Looking at these statistics. and the husband felt like he saved them hundreds of dollars. she glanced at it and immediately deferred to his opinion. It can also work in reverse: establishing the other person as the expert. Conclusion The husband became the “expert” in this situation by doing the homework. The couple decided to limit their selection to those rated “excellent.” but there were substantial differences in price—differences that the wife did not see as a problem. the one that was the most expensive was superior. This strategy worked. He thus ended up having greater negotiating power.” and then argue for the frugal alternative.

and should therefore handle the problem. and Point of Service (POS) plans. Many bargainers on the other side will not know their HMOs from their PPOs or their POSs and are likely to leave important details up to “the expert” to decide—just as the negotiator planned! After explaining in some detail what each of these three types of insurance plans are. you gain an edge when negotiating a new plan for your company. a negotiator in a similar situation was able to get the other side to agree to include a plan that they had opposed only days before! Planning a Strategy 51 . he argues that she is the expert.” If you spend many hours learning about Health Maintenance Organizations (HMOs). Preferred Provider Organizations (PPOs).investment decision or deal with an error in a bill. He claims to lack the knowledge or insight to do the work—which he is then able to avoid! Example 2 A negotiator can often gain a valuable advantage on issues such as medical insurance or labor contracts by doing the homework and becoming an “expert.

here’s what they said to her: I think I should be rewarded with the piece of cake. Mom: I’ve decided that I’m not going to cut this piece of cake in half and give you both some.Tactic 12: Find Common Interests You are more likely to come away with a satisfying outcome if you and the other party set the stage for agreement. point them out at the very beginning of negotiations and refer to them throughout the process. These positive things are part of your goals and objectives. she decided to try something different. Russ: 52 50 Practical Negotiation Tactics . The two boys fought over the last piece of everything. neither of you want to be embarrassed at the outcome. They immediately began to fight over it. I wouldn’t care so much. and neither boy was very happy. This time. like we usually have. and their mother was tired of it. you want to reach an agreement that is favorable to an outside party. That simply rewards your continual squabbling. Be clear on what you have in common at the start. I also took out the garbage last week without being asked twice. particularly when things seem to be at a standstill. the last piece of cake will get thrown away. you both want to complete negotiations by a certain date. and I really love the banana/butternut/ sour cream frosting on this cake. and then asked their mom for a chance to negotiate with each other. Example 1 When Russ and Bill got home from school. and so on. This is done by deciding at the outset what you both have in common: You both want to reach an agreement. she made them share whatever it was. The boys quickly huddled. they saw that there was one piece of cake left over from their mom’s bridge party. Unless you can convince me otherwise. Usually. because I am so conscientious about my paper route. When they boys returned. I missed dessert the other night because I had to get to baseball practice. If this was chocolate icing.

That sounds like a wonderful solution. I helped with the bags without being asked twice. your new shop hours have caused your customers to park in our parking spaces. I got an “A” on my book report that I really had to work hard on and when you got home from the store last week. It was the type of shop the nearby residents preferred. she got a visit from some of the residents. Residents: Marilyn. Now that her children are in college. so these hours worked out well.m. Conclusion Once the boys realized that they had a common interest—not letting the cake get thrown away—they were able to negotiate a solution both of them could live with. We really want you to go back to your original times. and I really like white cake. One day. and her children were in school. and that’s not my favorite either. Planning a Strategy 53 .m. I can have the part with the icing and Bill can have the part with the cake and filling. Marilyn originally set her shop’s hours for 10:00 a. to 3:00 p. and keeps it open longer so she can attract customers on their way to and from work. Example 2 Marilyn’s Memorabilia Store was located along the main commercial street of a residential neighborhood. Customers have started to park in nearby apartment lots. she opens her shop at 7:30 a.Bill: Russ: Mother: I think I should be rewarded because I cleared the table for Russ the other night when he had to get to baseball practice.m. and better than a fast-food restaurant with late-night hours and a drive-through window. The last cake we had was chocolate cake. because there is no parking along the street during morning and evening rush hours. so that your customers can park on the street. This cake is white cake. We realized that if we cut the cake lengthwise.

Do you think the residents of the apartment house would agree to let me advertise that my customers can park in their lots between 7:30 a.m. and I close at 4:00 p. Marilyn: Conclusion Marilyn needed the extra parking. if I go ahead and open the shop at 7:30 a. Can’t you post signs that tell non-residents not to park in the lots? Residents: The problem is that for the signs to be very effective. Okay.m. 54 50 Practical Negotiation Tactics . I don’t think that would be very good for business.m. But I really am increasing my sales by being open longer hours. and 9:00 a. and 9:00 a.m. The shared parking arrangement did work out for Marilyn. I really need that extra income to stay in business. It is very costly to have cars towed. So. and 6:00 p. if residents haven’t left for work yet.m. the off-street lots probably won’t be used by my customers.m.. and is probably empty in the afternoon if they haven’t gotten home yet. we have to be willing to tow the cars that violate it. I have to convince them to come before work. But in order to keep my new customers.m. and see if it works. Do you? Marilyn: No. If you need to have the shop open more hours. Between 7:30 a. The parking lot used for apartment residents is probably full from 7:30– 9. my customers can’t park on the street. then we’ll try and accommodate you. We think they’ll be agreeable to the morning parking.00 a. or so anyway. rather than after work.m. and the residents needed Marilyn’s shop. And we don’t think you want your customers’ cars towed. Lets try it.m. let’s see what the options are. and between 4:00 p.. Most of our residents are gone by 8:00 a. Identifying their shared interests caused the nearby residents and the customers to reach agreement.? Residents: We certainly want you to stay in business here.I’m sorry this is happening. and usually the car is gone by the time a tow truck shows up anyway..m.

Tactic 13: Set a Deadline Be sure you know well ahead of time what the deadline is for completion of negotiations. such as a deadline beyond which the union will strike or the date that an outside party has set to withdraw an offer that is in both your interests). That will take days! I haven’t been in this house for twelve years. let’s all take a few hours to look around. Then we can sit down at this table at 3:00 p. and start choosing things. etc. we can each take turns selecting things … Like each tool or dish. the first. how should we go about dividing up the furniture and possessions? I can’t talk about it. How can I do that? You all live in this town and you know this house. Deadlines can also be set by both parties to a negotiation when they want to put some pressure on themselves to come to agreement as quickly as possible. Example 1 Four adult children have gathered at the home of their recently deceased mother. one at a time: the youngest. Deadlines can be imposed externally (such as the government’s deadline to get a tax break) or internally (set by one side.m. We just don’t have the time … We’ve got to do this—the house is sold! Okay. Well. I don’t. A few hours? I can’t—I’ve got to leave shortly for the drive home. Well. Jenny: Everett: Sue: Everett: Mary: Sue: Everett: Mary: Jenny: Everett: Okay. but it can also work against you if you set one that is unrealistic or you fail to plan for it adequately. A deadline can help you make the best possible agreement in the shortest amount of time. let’s all take two hours to look around and make a list of things we might want. But at Planning a Strategy 55 .

Agreed. Allan: Let me confer with the city attorneys. we cannot agree to these development plans submitted by your company until we have reviewed how they will affect the historic buildings.. David: I understand your concern. December 31. Example 2 Allan: As the negotiating team for the city. and I appreciate your interest in the historic structure. Conclusion The mutually agreed-to process and self-imposed deadline was a fair method of negotiating—a lot better than the four of them arguing over their mother’s possessions. Sue. we all leave. Allan: What! Why did you not tell us this before? David: We never thought you would take three months to get to this point.m. if we are not finished. can sell or give away what is left. However. then the whole deal is lost because my company will lose $10 million in tax benefits under a federal law that expires on midnight. Okay. your attorneys know the tax laws. All of us must come back before Saturday to take what is ours—agreed? Okay.Sue: Mary: Jenny: 5:00 p. 56 50 Practical Negotiation Tactics . this is December 29. if I cannot carry a negotiated and signed deal to my board by noon on December 31. And besides. being the oldest.

Allan: (One hour later. He waited to bring it up until it was clear that doing so would help him get the settlement his side desired. we can’t get the reports we wanted in 48 hours. Planning a Strategy 57 . and I don’t like it. Let’s continue. Obviously.) I understand the December 31 deadline. Conclusion Knowing the external deadline gave David a significant negotiating edge.

and I missed some assignments. we need to talk. but remember that both sides have weaknesses. Unfortunately. so he was able to prevail upon her to let him continue. There will be times during a negotiation when you will want to catch your opponent off-guard. But don’t lose it again. first-quarter grades are coming out at the end of the week. before your opponent tries to catch you off-guard. We had one at the beginning of the semester that we were using pretty often. but that was actually a different workbook. His mother disapproves of his study habits. 58 50 Practical Negotiation Tactics . Mom: What’s that? Jason: A few weeks ago I lost my workbook. Example 1 Jason likes to play video games as soon as he gets home from school and do his homework later. Then the teacher went back to the first one. don’t get mad. Now. but his grades are good. as well as those of the other side. Did you buy it? Jason: Yes. The objective is to negotiate from a position of strength. I’ll need to buy it again. while watching TV. He decided to preempt the discussion in order to make the best deal. as well as strengths. One day mine disappeared. but I have a problem in my Spanish class. and this usually means having all the right information. Mom: All right. Control the use of the information. and one of the ways to do that is to reveal a weakness at the beginning. Have a clear goal in mind AND all the information you need to make your points. and you can neutralize its effect on the negotiations. I’ll give you money for it. I bought the second one. and we used it a couple of times. Mom: I gave you money to buy a workbook a few weeks ago. He knows that a D will mean that he will have to change the way he studies. Jason: Mom.Tactic 14: Don’t Always Hide Your Weaknesses Be sure you know what your strengths and weaknesses are. and Jason knows he is getting a D in Spanish.

but I think you do need to change your study habits. Obviously. His explanation made sense. my study habits are okay. I’m getting a D in Spanish for the first quarter—but it’s not because I’m studying in front of the TV. Although his Spanish grade was only a C+.(maybe C+). Thanks. all right. or borderline B. Mom. B. Mom: Well. All of my other classes are A. Example 2 Jane once owned a piece of property she wanted very much to sell. so there’s no reason to think I need to change my study habits. I don’t think you’re taking your schoolwork seriously enough. Jason’s decision to warn his Mom ahead of time rather than have her see the D on his report card gave him an advantage in the negotiations about study time. I’ll give you more time. Pizza Boy was interested and had even made inquiries about the property. Since I missed some assignments. Mom: Well. English. Its owners found out that at least three other buyers had been in contact with Jane. and since he offered her the information up front. he was able to continue to study the way he wanted to. she trusted it more. And I know I have to be better about getting in all of my assignments. And those are hard classes—Algebra. But that Spanish grade needs to come up to a B!! Jason: Okay. I’m sorry. Environmental Science. but all three deals Planning a Strategy 59 . Jason: Spanish is just one class. Conclusion All of Jason’s grades did improve over the next quarter. and the D is directly related to my losing the book. It’s because I didn’t have the book. I think you need to give me the rest of the semester before making me change the way I do my schoolwork. then I’ll agree to make changes. I think I can do that.Jason: Another thing. The location was ideal for a convenience store or a fast-food restaurant. The work I did turn in was fine. If I don’t pull the D up to a C or better.

and it’s zoned for commercial use. Jane: Oh. she started her campaign to keep them from closing the deal. I think you’ll find that this is only one person. Jane’s up-front disclosure of a potential problem allowed Pizza Boy to weigh the negatives with the positives. Pizza Boy: Well. since they were well aware of the negatives. When she contacts you. A tentative deal was signed. You are a big enough corporation to withstand her objections. I’m sure. we’re not interested in neighborhood fights. Pizza Boy was prepared for her call. I’ve got to warn you—you might hear that there is neighborhood resistance to your putting in a pizza restaurant. They decided not to fight a disgruntled neighbor. When the neighbor heard about the new buyer. 60 50 Practical Negotiation Tactics . she will want you to think it’s the whole neighborhood. the other interested buyers already have businesses in the neighborhood. The real problem. The Pizza Boy people figured that Jane’s asking price must be too high or that she is unwilling to negotiate. let’s assume that you are right. But unlike your company. What are her grounds for complaining? Jane: She doesn’t have any. What are you asking for the property? Conclusion Jane told them her asking price. was that Jane’s neighbor had contacted each of the previous potential buyers and complained about their plans to use the property. really. I know. Actually. and was able to politely ignore her. either. Pizza Boy: We’ve checked the property out. Furthermore. there were no unpleasant surprises to stop the deal. The neighbor’s attitude suggested that there would be major resistance in the neighborhood if Pizza Boy tried to put in a commercial establishment. I’m very happy you’re interested in my property. which was way below the price they were actually willing to pay. however. it’s only the neighbor to the right of the property who has a problem. This is how the negotiations went: Jane: Pizza Boy. Pizza Boy: Well. though.had fallen through. however.

None is as important as the first one.750–$25. This is a practical starting point that will not anger the other side (and might even be expected). as illustrated in the following figure: Seller Resistance Point ($22. Many negotiators make their initial offer the highest acceptable offer (Tactic #19: Make a First and Best Offer). Adapted from Labor Relations and Collective Bargaining. Another common strategy is to start with the status quo. Carrell and Christina Heavrin.500) Fig.000 22 23 24 25 26 27 Initial Offer $28. by Michael R. (2004).000 Buyer Initial Offer ($21.Stage 3: Exchanging Initial Offers any offers and counteroffers are made during a typical negotiation—sometimes even hundreds. The initial offers of both parties are usually set reasonably above or below what each believes to be the settlement range. The initial offer sets the tone of the negotiations and reveals something about the strategy of each side. such as proposing to continue at the current rate or price. 190–192. in negotiating a labor agreement or the price of goods or services: The monetary gain realized by one party is also the monetary loss of the other party. “Distributive” bargaining (“win-lose” or “zero sum”) is used. The negotiator firmly states that it is their best offer in an attempt to gain a nice.500) Resistance Point ($25.000) Settlement Range ($22. quick agreement. for example.000) Target Point ($23. 2: Distributive Bargaining Process.500) M $21. Experienced negotiators often view negotiations as a process in which the goals of one party are in direct conflict with the goals of the other party. Exchanging Initial Offers 61 .750) Target Point ($24. Perhaps the worst-case scenario with initial offers is when a negotiator has his or her initial offer immediately accepted and ends up feeling that he or she could have negotiated a better settlement if the initial offer had been lower or higher—the so-called winner’s curse.

thus producing a true “win-win” negotiation. these points have set the outer limits. Two extremely helpful tactics to be used immediately after initial offers are made are Tactic #15: Caucus and Tactic #20: Posturing. each initial offer ($21. The most common method of negotiating more than one issue or item is to combine two or more in a deal that gives each side something (Tactic #17: Package Items). include others that are actually of no value to you in your initial offer (Tactic #16: Use Throwaway Items) to hide the true items of interest and show that you are willing to give in on some items.In this example. See Tactic #18: Agree on Something As Soon As You Can. Both of these tactics give experienced negotiators an edge when they face novice negotiators who are more likely to rush the process and expose their position.000. A target point is the desired settlement value a party has set as a goal when negotiations begin. if the buyer’s initial offer was $25. it is termed the settlement point – not the “right price” or “fair price. In the example. The settlement range is the distance between the resistance points.000 and $28. thus starting out on a positive note.” but the settlement price. usually. the other side does not agree to this value). yet is positioned well above or below what the party believes to be the opponent’s resistance point (thus avoiding the so-called winner’s curse). and is the range in which most negotiations actually occur. the seller would immediately accept it because it is greater than the target point and the buyer would suffer a winner’s curse. Experienced negotiators will begin the negotiation of several items by quickly proposing such a package. When the two parties agree to a price within the range. You can use a tactic in making your initial offer that will give you an advantage: When multiple items or issues are on the table. the process quickly narrows to the range between the initial offers. 62 50 Practical Negotiation Tactics . Resistance points are the maximum or minimum beyond which a negotiator is likely to consider an offer unacceptable (and possibly walk out). After initial offers are exchanged.000) is reasonable.

a caucus can be used as a break to calm the situation down. Example 1 Shelly’s “Sweet Sixteen” party was coming up.m. so her parents sat down with their daughter to discuss the details. or if a member takes on a role in the negotiations that has not been assigned to them. Shelly: Twenty friends? You’re kidding! I’ve just started on my list.Tactic 15: Caucus If you are part of a negotiating team. To do so in front of your opponent would obviously undermine your team’s position in the negotiations. Unfortunately. We don’t want it to be a late evening. Mom: We’re planning on having your party here on Saturday night. If negotiations seem stalled. Her mom and dad had already talked about it privately. If the negotiations have suddenly gone in an unanticipated direction. There are many ways to use this strategy. Shelly. If the team is feeling pressure to concede on certain items. and presumably had an agreement. calling for a caucus gives you a chance to get your team to recommit to a particular course of action. make use of the opportunity to call for a caucus. the negotiations got out of hand when Shelly’s dad forgot what had been decided. so we’ll have the party from 7:00 p. without revealing their ideas to the other side. And that’s just my friends from school! I haven’t started Exchanging Initial Offers 63 . If the negotiations are heated. because it might disturb the neighbors. and I already have 25 names.m. it gives the parties an opportunity to reassess where they are and determine if everyone involved agrees that they should be heading in this direction. We’ll just have chips and soda. A caucus is certainly called for if individual members of the team become agitated or express frustration with the progress of the negotiations. A caucus is when a negotiating team calls for a break and leaves the negotiating table to confer in private. A caucus gives you an opportunity to work out problems with your own team in private. You can invite up to 20 of your friends.–10:00 p. call a caucus so both sides can brainstorm new solutions to keep the negotiations going.

And can we bring in pizza? Or maybe one of those “mile-long” hero sandwiches? I like those—let’s do the hero sandwiches. alone. (with some irritation) I’m not sure. I’m sure we can ask them to tone it down a little. And midnight is definitely too late. Oh.Dad: Mom: Dad: Shelly: Mom: Shelly: Mom: Shelly: Dad: Mom: Dad: Shelly: Dad: Mom: on the friends I’ve made over the summer at the pool. That would be great! It would keep everyone entertained. Mom! This is my “Sweet Sixteen” party. Jerry from down the street is in a really good band that all of the crowd likes. Time out! Dad. Your dad and I already talked about this and agreed that 20 guests would be the limit. We’ll get a band—everyone does. (shocked) Jerry’s band from down the street? They’re a punk rock band! Their music is totally inappropriate for sixteen year-olds. Shelly. (During the caucus. we’ll call you when we’re ready.—that’s so “baby.” They would never expect a party to end before midnight. we need to talk. Shelly’s parents reviewed their first planning discussion and went over what Shelly’s mom thought they had already 64 50 Practical Negotiation Tactics . I guess the VFW will work. Dad. In fact. I think we can handle a few more kids—how about 35? And midnight sounds okay. Actually. I think the band would be fine. And they can’t go home at 10:00 p. I could invite everyone!! Hold on! I thought we agreed that this was to be a simple party.m. we could rent the VFW hall. It’s special!!! Well. okay. We could play records and you guys could dance. That sounds like too many for here at the house. and then the number of kids won’t matter. (excited) That would be so cool.

When they called Shelly back in.m. All right. But we can have the band. we’re going to rent the VFW hall. midnight. and not a huge production. and you can invite more friends. can’t we? No band.Mom: Shelly: Mom: Shelly: Mom: Shelly: Dad: Shelly: Mom: Shelly: decided. sorry. That way. but we’ll schedule the party for 8:00 p. But you are limited to 40. That’s so lame. And we’re serving chips and sodas. Does that mean no presents.) Okay. Example 2 The contract negotiations between the company and the union had been going on for days.m. Mom’s call for a caucus gave them a chance to regroup and re-state their original objective. A DJ? I guess that’s okay.m. Okay. this mom-and-dad negotiating team became unglued during the negotiations. Agreed. but no Sweet Sixteen birthday party decorations. Dad. The item currently on the table was the company’s offer to give each Exchanging Initial Offers 65 . we will be better able to chaperone. her mom presented the revised proposal. is for little kids!! No. please!! 11:00 p. too? No way!! I want presents!! Conclusion In spite of their prior planning. and we will need to approve the list. to 11:00 p.m. which was to make sure Shelly’s Sweet Sixteen party was a fun and safe evening. causing them to lose control and make compromises they hadn’t intended to make. but your dad and I agree on getting a DJ to play. Your mom and I agree—11:00 p.

Union: Why are you so concerned about new job opportunities? Are you holding out on us? Company: No. 66 50 Practical Negotiation Tactics . I’m just saying that tuition benefits are sometimes a good substitute for health insurance. A lot of employees have spouses who can get health insurance coverage through their work. The tuition benefits will encourage the workers to be prepared for new job opportunities. What is this. Union: You’re offering a choice between health insurance and tuition payments? What kind of a deal is this? Company: Hey. Union: (angrily) I’m not presenting this proposal to my people. The company’s negotiator didn’t recognize the misunderstanding. some attempt to undermine me with my members? Company: I don’t know what you’re so worked up about—we’re willing to spend the same amount of money!! Union negotiator #2: Can we take a break? Union: We don’t need a break—we’re not discussing this stupid proposal. and thought he was being asked to choose between a health insurance plan and a tuition benefit plan for all members. With the cost of college educations so high. it’s a good proposal. Tuition in place of health insurances? They’ll think I’ve lost my mind. Union negotiator #2: Please—just a moment outside. and the following conversation occurred.individual member of the bargaining unit the option of being in the health insurance plan offered in the contract or receiving the same amount of money the company pays for health coverage as a tuition reimbursement benefit for the employee or any member of his or her immediate family. many will want to use it for their children’s education. The union’s lead negotiator misunderstood the proposal.

Exchanging Initial Offers 67 .) I’m sorry. let’s move on. (After Negotiator #2 explained that the choice of tuition or health insurance benefits would be an individual choice for each unit member and not a change in the contract for everyone. and the parties were able to complete their negotiations. Conclusion Negotiator #2’s timely call for a caucus so she could explain the miscommunication in private saved the session. the parties returned to the room. and I apologize for explaining it poorly. I thought that the contract would cover one or the other for everyone. I didn’t understand that your proposal was to allow each individual member to choose between the health coverage or the tuition benefit. we’ll be back in 5 minutes. Good. Negotiator #1 regained his footing.Union: Union: Company: Okay. Now. I think that what you’re proposing is a really good idea.

but the key to making it work is to include the throwaways in an initial list of demands OR add it in at a strategic time. but … Salesman: But what? Hobbs: Well. However. He doesn’t really care about the color of the new vehicle.” Party B thinks that A has sacrificed one important objective to gain another. according to my figures.” Throwaway items are those things that hold little or no value to you. Salesman: Let me talk to my manager. so be sure you present them in a way that suggests importance. you are making $200 profit over the true dealer’s cost. A has gained something of true value and given up nothing he values in return. according to the Consumer Reports listing of the cost of the vehicle. Example 1 The buyer. I can go to another dealer and get a green exterior—the color I like best. we’ve got expenses and we need to make some profit. quickly checked the dealer’s inventory of sport utility vehicles in stock. but he makes a mental note to use color as a “throwaway” item. At a point late in the negotiations. Salesman: Well. (Salesman returns with manager) 68 50 Practical Negotiation Tactics . Here’s how it works: Party A exchanges the item for something of true value. It is a useful tactic in any negotiations. and noticed that none of the vehicles have a green exterior. you don’t want your opponent to know what these things are.Tactic 16: Use Throwaway Items Identify ahead of time what you place a high value on and what you are willing to give up easily—your “throwaways. Hobbs: Yes. Hobbs. But for this price. when the two sides are only a few dollars apart. not revealing that the item exchanged is a “throwaway. this conversation takes place: Hobbs: Yes. I know. but in reality. it’s a great car and a fair deal. I’ll go get him. Mr.

