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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exactly. or engage in an unproductive argument. This book is designed to give the reader an understanding of the negotiation process by presenting fifty proven. start reading! Most people come face-to-face with a negotiation situation of one type or another on a daily basis: on the job. 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. with neighbors. such as these: • You receive the wrong order at a restaurant. practical tactics useful in real-life situations at work or at home. But if you scored 8 or less. Instead. • A co-worker asks for volunteers for a new project. accept what is given. 4 50 Practical Negotiation Tactics .negotiator! Pass this book on to someone else who needs it. they pay the sticker price. Unfortunately. • A child wants a new toy now. with family members. at a flea market. 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. but many of us miss the opportunity to bargain in other situations. some will in retrospect even remember being the victim of one or two of them. Who. Most readers will no doubt recognize some of these strategies. few people understand that normal interactions represent bargaining opportunities.

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

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

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

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

Depending on the situation and the parties involved. but feel free to try them when they seem most appropriate to your specific circumstance. rearranged. stages can be combined. 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. or even skipped altogether. The Comprehensive Model Negotiation is more of an art than a science. the other side loses.Distributive (Win-Lose) Issues: Those issues that the parties are directly at odds with. Examples: • an item sold by one party and bought by the other • wage increases won by one side. What one side gains. 10 50 Practical Negotiation Tactics .

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 .The Negotiation Process Table 1: The Negotiation Process: Seven Basic Stages Stage 1 Identify situation as one for negotiation Preparation: Key Factors – Time.

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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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his BATNA was not to hold out for more money. best. but rather what the buyer planned to do with the car. and equipment. 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. 16 50 Practical Negotiation Tactics .” which was refused. The owners. For the past two months. When negotiations with the union became hopeless. and it now employs 230 craftsmen. The $56 million dollar business took them 30 years to grow. With only two weeks remaining before a threatened strike. Conclusion Selling their business was the Jaggers’ BATNA. The union negotiators convinced the employees that this too. The union negotiators thought the Jaggers were bluffing. the Jaggers decided to seek buyers for their land. They learned that their assets would be easy to sell and were worth more than originally estimated. 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. as Harvey had for many years.Conclusion Harvey’s best alternative—his BATNA—was simply to hold on to the car for the moment. providing them with a very good income for life. as a last resort. inventory. In this case. and either move it with him to Arizona or find another classic car collector who might buy it (perhaps for less) and preserve it. notified all the employees of their intentions. and the Jaggers decided once and for all to sell their business assets and invest the proceeds conservatively. Example 2 Shari and Jim Jaggers own a successful West Coast pottery company. The threatened strike became a reality. selling became an attractive alternative to a strike or prolonged battle. labor contract negotiations between the Jaggers and a local labor union representing the pottery’s craftsmen have stalled. and final offer. The union is demanding wage and benefit increases. The Jaggers gave the union their “last.

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

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

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

he agreed to allow BigManu to accommodate him without limiting their ability to make business decisions. I certainly want to do all I can until then to protect my people. you’ll have a guaranteed “in” to protect your people.BigManu: We intend for you to stay and become a big part of our company. BigManu: Why don’t we guarantee to you that you will stay for two years? That way. would it? Rick: Well. Rich almost lost the deal. that might work. 20 50 Practical Negotiation Tactics . Rick: Well. I’m hoping to retire in two years. Let me get back to you. 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. 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). to tell you the truth. This wouldn’t have anything to do with your own plans for the future.

(thirty minutes later) Bailey: So. such as a hotel conference room. too. Bailey: Cybil: Preparation 21 .) Let’s take all our Beanie Babies to my house to trade! Okay. Mother: Hush. it’s a deal. girls. Make up your minds. they control the breaks and environmental factors. and go play somewhere! Cybil: Well … Okay. the frog is everybody’s favorite. Cybil. 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. (Think of the showroom tactics used by car dealers. but never to THEIR advantage! Example 1 (Two ten-year-old girls are talking. I like the frog. and so on.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. 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. they have the information they need at their fingertips. how can you trade the frog—he’s your best one! Dede: (Bailey’s other sister) Yeah.) Prepare for the negotiations by controlling the setting—to your advantage or to mutual advantage.

