Getting to YES

Anna Christina Rosenberg – Aron Njáll Þorfinnsson

Reykjavik University Fall 2010

Reykjavik University Venture Capital

1. What are the primary lessons you took away from the book that could help you in a deal negotiation

environment, for example, negotiating terms of a purchase and sale agreement, credit agreement or

employment agreement for a CEO?

The four points that the books focuses on are: to separate people from the problem, focus on interest and not

problems, invent options for mutual gain and insist on using objective criteria. All these four focus points are

useful in order to answer question one. If people can use these points to their benefits they will be in a better

position to understand what their BATNA is and more importantly try and understand what their oppositions

BATNA might be. The book emphasizes that negotiation is not a competition with a winner and looser but a

process where a point of mutual benefit is searched. It is a process of human communication. So building a

relationship is not a less important part of the process than the subject of which the negotiation is about.

Separate people from the problem

Separate the relationship from the substance. To do so you must listen and learn about your opponent’s

perceptions and communicate yours effectively. Understand you are first and last dealing with people that have

emotions, desire and might be anxious like yourself. You must be able to put yourself in the shoes of others to

fully understand where they are coming from. Give others chance to express their feelings if they need to without

taking it personal and react likewise. Likewise make sure that even though you are allowed to vent you must be

sure to not make it seem like you are placing blame on the other party. No negotiation takes place without

communication so make sure you are heard and understood and vice versa. A good technique is to acknowledge

what is being said and guard a mutual understanding is by rephrasing what you heard and understood. If evoking

in international negotiations be aware of the cultural differences. Words or gestures might have a completely

different meaning so be well prepared and familiarized with the culture and norms of that country.

Anna Christina Rosenberg Fall 2010

Aron Njáll Þorfinnsson
Reykjavik University Venture Capital

Focus on interests and not positions

Avoid positions; it likely ends with the other side feeling defeated or no deal at all. Instead focus on interests –

understand what matters and why. Children can be some of the toughest negotiators you come across. However

children are not afraid to say what they want whereas adults tend to go circles around the subject. If we don’t

know where the interest lie it will be much more difficult to negotiate for it. Even though the interests for both

parties may not be the same it is certain that both parties have them. If there were no interests, there would not be

a negotiation.

Invent options for mutual gains

Do not fall into the trap of the already fixed pie. It is always a bad negotiation if you have one fixed thing that you

want to gain and if you consider your gain their loss or vice versa. Identify shared interests. Negotiations are

rarely black or white. Enter the negotiation with multiple options. If you come prepared to a negotiation with

more than one option for a suitable outcome for you, the negotiation is more likely to be a success. There are

many ways to find those different options and brainstorming for ideas can be a great one. You not only need to

find shared interests but also different ones. Find the differences between you and your negotiating party in order

to figure out if and where these different interests may lie. Understand their positions and understand that first and

foremost they are people with emotions like you. Remember to be soft on the people but hard on the problem.

Insist on using objective criteria

In order for this part of the negotiation to be successful you need to prepare. The golden rule of 80/20 is in our

opinion a very good one. 80% of the time of a negotiation should be for preparations. Before actually sitting down

opposite your opponent you should have put in most of the work by researching, preparing and planning. If you

can show your opponent that you have done the research and by doing so concluded what a fair price should be, it

will be much harder for them to disagree. If all is correctly done and you have framed the argument well, the end-

result should be an agreement that will benefit both parties.

Anna Christina Rosenberg Fall 2010

Aron Njáll Þorfinnsson
Reykjavik University Venture Capital

Conclusion

Whether or not we realize it, people negotiate about something every single day. Often people tend to think about

negotiations as big agreements between two companies but the reality is that whether the negotiations are on a

large or small scale the same principals can be applied.

2. If you were entering into a negotiation with a lender to finance a transaction that you or your firm was

sponsoring, would you want the lead person on the other side to be intellectually superior to you, about your

equal, or someone you could run circles around, and why? Are there advantages and disadvantages to the

options that led you to your choice?

Personally we decided that we would want to be in the middle that is that our opponent would be equally

intelligent to us. Certainly there are both advantages as well as disadvantages for both options of an either soft or

hard opponent. First of all in order to be successful at a negotiation you do not need to be intellectually superior.

If you have done your homework and realize what your BATNA is and try to figure out your opponents BATNA

then you should be able to have a good outcome. Negotiation power does not lie only in intelligence. There are

many ways to enhancing the bargaining power of a negotiator, like enhancing your BATNA, understanding your

opponent and their interests. We would also not want to be the hard negotiator since it could be damaging for

future relationships and reputation.

The characteristics of a soft negotiator

The main focus for the soft negotiator is to maintain a good relationship with the other party. Even though this

style may produce results quickly it can make you vulnerable to a hard bargainer. The soft bargainer often makes

concessions in order to reach an agreement but deals that are primarily concerned with the relationship usually

end up being a sloppy deal.

Anna Christina Rosenberg Fall 2010

Aron Njáll Þorfinnsson
Reykjavik University Venture Capital

The characteristics of a hard negotiator

The hard negotiator uses power and dominance in order to get what he wants. This negotiator is looking to win,

which the book clearly illustrates is not the best way of thinking. Being a hard negotiator can easily lead to a bad

reputation due to the fact that these negotiators often manipulate the situation and mislead real goals. A really

hard bargainer may even evolve to using dirty tricks such as deliberate deception, psychological warfare and

positional pressure tactics. The hard negotiator often appears when it is a one-time deal and when no goodwill is

required, that is he does not care how he reaches the agreement as long as he does.

Conclusion

Hard negotiators often tend to become personally involved with their own position whereas the soft negotiator

might loose sight of his position in order to keep peace. Neither of these methods seems to be the most beneficial

negotiation style so our conclusion is to try and find a middle way that works in order to get a clearer view of the

substantive problem.

Overall be prepared when entering into a negotiation. Go over a checklist to see if you have covered the basics.

What is your goal? What can you and your opponent trade? What are your alternatives? What is the history of the

relationship? What are the consequences of winning or loosing the negotiations? Questions like this should be

answered in order to establish a BATNA, which will be the ultimate bargaining power. Be prepared that the

position of your opponent might not be as fundamentally opposed as they may initially appear. Often the truth is

that your opponent has very different goals and interest from the ones you expected.

Anna Christina Rosenberg Fall 2010

Aron Njáll Þorfinnsson