All three employees must agree to the schedule. Why didn’t you mention the color before? I didn’t expect to actually buy a new car today (note: not the truth). The days in question are: Exchanging Initial Offers 69 . he brought it up and convinced the salesman and manager that it was an important item to him—possibly even a deal-breaker. The three are sitting at a lunch table to discuss the schedule. Then we have a deal. Example 2 The office supervisor told the three internal sales representatives (Jenny.. At the very end of the negotiations.no it’s not. Conclusion Mr. Employees will be paid time-and-a half for each of these days.Manager: Hobbs: Manager: Hobbs: Manager: Hobbs: Manager: We are offering you a great deal. but you’ve made me a fair offer and you have been pleasant to negotiate with … Then why not buy the red one you drove—the one we based the figures on? I keep cars 8–10 years. and seniority will be used to determine who gets to choose the first day. Miguel.. and Carolyn) to develop a mutually acceptable (to the three of them) holiday schedule in which at least one person will cover the office on each of nine “slow” days.. I’ll take the red one for $100 less. The manager was convinced enough to sacrifice a final $100 for the throwaway. so I might as well get the color I want! What if we offer you the red one for $100 less? Is the color worth $100? I . Hobbs successfully chose color as a throwaway item.

This would allow Jenny and Miguel to each work only two days. They have decided to start over. They all agreed to their schedules. Jenny and Miguel feel that they received something of value from Carolyn: She must work two more days than they must work. A second and third round produced the following allocation: Jenny: December 23. She would actually prefer to work the extra days and get paid time-and-a half. Carolyn has decided to use as a “throwaway” the number of days she will work (previously. and each chooses their days to work: Carolyn: December 27. 24. January 2 None of the three are totally happy with the results. December 31 Miguel: November 25. 2 Jenny: December 23. but that is a secondary consideration. if they let her choose the two days she will be off and the five days she will work. December 27. December 30. it was assumed that each would work three) in order to have December 24 and 26 off to be at home with her children. 31 January 1. 31. 27. 26 Miguel: November 25. 2 In the first round of negotiation. January 1. She proposes to work five days. each made a first choice of days they will work. December 24 Conclusion Carolyn has achieved her objective: She will be off December 24 and 26. December 26. 26. 70 50 Practical Negotiation Tactics .November 25 (the day after Thanksgiving) December 23. She got what she wanted by giving up something she did not value: the two other days. 30. 30. They agree. in exchange for giving up earlier choices due to seniority. January 1 Carolyn: December 24.

Tactic 17: Package Items In a negotiation where there are multiple issues or items to be negotiated. The house was closed up at the time of their mother’s death because she had been in a nursing facility for a couple of months. the antiques. A reluctance to include one particular financial item with other financial issues. The process of grouping items can be an educational exercise because the response to one party’s suggested packaging of items might reveal how the other party views the various items on the table. Anne: As I see it. The house and much of the furniture has been in the Exchanging Initial Offers 71 . their mom left specific pieces of jewelry and art in the will to each of the girls. one might package all of the financial issues in one group and negotiate on that package as one issue.000. we need to sell the house. 300 shares of stock in a pharmaceutical company. Autumn: I don’t have any objection to selling the stock and distributing the proceeds and the cash three ways. for example. Example 1 When their mother died at age 82. can indicate that something you think is minor is really a major concern to your opponent. When the girls decided it was time to talk about the estate. it is often helpful to package the items in distinct groups and then deal with each package separately. were faced with the task of selling the house and disposing of their mom’s personal belongings. but I’d like to talk about the house and the furniture. and the stock and distribute the proceeds. Autumn and Angela. and a collection of antique furniture. The estate’s assets included a checking and savings account totaling $450. In addition. Anne and her sisters. they met at the house. realizing that the total cost of a deal might make or break the agreement. a house valued at $250.000 with no mortgage on it. along with the cash. For example. three ways. Their mother’s will was very clear: the three daughters were to all have an equal share of her estate.

If Angela wants to hold on to her stock. Why don’t we leave some of the cash in the bank. Angela: I live close by. don’t you think? Angela: Maybe. It’s a buyer’s market now. In fact. so I will be able to keep tabs on it. Anne: I’m not sure I’m comfortable talking about trading the jewelry and art Mom left to each of us. she’s free to do so.family for years. And we’ll fix the house up. and use it to fix the house up? Then when we make a decision. there’s a lot of work that needs to be done to get it ready to sell or to make it livable for one of us. we can sell ours. Angela: Now’s not a good time to sell either the stock or the house and antiques. So we agree: We’ll leave $30.” She gave those things to us. What would you think about agreeing today to distribute the cash and stock three ways. There was a reason why she gave us what she did. and letting everything else wait for another discussion. I’d really be interested in talking a trade for some of them. and if we wait a couple of years. it’s a magnet for vandals. we’re really free to do with them what we want. Autumn: Sounds good to me. we’ll discuss again what happens to the house and the antiques. We’ll split the stock three ways. If we want. I’d like it all to stay in the family. I’d like to talk about the art works Mom left each of us. Anne: But that means we have to continue to take care of the house and its contents. but the operative word is “give. Autumn: I think its awfully soon to be making these kinds of decisions. we will have a more valuable asset. Soon. Mother was born here and grew up here. Anne: Okay.000 in the bank and distribute the remainder three ways. With no one living here. we’d get a lot more for them. and now that we have them. Angela: And we can talk about the art and jewelry? 72 50 Practical Negotiation Tactics . Frankly.

funeral. deciding to base the increases on a percentage or equally distribute the funds for increases among the professional and clerical staff. but I’m making no commitment to trade. what kind of paid leaves there will be (personal. sick. The second: working conditions (work schedules and promotional opportunities). Angela: That’s fine. and the art works—will be more difficult. Anne: Same with me. The following tasks needed to be a accomplished: establishing basic pay schedules. Waiting to make decisions on those items until some time has passed gives the women an opportunity to look at a number of options. tuition benefits.Autumn: I can agree not to do anything with the jewelry and art Mom left me before we talk. The negotiations on the other items—the house. the jewelry. and establishing a work schedule to accommodate evening and weekend clients. including benefits for partners in non-traditional relationships. and deal with one area at a time? The first: Wage issues (pay schedules and the annual and merit raise issues). Conclusion Autumn’s suggestion to package the money and stock because they can be easily divided by three made agreement on those items possible. deciding whether there would be annual wage increases as well as merit increases. Example 2 The attorneys and staff of the local Legal Aid Society formed a union and were about to negotiate their first contract with the executive director. May I suggest that we divide the items into three areas. The third: Ben- Exchanging Initial Offers 73 . Employees: We’ve got a lot of items to cover. etc. Several issues also needed to be addressed: the ability of employees to move up through the organization. vacation.). and the assignment of the limited number of parking spaces. health benefits. the antiques.

Later negotiations were difficult. tuition benefits. Executive Director: Sounds like a good agenda. but the parties were able to come to agreement because the wage issue had been resolved. that makes sense. Conclusion The executive director’s request to move merit raises out of the Wage category and move paid leave into that category because there is little flexibility to finance those areas allowed the parties to resolve the wage issue first. Executive Director: Well. Also. 74 50 Practical Negotiation Tactics . That’s a program that can have a lot to do with how employees are able to increase their worth to the organization. Let’s get started. and the parking spaces).efits (health insurance. Employees: I’m surprised that you would take merit increases out of a general discussion of wages. paid leave times. And paid leave clearly belongs with Wage issues and should be discussed with the pay schedules. so there’s not going to be a lot of discussion on what our pay schedules and annual increases can be. Executive Director: I think it’s a good idea to group items together. as well. Wages should not include merit pay raises. I think it also makes sense to include tuition benefits in the Working Conditions category. Employees: Okay. I would include that under the Working Conditions category. to be honest with you. the paid leave categories are pretty clearly defined. we are an agency supported generally by public funding. but I’d change your list. So I’d like to see us get through the wage issues quickly and then move on. There is more flexibility to use non-public money sources to reward employees who will cover night or weekend hours or who qualify for merit increases. because they’re really an incentive for better performance.

no matter how insignificant. The discussion might become very heated. Kathy borrowed more money to go to graduate school full-time. and both have good jobs. Tim began working right after graduation. It indicates to your opponent that you are a reasonable negotiator. Kathy’s first job paid more than Tim’s because she had a graduate degree. Kathy was asked by her employer to relocate to another city. Tim worried that he would be stuck with all of the debt. You signed those papers. They were in the middle of buying a house. An initial agreement. rather than disposing of assets. because Tim felt that Kathy had taken advantage of him during the marriage. and she agreed. too. after a brief marriage.Tactic 18: Agree on Something As Soon As You Can Negotiations are more successful if both sides can agree on something—anything—almost immediately. Their “property division” was mostly about dividing their debts. but don’t think you’re going to stick me with all of the mortgage and credit-card payments. You can also make an effort to agree on something your opponent offers early in the negotiations. The couple hoped to do the divorce without involving lawyers in order to save money. Now. and might not even be able to keep the house. Exchanging Initial Offers 75 . Consider starting things off by presenting your opponent with a proposal you feel confident can be agreed upon without argument. Example 1 Tim and Kathy. and they were making payments on school loans (for his undergraduate degree and her undergraduate and graduate degree) and on two cars. They have no children. They had also furnished their house on credit. are divorcing. They met and married in college. without suggesting any changes or modifications. Tim: You might be leaving town. with her promotion sending her out of town. and that you are entering into the negotiations with the intent to reach agreement. sets the stage for mutual respect and communication. It was her idea to buy the house and go into debt to furnish it.

a wholesale art dealer.. When we bought them two years ago. about the house and furnishings. What do you want to do about them? Conclusion Having agreed to two items very quickly. If both of us had been working the year I went to graduate school. Kathy and Tim were able to agree that Tim would take over paying for the house and furnishings and Kathy would get 50% of the equity accrued by the time of the divorce. even though the convertible is being paid for through a 48-month loan and the sports car through a 36-month loan. I can hardly argue with that. I don’t intend to “stick” you with anything. I think that makes sense. and you got your sports car. as you remember. Frankly. ABC usually uses UPS 76 50 Practical Negotiation Tactics .Kathy: Hey. Tim: Okay. Tim: Well. I say we agree to transfer the convertible loan to me and you take over the loan on the sports car. an art gallery. yes. and XYZ Co. The monthly payments are about the same. Example 2 ABC Company. Kathy: Now. I think it only fair that I take over repayment of all the school loans. I got my convertible. we decided to each pick out our “dream car” and that we would not overrule the other’s choice. The first thing I’d like to talk about is what we are going to do about the cars. and he could pay it in annual installments over a five-year period. hold on. They also agreed that Tim wouldn’t have to pay her that amount for five years. Okay. Kathy: I suppose we should look at the school loans next. as long as the cost was approximately the same. we would have paid down our school loans more. entered into a contract through which ABC sold to XYZ twelve works of art by 19th century American painters of modest talent for a post–July 4th sale.

You can get the three new artworks here so that we can hold the sale as scheduled? Yes. The three parties agreed to hold a conference call late Monday afternoon to try and resolve the dispute. and we will continue to discuss who is liable for the three water-damaged works. and arrived on time and apparently in good condition. when the boxes were opened on Monday. ABC’s position was that the artwork was fine when it left their location. They arrived right before the holiday weekend began. and began preparing to return all of the artwork to ABC. but only if you let us ship it UPS. XYZ: ABC: Exchanging Initial Offers 77 . but XYZ asked specifically that a little-known company specializing in shipping art known as WeCanShipArt be the shipper. XYZ’s manager failed to open the boxes or remove the artworks. XYZ decided to cancel the promotional sale that was to start on Wednesday. Holiday weekend storms caused the electricity to go off for different periods in different parts of the city. and that XYZ needed to either go to the shipping company or its own employees for compensation for the damage. Unfortunately. We’ll expect you to pay for the 12 works that will be in your show.to ship artwork. XYZ contacted ABC immediately. There was no indication that the gallery’s electricity had gone out over the weekend. WeCanShipArt claimed that the boxes were not damaged in shipment—the artwork was already water damaged. water from the gallery’s air conditioning unit pooled on some of the surfaces of the warehouse area. or else the box was damaged in XYZ’s warehouse. it was obvious that the art in one of the boxes had suffered considerable water damage. and the boxes showed no external damage. However. and put the company on notice that it was not going to accept the order because the planned sale needed a dozen works of art to make it profitable. let me make XYZ an offer: We will deliver three additional artworks to you by the end of the day tomorrow so you can conduct your promotional sale as advertised. The artworks filled four boxes. The other times this happened. ABC refused to pay WeCanShipArt until it received payment from XYZ. ABC: Before we begin.

I can’t see how I can refuse that. and if word gets out that you think it was. that’s okay with me if it’s okay with XYZ. XYZ: Okay. The artwork was not damaged while in our control. how do we resolve the issue of the damaged artworks? Conclusion ABC’s decision to offer a solution to XYZ’s immediate problem. we’ll take responsibility for all of the consequences: the lost sale to ABC and the lost promotional sale by XYZ. ABC: Well. 78 50 Practical Negotiation Tactics .XYZ: Agreed. they will split the cost of the three damaged pieces three ways. regardless of where the original three artworks were damaged. tomorrow and we’ll wait for payment on both shipments until we resolve how the artworks were damaged. at its financial risk. WeCanShipArt: Wait a minute. And we’ll eat the cost of shipping. Now. You can’t just ignore us. If we don’t make the deadline. Having reached an amiable solution to the immediate problem. They also agreed that if the investigations are not conclusive. generated a like offer from WeCanShipArt and a reasonable response from XYZ. the three companies were able to agree to undertake an investigation within each company to determine when the artworks were damaged. we’re ruined.m. We can guarantee that we will deliver the new order in perfect condition by 5:00 p.

and even more hours in the fall picking up leaves. It is important that both sides know that there is no negotiating beyond the single “best offer”—that the first offer will either be accepted or rejected. I don’t have any idea. and it came with the bush hog and the leaf pick-up. Ann: Well. Why don’t you give me a price? Colleen: Oh. consider using the “First and Best” tactic. We plan to put an ad in the paper next week. we paid $5. we’ll sell it to you. no hard feelings either way. The “first and best” tactic enabled them to settle the matter easily. Exchanging Initial Offers 79 . Conclusion Ann and Colleen did not feel like negotiating over the tractor and running the risk that it might affect their friendship. Okay? No quibbling. I don’t want to quibble. I know you and Jeff said you’d like one because you have about five acres. period. Example 1 Colleen: Ann. You must mean what you say and be prepared to walk away from an unacceptable offer. Ann: Thanks! We really need one. What do you want for it? Colleen: Well. Ann: That sounds great! I don’t want this to affect our friendship.Tactic 19: Make a First and Best Offer If you want to cut a deal but you don’t like the “give-and-take” negotiation process. Can you check others in the paper and just give us your best price? We will either take it or advertise the tractor in the paper. but if you’re interested. Jeff spends many hours mowing the yard every week.000 for it six years ago. we plan on selling our Ford tractor when we move. but ONLY if you have a bottom line or definite point at which you will accept an agreement and you believe the other party will make a reasonable offer.

Conclusion Archie accepted the job offer. no questions asked.Example 2 Archie: Well. I’ll get back to you in three days. I’ll discuss it with my wife and get back to you in 48 hours. and you know my current salary. but we have internal budget considerations and we must consider equity with other employees. I don’t like negotiating over salary either. So. Here it is. who admired the way Archie negotiated his starting salary. I expect a fair increase. I want the job. on this slip of paper. He also started the job with a positive working relationship with Vernon. Archie: Thanks. I think we have agreed to all aspects of the job offer. as we agreed. how about you making your first salary offer your best one. but I don’t want to start off in a new job by negotiating with my boss! So. except salary. I came up with the best salary offer I can make. because it was several thousand dollars above what he decided was the minimum it would take for him to change employers. (three days later) Vernon: Archie. I’ll either accept it or reject it. 80 50 Practical Negotiation Tactics . and I’ll take 48 hours to consider it. Okay? Vernon: That sounds good. We want you.

He and his date had decided that as long as they could join their friends for breakfast after the prom. Sally’s Senior Prom is coming up. He knew his parents would not agree to let him stay out all night. Example 1 Kevin. I’m the only junior in the crowd. 17 years old and a junior in high school. you only have one Senior Prom in your life. and we’ve made a lot of plans with our friends that I need to talk to you about. Posturing is indeed “acting. Fourth. His girl friend’s Senior Prom was coming up and Kevin obviously wanted to stay out beyond his usual curfew time of 1:00 a. a 4:00 a. we’re all meeting at Donna’s so we can share a limousine. and in a favorable light. Kevin: Mom and Dad.m. curfew would be okay. we’re not going to be dating exclusively after this summer. Third. since Sally is going away to college next year. you will probably have to modify some of your positions if you are to reach agreement. was dating a senior. so he knew that he would have to sell them very quickly. so the prom is a pretty big deal to both of us. This is called posturing—presenting your position strongly and completely. and ignore or deny any weaknesses in it.” As you know. then the prom. and it really wouldn’t be fair if I wasn’t able to go along with the rest of the group. First. look for indications from your opponent as to what he or she believes is their best position. you know that Sally is really looking forward to this. Exchanging Initial Offers 81 . Present your position and demands as if yours is the only logical position.m. and then to breakfast at “Timothy’s. Second. but he figured “all night” was relative. It might be your only opportunity to explain your position without interruption. (Once negotiations get underway. First we’re going to dinner.) During the posturing phase.Tactic 20: Posturing You might have to do a little acting at the beginning of the negotiations.” but it is also a source of valuable information that can help the negotiations proceed to a successful conclusion. Kevin had “negotiated” with his parents before.

for sure. We’ve heard that they allow kids to drink. the limousine will take us back to Donna’s house to spend the night. we told you that we would not be changing our rules to accommodate that older group. Donna’s parents are not as strict as they could be when a bunch of you are there. but to use that as a reason to stay overnight doesn’t make sense.m. That’s the deal then? Okay. we’ll have to get in our car and drive home very early in the morning. We think that after the breakfast. you and Sally need to call it a night (or really a morning). Finally. Fifth. Second. So. I don’t drink or do drugs. you have been fairly good about making your curfew—most of the time. You make some good points. you will have another Senior Prom—yours—so we don’t think you will be “missing” that much if you don’t stay out all night. and we’re just not happy about that. I’ve never missed my curfew. but because the owner’s daughter goes to Sally’s school. And. Sally’s parents trust us and have already said yes to her. However. this prom is a one-night thing—a dance that is dressier than you’re used to. Yes. but it should not be oversold.or drug-free. I think I ought to be able to stay out all night.Mom: Kevin: Mom: Kevin: Timothy’s usually isn’t open early in the morning. That’s asking us to believe a lot. You realize that this could be as late as 4:00 a. Things can happen on a night like that that adversely affect you for the rest of your life. From where we sit. I know you trust me and that I’ve earned the trust. Also. 82 50 Practical Negotiation Tactics . I believe you can pay a little more and have the limousine bring you both home. and the crowd we hang with doesn’t either. we know. remember that when you started dating Sally and hanging out with an older crowd. Donna’s parents will be there. happy about your plans to use a limousine so you kids aren’t driving. We’re just not convinced that your entire group has been alcohol. yes. And if we don’t spend the night. so there will be plenty of chaperoning. We are. they will be open for the Prom crowd only. of course. which could be dangerous.

one-floor operation would be very profitable. and a new. we are one of the largest employers in this county. and had this conversation: Tencro: We really want to keep our company here and expand it. With 800 employees. other companies have received incentives and Tencro certainly wants all it can get. Tencro: Let me just remind you of what our company means to this state. EDO: Well. but there are limited options available. Tencro approached the state’s Economic Development Officer. the state can do to help the company expand and rebuild. The assembly plant is out-of-date. and it does not really need any help. If we can expand here. Nevertheless. The spin-off business from our operations is huge. because his parents could not disagree with such wellthought-out ideas. but was disappointed to learn that they offer very few incentives.m. but we’re getting a lot of interest from other states willing to help us relocate. The company approached other states to see what incentives they might offer Tencro to locate in their state.Conclusion Kevin’s strategy to hit his parents with all of his very good arguments at the outset gave him an advantage. It currently employs 800 people. we’d be adding at least 500 new jobs. Sally and Kevin had a wonderful night and were quite happy to have the evening end at 4:00 a. Also. Tencro has approached the state’s Office for Business Incentives to see what. we’re of course interested in keeping you here. and it will grow—everything from sub-parts manufacturing to the shipping business we generate. Tencro is not going to leave the state. Example 2 Tencro Company decided to modernize and expand its business. regardless of the incentives. but it could easily add another 500 if it had the space on its assembly line. our Exchanging Initial Offers 83 . We need to find out what you’re willing to do to keep us here. if anything.

The industrial park land can’t be “free” because we have agreements with other companies that had to buy the land. Just increasing the workforce by 500 will pull new people into the community and cause housing costs to rise—something our citizens on fixed incomes are very much against. moving to a new location will raise a lot of questions from neighbors about the increase in traffic and pollution that might be generated by your plant. That might involve the state building housing for them at a reduced cost and providing them with some retraining. EDO: Well. And we’ve been offered land practically free in the neighboring state. and traffic signals. We 84 50 Practical Negotiation Tactics . and we’ve had to divert funds from business incentive programs over to basic services. or else it will not be cost-effective for us to stay here. We need help in the cost of attracting and training the new 500 employees. etc.. additional police. what do you have to have? Tencro: We need a new location—20 acres or so—to build our new plant. any plan by the state to build housing that is subsidized by tax dollars will draw a great deal of criticism. And. now that the economy has improved. while we value your company as a long-time corporate citizen. We do want you to expand your plant. etc.employees pump money into the economy by buying houses and cars. and we are willing to offer some training dollars for the new workers. Certainly. We think that we’re the reason XYZ and ABC companies located here and we believe they are likely to leave if we do. We need certain incentives. if the new location is at the local industrial park. paying taxes. There are more residents in the state demanding more public services: road improvements. We need a rebate on the local income taxes to help pay off the loan to build our new building. so we’d have to have it free here. Also. schools. We can’t possibly give it away to other companies coming in behind them. EDO: The state has very limited resources to pay for economic development incentives. we will need the two-lane entrance expanded to four lanes.