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

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

while she wasn’t an expert. Had they actually prepared bids on the work. Budget Officer: I don’t know what your problem is. they said. I’ll revise my bill to meet the lowest estimate you get. Larry: That sounds fair. they had to agree that their early estimates were low. The college’s budget officer was understandably offended. He was disappointed in the performance of the fund. From a look at the portfolio. and decided to bring the matter up at a Board meeting. 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. I find your suggestion to the Board that I haven’t been doing my job right to be very insulting! Stuart: I’m sorry.disagree on the need for that work or that they would have done it for less. Comparing the estimates to Will’s actual costs would have been counterproductive. he used his financial expertise to analyze the investments of the college’s endowment fund. because (as Will pointed out) it wasn’t an apples-to-apples comparison. I have been very diligent about making sure that the fund makes the most money it can without putting us at risk. she had been investing the college’s endowment funds for many years. The estimates would have been higher than what cousin Will charged. I certainly didn’t mean to offend you. they would have had to revise the figures. 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. Example 2 After Stuart was appointed to the college’s Board of Trustees. my first reaction was that some of the investments 24 50 Practical Negotiation Tactics . Conclusion When the other plumbers looked at the work.

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

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

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

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

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

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

. Both sides caucused: The leaders on each side met to negotiate a compromise. At 5:30 p.deadlock. He planned for it accordingly. When the meeting resumed at 4:00 p... a member of the anti-project group left the room.m. in the end. and the meeting was adjourned. That effort failed. the leader of the pro-partnership side heard someone say that the meeting needed to end by 5:30 p. The measure passed 6–5 at 5:45 p.. Preparation 31 . timing was everything. and it worked. the pro-project leader told his members to filibuster until he gave a signal and called for another vote. the project had been stalled by 6–6 votes. 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. as predicted.m.m.m. A member of the pro-project group quickly called for a vote after the leader gave a signal. Then. during an hour break in the meeting. For weeks. Conclusion The leader of the pro-project group recognized that they might have a unique timing advantage.

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Some of the tactics listed in this book are only suitable for single-session negotiations.Stage 2: Planning a Strategy he next stage is critical: Choosing a strategy. cooperative manner. you must first evaluate your needs and those of your opponent. 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. Third parties sometimes have their own hidden agendas. and Tactic #48 (Walk Away). Be sure you are aware of this at the beginning. The overall strategy chosen does not limit the use of other tactics. For example. 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. 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. Look at the personalities of each negotiator and see which side will be more vulnerable to pressure bargaining (Stage 5). but in practice it will likely influence the whole process. such as Tactic #19 (Make a First and Best Offer). such as a third-party negotiator. Tactic #43 (Nickel and Diming). decide whether the negotiations should be continuous. for example. If you prefer to take a firm and direct approach. Tactic #33 (Bluff). such as a buyer and a seller or a city and its union. Are there any outside people who might influence the process. A neutral. as it can substantially alter the negotiations between two primary parties. In some cases. Tactic #12: Find Common Interests can be helpful. then Tactic #13: Set a Deadline or Tactic #11: Have an Expert Witness might be helpful. as well as their bargaining history and financial and political positions. Before you can do this. After you have evaluated these factors. Identify all outside influences and hidden agendas before you develop your strategy. 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 . or one-time-only. uncaring approach (Tactic #9: Control Your Emotions. might step in and help settle negotiations between a union and administration negotiators. if you want to begin in a friendly.

The buyer loved the location. 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). 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). The agent explained that the seller was desperate. By assuming opposing roles. half-serious. His teenage sons had “trashed” the house. I offer half the asking price. The buyer said he wasn’t interested. 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. the seller’s agent called the buyer about the property. but the inside was a complete turnoff. For example.side is either caught off-guard or (in some rare cases) a negotiator will be able to achieve an unexpected fantastic settlement.” The agent took the offer to the seller. two people on the team will be more successful because they evoke different emotions from the other side. Weeks later. and the buyer was able to completely renovate the house and still have a great deal. with “All right. 34 50 Practical Negotiation Tactics . The desperate owner agreed. “Please make any offer—they are motivated!” The buyer responded. If there is a significant weakness in your position.