Tencro: Well. Future negotiations continued. However. Conclusion The posturing by both sides could have caused the whole negotiation process to bog down. Tencro was able to pay off the borrowed money in half the time. let us go back and take another look at our options. Tencro bought land in the industrial park. and hired 500 new employees. Exchanging Initial Offers 85 . the training and the new road improvements were all the incentives offered to Tencro. The new set-up was so profitable. EDO: Get back to us as soon as you can. Other than that. but for the fact that each party did its homework and was aware of the true facts. borrowed money for the new building. and the state did end up participating in a housing subdivision in order to keep the purchase price down for the new employees.agree that the road into the industrial park must be widened and a traffic light installed at our expense. we’re just not in a position to offer more than that at this time.

because you have settled quickly.000 three years ago). and that two similar ones on the same street sold for $330. The worst first offer is the one that is so high or so low that the other party jumps on it immediately—known as the “Winner’s Curse. such as last year’s price. never give them their asking price. and houses in this area sell fast. Sue: Let’s offer $325.000 two years ago. They found one they both like that lists for $325. The other party will probably come back with an equally ridiculous offer.) To prevent this from happening.000. offer $150.000 and $337.Tactic 21: Avoid the “Winner’s Curse” It is often quite difficult to make the first offer. That’s a fair price. which can be very useful). Example 1 Jay and Sue are looking to buy a house in a specific neighborhood because it has a good school system. thus requiring greater concessions on both sides. or 3) Make an unrealistic offer (i.000..000.000—what they paid for it. at minimum cost.000 for a house that sold for $185.” The perfect first offer. either: 1) Let the other party make the first offer (this means that you will be giving up the chance to focus the negotiations on your figure.000 this year. Jay: No. Jay: No. We don’t know how anxious they are to sell or if they know the market. particularly if you don’t know the other party’s “settlement range.e. is the most (or least) the other side will accept. Avoid giving away too much at the outset. think things through before you make or accept the first offer. then $320. before someone else does. Let’s low-ball them and offer $290. but you feel cursed because you gave away too much.” (You have won a settlement. 2) Start out with an old number. and you cannot withdraw it in good faith. The sellers must be willing to come down a few thousand … Sue: Well. 86 50 Practical Negotiation Tactics . of course. Their realtor told them that it sold for $290.

(the next day …) Jay: They made us a counteroffer of $307.Sue: Don’t be crazy. Frank: Me too.000 total. Lyle Foxworthy. I can’t tell our realtor $290.500—half the difference! Sue: Great. since they had already bought another house. Sue: Then you do it. They outlined how they would develop a new employee performance-appraisal system. then let them make a counteroffer. and the offer was based on fact: the prior negotiated price. as Sue had first suggested. That’s an insult! Jay: Well. Let’s accept it! Conclusion Jay and Sue avoided the so-called winner’s curse by making a low (but reasonable) first offer. was very impressed with their presentation. The buyers were very motivated to sell. the company president. Exchanging Initial Offers 87 .000 for each of us—$6. realizing they offered too much. the sellers obviously would have accepted and Jay and Sue. they had offered $325.000. Lyle: So what’s your price? Bob: Can you tell us what you have budgeted for this project? Lyle: No. If. as requested by the human resource director.) Bob: I’d do it for $3. Both parties felt that they made a good deal. Give us your lowest price. (Bob and Frank meet privately to discuss the situation. would have suffered the winner’s curse! Example 2 Bob Myers and Frank Costello made a presentation to the top management of a paint company.000. but who knows what they are planning on offering.

and it would not apply. Lyle: Okay. Conclusion Bob and Frank avoided the winner’s curse by forcing Lyle to make the first offer.Bob: Lets make them give us a price! (Bob and Frank return to the meeting room. We’ve waited long enough.000. 88 50 Practical Negotiation Tactics . Bob: That’s fair. We’ll do the job. but we can’t pay more than $18.000.) Lyle: Okay. What is it? Lyle: Why don’t you give us a price? Bob: We can’t use our daily rate because it might be too high for this work. What’s the cost? Bob: We want the job. and you two come highly recommended.000) their minimum price of $6. That is all that’s left in this year’s training budget. They also ended up getting three times ($18. but we know you must have an amount budgeted for this and we are willing to do it for that amount. I’m out of time.

but possibly of different values to your opponent. Skilled negotiators such as salespeople. Use a prolonged period of silence (see Tactic #29) to convey something at a strategic moment. In some negotiation situations. Also. which is often the case. labor negotiators. because if you do not at least appear to be flexible. carefully evaluate an opponent’s offer. It has often been said that the key to negotiations is to be flexible (see Tactic #25). is likely to pull away from the table. Expect that the “total pie” will be different from what it was at the outset. the other party. Wait to counter (see Tactic #24) because this will give the opponent the sense that you are serious about bargaining.Stage 4: Making Counteroffers he heart of the negotiation process is the give-and-take. Experienced negotiators seldom reveal their exact priorities and objectives. and remain open to offers and options that you did not originally expect (see Tactic #30: Always Leave Room for Dessert). One or more parts might be acceptable or indicate movement from their previous positions. and do not flatly reject it because it is not your offer. in fact. This can produce a negotiated solution without giving up your priorities (see Tactic #28: Fixed Alternatives). be enlarged (see Tactic #27: Expanding the Pie). and attorneys use tried and true tactics in giving and receiving offers. Instead. what appears to be an outer limit of the settlement range when the process starts can. do not dismiss it because it is not all you want. seeing no common ground. Experienced negotiators also know that proposing multiple options (see Tactic #22) and offering a tradeoff (see Tactic #23) are useful when more than one issue or item is to be negotiated. which would most likely weaken their position (see Tactic #26: Keeping Secrets). When the other party makes an offer. be prepared to divide an offer into smaller ones to make it appear to be more reasonable to the other party (see Tactic #31: Cut Salami Slices) or offer two or more alternative proposals of equal value to you. T Making Counteroffers (The “Give and Take”) 89 .

their parents began discussing a family summer vacation. Jerry pointed out that he is expected to work until July 31st. Sydney. while it may be your best option. 19. Example 1 Jerry. In mid-June. Dad. Option 1: No family vacation. and quicker. so you can go without me. Proposing multiple ways to reach your goal can get you to the same place. We have four options. except when you’re negotiating. His brother Sydney. Proposing only one solution to a problem. Jerry had already started his summer job. 15. The week he would be home would be the first week of school for Sydney. Dad: Wait a minute. Let’s see what we can work out. completed his first year of college and came home for the summer around the middle of May. what say you. and that he already made plans to visit with college friends on the East Coast for the two weeks after that. Jerry will be here. finished his freshman year of high school at the beginning of June. The reciprocal opportunity to review and select among options rather than accept one (“take it or leave it”) also gives your opponent a way to win. 90 50 Practical Negotiation Tactics .Tactic 22: Propose Multiple Options The shortest distance between two points is a straight line. and I try to get to the South Carolina beach for a week in July? Sydney: I’m not going to the beach with my parents! I’ll just stay home. gives your opponent little maneuvering room and might even prolong or damage the negotiations. Option 2: Mom and I go before Jerry leaves on August 1. The effort it takes to come up with multiple options (all of which are acceptable to you) reveals additional ways in which you see yourself “winning” in the negotiations. it looks like we can’t really plan a vacation for all four of us. He planned on being home for one last week before having to pack up and go back to college. Here’s the discussion that followed: Mom: Well. I don’t want to give up on a family vacation that quickly.

By proposing numerous options. If we started the vacation on a Thursday. Conclusion The goal was to have a family vacation. so I won’t be able to meet up with you until Sunday. we meet up with him that week for vacation. Jerry: Okay with me. one paralegal. Bob. and Carl). if it’s okay with Jerry. Sydney: So what you’re suggesting is that the three of us are on vacation from Thursday to Sunday. and Sydney go to South Carolina before his school starts. Mom? Mom: Let’s do it. we could return home on Thursday and still get a week’s vacation. Joe has no say in who was hired by the corporate legal office to work in his unit. Option 4: Jerry doesn’t return home the week between his visit to the Northeast and returning to school. and one secretary in his litigation unit. Jerry: My friends and I have plans through Saturday of that week. Sydney: Don’t I start school that week? I don’t want to miss school. Sydney: Okay.Option 3: Mom. Classes don’t start until Friday. Andrea considers Making Counteroffers (The “Give and Take”) 91 . when we come home. they were able to make that happen and not interfere with or argue about the merits of each other’s individual goals. but it should work out all right. Example 2 Joe is an attorney whose job responsibilities include managing three other attorneys (Andrea. actually. you have a half-day orientation on Wednesday. Then Jerry joins us until Thursday. And I miss orientation and start school the next day? Dad: That’s an option. but he can discharge employees for poor performance. It’s not perfect. Mom: Well. me.

you can agree to a demotion so that your areas of responsibility are lessened to that of a paralegal. It is to the corporation’s benefit to address that problem here and now. I really see your options as follows: You can leave the corporation. Andrea: Well. or you can work out a “supervision” agreement with me so that I can better monitor your performance. Her job performance was acceptable. Andrea. so Joe took a “hands off” approach. let me say that I’m handling the missed deadline on the pleading. It was just a comment. and resents any attempt by Joe to supervise her work. rather than to put it off on someone else or for some time in the future. and I don’t see why we don’t have more independence.herself to be a professional. isn’t it? But I don’t think just moving you really solves the problem. If you don’t like the way I do my job. Joe: That is certainly an option. Before you start. The attorney for the other side has agreed to give me the additional time to file it. Andrea: You didn’t list moving to another unit as an option. We have a formal procedure that you just don’t like to follow. but it doesn’t solve the problem—nor is it the only problem. you have a job-performance problem. Joe: That’s all well and good. Joe: Andrea. we have a very big problem. why don’t you just move me to another unit? I’m certain Bill thinks I do good work and would be happy to have me in his group. In the last month. To put it as bluntly as I can. You had no authority to agree to settle the Stites case without clearing it with me. you know that wasn’t an okay to settle. which forced Joe to take action. Andrea: Wait Joe. she made a two glaring errors in judgment. Joe: Come on. I thought I had cleared it with you when I told you what I thought they ought to offer and you said that sounded too good to be true. Andrea: We’re hired for our expertise. 92 50 Practical Negotiation Tactics . however.

(Adapted from The Mind and The Heart of the Negotiator. then it would save face for me if it comes with a move to another unit. Andrea: Well. improve her work performance. Andrea’s move and subsequent “approval” regime did. rather than my staying here. but it would still require some change in the way you work: either a demotion. lets talk to Bill about the move. Conclusion Joe’s willingness to offer more than one solution gave Andrea a way to look at this unfortunate situation as an opportunity. or I would advise your next supervisor to put you on a very formal approval program. If you are convinced that I have to undertake an “approval” program. by Leigh Thompson. Joe: That’s fine with me. If that option is okay with you.) Making Counteroffers (The “Give and Take”) 93 . I want to stay with the firm. the needs of the corporation have to come first. in fact.Joe: That could be an option. But in fairness to our mutual employer. It also changed her attitude about being both a professional and a team player in a corporate office. I hope we can work it out. and propose an acceptable alternative. my goal is the same is yours: to create an environment where you can perform to your full potential. Believe it or not.

Maureen: First. Let’s see. Avoid assuming that you both differ on every issue (in which case you might be making unnecessary sacrifices) by first identifying items for which both sides have similar desires. Let’s agree to those things. They have a fixed amount of money—$14. thus making it necessary to find a middle ground on each. if a buyer negotiates a $500 reduction of a contractor’s bill. because it can speed up negotiations and produce a more desirable outcome. one person’s gain is another’s loss—zero-sum. For example. In essence.) Yes. then those which can be easily traded. They each agreed to list the items they want and then to negotiate whether or not they will be purchased. we both want the sod. and finally.). 3) distributive items (those items for which the two parties have exactly opposite interests. (She looks over the list.500. the fencing.Tactic 23: The “Win-Win” Approach (Identify Issues as Compatible. only those with polar-opposite interests that must be divided. These items often involve money). or Distributive) The “win-win” approach to negotiations is a basic tradeoff strategy of seeking maximum gains for both sides. three strategies are used. Wow! We are off to a good start. etc. With distributive items. It goes like this: Organize the joint list of demands into three categories: 1) compatible items (those items that both parties can quickly agree on because they share the same desired outcome). Brooks: Right. Exchange. let’s see if there are any items we both want. that’s $9. Example 1 Brooks and Maureen Wilson have just finished building a new home. then the contractor has lost $500 in revenue. It is used only when each side has several demands.000. and a home theatre. 2) exchange items (those that can be easily traded off—one item for another item of equal value. This approach is an important tactic. 94 50 Practical Negotiation Tactics . They both agreed that this is the maximum they will spend on “extras” before moving in.

000 $3.200 $200–$2. These are all permanent immediate needs. Can we split it evenly? Brooks: Okay.500 $2.# 1 Sod Item Cost $1.500 $500 $1.000 $500 $1. which I’d like to keep in the bank.000 $5.000! Brooks: Good. that makes sense. which takes another $3. I’ll trade your sidewalk and trees for my whirlpool bath.000 $1. I’d like to spend some of it on lighting upgrades. $750 for lighting and $750 in the bank. We have $1.000 Brooks X X Maureen X “Win-Win” Category Compatible Exchange 2 Trees (3) 3 Berber carpeting 4 Lighting upgrades 5 Third garage 6 Tile entry 7 Designer drapes 8 Deluxe home theatre 9 Extra sidewalk 10 Custom chandelier 11 Whirlpool bath 12 Fencing X X X X X X X X X X X Exchange Compatible X Compatible Exchange Distributive Maureen: Well. and we both get things we want. Maureen: No.500 $5.500 left.000 $2. Making Counteroffers (The “Give and Take”) 95 .

finally agreeing to split the difference on the remaining amount (distributive items). Maureen and Brooks were able to identify those things they both wanted (the compatible items) and then trade some items of equal value (the exchange items). This year. Drug-Testing Program 96 50 Practical Negotiation Tactics . Pension Increase 3. Item Management 3 years None 1% 10% of net For cause only Union 3 years 2% 5% 12% of net For cause only Win-Win Category Compatible Exchange Distributive Exchange Compatible 1. Profit-Sharing 5. both sides exchanged lists of initial demands at their first meeting. Length of Contract 2.Conclusion By taking the time to list all the items each person wanted and their cost estimates. Example 2 Ohio Metals Company and Local 56 of the Primary and Sheet Metal Workers of America-AFL-CIO have had a generally positive labor relationship for over fifty years. During that time. Wage Increase 4. The combined lists total thirteen different items: Desired Outcome No. All items to be negotiated and their desired outcome for each item were put in writing for review. even in difficult years. management and union negotiators found that a “winwin” approach to negotiations worked well.

signed. Shift Differential 11. and the union clothing allowance proposal (#13) for the management funeral leave proposal (#8).Compatible rent provision 15% Exchange 15% No layoff provision $100/month Exchange Exchange Exchange In their second meeting. Paid Funeral Leave 9. the negotiators agreed that they had compatible positions on three items: (#1) length of contract. Next. They proceeded to draft the language to settle these issues. and removed from the table. Subcontracting 12. Because they held opposite positions on these issues. and (#9) to continue the often-discussed no strike/no lockout provision. Overtime Assignment 8. they exchanged the economic issues of approximately equal cost: the union pension increase proposal (#2) for the management shift differential (#10). No Strike/No Lockout 10. Next. the management profit sharing plan (#4) was exchanged for the union overtime assignment plan (#7). one Making Counteroffers (The “Give and Take”) 97 . Health Insurance Employees pay 20% Continue cur. Clothing Allowance Based on senior.6. they accepted the union job security proposal (#12) in exchange for the management subcontracting proposal (#11). eleven of the thirteen original issues to be negotiated had been agreed to. This gave members of both sides a sense of accomplishment as they began to discuss the remaining two issues for which they must find a middle ground.Voluntary ity 2 days Continue current provision 10% 10% No provision $50/month 3 days Continue cur.Distributive rent program co-pay Exchange Exchange 7. Finally. Job Security 13. (#5) a new drug testing program. At this point. they began to trade off the exchange issues of similar value and nature. First.

exchange. A middle ground often must be found on each of these distributive issues if you are to reach an agreement. negotiations begin on a positive “win-win” note. Third. These two distributive issues—wages (#1) and health insurance (#6)—were the most challenging to settle. Conclusion This tactic is simple. but it can be very effective when a negotiation situation involves several issues. Second.side’s gain is the other’s loss. you can use the process to settle many of the other issues on the table. Both sides first agree that all issues to be discussed will indeed be listed and openly discussed. when you exchange items so that each party achieves their desired outcome on one of the two. when you agree on the items where both parties have similar desired outcomes. if both parties start from reasonable positions. They then identify each as compatible. or distributive so that the negotiations can begin in an organized manner. Sometimes the classic “split-the-difference” method is helpful in locating a middle ground. but a middle ground was eventually found on each and negotiations ended. 98 50 Practical Negotiation Tactics . the most difficult issues (often involving price or some other economic measure) can be negotiated because you know that most items have been settled successfully and only a few remain. The tactic offers several advantages: First.

and refrigerator. and looks like you are belittling them. The final issue had to do with “lights out” and quiet times for studying. They agreed on which part of the room each would have. Waiting a respectful amount of time to counter. even if you aren’t going to accept their offer. This isn’t high school. Rob: Making Counteroffers (The “Give and Take”) 99 . Jasper: Finish or not. Jasper studies during the day and early evening and likes to stay up very late watching TV and visiting with friends. It is especially important that you do two things: take your time before rejecting any offer from the other side. stereo. and can help you reach your goal. Mutual respect must be part of the negotiation process. Since they didn’t know each other well. Rob: Wait a minute. A counterproposal delivered too quickly tells the other side that you haven’t or won’t even seriously consider their offer. You can reject the offer and offer a counterproposal after it is obvious that you have taken the time to consider the merits of it. So when’s a good time? Jasper: (without hesitation) No way.Tactic 24: Wait to Counter As the negotiations begin. each side is expected to put an offer on the table. will make your opponent feel good about the process. the location of the TV. you know. I’m not interested in a curfew. and studies late into the night. Here is how the last issue was handled: Okay. and on what would be considered acceptable “sharing” of each other’s junk food supplies. Rob stays busy all day and evening with other activities. and from a strategic standpoint. so he wants a quiet room late at night. Example 1 Jasper and Rob met when they were assigned to the same dorm room their freshman year in college. they decided to establish “room rules” so that they would both be comfortable with the room assignment. last item: I’d like it quiet in the room at night. so I can study. do not offer a counterproposal right away. Let me finish.

Neither side anticipates that there would be 100 50 Practical Negotiation Tactics . Rob: (there is no hesitation in this voice) No. I want a 10:30 p. Jasper: (without taking a breath) At best. and that’s not negotiable. the positions of non-union crew leader and floor manager would both be eliminated. 10:30 p. and that’s it.m. and d) a hearing with company owner if the matter is not resolved in 20 days. Under the restructuring. is all I’ll consider.Rob: (Rob was about to suggest midnight on Mondays through Thursdays. The appeals procedure would have to be altered to reflect the restructuring. Example 2 ABC Company’s management was being restructured and compressed in order to facilitate its new “just-in-time” manufacturing philosophy. No agreement was reached. but changed his mind when he saw Jasper’s attitude. Jasper: Midnight. b) written complaint to a floor manager if the matter is not resolved in 5 days. and the union foreman would report directly to the plant manager. midnight during the week is the only thing I’ll consider. c) a formal “meeting” with plant manager if the matter is not resolved in 10 days.) Listen. employee grievances had to go through four levels of supervisory review and appeal: a) verbal complaint to the non-union crew leader. The union contract required that management renegotiate this change in the grievance procedure with the union. Rob: I’m going to look for a new roommate!! Jasper: Fine!! Conclusion It was clear that neither Rob nor Jasper was seriously considering the requests and suggestions of the other person. Under ABC ‘s contract with the union. Failure of both young men to allow one another to have their proposal considered caused the relationship to break down. curfew on TV and other noise every night.m.

rather than go on to appeal it to the company owner. the union arrived at the meeting prepared to support a streamlined process that called for the employee with a grievance to discuss it first with the union foreman. and began the negotiation session concerning the grievance procedure. We just cut out two steps. rather than as a judge on the merits of the grievance. no one can complain about that. The union was prepared to accept the plant manager’s position as final. Our guys are prepared to accept a shorter grievance procedure if we can find a way to ensure that you’ll take our grievance issues seriously. but to dictate. We’ve got a couple of alternative models for you to consider. Company: (no hesitating) Trust me. We’d like you to consider the plant manager’s role as a problem-solver. the employee and the foreman would meet with the plant manager and attempt to resolve it. this redraft is a very simple change to the contract. Union: You obviously didn’t come here to negotiate. The redraft is simple and straightforward. An aggrieved employee can make a request for a meeting with the plant manager. he/she can take the grievance to the plant owner for a hearing. because those management layers are gone. If in 20 days he/she has not been satisfied. Certainly. If the union foreman felt that the grievance had merit. our grievances often signal to management that there are real problems on the shop floor.) We’re just not happy that you are proposing a Making Counteroffers (The “Give and Take”) 101 . Union: Hold on. Union: As you know. In fact. and everything else stays the same. Company: Here’s the new draft of the grievance procedure. (Note: An attitude change sets in. After initial pleasantries were exchanged.any objection to the change. We think that this is an opportunity to eliminate some of the adversarial aspects of the grievance procedure. ABC Company’s negotiator explained the management changes soon to be implemented. Company: (rather abruptly) Let’s not drag this out. and I’m certain your members will be okay with it. We’ve simply eliminated the first two steps.

the company entertained the ideas the union had tried to propose before. and we’ll strike if we have to. rather than in the 35 days the current system provides. the two parties did meet again. and actually accepted a three-step procedure. to prevent any change! Company: (surprised) What? Why would you object to this? Your guys will get a final decision in 20 days. You can’t be serious. After a cooling off period. We’ll see you on the picket line. Conclusion ABC Company’s failure to take adequate time to consider the union’s offer or even act as if it was considering the offer prolonged the negotiations unnecessarily. Union: We’re very serious. 102 50 Practical Negotiation Tactics . This time.two-step grievance procedure instead of a four-step procedure.

If you are flexible. and we’re really not able to enjoy either one. Sue’s sister Nancy called her to talk her into coming anyway.m. They flipped a coin to see who “got” them and the new baby this year. The couple used to have Thanksgiving dinner at both families’ homes. successful negotiators remain flexible because new solutions to old problems often surface during a negotiation. Sue: Yes. Even before the baby’s arrival. and now have a new baby girl. two sisters. Bill. Next year. Be open minded. you can adjust your demands or goals to include such new ideas. Nancy: Sue. Making Counteroffers (The “Give and Take”) 103 . and at least five aunts and uncles) ate around 7:00 p. Mom says you. and do not dismiss something said by your opponent just because it came from the opponent. Bill’s family (parents. and the baby aren’t coming for Thanksgiving dinner this year—that you’re going to Bill’s parents’ house. it’s just too much to do both. Sue and Bill decided that they had to begin alternating their Thanksgiving Day visits between the two families. Example 1 Sue and Bill have been married four years. we’ll get to our side. and ten nieces and nephews) always ate around 5:00 p. their spouses. and identified the range of options they feel comfortable with negotiating. and Sue called her mother to let her know that they would not be coming for Thanksgiving dinner this year. But after the negotiation gets started.Tactic 25: Be Flexible A negotiation begins with both parties having some idea of where they hope to end up. Arriving late at Bill’s family gathering caused him to miss the “traditional” pre-dinner pro-football game on TV (which he had grown up believing was the real reason for thanks at Thanksgiving). two brothers. one sister. Bill’s family won. Sue’s family (parents. four brothers.m. They’ve done the research. established goals. the Thanksgiving marathon caused problems: They would have to leave Sue’s family’s celebration before the “traditional” after-dinner trivia games (which Sue really enjoyed).

So that doesn’t work. There’s nothing “special” about Friday. Celebrating the next day seems odd. Nancy: I’ll let you know. either. it’s okay with me if you can sell it to everyone else. Conclusion Nancy’s goal when she called Sue was to talk her into coming to their Mom’s Thanksgiving Dinner on Thursday. Everyone in Sue’s family liked the idea of celebrating on the Friday after Thanksgiving. Nancy: If we keep the time at 5:00 p. Sue: I don’t know. Nancy was able to accomplish the real goal of the negotiations—to make sure that the holiday would be celebrated with the whole family present. she suggested a unique alternative.m. Mom’s very upset. I mean.. and it became the family’s new tradition. By being flexible. Bill won the coin toss for this year. Thanksgiving is Thursday. I know that I would rather not do two Thanksgiving dinners on Thursday. Isn’t that what Thanksgiving is about—taking a day to give thanks for our blessings with the people we love? We’ll just arrange it so we do it two days in a row! Sue: Well. but she won’t tell you. but then I realized that the rest of you already go to your in-laws earlier in the day. Nancy: What if we did Thanksgiving on Friday? Sue: What? Nobody does Thanksgiving on Friday—that’s un-American! Anyway. Sue: Next year. we’ll come to Mom’s. I thought of asking Mom if she could move dinner up to noon or so. When that goal looked out of reach. Nancy: We’d make it special by all of us being together. some people have to work on the Friday after Thanksgiving. I bet everyone could make it on Friday. 104 50 Practical Negotiation Tactics . the holiday will be over.Nancy: It just won’t be right without you guys.

Kids’ Home and the foundation have decided that a parcel of city-owned land would be ideal as a site for the new building. but we need some assurance that you will be able to build and operate the orphan home at that location. and raise the money to pay it back? And can’t the foundation grant you money on an annual basis? Making Counteroffers (The “Give and Take”) 105 . Kids’ Home hoped to get $500. Kids’ Home: As you know. a non-profit organization for orphaned children. the foundation’s regular annual grants come to roughly half of their available funds. Kids’ Home: That’s why we brought the foundation’s officials with us. City officals: We can probably give you the land for free. We’re hoping to get a commitment from them to build and help fund the operations of a new facility. We only have maybe $2 million a year to put toward this charity. Estimates for building a new orphan home ranged from $12–$15 million. we hope to break ground early next year for the new orphan home. Kids’ Home is also hoping to get the city to encourage the foundation to commit to full funding of the building project. but the principal of the fund can’t be touched. but we can’t fund all of the $12 or $15 million.5 million is available for distribution to numerous charities. We need the city’s help by allowing us to get the city land donated to us (for free). City: Can’t you borrow the money from a bank to build the facility.000 a year for operations. the interest income of around $6. The foundation has a substantial endowment fund. They are meeting with the city to ask that the land be donated by the city for the project. Unfortunately (for Kids’ Home). depending on the cost of the land. Foundation officals: Oh.Example 2 Kids’ Home. had been negotiating with a foundation to become its major benefactor for a new building and to supplement the organization’s annual operating budget. Each year. we’re committed in theory.

106 50 Practical Negotiation Tactics . Kids’ Home was able to acquire state-issued no-interest bonds backed by the foundation’s pledge of interest income to build the new orphan home.Kids’ Home: Borrowing the money gets very expensive. And “donations” aren’t a very safe collateral for any bank that wants to loan us money. Why not ask the state to issue no-interest bonds? It can do that for non-profit organizations. Foundation: City: Foundation: Kids’ Home: Conclusion By exploring alternative financing plans suggested by the city. We’re a nonprofit group. and really taxes our ability to raise funds. We’re not familiar with that program. We wouldn’t want to make such a commitment to a bank. I’ll contact the state tomorrow. but we’re willing to look at it. We’ve never committed our funds to pay back a bank loan. If we borrowed $15 million at 10% interest. We probably would not be able to participate. The commitment by the foundation to make the annual bond payment debt backed by the foundation’s endowment fund should be sufficient collateral to get such bonds issued and purchased. it could end up costing double that amount.

These parties could get rather loud. Jones: We’ve obviously gotten off on the wrong foot. However. and asked the officers to cite the Jones kids for parking too close to a corner. each side has to know generally what each other wants to accomplish. you might not want to reveal all of your priorities at first. The Jones’ two older children—girls in their early 20’s—often had friends over on Friday and Saturday nights. But the Jones clan had four cars altogether. Mr. you should be careful not to misrepresent your position to such an extent that your opponent will feel that you have lied. At the same time. and often took up all the space along the street in front of the two houses. Making Counteroffers (The “Give and Take”) 107 . it is not acceptable to lie.m. The Jones’ two younger children—boys in their mid-teens—hit baseballs into the Smiths’ yard and scared the Smiths’ dog. The Jones family let their tree branches hang over the Smiths’ back fence and rub against the Smiths’ garage roof. and you probably won’t identify your throwaway items or tell your opponent your bottom-line. It is perfectly acceptable to say that you are not ready to reveal certain things. the neighbors began to have problems. yet not reveal all of your goals and objectives. Successful negotiations depend on trust. The Smiths called the police to complain about a late-night party. The Jones family suspected that the Smiths called the police. Example 1 Soon after the Jones family moved in next door to the Smiths. Mr.Tactic 26: Keep Few Secrets One of the most difficult skills to master in a negotiation is how to be candid. and we would very much like to talk about how we can resolve these issues. the Smiths could count on parking their car directly in front of their house. and trust can only be established if all parties interact truthfully. Smith: We don’t know what you’re talking about. They asked to meet with the Smiths to talk about these disagreements. In order for a negotiation to be successful. Before the Jones family moved into the neighborhood. and often lasted until 2:00 or 3:00 a.

Also. Jones: I wish you had mentioned that the last time we talked. yes. and they won’t be having friends over more than one night a weekend from now on.) 108 50 Practical Negotiation Tactics . we thought you might have called the police about our kids’ party and our cars. And the music is to be off at midnight. In spite of the Smiths’ assurances. but we do know that someone has complained. the late-night parties are a problem. fine. a lot of problems. Smith: You know that your boys are causing our dog. since you’ve asked. And we’ll make sure none of our cars are parked in front of your house. Smith: Well. the next time the boys were out playing and the ball came into the Smiths’ yard. Jones: We’ve already talked to the girls about the parties. and was met with the following: Mr. Mr.Mr. I guess. the Jones were visited by a city inspector because of a complaint from the Smiths about the tree branches hanging over the fence and brushing against the garage roof. Smith: Well. I’ll talk to the boys and we’ll make sure they play baseball in the park. It is really very disturbing. Almost every day. we have a problem walking long distances in bad weather. they kept it. Smith: No. and not in the back yard. So. Mr. then they’ll need to come in at midnight so that their talking doesn’t disturb you. In good weather. Muffin. they’re hitting baseballs into our yard. Mr. Jones came to see what the problem was. Jones: Well. (A week later. Is that everything now? Mr. we’d like to be able to park our car in front of our house. At our age. we would like to work out some solution. that wasn’t us. if they are outside. Jones: Okay. Mr. Mr. Smith: Yes. we’re good now? Mr. If you can tell us all the things that we have done or are doing that have caused you to be inconvenienced.

Jones: Sure. Union officials are afraid that a Japanese company might purchase it. Japanese companies often do not “recognize” labor unions the same way U. or European companies do. You obviously don’t want to be “good neighbors.Mr. Mr. The British insist that a very strict confidentiality provision be part of the negotiating process. and too bad for you! Conclusion The disagreements and unpleasantness continued until the Smiths finally sold their house and moved into a condominium. Unless Neno can get the Union members back to work on Monday. Example 2 Neno Enterprises is a shipping company with extensive global operations. But we didn’t call the inspector. Neno has been negotiating the sale of its business to a British company. Jones: (at the Smiths’ door.S. We would have fixed the tree if you had asked. The union laborers walked off the job on Friday. The union knows that the company is up for sale. you’ve said that before.” Forget all we’ve agreed to do—we’ll just enjoy the use of our property. or the deal is off. Neno’s president and the Union representative met to discuss the walkout. the British firm will walk away from the deal. the tree was clearly over the fence. Why didn’t you tell us? We can’t read what’s on your mind! Mr. Smith: Well. and the deal is close to being final. have labor unions. You could have seen that yourself. but Neno cannot tell the union this. irate) I can’t believe you people called an inspector on us. although none of the facilities outside the U. because they didn’t like a grievance decision. Making Counteroffers (The “Give and Take”) 109 . The Jones’ effort to sit down and negotiate the problems with the Smiths were thwarted by the Smiths’ reluctance to put all of their concerns on the table and their failure to admit that they were the ones who made the formal complaints. Its local headquarters has a union to handle its international shipping.S.

whether it’s for one weekend or a week. I can’t really be more explicit than that at this time. I promise you. Neno: Look. Therefore. 110 50 Practical Negotiation Tactics . But if your guys are out past Sunday. we don’t. We can’t put up with the kind of decision we got on our grievance. If they do come back. If that’s going to have a bad effect on your being able to sell the business. it will impact our marketability. I’ll forget all about the strike. Union: We think that the grievance decision affects our wages. It’s not the time to have one. I think it already has. no harm-no foul. You really don’t want to do that. and if the guys are back on Monday. then there’s probably no harm done. Have the guys back on Monday. I know it’s not news to you that this business is up for sale. is still a labor shutdown. We’ll meet with all of the parties on the grievance first thing Monday. Our guys are prepared to stay out a lot longer than Monday. I’m certain that if we can sit down and talk next week. maybe by next Friday or the week after that we’ll have our guys back to work. You don’t want to mess up our negotiations. this is a legal strike under the contract. But we also need to make it clear that we expect you and whoever might buy your company to take our contract seriously. Union: What aren’t you telling me? A labor shutdown. Neno: All I’m saying is that there is a difference. If everyone is back on Monday. We’ve not had a labor shutdown in 20 years. Neno: Look. I need your guys to come back to work on Monday. so the union won’t be hurt by the buyout. do you? Union: No.Neno: You know this is a wildcat strike and that it is in violation of our contract. we will resolve it to your satisfaction by the end of the day. But I have to have everyone back on Monday. Anyone who buys the company will have to honor the contract we have. And one company that is interested has a really good track record on expanding the businesses they buy. any interruption in our shipping could affect how these buyers look at our business. the slowdown as a result of no one working Saturday and Sunday won’t be noticeable.

Union: It’s that important to you? Neno: Yes. Neno called the union negotiator in and briefed him on the sale. Can you assure me of that? Neno: Yes. rather than make up reasons. I can. But I can’t. and it’s that important to you as well. as well. Neno’s decision to respect his confidentiality agreement and simply tell the union that he couldn’t disclose all the information. I’m going to go along with you because you’ve always dealt straight with me. Conclusion On Monday. while the grievance was being resolved. the sale was finalized. but the British firm will allow them to organize at their foreign locations. Union: Okay. I would be more specific. Union: Okay. But I need to tell my guys that this is important to them as well. Making Counteroffers (The “Give and Take”) 111 . the union was willing to trust Neno—even though he couldn’t tell them everything. we’ll be back to work on Monday. He told him that it would mean that the union would not only keep its jobs here. If I could. Because the parties had dealt honestly with each other in the past. was the right decision to make.

Tactic 27: Expand the Pie
In some negotiation situations, agreement can be reached by increasing the total pool of resources available to all the parties involved. While this is not practical in every situation, a relatively minor increase in the resources available might allow both parties to reach a solution. Resources should be as broadly defined as possible—money, people, time, etc.—when considering how a “fixed pie” might be expanded.

Example 1
Alexis, age 7, did not want to practice her violin for an hour today, but she promised her parents that she would practice an hour each day if they bought her the instrument. She really wants to visit her friend Michelle and spend the night.

Mother: Alexis, our agreement was one hour a day, every day! Alexis: I know, but if I’m going to play with Michelle, I’ve got to go with her now! She only has two hours before her game and then her mother is taking us shopping. Mother: That’s too bad. Alexis: Can’t I miss one day? Mother: No, you promised to practice every day to learn to play. Alexis: Could I practice two hours tomorrow when I get home? Mother: One in the morning and one at night? Alexis: Yeah. That would be easy. And I would still get in three hours of practice this weekend. Mother: Okay. Then you can go with Michele.

Conclusion
Alexis’s proposal expanded the resource of time to find a solution, and her mother agreed to it because her objective (for her daughter to get in enough practice time) was met.

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Example 2
Supervisor: Peggy and Kim, you’ve both had a great sales month and you both earned that trip to Hawaii, according to the promotion program. The cost to send both of you and your spouses exceeds the budget by $1,200, however, so we’ll need to negotiate something. Peggy: Like what? Supervisor: Well … I could send one couple this year and the other next year, since I’ll have a new travel budget by then. Kim: That doesn’t seem fair. We both earned it this year, and we want to take it this summer! Peggy: That’s right! Supervisor: I’m sorry. We never expected to have six people qualify for the trip this year, and the budget is simply not large enough. Peggy: Well, that is your problem. What other ideas do you have? Supervisor: You can each pay half the cost of the flights. Kim: Why should we pay for part of a bonus we earned? Supervisor: Let me talk to the department head about this … (The next day) Supervisor: I spoke with the department head, who explained that if we keep spending the office-supply budget at the current rate, there should be enough left over for me to transfer some money to the travel account to cover the trip for you and your spouses. Will you both help me control supply expenses? Kim: Sure we will, and thank you for finding a solution so we can all go on the trip! Peggy: Yes, we can keep supply expenses down. Thanks for thinking creatively.

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Conclusion
The supervisor in this situation quickly recognized that no negotiated settlement would satisfy Kim and Peggy. Their morale was important to her, so she sought to “expand the pie.” She did so without increasing the total annual budget, which was why the department head agreed to the one-time budget transfer.

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Tactic 28: Offer Fixed Alternatives
You might be more successful if you present several alternative positions to the other side. One party can present to the second party two or more proposals of equal value to the first party. This gives the second party the option of choosing one of the multiple offers. The second party is more likely to respond positively to this strategy because (1) people generally prefer having more choices; (2) one of the offers might be of greater perceived value to the second party; and (3) most people prefer to have input into a decision—even if it’s only choosing one proposal out of two.

Example 1
Colleen’s fifteen year-old daughter hates cleaning her room. She usually lets it get quite messy, like most teenagers. On Friday afternoon, the following negotiation takes place when Amber arrives home from school: Colleen: Amber, you must clean up your room. We are having an open house on Sunday, and the house will never sell with your room like it is now! Amber: Oh, Mom … Tonight’s the big sleepover at Chelsea’s house and tomorrow (Saturday) I have a basketball game. Colleen: Amber, I’ve been telling you for three days to clean your room! This is it! You are not leaving this house until it’s clean. Amber: That’s not fair! Last Saturday, you said I could go to Chelsea’s sleepover! Colleen: That was before you kept putting off cleaning your room. Amber: All my friends are going … (pause) Colleen: Okay, Amber, here are your choices: One. Clean your room right now and I’ll take you to her house after you finish. Two. Come home tomor-

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I’ll do it now. but I will cut your staff by one part-time person (or $15. she chose the one she most preferred. keeping her Saturday free. or we lose a whole year.000 budget! I need at least $20. that is enough time. and clean it. Roberto: Well. Amber resisted the chore she hated. Roberto: But I need to start the direct mail and newspaper ads within two weeks. but the company president does not share your optimism on this program. I have three hours. I’ll approve $15. Clean it after your game.000. At least this way the program will have a chance to succeed! 116 50 Practical Negotiation Tactics . Conclusion At first. I’m not going back to him again to discuss this program. B. I’ll approve $15. but no TV or anything until it’s done! (pause) Okay. Three. Felipe: (Roberto’s supervisor) Sorry.000 in the budget.000). I can accept B.000 for advertising. (long pause) Felipe: Let me give you three options: A. I can’t help. Felipe: Well. Take it or leave it.000 for advertising. Use the $5. Roberto: But it will never generate enough interest if no one knows about it. I’ll find a way to do without one part-time person. or C.Amber: row before your basketball game. but I will cut your travel budget out completely. Example 2 Roberto: I can’t properly advertise this new program with a $5. Felipe: Sorry. But when her mother laid out the schedule and gave her alternatives.

thus achieving his goal of not having to ask for a larger budget. One alternative.” He offered Roberto three alternatives of equal cost. would enable him to adequately promote the program. Making Counteroffers (The “Give and Take”) 117 .Conclusion Felipe was willing to think “outside the box. Roberto believed. which was his goal.

If his opponent cannot agree to the demand but does not want to end the negotiations. This should have resulted in an automatic promotion and a sizable pay increase. I have to tell you that while I appreciate what you have done for me. She was determined to hold her ground for at least a 13% pay increase and a promotion. You know my commitment to this company. I very much appreciated the fair job performance review you gave me. you are a valued employee. he can make an open-ended statement. I am very disappointed in the company’s decision not to promote me and to limit my merit increase to 3%. and the annual merit raise she was getting from the company was the same 3% other employees were receiving. Susan: I hope so. Unfortunately. inviting a response. But she also knew he would have to be willing to go to bat for her with his superiors if she was to get her advancement. one of the wisest things you can do is to keep silent—particularly when the parties have met several times and identified many areas of agreement. Susan knew that she was considered a valued employee and that her boss would want to do the best he could for her. Jones. After a few minutes of silence. and 118 50 Practical Negotiation Tactics . Jones: I certainly do. It was 16% less than she had been led to believe she would be getting. Susan: Mr. Here’s how the negotiations went. The negotiator for the other side says nothing. the negotiator who feels the most uncomfortable with the silence will fill the gap and most likely make a concession in order to get the other party to speak. I think you would agree with me that I have performed well above expectations this past year.Tactic 29: Prolonged Silence When negotiations have hit a critical stage. nearing her third year with the company. received a glowing report from her boss on her job performance. but one side comes back with a non-negotiable demand. the promotion had not yet been approved. Example 1 Susan.

I really want you to stay with the company. I would very much appreciate it if you could ask the company to reconsider. (says nothing) Or. Jones went to management and convinced them that they should give Susan the promotion and the 13% raise. because I feel my future with the company might be at stake here. (says nothing) If I can’t get that pay increase approved right now.or three-year period. and sell it to management that way. if management can see their way to giving you the pay increase now. I must ask you to try to get both. but I don’t think management will be willing to give you an additional 10% pay raise AND a promotion. the company’s refusal to grant them now was a harder position to support. Making Counteroffers (The “Give and Take”) 119 . Once he acknowledged that both items might be awarded sometime in the future. Okay? (says nothing) Let me check it out and I’ll get back to you. Susan’s silence prompted Mr. but a pay increase of that size might be more difficult. If there is some flexibility in your request. and I think that I really haven’t been dealt with fairly. of course I will be glad to do that.Jones: Susan: Jones: Susan: Jones: Susan: Jones: Susan: Jones: that I deserve more consideration. Promotions of this type are all but automatic around here. Conclusion Mr. Jones to continue to offer solutions. and I’m sure management will agree. it could help. Well. I could probably find a way to phase it in over a two. maybe we can talk about the promotion later in the year. I suppose I could get the promotion approved with the proper presentation.

Town Council Representative: I think you’re wrong. The end of the agreement coincided with the election cycle for the two towns. Town Council Chair). This is how the negotiations went: Town Council Representative: Well. Mayor’s representative: No. The mayor’s negotiating representative wanted to complete the negotiations on the expanded agreement. Town Council Chair’s representative believed that the ability to expand on the agreement was critically wounded by the uncertainty as to which office the mayor might seek. I think you’ll agree with me that the announcement your boss made about maybe running for Town Council Chair has dealt our negotiations to expand the agreement a fatal blow. but the officials had hoped to complete the negotiations prior to anyone involved announcing for office. but now they’ve got to ask what Madame Mayor’s motivations are. by saying that she might run for Chair. My bosses might not have been inclined to expand the agreement anyway. The office she was thinking about was the office held by her counterpart in the neighboring community (Mr. has colored these negotiations.Example 2 Two local governments entered into a tax-sharing arrangement in order to provide joint services to citizens in a more efficient manner. I don’t think it’s a problem. The term of the original agreement was nearing its end. Also. and were trying to settle on new and expanded areas when one of the elected officials (Ms. The parties agreed to continue the previous terms of the agreement. She has not decided what she’s running for. the people Madame Mayor currently 120 50 Practical Negotiation Tactics . her plans really don’t have any bearing on these negotiations. and representatives of the elected officials of the two towns were meeting to renew and possibly expand the agreement. He decided to push for a simple renewal of the original terms. The mayor. and until she does. Mayor) said that she was considering running for office. Mr.

I think we really have to drop back and just propose a renewal of the tax sharing agreement without adding any new items. In the end. the Town Council representative’s position prevailed. I don’t know what her reaction will be. Making Counteroffers (The “Give and Take”) 121 . Town Council Representative: (silence) Mayor’s representative: I would think that at least the proposals that don’t involve budget changes could be pursued. I hate not to attempt to add some additional areas to the agreement. Town Council Representative: (long silence) Mayor’s representative: (after an uncomfortably long silence) Well. the Town Council’s representative left the mayor’s representative with no room to maneuver.represents have to worry that her desire to switch governments might taint the negotiations. Town Council Representative: (silence) Mayor’s representative: I think it would look very bad for both of us if we spent all of this time negotiating and we don’t end up with anything new. and the agreement was renewed with no new provisions. He either had to end the session or figure out what to say to reengage the other side. Conclusion By remaining silent. I’ll go back and tell Madame Mayor your position. Mayor’s representative: Well.

One day. she noticed that the brook came within 100 yards of it. The reason I built it was so that I could protect my patio. you should always enter the talks with a good idea of what you are willing to agree to. and began to renovate it as a home and a pottery shop. You are more likely to be successful if you identify a range of options that fall within your comfort zone than if you have a fixed bottom line with little wiggle room. Having an iron-clad demand probably won’t give you enough room to reach an agreement. Neighbor: Well. Joe. when one of you might say. The brook 122 50 Practical Negotiation Tactics .Tactic 30: Always Leave Room for Dessert Negotiating is the art of give-and-take. Madeline built a gazebo about 500 yards from the brook. after the gazebo had been there for about five months. Obviously. She discovered that a rock barrier. She went to discuss this problem with the upstream neighbor and had every intention of demanding that the barrier be removed immediately. the brook was the property line separating her property from a neighboring farm. Madeline. The property came with three acres of forest alongside a meandering brook. Your rock barrier has sent the brook onto my property and it is too close to my gazebo. which an upstream neighbor had built. I have a problem. Example 1 Madeline bought an old farmhouse outside of a small town. This range for maneuvering is not the same thing as the list of items you make at the outset—it’s the last space separating you and your opponent. As was sometimes the case in these parts. or we will be at an impasse. had redirected the brook further into her property.” Avoid making that “necessary concession” too narrow: It should be large enough for both of you to step into comfortably. “I have to have this. in a small clearing. You will have to remove the rock barrier. the brook and rock barrier are on my property. She traced the brook back along its course to see why and where it had changed its path. Madeline: Hi. It calls for compromise.