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

000 offer by coming down in price at least a little. the founders of the firm. the transaction also included some degree of consolidation of the law firms involved—not just the use of the firm’s name. Example 2 The law firm of Bits & Bites was a Sioux City institution.000 or 1% of profits (whichever is less) over the next ten years in order to use the name.000. Here’s how the initial negotiations went: Partners: Well. the buyer took it as a signal that either Carol didn’t want to sell. In any event. The partners are interested in selling the name.Buyer: What if we offered you $100. enjoying a statewide reputation for quality representation. 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. Carol drove off a potential buyer by setting an asking price that was just too high. were still alive. but they have no idea what the value of their firm’s name might be in this nearby city. we are certainly interested in your request to “buy” our firm name to use in your city. The other law firm was prepared to pay $100.000? Carol: We really can’t take less than $160. When Carol refused to budge. We’re curious. and then $10. 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. or she has unreal expectations. as to how you think the name is going to benefit you.000 immediately. 36 50 Practical Negotiation Tactics . though. Neither Edward Bits nor Edmund Bites. Inquiries to other law firms were not very helpful because in almost all of the instances. Buyer: Good luck!! Conclusion The buyer expected Carol to counter the $100.

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

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

And take the leaf-catcher attachment and the gas can.Tactic 8: The Good Guy/Bad Guy Routine The “good guy/bad guy” routine is a useful one. Peggy: Planning a Strategy 39 . Paula: Go ahead and ride it home. we won’t need it at the new condo. Andy and Paula. I don’t know what the deal is now. not for $1. Andy: I want them… Paula: Go ahead and take them. I want to keep those. and I know how you take care of things. only three years ago. what’s your price? Andy: $1. you’re really moving! I hate to see you leave. Peggy: So. I heard that you want to sell your riding mower. threatening. so I’ll take it. Peggy. Peggy: I assumed they went with the mower. Andy and Paula: Yes. I’ll go home and you can call me if you two can reach an agreement. Peggy: That’s fair. Example 1 So. Your opponents will want to avoid confrontation and unpleasantness with the “bad guy” and are likely to be more willing to cooperate with you. (bad guy) and implies that his or her side will hold firm on their demands.200! We should get $1. etc. while another acts difficult. Andy: No. I can use them. Half what it cost us new. One member of your team acts friendly to people on the other side (the good guy) in order to gain their trust and support.200. Andy: No. angry. Peggy: I’m hearing one thing from Paula and another from Andy.400 if the catcher and can are included. They cost about $300. since they are sitting out in the driveway with it.

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

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

This will put you at a distinct disadvantage from this point on. I noticed this. 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. 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. 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. How may I help you? Hello. made some very good purchase decisions for his small business. he was very unhappy.10 a minute rate at my office location. I have a problem with my recent bill and my billing rate. 42 50 Practical Negotiation Tactics . The fault was partly his because he did not stay on top of changes. He decided that the best approach was to act indignant when he spoke to the company representative. 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.Tactic 9: Control Your Emotions Stay cool.00 a minute. because we have had a sick relative out of town and we used long distance a lot this past month. He had. and might even harden your opponent into an unfavorable position (for you or for both of you). Control your emotions and use them to your advantage! Example 1 Mike prided himself on being an informed and educated consumer. So. Here’s how the phone conversation went: Customer representative: Mike: Over-the-Air Long Distance. It seems that the rate you are charging me on my home phone is $1. such as deals on computer packages and phone services. in fact. but I recently was sold a $.