Madeline was able to protect her gazebo. My neighbor on the adjacent farm wants to sell part of his property for a housing development. What if you removed the barrier for a short time. she widened her range of options. I ask that you allow an expert to suggest the best way to provide for the diversion of the brook to protect your house and my patio. Conclusion Madeline’s objective when she met with her neighbor was simple: Have the rock barrier removed. which enabled her to achieve her goals. Neighbor: I’m sorry. Madeline: Well. what I need is to protect my property line and my gazebo. Then. restore her property line. It might not be necessary to make such a dramatic change. Making Counteroffers (The “Give and Take”) 123 . and allowed me to have a survey done so that my deed can be corrected to describe the “existing brook” boundary line by other landmarks. I understand that. but I don’t know what I can do about it. Also. Madeline: Yes. but you’ve changed the boundary line of my property. This will put these houses right next to me. you have not only threatened my gazebo. Madeline: But by diverting the brook. but only if I have a clear understanding with you that the barrier will be rebuilt to protect my house. I couldn’t have that. Neighbor: I can do both of these things. and allow the neighbor to protect his home. if the brook is redirected.extended right up to my back door when the rain was heavy. When she found out that this was not going to solve her neighbor’s problem. I won’t remove the rock barrier. and return everything as it was. I can’t have the brook in my house. I’ve lost 400 yards of property on my three acres. By expanding the range of options available to resolve the dispute. She left room for a compromise. at least I’ve maintained my property line.

Pilots: Look. and are willing to keep pension benefits the same. we know that health insurance premiums might skyrocket. 124 50 Practical Negotiation Tactics . And we cannot afford that $1.000 (which we reasonably should have expected to pay in premiums) in the pension account now. then the pension benefits overall will increase by $10.000.000. The company wants to trade paying for dependent coverage for better pension benefits. This is just a cash-flow problem that your members have to understand.000 to cover the premiums for dependent coverage. dependent coverage could cost us $1. The airline industry is in a slump. Everyone was afraid that the dispute would cause an impasse and a possible strike.000. If we invest the $200. what they really need is for you to cover the costs of dependent coverage. Pilots: So you are projecting that the increase in dependent coverage premiums will average $200. However. But only a few of our people are close to retirement age. Over the last five years. the company can make your pensions much better.000 figure. This would be a better benefit in the long run.000 a year over the next five years? Company: Yes. The projections for the next five years were that these costs would increase to about $1. The pilots want dependent coverage paid for by the company. Company: This could not come at a worst time for us. the discussions of the employee benefits package bogged down on the issue of health insurance costs and pension benefits.000. Over the next five years.000.000. with all wage and operations issues resolved fairly early.Example 2 The contract negotiations between the pilots and the airline had been going pretty well. and the premiums for health care just keep going up. you are taking a risk on the costs increasing. With long-term planning and investments. the airline paid a total of $200. as it has always been. that would be the minimum increase. As best as we can tell.000. and we know that with this new contract term of five years.

and the pilots knew what to ask for when the contract expired. The $200. so the decision to be flexible was a good one.000 available.000. with a cap of $200. The dependent coverage is more important to us now than the pension benefits. Pilots: Since the concern is about agreeing to a 5-year commitment without knowing the increases we might have in health insurance costs. Are you willing to risk not having an opportunity to increase pension benefits? Pilots: Yes. then those funds will not be available to invest in the pension plan.000 the first year on the premiums. the company will not be expected to give us this benefit. if they were that high.Pilots: But you do have the $200. that would be worth it. Company: Then it’s okay with us. or invest in the pension plan? Company: Yes.000 actually carried them through four years. however. Conclusion The company was committed to limiting its exposure to $200. Company: If the company spends the $200. The pilots expanded the range of options.000 to either pay one year of the premiums. The health insurance market stabilized. by agreeing to let the company cap its exposure for dependent health coverage. It initially believed that the only option was to put that money into pension benefits. Making Counteroffers (The “Give and Take”) 125 . can we agree to a year-to-year agreement on dependent coverage.000? Once the cap is met. If we can get two or even three years out of the $200. we are.

do you want to look at something else? Buyer: No. Example 1 Car buyer: What.000 car. it’s a deal? 126 50 Practical Negotiation Tactics . Phrases such as “for only pennies a day.000 for a Volvo? I bought the one I’m driving for $19. and compare it to your strategic objective.” “affordable weekly payments. If you are on the receiving end of such a tactic. I just can’t imagine the monthly payment on a $45.500! Saleswoman: Yes. I recall the day you drove it out of here.… (20 minutes later) Saleswoman: So. but that was several years ago. I love this car. $45. if I can give you this car with a $300 monthly payment.Tactic 31: Cut Salami Slices One way to overcome anticipated or exhibited resistance to a proposed cost is to cut it into smaller units or “slices of salami. Buyer: Way too much! Saleswoman: Well. I guess it would be around $600 per month. what monthly payment did you have in mind? Buyer: More like $300 per month.” Salesmen use this standard tactic with “big ticket” items: They present the total cost in small enough pieces to sound reasonable to the other party. be sure to add up the total cost. Saleswoman: I’ll be right back. Buyer: Yes. Saleswoman: With your 740 in trade.” and “low monthly rates” are examples of the salami tactic. but the Consumer Price Index has not gone up 150%—nor has my paycheck! Saleswoman: So.

But my neighbor pays $39. Once the buyer volunteered that $300 was an affordable “slice.000 down and $300 a month! Conclusion The saleswoman knew the buyer was suffering from “sticker shock. I can’t discuss another client’s account.00 per month.” she had him—she worked around the $300 slices. do you want HBO? How much? $5. Great! So. Let’s see. down payment. it will be a five-year lease. do you want Disney? Yes. can’t you? Buyer: Yes. I can afford $6. and payout slices to reach the total price she wanted. you can get the Disney channel for only $5.00 per month for your service. I can’t afford that much.000 price into “slices” the buyer thought reasonable. as promised. Saleswoman: Simple.99 per month. You can do that. Making Counteroffers (The “Give and Take”) 127 . Sure. but let me see the numbers.” She decided to cut the $45.00 per month. (looks at the numbers) That looks good. Example 2 Cable representative: Owner: Cable representative: Owner: Cable representative: Owner: Cable representative: Owner: Cable representative: Owner: Yes. and added the trade-in.Buyer: I don’t see how you can do that. Instead of a three-year lease. with your car and $6.000 down. but what else must I buy? Only the basic service for $8.

2. Disney is for the kids! The sports channels are for me. Conclusion The owner thought his neighbor’s service at $39. Thanks. What about the music package? Yes. instead of one total amount. I really want the sports channels. they asked about the Cartoon Network. but he agreed to six “salami slices” for a total of $38. 128 50 Practical Negotiation Tactics . Great. Any other kids’ channels? Yes.00 a month. That’s $5.00 per month was far too much. The total is $38. But that’s all! Then we’ll hook you up on Monday.00 per month. we had that before. and SI 1. and probably felt much better about the total negotiated package because it was presented in modest individual slices.99 per month. Okay. and my wife wants the old movies.Cable representative: Owner: Cable representative: Owner: Cable representative: Owner: Cable representative: Owner: Cable representative: Owner: Cable representative: Owner: The Sports Combo–ESPN 1.00.00! Why? Because he judged the per-slice price to be reasonable. Yeah. That’s another $5. 2? How much? $8. 3.

A negotiator who contemplates using pressure tactics must first realize that he/she has increased the probability that negotiations will end without an agreement because the other side objects to the excessive pressure and simply walks away. Some less-obvious and more easily accepted pressure tactics are to use visuals to control the negotiation talks by focusing discussion on subjects that favor your side (Tactic # 34). Tactic #33 (The Bluff) is a classic pressure tactic. and it can destroy your credibility. the traditional car salesperson might tell the buyer. Applying Pressure 129 . but in tense. so are you ready to make a deal? This might convince a few buyers. which can be successful if the opposing team has two or more members who hold different views of an issue. For example. Humor might not look like pressure. “I can only guarantee this price until 6:00 p. pressure tactics should probably be avoided. and the use of humor. but others will walk out the door. Tactic #35 (Applying Excessive Pressure) is a similar tactic that should also be used with caution. Other less-obvious pressure tactics include Tactic #37 (Divide and Conquer). angry negotiations. In some cases. Tactic #36 (The Element of Surprise) can catch an opponent off-guard and cause stalled negotiations to move forward. an unexpected element of humor can break the tension and encourage a person to calmly get back to the issues. It should be used with caution: It can end negotiations immediately.Stage 5: Applying Pressure P ressure tactics are generally used in situations where one side firmly believes that it holds the upper hand or simply convinces the other side that it does. it is effective. today.m. turned off by the tactic. but it can be used effectively when one party clearly has an edge. however. When both sides believe that each has equally strong positions.

together and separately. When Lacey found out that his employer was transferring him to another city farther down the coast. I think Chloe and I would be willing to pay more than just the money you guys put into it. We’d hate to give it up. Abby really loves that boat. he and Chloe wanted to buy out Don’s and Abby’s interest. Don: Absolutely. Don and Abby now use it less and less. but Don. Lacey: Don. and we need to talk to you about how we can buy you guys out. but it is not a good idea to exaggerate what you are offering or what you are giving up. It 130 50 Practical Negotiation Tactics . Chloe and I would like to take the sailboat with us. I don’t see how we could buy a boat or even a half-interest in a boat for what we put in on this one. and they will weaken your credibility. Your opponent will consider you untrustworthy and might even be insulted by your attitude. and we’ll be moving south in the next month or so. Lacey and Chloe didn’t know that Don and Abby were. Lacey: I know. big news! I’ve been promoted. And we don’t want to be unfair. Example 1 Don and Abby went in on the purchase of a sailboat with their friends Lacey and Chloe. Although I do think there ought to be some consideration for the two years you had use of the boat. boat prices have really gone up. I can’t tell you how many times Abby has said how happy she is that we have the sailboat. In the last couple of years. The two couples used the sailboat a lot the first couple of years. getting a divorce and each moving away (and would have no more use for the sailboat). I don’t know. Don: Wow. in fact.Tactic 32: Don’t Exaggerate It’s always acceptable in negotiations to put your best case forward and present your position vigorously. Lacey. Such exaggerations are easily revealed or uncovered.

the boat has depreciated. If Don had not exaggerated the importance of the boat and dealt with Lacey honestly. and I’ll get back to you. I have big news too. Let me talk to her. I’m surprised by your attitude. Don. Applying Pressure 131 . but separately. which you would have to share if you want to retain half-ownership. Don: Lacey. (Around the same time. and neither of us put much in for upkeep. We’ll be leaving here for the Midwest. I’ve been thinking. and we’re moving farther south. Conclusion Don got a lot less than he could have from Lacey because he found out that Don exaggerated the importance of giving up the boat. Chloe: Oh. Don and I are getting a divorce. Abby is having this conversation with Chloe) Chloe: Abby. After all. (After Lacey and Chloe had a chance to talk. big news!! Don got his promotion.is just about the most important thing we own. Lacey: Cut it out.) Lacey: Don. I was afraid something was going on when you all-butstopped joining us on the boat. I thought you understood how important this boat is to Abby. Lacey and Don’s negotiations changed considerably. Abby: Well. though it’s not so happy. Abby told Chloe about the divorce and about how she never wants to see the boat again. he likely would have found himself in a stronger negotiating position. Abby: That boat. I’ll be glad never to see it again. I think it would be fair to pay you and Abby half of what you originally put into the boat for your 50% share. It just reminds me of how happy Don and I used to be. It’s about time now for some major investment. I’m sorry.

the company president decided to use the stock price as a negotiating tool during the current union contract talks. but this has been such a crazy situation. I think you’ll have to agree with me that wage increases in this next contract will not be available. our production line changes at least three times a year. in fact. Company president: Well. I read in the papers every day that the market is still strong. the situation in the stock market is not good. I’ll be looking to you to make some major wage concessions on this upcoming contract. and that the economy is strong. I can’t see how today’s numbers really impact the long-term profitability of this company. I’m telling you the stock price is having a huge impact on us already. When I go to the bank for the Letter of Credit to keep our cash flow uniform while we switch from one type of production line to the other. The current stock price is the lowest it has ever been. they will make their decision based on a review of the stock price that day. Union negotiator: The stock price might be down right now. in this global market. And while these fluctuations have little to do with the health of the company itself. Telling me there’ll be no wage increase and asking for wage concessions now is a little premature. I’ll have to show them 132 50 Practical Negotiation Tactics . I’ll be going back to them as soon as next week. And as you know. Here’s how these negotiations went: Company president: Well. I’m afraid that with this current information. we will need to make drastic cuts in our operating costs just to survive.Example 2 Aimes Manufacturing had experienced major ups and downs in the price of its stock for the last two years.

Applying Pressure 133 .) Union negotiator: I’m sorry. When negotiations resumed. he lost the trust of the union. Let’s get back together next week. Union negotiator: Well. okay. but your proposal to cut wages is just not going to fly. the union checked into the Letter of Credit transaction with some experts in banking. let’s talk about it. no concessions! In fact. Give me your proposal for wage concessions. we’d like to reopen talks on next year’s pay increase. (In the interim.that we’ve cut expenses to counter the losses in the stock market. they would do a thorough analysis and look at the health of the company over the long haul. this week’s price would have little or no effect on your ability to get a Letter of Credit from the bank. Union negotiator: I know that’s what you told me. When the market took a swing up during the negotiations. They told union officials that it would be very rare for a bank to make its decision solely on stock price. Company president: What? I thought you understood that it is essential that we get concessions on this if we want to stay afloat. and I’ll have our people look at it. Company president: All right. If the stock goes up next week. but I checked it out and it’s not totally true. If you put it that way. We think this company is very healthy and can withstand the temporary downturn. here’s what happened. the company’s position was weakened even more. and the union ended up with a substantial increase in their contract. So. Conclusion Because the company’s president over-emphasized the impact of the market on the company. The union became hardened in its position that the employees needed wage increases in the new contract.

Here’s how the discussion went: Christy: Tom. She knew that if she made such a demand and threatened to leave him unless he made a commitment. are you? Christy: I don’t want to be. Example 1 Christy and Tom had been dating for about a year. 134 50 Practical Negotiation Tactics . Tom: Oh. You’re not upset about that. yeah. either. The couple had not discussed marriage. Sara said she saw you at the movies with Charlene yesterday. This can come back to haunt you. you will have lost credibility with your opponent. Poker players know all-too-well-that bluffing can be very costly. Christy was surprised and hurt when a friend of hers mentioned that she had seen Tom at the movies with his former girlfriend. so their “free” time was very limited. Christy realized that asking for a commitment from Tom at this stage would be a very serious discussion. but I really am. I guess I’m just surprised. and she didn’t think Tom had. I knew you had a class. If one party threatens to walk out of the negotiations if a demand isn’t agreed to. I called Charlene and she was available. and they really have no intentions of doing so. If you subsequently agree to begin talks again. Both of them were still in graduate school and worked full-time. and I really wanted to see the new Lenny Bruce movie. but Christy thought the relationship was heading in that direction. it might backfire. Charlene. but you always run the risk of having the opposing party call your bluff and end the negotiations without reaching agreement. I really hate it that you chose to see the movie with Charlene. We don’t have that much free time together. they are bluffing. There is a chance that the tactic will work and that both sides will agree to the proposal on the table. Christy thought that their relationship was exclusive: She hadn’t gone out with anyone else.Tactic 33: Bluff! Bluff with caution.

so he didn’t call her bluff. and at first he thought she might bluffing. She convinced Tom that her feelings were strong.Tom: She’s a friend who happens to be a girl. Christy: What I’m saying is that I can’t accept that you are going out with a “friend” who is a woman—not at this stage of our relationship. Actually. The union negotiators. but very little progress had been made. he had to make a commitment or risk losing her. I’m willing to risk losing you. It really wasn’t a “date”—we just saw the same movie together. Going to a movie with one of them to me is the same as going to the movies with one of my male buddies. If Tom had “called” Christy’s bluff. Tom: I have friends of long standing who are women. If that’s not possible. Christy would have had to decide whether or not she was indeed bluffing or if she would really end their relationship. It’s made me realize that I want us to have an exclusive relationship. It is. if you can’t make that kind of commitment. then I’m afraid I want us to stop seeing each other. Conclusion Tom didn’t want to lose Christy. Since he wasn’t sure about that. she paid her own way. Example 2 Nexon and its union had been negotiating a new contract for the past couple of weeks. Christy: I just can’t see it that way. Tom: You’re serious? It’s that important to you? Christy: Yes. Applying Pressure 135 . He believed she was sincere. I won’t go out with any woman friend. I just thought of her because I knew you weren’t available. Tom: Okay. I’m not “dating” anyone else. I certainly don’t want to lose you. I need to have your commitment that you won’t do that.

The union members ended up voting not to strike at this time. we want the part-time workers to apply for and fill fulltime positions as they become available. Why don’t we put this one aside for now.) 136 50 Practical Negotiation Tactics . And I don’t believe you’re going to go call for a strike over this. or else we’ll be asking the membership to strike. Union: You don’t seem to understand. (The union negotiating team left the bargaining session and called for an emergency meeting with all union members. Union: You’re wrong. Here is what happened at the next negotiations session: Nexon: I’m sorry. and try and reach agreement on the cost-of-living increase you’re proposing? Union: No. Many of our union members who are working part-time hope to work full-time. We’re not going to reach agreement on this at all.believing that Nexon would not risk a strike. Second. much less today. Nexon: I’m just not prepared to give you one. we’re really prepared to go the distance on this benefits issue. Another bargaining session was scheduled. This is something we just have to have. Nexon: We’ve got lots of issues to discuss. but working without benefits is simply not acceptable. but the company cannot offer the same benefits to the parttime workers as it offers to the full-time workers. If we’re not able to reach agreement on this. decided to threaten to walk out of the negotiations and have the membership vote on a strike unless Nexon made some concessions at the next meeting. First. We need some agreement on this today. it will cost too much. We need an answer today. then all of our other demands will change. Nexon negotiators did not believe that the workers would actually strike this early in the negotiations. Nexon: I’m sorry. This is a critical issue to us.

Union: Okay, we’ve decided to put aside the part-time benefits issue for now. We’d like to discuss the cost-of-living request today. We’re looking for a 5% increase for all employees—full-time and part-time. Nexon: I’m afraid that a 5% increase is out of the question. Inflation has been very low this year, and we’ve certainly not increased our prices by 5%. We’re only in a position to offer a 2% increase, and we believe your membership will accept that. Union: 2%?? Are you crazy? Our people will never accept that!! They’d sooner strike!! Nexon: Fine. Ask for another strike vote and get back to me. Union: Wait, wait. Let’s be reasonable.

Conclusion
Negotiators for the company knew the threat of a strike was only a bluff, because the union did not have member backing. When they tried to bluff the first time and failed to convince the members to strike, their ability to successfully bluff again was lost. They had a very difficult time in the subsequent negotiations, because Nexon was able to call their bluff numerous times.

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Tactic 34: Control the Forum with Visuals
Some tried-and-true strategies used for meetings and presentations can also be effective during negotiations—particularly those that help you get your points across to the other party. Even the best negotiators have trouble keeping a discussion focused, which is why they make good use of visual aids. In many situations, including negotiation sessions, a person or team is trying to communicate ideas and persuade others to accept their position. Maintaining control of a lengthy discussion and keeping everyone focused on one’s presentation is often difficult, but it is critical to successful communication and persuasion. This control of the “forum” or general discussion, if attempted solely by dialogue or handouts, can be difficult for the best negotiators. Thus, a tactic that will help keep the discussion focused on one’s arguments and presentation can be extremely helpful. An easel and flipchart, a chalkboard, or a PowerPoint presentation can be very effective in controlling a forum. By only showing one part of a presentation at a time, you can focus everybody’s attention on one page of a flipchart or one slide (or even just one line of text). People won’t be able to flip through pages or discuss other parts of a handout (this often occurs when the entire proposal is given out at the start of a session), and the presenter won’t lose the audience’s attention. It is also more difficult for people to go back to earlier parts of the presentation, because the text no longer appears on the screen or flipchart. A negotiator who presents new proposals or information with well-developed visuals can more easily control the forum or focus of the group discussion.

Example 1
Dinnertime at the Gronefeld house was usually loud and chaotic. The parents and six children had dinner together most evenings, but it was understandably hectic; multiple conversations were going on at the same time. One night, Aime (age fourteen) tried to present an argument about allowances and the division of chores among the children. Constant interruptions from other children and a general inability of all eight people to follow one dialogue simply caused her to give up her

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idea. The next night, however, Aime came prepared with a piece of construction paper and a gavel she had removed from a plaque in her father’s office. On the construction paper were three columns: Person; Chores; Allowance. The written specifics were covered up with pieces of construction paper. After everyone took their seats at the dinner table, she banged the table with the gavel until all were silent. “I have a proposal for a new division of chores and new allowances,” she began. “Please let me explain this one person at a time, so we can agree on that person’s chores and allowance, and then move on to the next person.” Aime now had everyone’s full attention, because they were curious about what was covered up on the chart. Aime had sucessfully focused everyones attention on her chart. The parents, impressed by her work and specific proposals, agreed to her suggestions with only one change. Person Chores Allowance

Conclusion
Aime realized that she would never achieve her goal unless she could command everyone’s attention and focus the dinner-table talk on her concerns. She was able to control the dinner forum with a gavel and a chart. The key to her success was that she unveiled only one line at a time, thus focusing the discussion and reaching agreement on each child. This stopped the confusion.

Example 2
A committee of three members of a governing board of twelve people is responsible for developing and presenting the annual budget recommendation for

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the organization. A majority of the board members must vote for the proposed budget for it to become effective. Past committee meetings dealing with the proposed budget have been chaotic, long, and usually heated. The typical format for the meeting is for the chair to hand out a copy of the entire proposed budget at the start of the meeting, quickly provide an overview, field questions, and then try to negotiate for the seven needed votes for passage. Steve, one of the budget committee members, has decided to try a new approach: focusing discussion on one budget at a time to prevent people from discussing several items at once. Steve: Ladies and gentlemen, to help us review this budget proposal in an organized fashion, I have outlined it on the pages of this flipchart. Each section of the budget appears on a single page. I’ll go through it one page at a time. Please ask questions only on that section or page. This will keep all of us discussing the same budget issue. Agreed? Board chair: Does everyone agree to this proposed budget-review process? All in favor say agree, opposed no. Seeing no opposition, it passes. Steve: Let’s begin with the capital budget for the Fifth Ward … Allan: Steve, I have a question about this year’s budget for health insurance … Steve: That’s Section 7 on page 7 of the flipchart. Allan, please hold your question until we get there. We will review and discuss all of these items one at a time, in the order they appear on the chart.

Conclusion
Although several sections of the budget proposal sparked spirited debate, Steve was able to control the discussion and focus the meeting on one issue at a time by effectively using a visual aid. The meeting was much shorter, more productive, and less acrimonious than in prior years.

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The same kind of thing happened a couple of years before that: In the middle of August. They are more flexible on price and service when they know the consumer is not under any pressure to buy the service being offered. Since the heating and air conditioning company held no leverage over him. he was able to successfully bargain for other services. It’s easy to prediet the outcome in collective bargaining talks if one side is clearly in a very favorable position. If the employer is a shipping and express mail company. his air-conditioning unit went out. It is sometimes referred to as “pressure bargaining. for example. The owners of professional sports Applying Pressure 141 . the guy was in no position to dicker over the price of the repair. there were times when there was no pressure and no emergency. such as the advantage of time. Unions can strike at any time to achieve their goals if they have some leverage. when one side has “leverage” over the other. On the other hand. once had to call a plumber in for emergency repairs. its union has the advantage in the weeks just before Christmas. Since his toilet had overflowed and water was continuing to run all over the floor. Try bargaining with a plumber! This homeowner. He was at the mercy of the company that could install an appropriate unit the fastest.Tactic 35: Apply Pressure (when you have the leverage) Analyzing a situation and applying pressure in order to achieve your goals when you have leverage over the other party is a commonly used tactic in negotiations. Example 2 Let’s face it: Sometimes one party holds all the cards. while the other is not—that is.” Example 1 We have all been at the mercy of someone who uses pressure bargaining. because this is the busiest time for that industry. and was forced to pay whatever they demanded. not blessed with many household repair skills. Many companies sell “tune ups” and routine seasonal checks to keep their people busy all year.

) The leverage of supply is also very powerful: If a jeweler has an exclusive contract to sell a ring everyone wants. etc. if the unemployment rate is high and jobs are few. unemployment is low and jobs are plentiful. can suffer repercussions in the form of sabotage. either individually or through collective bargaining. there are likely to be long-term repercussions. What goes around comes around. (Team owners are notoriously unpredictable. A note of caution: Circumstances in one round of negotiations might give one side an advantage. consider whether or not the two parties will likely meet again in the future to negotiate. the employer has the advantage: a supply of jobs. will what goes around come around? 142 50 Practical Negotiation Tactics . Other employers find themselves in situations that actually reverse the leverage (when. despite strong resistance. If you have a special skill that an employer needs and few others have that skill. but before you choose such a tactic. Employers who refuse to give in on issues of high importance to employees and exert pressure on unions to accept their terms. he didn’t have to be flexible because the employees believed that they had no alternatives. it is the union’s turn to hold firm on its demand). low employee motivation.teams are generally more vulnerable to pressure from the players’ union several days before the season begins. If so. and other undesired outcomes. When one side places undue pressure on the other side. she has leverage and can more likely hold firm on her price. then you are in a position where you can set reasonable demands on wages. however. Conclusion “Pressure bargaining” is a way to achieve objectives that are greater than what is deserved or desired by the other side. benefits. Many labor contracts were agreed to when unemployment and inflation were high and employees felt pressured to accept the demands of the employer. This gives it the upper hand in negotiating with employees. When the employer proposed adding duties to the job classifications. On the other hand. but they are less willing to negotiate several months ahead. for example. The employees had no power to resist the demands of the employer.

I took it out of the box. Andrea: Okay.) Applying Pressure 143 . Almost from the beginning of the three-hour drive. Just because you saw it first doesn’t make it yours. Mom said so. They stopped for lunch at a fast-food restaurant and shared a children’s meal that came with a small doll. I can’t drive if you keep this up. the argument is over the doll’s shoes. you have it this part of the trip. Andrea had taken them off the doll. Susie: Okay. About an hour into the drive. (Their dad pulls to the side of the road and turns to face them in the back seat. Tell Susie to let me have it.Tactic 36: Surprise! Never underestimate the power of surprise—particularly when things have bogged down and both sides are simply repeating their positions without making any headway. you have it when we drive home. and Susie. and Susie hid them under the seat. Just share the doll. Susie: The doll belongs to both of us. Andrea: The doll is mine. the fighting starts up again. and I can’t stand it. Andrea. and here’s how the “negotiations” went: Dad: You two stop fighting. the little girls began to fight over the doll. The doll can be shared. Their dad tried to reason with them. Example 1 A father and his two daughters were on their way to visit the grandparents. Why? A sudden surprise can disrupt the dynamics of a negotiation. the girls had been fussy. but use this tactic judiciously. Consider making a suggestion or a proposal that completely surprises your opponent. because you will probably only get to use it once.) Dad: Stop it right now. We’ve got a long ride ahead of us. (In a few minutes. This time. You’re driving me nuts.

in fact. The auditor’s job was to make sure that tax dollars collected for the local education system were appropriately handled. (They continued to argue and whine and pinch each other. He grabbed it and threw it out the window. Finally. Both Andrea and Susie were so shocked by their dad’s action. charging that they breached their duty in their handling these funds. and reached back for the doll. and I hope I can convince you of that. and that they had invested and spent the tax dollars wisely. at great expense to the auditor’s office and the school board. they didn’t say another word. to no avail. Dad tried correcting them a few more times. I want the shoes.) Dad: Now there’s no more fighting over the doll. She can have them later. Susie: Daddy didn’t say anything about the shoes. I think I have acted properly. Conclusion Dad’s use of a “surprise” tactic was extreme. He initiated the litigation against the local school board members and several banks that invested the money for the board. The tactic was so successful. he slowed down. Here’s how the meeting went: Auditor: I appreciate a chance to talk to you about this litigation.Andrea: Give me the shoes back. that they never fought over a toy in the back seat of the car again!! Example 2 The editor of a local newspaper was planning on writing an editorial critical of a locally elected auditor who had filed a very nasty lawsuit. Daddy said I got the doll on the way to Grandma’s house. The local newspaper was prepared to urge the auditor to end the litigation. The defendants contended that the auditor’s actions were politically motivated. Dolly doesn’t need shoes on in the car. but nothing else up to that point was working. The auditor asked to meet with the editor to explain his position. Dolly has to have her shoes. 144 50 Practical Negotiation Tactics . so it was worth the risk. The litigation itself had been going on for more than three years.

Editor: Well. That’s really the reason this has gone on so long. Applying Pressure 145 . Here are the papers. as a matter of fact. Editor: (surprised) Really? They settled? This is public information? Auditor: Yes. The auditor successfully used the element of surprise in announcing the settlement and thus changed the direction of the editorial. but actually superior to some other entities you supervise. this case needs to be dropped. Conclusion The editor wrote an editorial urging a resolution for the good of the community. The school board members make a very good argument that their practices regarding how the funds were expended are not just adequate. Your reporters will probably want to follow up on it. Thank you for coming in. and a significant amount of money will go toward the tax fund. Auditor: I appreciate their arguments. Editor: Well. My frustration is that they have refused to provide our office with sufficient information to back up their contention that what they are doing is best for the schools. rather than drop the case. This morning.Editor: I’m certainly willing to listen. there’s just nothing to back up your allegations. I really think the community would be better off. one of the banks settled with my office. perhaps you should just cut your losses—and just drop the suit. From what I can see. Auditor: Well. Obviously. We believe the other defendants will soon follow suit. but I have to warn you that from what I’ve seen and heard so far. and it is costing your office money and good will. but recommended that the parties reach a settlement. the bank would not have done that had we not proven our case. They’ve been making that same argument from the beginning. I guess we’re finished here. They are very persuasive that this is just a political battle. I think I have something here that will convince you otherwise.

although getting your license and getting a pool table are connected. Example 1 Tina’s husband Mike wants to buy a pool table for their family room. Mike knows he needs to get either his wife or his son on his side. and a car is more important to him than a pool table. Tina is against it because she doesn’t think it will be used that much and it will take up a majority of the floor space in the family room. Tina and their son Kevin are against the idea. Kevin: So am I. Kevin is against it because he is turning 16 years-old soon. I’d 146 50 Practical Negotiation Tactics . Mike: I know. Dad. night after night. If the other side involves more than one person. I know we’ll all enjoy it. I want to talk about a car! Mike: It’s really not one or the other. they’ll be mobile! The last thing I want is for them to be out cruising around. Kevin: I don’t really care about a pool table. I can remember spending hours playing with my friends and family when I was growing up.Tactic 37: Divide and Conquer Certain negotiations lend themselves to a divide-and-conquer tactic. Tina: What do you mean? Mike: When Kevin and his friends get their licenses. especially Kevin. but I think it will get a lot of use. If the negotiating team sitting across the table from you seems to be divided on a subject or one of the team members seems to be more sympathetic to your arguments. try to focus on that subject or address that member directly to get them to be more amenable to your proposal. you might be able to dilute their power by identifying their different interests and addressing them separately. Tina: I’m really against this pool table idea.

Mike: I really do. received it without comment. A pool table could attract them here. only Kevin did. She noticed that Jim (another member of the union’s negotiating team. Tom. Example 2 Negotiations on a new union contract seemed to be going quite smoothly.like them to hang out here more. she joined his side of the debate. Instead of both opposing the idea. I’m surprised. don’t you think you guys would use it? Kevin: I guess so. the chief negotiator for the company. A number of contract changes have already been worked out and Wylma. Tina: Well. But I’m not going to hang out here all the time. Wylma: Tom. Wylma was surprised the next day when Tom started the meeting off with an out-and-out rejection of the wage offer and made a demand for a wage increase of four times the company’s offer. then maybe it’s not such a bad idea. the head of the union negotiating team. Conclusion Mike found an argument that divided Tina and Kevin. has just presented the company’s initial wage offer. and Kevin and his friends use it often. I thought we were making real progress. Here’s how the negotiations went. Once Mike convinced Tina of the idea’s merits. They bought the pool table. some. And I really do need a car! Tina: Do you really think the guys would use it? I would rather have them here than out getting into trouble. who was studying the company’s financial records for the team) became uncomfortable when he heard Tom’s demand. Kevin. What happened? Applying Pressure 147 .

you’ve heard our demand. Your demand is totally unreasonable. Wylma: Jim. you’ve seen our sales projections and production costs. you certainly are aware of our financial situation. Do you think this is reasonable? Jim: (looking uncomfortable) Well. these are accurate. Tom had reduced his wage demand significantly.Tom: Wylma: Nothing happened. Jim? Jim: Yes. Wylma: Let’s take a break. but he added some workplace changes that Wylma was comfortable negotiating. Wylma distributed copies of financial data that showed the company’s current condition. 148 50 Practical Negotiation Tactics . I think you need to rethink your demand. But Tom. forcing them to reconsider their demand. Conclusion Wylma’s appeal to Jim’s knowledge of the actual financial situation of the company worked to divide the union’s negotiating team. When the negotiations began again. (When they resumed. Right. as Jim can point out to you. This is just what we think is fair. Wylma: Tom.) Wylma: Now Tom. these are our actual accounting figures. Tom: We don’t think so. Let’s start again tomorrow morning.

Humor often works to break the tension of the room. especially between Madison and Cory. but the thought that matters. so pressure grew to draw names and exchange gifts. but it should never be at anybody’s personal expense. I don’t feel Christmas in the way I used to. Cory: Madison. and it makes me very sad. Tempers flare and people say things they shouldn’t out of anger or frustration. married. It was a tradition in the Jones family to spend Thanksgiving dinner arguing about how the family wanted to celebrate Christmas. but as the children grew up and had families of their own.Tactic 38: Break the Tension Tension is inevitable in most negotiations. Madison: Okay. I know that you all think I’m silly about wanting to exchange Christmas presents among the adults. so you can find a way to quickly neutralize it. Ever since Mom and Dad died. When all of their children were small. so what’s the point? I don’t need another tie! Madison: It’s not the gift. You are almost 40 years old. We can’t afford to buy each other things we really need. it was easy to agree on just giving presents to the children. I want to say something. That will just make a bad situation worse. the oldest and youngest Jones children. Sometimes the argument got heated. Example 1 The four Jones kids grew up. and had children. Stay alert and watch for clues that a negotiation is about to get out of hand. get over it. Applying Pressure 149 . but it is really important to me. some of the siblings decided they liked giving presents to one another. When are you going to grow up? Madison: (very emotional) I can’t believe you can say that to me! Christmas should mean something! Cory: It’s just silly for adults to exchange presents.

Cory:

You can say that, but everyone is disappointed when they receive a cheap gift, even if they won’t admit it! Madison: Why are you being so stubborn? You’re just ruining everything! Cory: (also emotional) Look, if you have to receive presents in order to feel that it’s Christmas, we can all just give you presents! Madison: (without hesitation) Okay! I can live with that!! (Everyone laughs.)

Conclusion
Madison’s quip diffused the emotions of the parties. Cory, while very angry, was surprised by Madison’s answer, and was able to laugh. With that, other family members joined in the discussion and they agreed that those who wanted to participate in the gift exchange would. Those who didn’t, wouldn’t.

Example 2
Jay believed that the new home-theater system he bought was a lemon, but he had very little success in getting the salesman to take responsibility. The salesman agreed to have every complaint looked at by a service technician, but the technician always gave the system a clean bill of health, which infuriated Jay. Jay finally asked for a meeting with the store’s owner, fully intending to leave the meeting with a full refund. Jay: Mr. Owner, I’m very serious when I say that I will not keep this system. It is a lemon, and you know it. Either the sound or the DVD or the picture is always off. Owner: Now Jay, there are some problems with the system, but nothing we can’t fix. Let me turn it over to my best technician, and he’ll be right over to fix it. Jay: We’ve been down that road already. The system has been on the blink 20 out of the last 30 days.

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Owner: You’ve had a loaner TV/VCR while yours was being worked on. We’ll be happy to loan you one again whenever you need it. Jay: (becoming annoyed) That’s not the point. I bought a new home theater system and I want to use it! I’m very frustrated by your attitude. Temporary fixes aren’t good enough. Owner: Well, we are attempting to fix the system. You’re the only person who’s had this kind of trouble with one of our new ones. Maybe you’re just having “buyer’s remorse” and really don’t want the system anymore! Jay: (very irate) I can’t believe you said that! This system is a lemon, and you’re trying to blame me! What a crock! What kind of business are you running here? You’re a bunch of crooks. Owner: (now also irate) Just hold on there! I run a respectable business, and I resent your attitude. We’ve bent over backwards to check out each of your complaints, none of which were found to be major defects—just things that needed adjustments. Jay: (very angry) That’s not true. The surround-sound speakers never work at the same time. You don’t call that a major defect? Owner: (realizing he needed to break the tension) Well, my 30-year old Sony TV only has one 3” speaker, but I still watch it. Jay: (pausing and calming down) Yes, my first TV was a Sony. Owner: Look, I’m sorry we’re at this point. Let me take this to my top technician and your salesman, and we’ll fix it. Give me one day. Jay: Okay, but just one day!

Conclusion
The owner used a joke to interrupt the angry negotiations that were going nowhere. He exchanged Jay’s surround-sound system for another new model. The system Jay rejected was sold as a “used” one and never came back in for repairs. Jay’s new system worked fine, and he ended up becoming a repeat customer.

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Stage 6: Making Progress
aking and reviewing proposals and counter proposals will not always close the gap between the two parties’ positions and gain a settlement. Progress might be made, however, by invoking a certain tactic at a critical time, particularly Tactic #39 (Compromise). Often believed to be the key to successful negotiations, compromise is not giving in; instead, it is the ability of a negotiator to prepare a settlement that represents some concessions on the part of each side, but that will also help gain a proposal that is acceptable to both parties. Other key tactics that can move the negotiations to a settlement include the presence or use of an unexpected friendly personality to disarm an opponent (Tactic #40: Be Friendly!) Bringing to the table a person who is highly respected by the opposing team is a good move; such an individual might be able to gain their confidence and support your position (Tactic #44: Make Use of a Positive ‘Halo Effect’). One tactic that never fails is the classic Split and Choose (Tactic #42), which goes like this: One side divides the item into two parts, and the other side gets to choose which part they prefer. Parents have used this tactic to divide the last piece of pie or cake between two kids for decades! Additional key methods that move things along include the chilling effect of one party unexpectedly tape-recording meetings (Tactic #41) or presenting facts (Tactic #45) that unexpectedly support their position. Experienced negotiators also achieve progress by asking probing questions (Tactic #46), which can reveal or point out flaws in their opponent’s position or by using a period of prolonged silence right after a heated exchange. Experienced negotiators often achieve a final gain in a settlement by nickel and diming (Tactic #43) over small items.

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Mr. they were the last children left in the playroom for the remaining two hours of the day. At some point. don’t you want to play? We could color before your mom comes. Both of the little girls liked to play ball when they were outside. each side must decide whether or not one more compromise will produce an agreement that they will later regret.” Can I color now? You said we would color later. The day-care worker wanted to take them outside for a while so that he could visit with his friend. Example 1 Julie and Dara both attend a local preschool. Isn’t it “later” yet? Right now would be a good time to go outside. however. 154 50 Practical Negotiation Tactics . Then we can color. If there is resistance to compromise.” but she needed Dara to play with her. they would have to play ball with older children. was ready to color. Dara.” Dara. C.: Julie: Dara: Mr.Tactic 39: Compromise Negotiations are successful when all parties walk away with an agreement they are satisfied with. the exchange will be between things of equal value. not the Prince. It is the give-andtake of a negotiation: one party agrees to give up one of its demands in exchange for something of value from the other party. the individual might be afraid that the exchange isn’t equitable). and that doesn’t happen without compromise. I want to play “Princess” and I want Dara to be the “Prince. C. who was outside with older children. Julie wanted to play “dress-up. I want to play “Prince and Princess. If I can be the Princess.: Julie: Dara: Julie: Girls. One day. Okay. When that point is reached. how about going out to the yard for a while? You can swing or play ball. it is better not to compromise. (In a successful negotiation. but since the other children in their room were not there. or maybe tomorrow.

They were also concerned that teenagers would congregate outside the theater at all hours and there would be more litter and trash around the mall’s parking lot. They did all the compromising they were willing to do. We want to play dress-up and then color. The owner and a small group of neighbors met to talk about these problems. The neighbors: The neighborhood has four concerns: Theater patrons will be taking up scarce on-street parking spaces. They were worried about the increase in traffic through their neighborhood and the possibility that the few scarce on-street parking spaces would be used by theater patrons. C. however. When his variance application was made public. there will be an overall increase in traffic coming through the neighborhood and vehicles will be turning into and leaving the parking lot. you can come back in and play “Prince and Princess. the parking lot will start to look trashy. According to the city’s zoning laws. Mr.” No. neighbors became concerned about the changes to the mall.Mr. We don’t want to go outside. or apply for a variance. and teenagers attracted by Making Progress 155 . C. Conclusion The children stayed inside and played dress-up. wouldn’t you like to go outside first? After you swing for a while or play ball. The owner decided to try for a variance. and they still had time to color. Example 2 The owner of a small strip mall in the heart of a residential neighborhood was planning to add a small movie theater to the other businesses in the mall. The existing parking lot didn’t meet the current parking standards for that size theater.: Julie: Hey. the owner had to supply additional parking. failed to offer the children something that was as important as the plans they had made.

What if I changed the entrance to the middle of the lot? That way. but it’s not ever full. the closest parking to it is along Elm Street. Right now.the theater will start to hang around and maybe wander around our yards at night. the north lot is used more. We hope you’re right. Right now. I could put a privacy fence along the east and west—at the backs of your yards. with your plans to put the entrance of the theater on the east side of the mall. So. The fence would shield neighbors from the lights from the vehicles and block the walking access through the alley. I’m certain the lot will accommodate the theater crowd without increasing the parking on your neighborhood streets. Owner: You know that there’s always plenty of parking in the south end of the mall’s parking lot. In fact. even though I’m not adding any parking. Not having in and out traffic to the south of the mall is just not very practical. lights in and out at night can be very annoying. if I agree to move the theater entrance to the south side. All a patron has to do is park on Elm and walk beside Joe’s yard through the small alley there. We’re just not convinced. the south parking lot has not been used much. Many of our homes back up to that lot. only when that lot is full would cars come around the mall and park on the south side. You could have all of the traffic enter from the north lot. I’m afraid. as you said. driveways on the south side of the mall are along the east and west side of the parking lot. And. and we’d like to keep it that way. We’d really like to block off that cut-through and have the theater face the south. not having direct access to the south lot from the street would be unworkable. With the Comedy Club and the grocery store on that end. We’d like you to prohibit cars from entering or leaving from the south lot. and break in his door. The neighbors: Owner: 156 50 Practical Negotiation Tactics .

And a year after the theater opened. Making Progress 157 . there could still be access from the street to our garages—just not to the main parking area. The fences created a buffer from the lights and noise. and make sure the parking lot is kept clean. however. But you’re going to have to have some kind of security as well. Conclusion Both sides had to give up something on certain items in order to reach agreement. The compromises were what everybody could live with. The fence would help with the vehicle lights and buffer this noise from the kids who hang around. then will you agree not to push for increased private security? Yes. put a privacy fence along both the east and west sides of the south lot. Agreed. If I agree to move the theater entrance to the south. but the privacy fence has to be landscaped so that it doesn’t look like a ghetto wall. set back a driveway width. and they discouraged patrons from parking on neighborhood streets. Now you’re talking about considerable expense. Teens can form into gangs if left unwatched.The neighbors: Owner: The neighbors: Owner: But we use those side drives to get to our garages. add a new entrance into the south lot. the neighbors reported that they were very happy with the way it all worked out. If the fence was set back the width of a driveway onto your property.

just forget it. Your opponent might give in readily. incident was usual or unusual. Lonely’s only companionship. and what kind of complaints might have already been made. She didn’t believe her neighbors ought to complain about the barking. She sought advice from the family on the other side of the neighbor with the barking dog to see whether this 3:00 a. They might even start to underestimate your negotiating skills. and I just moved in next door. Mrs. Joan was already pretty tired. and sleeping at night was already a difficult proposition! When the neighbor’s dog began to bark at 3:00 a.. but be friendly.Tactic 40: Be Friendly Being polite. 158 50 Practical Negotiation Tactics . and pleasant always enhances one’s ability to reach an agreement. Close your windows at night and don’t listen. Mrs. Present your position forcefully. professional.m. Joan had a new baby. they had gotten nowhere. If your opponent is aggressive or angry. and didn’t stop until 6:00 a. Take advantage of any confusion about your friendliness to try to get them to agree to some of the easier things you have to work out. respectful. and that as angry as they were. This gives you an advantage. so her neighbor’s barking dog came as an unpleasant surprise. and because she was hard of hearing. Lonely: If you’re here to complain about my Rocky. thinking that you will be just as easy to work with on the sticky issues. The dog was Mrs. your friendliness might disarm and relax them to the point where they begin to talk about their priorities and objectives. and started to get upset. she just didn’t think it was a serious problem. She learned that everyone in the neighborhood had complained at least once. but going out of your way to be friendly is an especially helpful tactic.m. because you are the one to set the tone for agreement. I’m Joan. Joan decided to at least try and talk to the neighbor. Lonely. Example 1 Joan was new to the neighborhood.m. Joan: Hi.

Lonely: Joan: Mrs. Lonely again. I’d like to introduce you to my new baby. Here’s my little angel. My friend wouldn’t charge anything for talking to us about Rocky and maybe giving us some advice. Mikey. then. I stopped by and visited with him over the fence this morning. too. don’t worry about that. Making Progress 159 . I’ve got a friend who is a veterinarian. He’s a real comfort to me. Who. How long have you had him? Almost eight years now. is a really sweet dog. I guess that would be okay. He’s been keeping me up at night. I guess so. (Joan’s sleep was disturbed by another night of barking. Do you think his age has contributed to some of that? You know. I need to get the baby home. I might have to talk to you about Rocky. Lonely: Joan: No. it’s probably because they just haven’t had the time to get to know him. I sure hope he starts sleeping through the night soon. I know that some of these people around here don’t like him. Lonely: Joan: Mrs. by the way. and I’d like to have him stop by and look at Rocky—would that be okay with you? Well. Lonely: Joan: Mrs. No. I’ll see you. I’ve only got my Social Security. Well. not at all. The barking at night has been mentioned to me. I can’t pay for something like that. When he does. isn’t he cute! He’s a handful.) Hi. sure. though. no. I just wanted to come by and introduce myself. but she took her baby and went to visit Mrs. Lonely: Joan: Mrs. Why. Maybe I could come back tomorrow and bring him? Oh.Joan: Mrs. Well.

its 150 management and sales employees could continue to work in Happy City. Joan took up contributions from the neighbors. Company ZZZ: (surprised) Well.S. Lonely’s needs and arrive at a workable solution to the problem. The barking all but stopped. Company ZZZ was not able to meet with local elected officials regarding the status of their operations before the press reported the layoffs and the uncertain future for the 150 white-collar employees.A. and Mrs. recognizing that the layoffs would be an issue in upcoming local elections. overseeing a factory in Mexico and selling products in the states. of course.Conclusion Joan’s friendly approach enabled her to understand Mrs. Company ZZZ. Lonely and Rocky. that the press got hold of the story of our company’s activities before we could call you to let you know. After Joan’s veterinarian friend visited with Mrs. Example 2 Company ZZZ planned to close its manufacturing plant and lay off 300 union employees. the mayor called and asked for a meeting with Company ZZZ officials. agreed to meet with the mayor.. When he heard the news on the radio. that’s very understanding of you. Here’s how the meeting went: Company ZZZ: We’re very sorry. he prescribed medicine that gave Rocky a more regular sleep schedule. you would have. Under its new corporate structure. They anticipated that it would be an unpleasant meeting. 160 50 Practical Negotiation Tactics . Lonely didn’t have to pay for the medicine she could not afford. Hearing about this from the press obviously puts you in a very embarrassing situation. I think that if you could have let me know ahead of time. Mayor: (very friendly) I understand how these things happen. U. It’s very difficult to make a move of this type without having it leak out.

Mayor: I wanted to meet with you so we can take the necessary steps to keep the 150 jobs here. I am certain that you would like that kind of “good” publicity coming quickly after the recent bad publicity. The buyer is a “disadvantaged business” we have been working with for some time. Would you be in a position to talk to me about such a deal. so we need to understand how we can affect their decision on keeping an office here. Unfortunately. the city has a potential buyer for your plant building. We recognize that your new corporate owner is a large company located in Malaysia. Conclusion The mayor’s strategy was to disarm the company with his friendly attitude and in return get a favorable response to his proposal to buy the property in question. the 150 management/sales jobs did end up moving to Mexico. Company ZZZ: I’m not sure what to tell you on that. Mayor: Please let me know as soon as you can. I think I can prevail upon the Malaysia group to let us handle the disposal of the property in such a way as to repair some of the damage our layoffs have created. This strategy worked. Mayor: Great! Let me know when we can talk again. Making Progress 161 . Many laid-off employees did indeed find new jobs at the plant. It’s possible that some of the 300 laid-off employees will find work at this new endeavor. because I’d hate for us not to make an appropriate pitch to them. and the mayor was reelected. or would we need to involve the Malaysia group? Company ZZZ: Certainly. You’ve been very understanding about this. and I want them to know that. They need a really good deal on the plant price. We just haven’t heard anything yet. By the way. The mayor was able to broker a deal for the “disadvantaged business” to buy the plant and convert it to a different widget maker.

She agreed that her proposal was not fair and that she had tried to take advantage of her younger sister. Fred Adams. Susan wanted to negotiate with Alexis to “pool” their money so they could buy something together. Alexis knew this was not fair. She borrowed a tape recorder so she could ask her father if this was a fair deal. Susan understood the impact a tape recording can have when it reveals a lie. Alexis agreed. Susan denied it.00. were on vacation with their parents in Myrtle Beach. South Carolina. The two sisters had saved up a little money so that they could buy souvenirs. Michael Wood. Conclusion For the first time in her life. but Susan had only $20. or used to pressure the other side to agree to certain demands. Alexis then played the tape for her father.Tactic 41: Record the Meeting The climate of a negotiation session can be “chilled” in an instant if one side unexpectedly brings a tape recorder to the table. Example 1 Susan. Example 2 Three men were meeting to discuss a charge of sexual harassment that had been made against Stuart Jones. Susan repeated her demand. this time in front of a hidden recorder. Then he played the tape. thus becoming a source of embarrassment. had $40. the younger sister. are talking about a possible settlement of the issue. threats. age 15. The effect on the other party might be even more substantial if lies. and Jones. Alexis. Jones’s supervisor. the accused. until Susan said they would evenly split what they bought. the investigator. and Alexis. or simply “bad faith” methods have been used by the other party.00 to spend. He asked his elder daughter about the arrangement. age 14. Somehow. They might worry that the tapes will be made public or given to others. 162 50 Practical Negotiation Tactics . who was disappointed to hear that she might propose such a deal.

Adams: Jones: Wood: Jones: Wood: Jones: Wood: Jones: Wood: Jones: Adams: Jones: Adams: Jones: Adams: Tell me again. I think I can write my recommendation. Jones. I’ve brought a tape recorder with me.” meaning something other than copies? No. Stuart. “Do what I want. And you did not threaten her job if she did not. Well. and now I’ll ask you to repeat your answers—on tape. Mr. I simply asked her to make copies for me as quickly as possible. No one could have possibly misunderstood your intentions? No reasonable person. So. to quote you. Ruiz and Ms. Conclusion Jones had knowingly lied when he denied the charges. he also lost his negotiating position. you are aware that the next step in this process is to ask witnesses to come forth. (a long pause) I want to see my lawyer. stares. Making Progress 163 . Jones suddenly realized that his strategy would not work. Appleton both claim they saw the incident and will testify. You never touched any part of her body? Not even accidentally? No. exactly what you said to Ms. Mr. And please describe your general manner. Starr. So you refuse to repeat the answers you just gave us? Yes. When Adams set the tape recorder on the table and revealed that he had witnesses. He failed to think about what might be the next step. Your request. and gestures did not have a single hint of sexual implication or innuendo? None at all. But by refusing to repeat his answers.

” the divider. one person is given the task of dividing the object(s) into two parts. The second person then chooses which of the two parts they will receive. take this knife and slice the Snickers into two halves. is usually careful about dividing the object into two equal parts.Tactic 42: Split and Choose When two parties both desire something that can be shared or divided between them. Many of us learned this one from our parents: After two people agree to the strategy. Oh. the classic “split and choose” tactic might be the best way to settle the issue. with the remaining part going to the person who did the dividing. Maria: Roberto: Maria: Father: Father: We can’t share it! It’s in one piece! I’ll eat half and give you the rest. Example 1 Maria (age 8) and Roberto (age 6) are arguing over who should get the jumbo-size Snickers candy bar their father brought home. which certainly is large enough (he naively thought) for two young children to easily share. Their dad instructed them to share the candy bar. so I’ve got to cut it into two equal pieces or else he will choose the bigger one? Exactly. Maria. Realizing the potential of getting the “smaller half.… No way! Haven’t you two heard of ‘split and choose’? It’s a fair way to divide things. because you did the cutting. What is it? Maria: Father: 164 50 Practical Negotiation Tactics . Maria and Roberto: No. of course. Roberto will get to choose which half he wants.

The remaining lots should be distributed between the two parcels to make each parcel as equal in value as possible. so we should be able to divide the property fairly. They all have a great view and are equally desirable to build on. but is not sure how to arrive at a fair split. Deal? Clarence: Sure. Making Progress 165 . Archie is ready to build a retirement home on the property. Clarence: Right. I propose that you divide the fourteen acres into two parcels that you believe are about equally desirable: one parcel with three lakefront lots and the other with four lakefront lots. even children. I don’t really care which lakefront lots I keep. both parties.Conclusion When two people desire the same object and it is something that can be divided in some way. Give me the map and a pencil. Lots must be at least one acre to be developed. There is only one place for an access road that must serve all lots. Archie: Here is the map. according to county deed restrictions. Clarence and Archie.000. quickly recognize the fairness of the divideand-choose method. Then I will choose which parcel I want. Example 2 Two friends and business partners. jointly purchased fourteen acres of lakefront property several years ago. and wants to divide it into two separate parcels. Archie: That’s true. They have a recent appraisal that values the property at $150. Clarence: But some of the lots away from the lake have been partially cleared and are flatter than others. The problem is that one of us will get four lakefront lots and the other will only get three lots. That makes them more desirable. but the appraiser pointed out that the seven one-acre lakefront lots are considerably more valuable than the other seven lots. Archie: I really don’t care either. Clarence agrees to divide it. that sounds fair.

Conclusion Clarence divided the fourteen acres into one parcel with three lakefront lots and six other lots. and both men were happy with the arrangement. and the second parcel with four lakefront lots and one other lot. Archie chose the parcel with the three lakefront lots. Which would you have chosen? 166 50 Practical Negotiation Tactics .

attach legs. is expected to dicker over the price. supposedly the bargainer in the household. Example 2 An experienced and skillful union organizer liked to tack on a tiny less-significant item each time a company and its union negotiated on a large and Making Progress 167 . Her husband Jason. Example 1 Brenda Davis is always thinking about the repairs that might be required on an item. The suite they liked best was already at the lowest price in town (the retailer was having a real sale). so the salesperson delivered the suite himself. he also set up all of the furniture in a second-floor bedroom.” Many people have witnessed or used this effective negotiating tactic. Conclusion The amount the couple spent was fairly large. we’ll take the suite if you’ll throw in free delivery and set up the furniture.Tactic 43: Nickel and Diming Insisting on the addition of a small item (a “nickel or dime” item) as an inducement to help settle a more-important item being negotiated can change the negotiations in a significant way.” Under store policy. Jason was having a hard time getting the salesman to lower the price.” thus extending the scope of the negotiations. miles from their home. and the delivery carrier doesn’t set up mirrors. Brenda did her part when she said. delivery was limited to a small geographical area. With a great deal of effort. They recently purchased a new bedroom suite after they carefully priced comparable furniture all over town. because a “nickel” item has been added to negotiations about a much more significant item costing “dollars. His tactic was to throw in a “nickel” in order to make lots of “dollars. etc. However. What started out as a single issue is now a combination of a major issue and a much smaller issue. “Okay.

we’ll agree to Health Plan A with another ½ cent on the pension fund. so be prepared to withdraw the nickel and dime item at the hint of trouble.” Conclusion The nickel and diming tactic is a classic negotiation tactic used successfully in a variety of situations. At the end of negotiations. the two sides had been engaged in considerable bargaining over an improved medical insurance plan (“Health Plan A”) costing hundreds of thousands of dollars. If one party misjudges the situation. it can be a dealbreaker. This experienced bargainer said.important item. one member of the management team commented on the move: “This guy has nickeled and dimed us a total of thirteen times—and for a lot of money! Next time we can’t give in on those small add-ons. 168 50 Practical Negotiation Tactics . In one case.” The company negotiator yielded to this small-potatoes counteroffer in order to win agreement on the health plan. “Okay. If used correctly—at the very end of a negotiation—the tactic can usually provide a small gain.

trustworthy. Donna: No way! These are the last two pieces of furniture. Kathy: Well you took the bar and four stools as one item! Donna: They are part of one set.” Having a member of a negotiating team whom the other side thinks can do no wrong might prove to be advantageous. and all the rest is small junk. Donna: I’ll take the bar with stools. decision-making meetings. but they are two pieces of furniture. You can go first. or knowledgeable. Kathy: But they are a matched set. Example 1 Donna: Mom said to take what we want from the old house and toss out the rest. People tend to make an effort to put their best foot forward. Donna: They match. Kathy: I suggest we take turns choosing which of these things we want. Kathy: Then I’ll take the couch and love seat. Kathy: Not if you accept your logic! (Pause) Donna: You’re not being fair… Making Progress 169 . Donna: Okay. This creates what is called a “halo effect.Tactic 44: Make Use of a Positive “Halo Effect” It is common in interviews. Kathy: I’ll take the pool table. and performance evaluations for people to come across as likeable. thus creating the impression in others that the good qualities they see are present all the time. I’ll take the color TV.

I want the stools.Kathy: Donna: Kathy: Donna: Kathy: Kathy: Donna: Kathy: Donna: Kathy: You’re not! (Pause) Well. He might or might not have also been a good arbitrator. Example 2 During a heated labor negotiation. Conclusion Kathy and Donna needed an arbitrator to settle their disagreement. but Kathy and Donna assumed that one positive quality (honesty) would carry over to other areas. the team representing the city management found itself unable to convince the union negotiators that their newly proposed staffing plan would provide adequate personnel for each firehouse. I want the love seat. and if the bar and stools should be one item or two. 170 50 Practical Negotiation Tactics . and ask him if the couch and chair should be one item or two. What for? Tell him the situation. Johnny had the “halo” of an honest person. The union negotiators. (Pause) We’ve got to settle this today and get this stuff moved. He’s our cousin. Good idea. what can we do? Give me the couch and love seat! No. I trust his judgment. with a record of labor involvement that included three recent strikes. and he has always struck me as an honest person. Let’s call Johnny Ryan.

Boston went to the negotiation table with the management team. when negotiations again stalled on a retirement plan issue. and that he did. They might have stretched his halo farther than his expertise and experience warranted.simply did not trust the management team. This time. He solemnly told the union negotiators that he had been hired to review it. Making Progress 171 . He said he believed that it would work as presented by management. without any reservations. the city management again hired Boston. During the break. even if the proposal appeared to be valid. The teams took a weekend break from the stalled negotiations. Conclusion The union leaders gave Boston a great deal of respect (even in areas such as budgeting and actuarial tables) because of his former position. the management team hired Sam Boston. but the power of the so-called halo effect was great. the consultant did not speak. Boston was widely known as a totally honest man who speaks his mind. On Monday. but his mere presence caused the union leaders to accept a management point as valid. thus bringing the negotiations to a conclusion. The union accepted the proposal. Two weeks later. the former union president. as a consultant to review their proposal.

Sometimes. $235. This offer is for more money than any four-bedroom houses on this neighborhood list. They sold for: $225. (Next day) We’ve reviewed the records you’ve produced. The owner. and we are countering with an offer of $250. Sam Jones: Sam Jones: 172 50 Practical Negotiation Tactics .000 under the listing price! We realize that. but we feel that it’s a fair offer. We love your house. How can you say that? We went to the county courthouse and looked up the real estate transactions for all the houses in this neighborhood that were sold over the past two years.000.000. $229. and $237.000. Henry Lopez: Sam Jones: Maria Lopez: Sam Jones: Maria Lopez: We love the house and have made a written offer of $240. I’ll get back to you.000. has owned the house for 24 years and is downsizing to a condo. Being able to present them at the most appropriate and critical times has made the difference in countless negotiation situations.Tactic 45: Use Facts Fact-gathering must be part of the preparations for every negotiations session. They believe it is overpriced.000. but you’ve priced it way too high.500. but the key is to gather facts that you might need—not just the facts that you will need. Here’s a list of the five that are about the same size as yours. the other party will ignore or refuse to believe the information. Example 1 Henry and Maria Lopez are interested in a house that lists for $275. $237.000. What? That’s $35. but the right facts presented at the right time can chill or astound and completely turn things around.000. Sam Jones.

The last 20 were over $2. I asked for a list of all new PCs bought this year.600 for a computer.Henry Lopez: Sam Jones: Henry Lopez: Sam Jones: Let us discuss this for a minute.000.600 unless the company president approves. let’s not worry about it. and did his homework.400 each. The facts presented by Henry and Maria Lopez caused Jones to re-counter their asking and likely sale price. No one can go over $1. Example 2 Supervisor: You know the policy. Hatfield: While I was at purchasing. Hatfield: My staff has done a lot of research. I’ll be… Okay. We’ve talked with purchasing and we have the authority to buy seven for $2. and wisely chose exactly when to present them in order to make his point. We accept.000 each. Making Progress 173 . He found facts that supported his position. Conclusion The Joneses had based their asking price on the advice of a friend. Here it is. if other departments have ignored the policy. That’s the bottom price. and we know that only this model will meet our needs. Conclusion Hatfield had anticipated what his supervisor’s position would be. Supervisor: Well. who was not particularly knoledgeable about real estate. Supervisor: If I okay this purchase order. I’ll get called on the carpet. You can’t pay more than $1. Order the new computers. Well… We have a written counter of $245.

Example 1 Maureen: What. yes. Maureen: The policy limits a person to only take out three books at the same time? Jenny: Yes. 174 50 Practical Negotiation Tactics . can you check out two on a card for him? Jenny: Well. Maureen: Well. Maureen: So you trust me with the books. I’m sure you would not. Otherwise. I want two of these. some people would have forty or fifty books out at the same time. and help you point out inconsistencies in a position that might “lead” the other side to change theirs. The effective use of probing questions can help achieve a favorable settlement. but I don’t set the policy and I can’t make exceptions. I can do that within the rules. you know me. reveal misperceptions or lack of knowledge about positions that can be corrected. Maureen. and two are for my husband. Maureen: Well. I can’t check out these four books? Jenny (Librarian): That’s the policy. I trust you. but you don’t want to jeopardize your job? Jenny: Yes.Tactic 46: Ask Probing Questions Ask probing questions and follow-up questions. and they would all be unavailable to others. If you trust me. Would I do that? Jenny: Maureen. A maximum of three books can be checked out to a person at any one time. But I can’t break the limit rule—it is an absolute rule here. They can help you identify or better understand what the other side really wants.

(Next day) Do you have the policy about giving out product sales information? No. What’s the policy number or date of approval? I don’t know. But this forces us to make decisions without complete information! Yes. but it’s because you don’t have access clearance. Making Progress 175 .Conclusion Maureen used probing questions to uncover a way to solve her problem and make it easy for Jenny to stay within the library rules. Example 2 Jack: Mark: Jack: Mark: Jack: Mark: Jack: Mark: Jack: Mark: Jack: Mark: Jack: Mark: Jack: Mark: Jack: Mark. Jay. Can you get me the number? Sure. If that data ended up in the wrong hands. Why? Some policy? Yes. Mary and Kenzie? They are 2-3 pay grades below us. are you sure I can’t get your information technology people to give us direct information on product sales? No. Babu. Sue. Security? Right. we can’t do that. and they don’t even have a use for the sales data. it could kill us. Mary. I couldn’t find anyone who knew it. Brooks. Who does have access clearance? Mike. and Kenzie. They say it’s a security issue.

… (Next day) Mark: The vice president said you can have access if you sign a security card like everyone else who has access clearance.” He intended to do this until he hit a dead-end or was able to find a solution to his problem. Conclusion Jack continued to probe by asking why and who in order to find out more about “the policy.P. that’s been the policy since I’ve been here. When can I get the data? Mark: Today.Mark: Well. if we can have access? Mark: I guess so. 176 50 Practical Negotiation Tactics . Once he discovered that employees in lower pay grades had access clearance. I’ll get it for you ASAP. Jack was able to receive clearance as well. Jack: Can you ask your V. I’ll sign now. His probing questions turned up a critical fact. Jack: Here.

If friends or neighbors need to settle something but prefer to avoid the negotiation process. In this process. If both parties desire a settlement but cannot seem to reach it through the usual give-and-take process. or even months after the first offer is presented.Stage 7: Reaching Agreement he final stage! It might come minutes. Other final-agreement tactics include Tactic #47 (Giving Premature Congratulations) to make the other side feel good about having achieved an agreement (while you spring another condition on them). When multiple issues are at stake and most have been agreed upon during negotiations. They bring it out when a dispute arises. this process can easily result in a final settlement. When two parties believe they have an oral agreement. this tactic can produce an agreement. days. the two parties agree to let a third party render a decision on unresolved issues and agree to accept the arbitrator’s decision as final and binding. T Reaching Agreement 177 . Tactic #50 should always be used right away: Commit the Offer to Paper! Even small issues negotiated among friends can cause problems if people rely on memory and assume that both parties have “heard” the exact same conditions. and the classic Walk Away (Tactic #48). If people are not willing to take even a few minutes to write down the terms that have been agreed upon and sign the paper. and the child learns an important lesson about life. how solid an agreement can it be? Even parents negotiating chores and other aspects of life with their teenagers have found it useful to have their children write down and sign the list. Tactic #49 (Final-Offer Arbitration) should bring about a settlement. which is used only when a negotiator is prepared to end negotiations without an agreement and you want the other party to make a final concession to reach a settlement. hours.

After days and weeks of on-again. Larry Snyder gets bored staying in any one place for many days. D. Nancy brought up the subject of vacation again after dinner.” Conclusion The husband was so excited about visiting Washington.…” Larry was very pleased that his wife was agreeing to the idea he had been trying to sell. 2) allows the other side to feel the release that comes with completing the bargain. she continued to speak: “…as long as you agree to drive us to visit my mother on her birthday.C. off-again discussions. Let’s do go to Virginia Beach and Washington D. She said. Example 2 Negotiations can take a long time and incorporate many issues. and Virginia Beach —his plan—that he let the euphoria of the moment cause him to agree to a trip he dreaded and in fact had successfully avoided all year.C. The bargainer skillfully 1) begins the congratulation sentence “I agree…”. As he hugged her. His wife had carefully planned her exact “premature” vacation agreement. Weeks of stressful meetings cause both sides at the bargaining table to look forward to its conclusion. They both have stressful jobs and look forward to their annual vacation together. 3) and adds one last key demand to the congratulation sentence. Near the end of a particularly anxious bargaining session when there was little time left to negotiate. Example 1 Many husbands and wives have different ideas about how they’ll spend their vacation.Tactic 47: The Premature Congratulation This tactic draws its strength from timing. one exhausted negotiator saw that his team was equally weary and 178 50 Practical Negotiation Tactics . but his wife Nancy likes to stay put and relax. “I’m thinking of agreeing to your plans for vacation.

but acceptable. (This is a bad position to be in. One operating issue involved the probation period for new employees. There were grins and handshakes coming from the other side. Reaching Agreement 179 . In our last offer. and rested. The celebration had begun. “It was hard for us.” Bob: Ted timed this perfectly. fit. Most people didn’t notice that the negotiators had not finished their hand shake… Ted: Then Ted continued his sentence with. “…as long as you give us a 45-day probation period. but we agree to everything in your final proposal…” Members of my team shouted hooray. One of the best pieces of negotiation advice is to remain fresh. It was so close. Therefore. I felt the tension in the room. as the negotiator came closer. because it makes you pretty vulnerable. We all knew that it could come down to agreement or strike. symbolizing that he was agreeing to the entire final offer. and this skillful negotiator let them feel the happiness and security one feels when the fear vanishes.almost willing to accept any deal. he turned on a large warm smile and extended his hand to shake. The old agreement specified a 30-day period.) Here’s what happened: Bob: I knew that the other side was similarly harried. However. we held firm on this and did not discuss the probation issue and many other “dead” issues for days. but the other side continued to ask for 60 days. When the chief negotiator emerged with his team and headed toward my team. It took only a few minutes of caucusing for my team to convince me that a 45-day probation was costly. but held firm on remaining operating principles. My team was afraid we would not even come to an agreement. we made some small concessions on financial matters. but also that they sensed the weariness of my team. Ted said. My team had convinced me that doubling the time frame would create a real problem on the shop floor.

Conclusion This “premature congratulation” tactic can only be used successfully at the very end of an unsure and shaky negotiation. 180 50 Practical Negotiation Tactics . knowing that it will probably be agreed to in order to continue in the euphoria of the moment. The negotiator makes a big show of agreeing and allows the other side to bask in the glory of a deal completed. However. the negotiator skillfully finishes his words of congratulations by inserting one last key demand.

all from Sue Wilson. (Vahaly drives the new Highlander home. I’ve worked with you before. You had time to assess my car. Jay. and the lease on my Avalon is about to expire. be sure you think this through beforehand. and he can simply buy it when the lease expires. how did you like it? Jay: Okay. Whether you are really bluffing or you are serious. You bought your wife a new van just last year. I don’t want to negotiate. Sue: Let me get you the keys so you can take this one home overnight to see how you like it. but his Avalon has been a good car. Sue: I remember you.Tactic 48: Walk Away Walking away from the table in the middle of negotiations is a risky tactic that should only be used when you know you have a good alternative to what is on the table AND you believe that the other party will think that you really are serious about quitting for good.) Jay: Sue. here are your keys. the following exchange occurs. Sue: Well. if I roll over the lease to a Highlander. He really likes it. right? Jay: Yes. He stopped by Pembroke one day to look at the new models. but I thought I might want to try a new Highlander. My name is Jay Vahaly. Jay: Hi. I like it. too. Jay. what can you do on a 36-month lease? Reaching Agreement 181 . or go after you and perhaps make a new concession in order to get you back to the table. Example 1 Jay Vahaly has purchased three new Toyotas from Pembroke Toyota over the past twelve years. The next morning. but my Avalon is a good car. a veteran salesperson. Your opponent will have to either let you go and run the risk that things are really over.

you can turn in the Avalon and get the Highlander for only $249 dollars more per month. That was the figure he was looking for. a successful musical instrument sales and rental store. I thought I’d get a fair deal. Sue called him as soon as he walked in the door and offered another $50 break on the lease. Jay. Jay. Jay: I guess I’ll go to Dixie Toyota and see what they will do for me. (He walks away) Sue: No. Jay—wait. (15 minutes later) Sue: Well.) Conclusion Jay knew his BATNA (best alternative to a negotiated agreement): to go somewhere else if the deal isn’t good enough. Please go back and work out a lower lease payment. $100 more. at most. Jay accepted. Sue: I’ll try. I’m disappointed. Sue: Sorry. Let me try again. They’ve talked about retiring in recent months.Sue: Give me a few minutes and I’ll find out … (20 minutes later) Sue: Well. (Jay got in his car and drove home. These Highlanders are hot items! Jay: Well. Example 2 Larry and Judy Bizannes own the Bizannes Music Mart. they came down to $199 more on a thirty-six month lease. but 182 50 Practical Negotiation Tactics . He effectively used the walk-away tactic to let Sue know that he was firm on the price. Jay: What? I was thinking the lease payment would be. He was prepared to keep his Avalon if the lease was even $1 more than his limit.

Reaching Agreement 183 . but their continued walkout convinced Michael that they would hold firm. go back to your office. You rejected it. and I only need your building to own it. Larry.5 million.) Conclusion Larry and Judy used the walk-away tactic and stayed away for two months in order to convince Michael that they were firm on their price. visited their store. our accountant said it’s worth $6 million. and we gave you our price. Michael: Well. Judy: Larry.both of them love their store. Michael: I have a check right here for 4. One day. What do you think? Judy: Larry. Michael calls on them again with a check for $5. Michael Roberts.5 million. come out here! (Judy comes out from the back room. Michael: Good morning. and I’m prepared to offer you $4. Larry. a local developer. today. which the Bizannes accept. Larry: Yes. I still want to develop this block. they were prepared to accept $5. you’ve already told us that. with a certified check.0 million. Two months later. let’s eat lunch. He met with Bizannes twice before. after no contact from Larry or Judy. How’s business? Larry: Great! I’m surprised to see you again.) Larry: Michael is here again. so why are you here? Michael: I’ve discussed it with my partners. (Judy and Larry walk into the back room and close the door. Larry: Judy. In reality.5 million. and he is offering us $4. and I’m not interested in less.5 million for the building. Larry: Michael.

000. 184 50 Practical Negotiation Tactics . That was the deal. Jenny told Lynne she could take the old Singer that she has no interest in (and doubts that it is worth restoring). and would be able to restore hers as well. Six months later. Lynne: No. One day Lynne dropped by for a visit and the discussion turned to the old Singer. Each party wants their offer chosen. Lynne responded that this was their intention. I won’t take it. Lynne told Jenny that she and her husband Gary have restored two other Singers. but they wanted to give Jenny $500 for her “share” of the machine. In most arbitrations. In final offer arbitration. Let’s split the money. But he isn’t allowed to try to find a “middle ground”—just to choose one position or the other. In arbitration. The following discussion occurs: Jenny: The old machine wasn’t worth $50 when you took it. Jenny has an antique Singer sewing machine. Lynne: No! I suggest that we each write down our position and let Dad choose one of the two as the final decision. We have a few dollars invested in parts and we had fun working on it. Jenny told them to sell it. so they generally give up some ground and try to make the offer appear as fair and reasonable as possible. Example 1 Jenny and Lynne are sisters. In mediation. They inform her that they put the machine on e-Bay and have an offer of $1. the mediator works with both sides to resolve certain issues but has no authority to make binding decisions. both sides have agreed in writing to accept the arbitrator’s decision.Tactic 49: Final-Offer Arbitration Mediation and arbitration are two well-known ways of resolving sticky disputes.000. which is generally voluntary. Lynne and Gary bring the restored Singer to Jenny’s house. Jenny: No. each party submits their final offer on each unresolved issue (usually in writing) and the arbitrator chooses one as the final settlement as it has been submitted (no changes or compromises). I offered it to you for nothing. the arbitrator is given the authority to make the parties comply with the final and binding decision. Both involve the use of third parties who are objective. which she has kept in a barn for over ten years. Keep the $1.

The union’s position could have run into millions of dollars. we are down to only three unresolved items. Their father found Jenny’s position to be the most reasonable. Conclusion Jenny’s final position was that she receive $50—the maximum possible value of an old “junker. the old machine was only worth $50 when Lynne hauled it away. after six weeks of negotiating. so I am invoking the finaloffer arbitration ground rule we have in place. and meet back here in 72 hours—3:00 p. Ralph: I know.” Lynne proposed a 50-50 split.Jenny: Dad: Okay. Tina. I have chosen management’s offer to keep it as it is under the current contract. Tina: Good. Example 2 Ralph: Well. Ralph: Right! (Friday at 3:00 p. binding decision on the three items. My troops are getting restless. first on the health insurance co-pay. based Reaching Agreement 185 . but we’ve made no movement on any of them since we started. on Friday. Any increase in value was due to the work of Gary and Lynne. As a brief explanation. They should get the other $950. (One week later) I think Jenny’s position is the most reasonable. Then we both submit our final offers to Judge Ryan within 48 hours.m. I can’t see any way to reach an agreement. At best. I’ll buy that. since he could only choose one offer.m. Tina: Yes.) Judge Ryan: Here is my written. he did not need to “haggle” with them.

At least we both saved time. Well. on the merit pool distribution method issue. and stress. and peacefully finalize a contract that contained several important gains for both sides.000—less than 1 percent of the total package. 186 50 Practical Negotiation Tactics . I have chosen management’s offer because the union did not justify why the past practice should be changed. Conclusion The final-offer arbitration process enabled the parties to gain a fast. and an item that large should have been negotiated at the table.Ralph: Tina: on last year’s data. Now let’s get a signed contract. Second. I have chosen the union’s final offer. I’m sure you realize that we could have taken six more weeks to reach the same point. Ralph. money. reasonable resolution to their last three unresolved issues. Finally. No increase has been given for six years. It will only cost $120. on the clothing allowance. I’m not happy with your decisions. nor why their method was superior. but we agreed to this process.

Example 1 Bill and Paulette had been house-hunting for some time. everyone is busy grappling with the details of the negotiations. During a discussion. and while Bill and Paulette had been using an agent to help locate houses.000. Bill: Reaching Agreement 187 . Seller: Yes. The party who writes down what has been agreed upon right away might have some advantage in precisely wording the agreement to that party’s advantage. not the furniture. At the very least. Bill pulled the seller aside. The goal of recording the precise details is to either avoid any misunderstandings or address them before the talks conclude. Seller: We’re asking $152. we won’t be involving our real estate agent. Obviously. They saw the “For Sale” and “Open House” signs. They finally looked at a house they really liked. all the usual stuff in a sale. Bill: Bill: Can we talk to you a minute? What’s your asking price? And that includes the appliances in the kitchen? And all of the drapes and blinds? Okay. and felt that they would have to work fast to make an offer before someone else did. seeing the agreement in writing will force both sides to acknowledge what has been said and agreed to in the negotiations. The owners were selling the house without a real estate agent. they looked at this particular house on their own. They were not the only couple to come to the open house. however.000. We’d like to make you an offer of $150.Tactic 50: Commit the Offer to Paper You can often control the progress and direction of a negotiation by writing down the agreements or understandings as they are being reached. Bill and Paulette fell in love with the house. and one of the other couples looked very interested. and decided to stop by to see if they liked the house. If we shake hands on it right now.

he listed the stove. Example 2 Monica brought a sex discrimination charge against her employer. (The seller recorded the offer of $150.000. look this over. and that the problems with her job performance were. Seller: Okay. and when she refused. that’s what I meant. he left the price at $150. In the section for fixtures and miscellaneous items to be left on the property. the house is yours. he listed an attached hutch in the kitchen. Under the section for appliances to be left on the property. The supervisor pointed out that he had a staff of 20 or so women. and the two area rugs were specifically included. It worked. then we have a deal. Conclusion The seller had always intended to leave the garbage disposal. In her complaint. and the garbage disposal. in fact.000 and added the additional items to “sweeten the pot” and give Bill and Paulette a deal they couldn’t refuse. and had been prepared to drop his price to $145. a public agency. Sign here. and two area rugs. Bill: (pleasantly surprised to learn that the garbage disposal. all window blinds and drapes. the hutch. but I’d like to make sure there are no misunderstandings. I think we can work something out. since he probably would have missed them) Yes. The employer’s affirmative action officer looked into the charges and determined that 188 50 Practical Negotiation Tactics .Seller: Just a minute. real. If it’s what you meant.000. he began to have “problems” with her job performance.) Seller: So. and that no one would ever say that he was guilty of any type of sexual harassment or sexual discrimination. The supervisor assured the employer that there was no basis for her complaint. she said that her supervisor had repeatedly asked her out. the hutch. When he had the chance to put the deal in writing. the refrigerator. Let me just get the standard “offer of sale” form and fill out what I hear you saying. and the two area rugs.

Monica had. you didn’t mention in the agreement that in exchange for the $100. I’m He: She: He: Reaching Agreement 189 . He offered to send settlement agreement papers to her. The employer’s lawyer told Monica’s lawyer that the employer was ready to settle the deal for the $100. and must agree not to tell anyone about the $100. but said that fighting the charges would be a long. by this time. my client is supposed to formally withdraw the complaint rather than just settle it. It might be standard when there’s a settlement.000. and expensive matter. Monica’s lawyer (She): Employer’s lawyer (He): She: I was surprised by your settlement documents.000 without actually having to prove anything. You’re just trying to make it seem as if your supervisor did nothing wrong.000. And the confidentiality clause is standard. the supervisor says he did nothing wrong and that Monica just misinterpreted what he said. even though we’re certain we would prevail. Why’s that? Well. The supervisor insisted that if the employer felt he had to settle. settling—What difference does it make to her? She’s getting her $100.000. She thinks the withdrawals and the secret settlement will be seen as some kind of admission on her part that she shouldn’t have brought the claim. drawn-out.there was little basis for the complaint. Withdrawing. Look. found a new job and wanted compensation for “embarrassment” and lost wages in the amount of $100. But the employer doesn’t want to go through the expense and publicity of a trial. then Monica had to acknowledge that the supervisor did nothing wrong. even though you are paying Monica because we can prove he did do something wrong.000. He’s happy to prove that in court. but it’s not standard when a complaint is formally withdrawn.

000. but word did get out that a public agency paid $200.She: authorized to pay $200.000 when all that was asked for was $100. Monica accepted the $200. 190 50 Practical Negotiation Tactics . Conclusion The decision by the employer’s lawyer to send a written agreement that did not reflect the actual agreement of the parties caused the negotiations to resume.000 just to get the employee to “withdraw” the complaint. There was a confidentiality agreement. It was made clear that the employer had paid the additional $100. It would have been a better strategy in this situation to raise the issue of withdrawing the complaint during the actual negotiations. to his disadvantage.000. I’ll take your offer back to her and let you know. but that’s under the same conditions—the claim must be formally withdrawn and Monica can never reveal the amount of the settlement.000 and the conditions of the offer.

In Tactic #17 (Package Items). when they engage in honest “give and take” negotiations.SECTION IV: PUTTING THE AGREEMENT IN WRITING s you can see. talking is not always the same thing as communicating. and contract. However. Think of how often you have said to someone. operating under an agreement after it has been reached can be even more difficult. even an informal agreement benefits from some type of written documentation. Reaching an agreement is the first step. and when they agree to solve problems together. most certainly needs to be in written form. If the agreement reached at the time had been put into writing with all three sisters signing it. depend on the kind of negotiations in which you are involved. Putting the Agreement in Writing 191 . reaching an agreement is sometimes a long and difficult process. A Communication Hearing is not necessarily the same as listening.” Clear communication is essential if you want to reach an agreement and have it abided by. of course. When two friends agree on what movie to see.” By the same token. “Oh. a written document is hardly necessary. I thought you said something else. it would have been easier to resume negotiations at a later date. Certainly someone has said to you. rather than attack each other. the three sisters reached an amiable agreement. “That may be what I said. but some of the decisions were put off for a couple of months. As these examples of personal and business negotiations show. Putting an agreement into writing serves three purposes: communication. One way to help the parties abide by an agreement is to put it into written form. however. then the parties have to abide by the agreement. commitment. Unfortunately. A union contract. but it was not what I meant. The degree of detail and formality of a written document will. it is much more effective in the long run when the parties enter into “win-win” agreements.

His mom could more easily enforce the agreement if she had it in writing. or movements being used by the sender. Larry wouldn’t have had to argue over a bill for the plumbing work his cousin Will did if he had asked for Will’s estimate before accepting his offer to help. the opportunity for the sender and the receiver to misinterpret is greater than if the communication is first spoken and then written.Communication is a process that involves a sender and a receiver. pictures. or express a thought or emotion through words. The sender wishes to convey an idea. If Jason fails to live up to his side of the deal.944. sounds. And because the sender and the receiver are two unique individuals. In Tactic #4 (Use Objective Criteria). nine hundred and forty-four dollars—$22. Who isn’t excited about buying a brand new SUV or truck? Until. When communication is limited to the spoken word only. he can be reminded of the details because it’s all there in black and white. or movements. Jason agreed to change his study habits if he couldn’t pull his grades up by the end of the semester. the price is spelled out in the loan document as “twenty-two thousand. seek information. pictures.” In Tactic #14 (Don’t Always Hide Your Weaknesses). Negotiations are often necessary because there was a “misunderstanding” that could have been avoided if the parties had put their agreement in writing. The receiver has to decode the message being sent by trying to understand and interpret the words. When you create a written record of the details of an agreement. you have created something tangible that can be referred to in the future when memories become fuzzy. a couple of months away. Oftentimes just seeing the agreement in black and white conveys its import as well as or better than hearing about it. Commitment Reducing an agreement to writing often forces both sides to truly commit to the agreement. the message being conveyed and received might be understood differently. Writing an agreement down gives the parties an opportunity to use more-specific or precise language and eliminate some of the emotion that might have accompanied the negotiations. that is. sounds. 192 50 Practical Negotiation Tactics .

WHY? The “why” of an agreement is generally the explanation of the mutual obligations or advantages the agreement represents—the reason why the parties began negotiating in the first place. as many people learn when they purchase a home. You can do this more formally by taking them to court (perhaps as a last resort). In either case. Putting the Agreement in Writing 193 . WHAT? The written document should clearly describe the item(s) covered by the agreement. in writing. protect yourself by having a written. the real estate contract includes information about the buyer and seller. the address and description of the real property. what. signed. and how much. which kind of. pulling an agreement in writing. Your spouse will share some responsibility for failing to make that duty clear in the agreement if. Both parties must receive a benefit or something they personally consider of value. say. one party will change behavior in exchange for something of value from the party who wants the behavior changed. how many.Contract Finally. Carefully and completely describe the subject matter of the agreement. and so on in standard contract form. One party wishes to buy what the other wishes to sell. where. have your spouse also agree to the details of the agreement. Generally. your plants die because the house-sitter wasn’t told to water them. when. and getting all the parties to sign it usually creates an enforceable contract. When you are ready to commit yourself in writing. dating it. Failure to do so can lead to big problems. and dated agreement. You can informally enforce an agreement just by showing the individual(s) the signed copy as a reminder of the substance of the agreement and their commitment to it. which. before the trip. WHO? Provide of the full names the parties necessary to the agreement. why. one party will work if the other party pays for the work. leading to misunderstandings and contract disputes. and put that information into the document. However. or it isn’t an agreement—it’s merely the conveying of a gift. Here’s what we mean. If you have agreed to pay someone to house-sit while your family is on vacation. details such as what fixtures stay or what appliances go can be easily overlooked. ask yourself the basic questions of who.

how much or how many. which one or which kind of. agreed to the same thing. depending upon the deal: when or where. and having all parties sign it ensures that the parties have. The more-specific and clear these details are. dating it. if that becomes necessary). in fact. It gives the parties an opportunity to really buy into the deal. 194 50 Practical Negotiation Tactics . And it can create a tangible reminder of the deal (or an enforceable agreement.The remaining questions fill in the details of the agreement. the better. Putting an agreement in writing.

Personal Negotiations Negotiation situation: Parties involved: Issue: Tactics that might be helpful. and how they can be used: Exercise Forms Putting the Agreement in Writing 195 .

Business Negotiations Negotiation situation: Parties involved: Issue: Tactics that might be helpful. and how they can be used: 196 50 Practical Negotiation Tactics .

________________ 6. ________________ 2. ________________ 9. ________________ 5. ________________ 8. ________________ 7. ________________ Tactic# How will I use this tactic? (Application) _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ _________________ ______ ______ ______ ______ ______ ______ ______ ______ ______ ______ Notes Putting the Agreement in Writing 197 . ________________ 4. ________________ 3.Name of Negotiation Tactic 1. ________________ 10.

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C. 1991. Inc. Fuller. Upper Saddle River. W. University of Missouri: Columbia Press. Minton. Gotbaum. Cleary. M. Getting Together: Building Relationships As We Negotiate. M.E. 1991. Labor Relations and Collective Bargaining: Cases. The Essentials of Negotiation. Upper Saddle River. 2001. 2001.. 2nd ed. New Jersey: Prentice-Hall. 7th ed. 1997. R. Mediation.: Waveland Press. J. Negotiation Skills. and M. R. Herb. Maddux. and Law. 2004. 1987. Patrick J. Practice. McKay. W. Sharpe. David. K.: Crisp Publications. 2nd ed. 1988. New York: Penguin Books. and J. New York: Basil Blackwell. D. Successful Negotiation: Effective “Win-Win” Strategies and Tactics. and S. Oakland. George. Calif. M. 1996. References 199 . 1999. R. Getting to Yes: Negotiating Agreement Without Giving In. Gavin. Inc. Eshelman. Ill. Calif. Inc. Inc. Saunders. New York: Penguin Books. Roger. 1980. Patton. Pocket Negotiator. and S. Clark. New York: Bantam Books. The Relaxation and Stress Reduction Workbook. Fiske. You Can Negotiate Anything. New York: Simon and Schuster. and B. Fisher. Heavrin. Cohen. Prospect Heights. E. Irwin. Negotiating in the Real World. New York: M. The Negotiator’s Handbook. Ury. Fisher. and C. Inc. and J. Domenici. Kennedy. Chicago: Richard D. New Jersey: Prentice-Hall. 1988. Los Altos.. Inc. Roger. 1989. Inc. Victor.REFERENCES Carrell.: New Harbinger Publications. The Negotiation Handbook. Brown. Lewicki. LittleJohn.

New York: Penguin Putnam. Taking Charge/Managing Conflict. Sharpe. George. Tsogas. L. New York: M. Thompson. Ury. Weeks. New Jersey: PrenticeHall. 1998.org 200 50 Practical Negotiation Tactics . 1981. Stulberg. 1982. Raiffa. C. Howard. 1994. The Art of Negotiating. Inc. The Art and Science of Negotiation. William. Inc. Massachusetts: D. 1996. Inc. G. R. Labor Relations in a Global Economy. The Eight Essential Steps to Conflict Resolution. Lexington. 2001. Raiffa. Howard. Gerald I. New York: Bantam Books. Upper Saddle River. Massachusetts: Harvard University Press. 1987. www. Heath and Company. Dudley. 1991. Inc. B. Shell.E. 1999. Massachusetts: PON Books. Cambridge. Lectures on Negotiation Analysis. The Mind and Heart of a Negotiator.negotiationsources. Cambridge. J. Getting Past No: Negotiating with Difficult People.Nierenberg. New York: Simon and Schuster. New York: Viking Press. Bargaining for Advantage.

in Economics from the University of Louisville.A. has practiced law for 28 years primarily in the public sector as an attorney for local government in her hometown of Louisville Kentucky. Business Forum. he was elected to the City of Louisville Board of Aldermen for five terms.ABOUT THE AUTHORS ichael R. The Academy of Management Review. These positions enabled him to build a sizable management consulting practice while teaching at the University of Louisville. In addition. He received his doctorate from the University of Kentucky. organizational behavior. Bakersfield. and MBA and B. The Journal of Accountancy Training. The Personnel Administrator. and negotiations. Most of his professional career has been spent in the Louisville area and has included positions as a personnel director and labor negotiator. Human Resource Management. Morehead State University. and Public Personnel Management.D. Carrell has held academic positions at California State University. Marshall University. Personnel Journal. Personnel. Books published by Dr. He has authored over 50 scholarly works in some of the leading management and human resource journals including The Academy of Management Journal. Dr. and the University of Louisville. Labor Law Journal. Organizational Behavior and Human Performance. In addition to negotiating numerous litigation settlements and contracts. Carrell are in the fields of collective bargaining and labor relations. During his academic career he has received awards for both outstanding research and teaching. HR Magazine. which is located in the greater Cincinnati area. The University of Nebraska-Omaha. and served as President of the Board and Mayor Pro-tem for three terms. Carrell is Dean of the College of Business at Northern Kentucky University. M Christina Heavrin J. she has helped negotiate a number of major agreements such as a multi-million dollar property exchange that relocated major industries and railroads from the City’s downtown wharf resulting in the development of both an award winning public About the Authors 201 .

the City and a for-profit hospital for guaranteed indigent health care services for city residents. Recently voters approved the merger of the City of Louisville and Jefferson County Governments. 202 50 Practical Negotiation Tactics .park and a successful industrial park in the City’s enterprise zone. an agreement between the State of Kentucky. Ms. a multi-million dollar expansion of Waterfront Park that included a major environmental clean up and the construction of a Minor League Baseball stadium in downtown Louisville. a tax sharing agreement between the City of Louisville and Jefferson County that enabled the two governments to share revenue of over two hundred million dollars and to combine their economic development programs. Heavrin is serving as Special Counsel to the first Mayor of the Metro Government where her duties include negotiating initial labor agreements between the Metro Government and its unionized employees. Jefferson County.