I realize that that might be the rate I started paying when I first took your service over eight years ago. I would think you would have given me the best rate you offer new customers. It hasn’t been increased at any time. we certainly would have discussed your options. I would have known I was paying too much. Customer representative: Let me pull up your account. how would anyone who might only have residential service even know to ask? Well.10 per minute rate on your long-distance service. Well. Mike: Customer representative: Mike: Customer representative: Planning a Strategy 43 . of course it is not always possible to give existing customers some of the “offers” we have out. 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. to begin now. Had you brought this to our attention before. (beginning to sound irritated. I see that the rate you are being charged is the rate we offer for the type of service you have with us. but this was quite a shock. But I am able to offer you a $. 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.I expected the bill to be higher than usual. Mike. and I also realize that if I had examined my bill closely.

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

Working with fireworks is working with explosives.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. 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. I’ve got to have the employees with the most experience to protect this place. Owner: Now. and it’s not what we’re even talking about. Employees’ negotiator: (with a stern voice) You have been saying this for three weeks. The owner told the employees that he was worried that during the overtime shifts. lesssenior employees might be at greater risk of injury because they have to handle explosives. they would become dissatisfied with their pay and want their base pay increased. and you just can’t be too careful. The employees’ negotiator finally decided to use “indignation” to break the stalemate. and that they should be asking for a fairer base wage for the work they do for you. The owner was afraid that if the mostsenior employees routinely passed up the overtime and the overtime pay. Where are your managers? Where is the training necessary to make Planning a Strategy 45 . 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. Owner: I’m just not willing to let my best people refuse to work the extra shifts during our busy season. that’s just not fair. and it’s getting old. On those overtime shifts. They will be putting the plant AND their fellow workers at risk by not being here. The most-senior employees want to have the right to refuse overtime and have those less-senior employees take the overtime.

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

you will decide if you want to buy it for that price or receive that amount from Mary Anne (but lose the grinder). The first party decides on a price for which he or she will either buy or sell the object to the second party. Both sisters covet it. I’m willing to pay or let it go for $800. Mike. the executor of the estate. However.” is the recommendation of Howard Raiffa. 3) They can agree to sell the object to a third party. you’re the oldest. since this one is in perfect shape and it was Mother’s. with winner taking all. Susan. a well-known negotiations professor from Harvard University. has decided to use the “reciprocal buy/sell offer” process to settle this last piece of the estate. Mike: Mary Anne. A fourth option.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. or sell it to the first party and consequently receive the full amount from the first party—thus giving up the object. so you set a price at which you agree to buy or sell the coffee grinder. with the highest bidder paying the amount to the other side in compensation for their loss. and split the proceeds. Planning a Strategy 47 . (two days later) Mary Anne: Well. The second party then decides to either buy it at that price and pay the first party. Then Susan. 2) They can flip a coin. called the “Reciprocal Buy-Sell Offer. 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. my kids and I looked on eBay and everywhere else and found out that coffee grinders in perfect condition sell for about $500. I’ll give you 48 hours to decide the price. All the rest of the estate has been divided among the family.

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

you agree to sell your half-interest to Bobby for $180 million. Conclusion Both parties wanted to keep the business. your bid is $170 million.Howard: Abe: Bobby: Abe. I will arrange to sell him my half-interest for $180 million. but only if they could become the sole owner. 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. And I will arrange financing to pay you $180 million to become sole owner. Bobby was willing to pay more than Abe to remain sole owner. and we close by July 1st. Bobby. Agreed. your bid is $190 million. and to close within ninety days. and both men had carefully estimated the market value of half the business. Planning a Strategy 49 . Abe.

When he showed his wife the detailed spreadsheet. the one that was the most expensive was superior. This approach can also be reversed: The wife in this situation is a banker. Conclusion The husband became the “expert” in this situation by doing the homework. she glanced at it and immediately deferred to his opinion. 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. The couple decided to limit their selection to those rated “excellent. the one he wanted (one of the least-expensive) was superior. When it came to comfort. so when the husband wants them to make an 50 50 Practical Negotiation Tactics .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. It can also work in reverse: establishing the other person as the expert.” but there were substantial differences in price—differences that the wife did not see as a problem. Looking at these statistics. he decided upon a strategy: First establish himself as the “dimension expert. and created a spreadsheet to compare the five best-rated couches on their list. This strategy worked. Based on seating capacity. and the husband felt like he saved them hundreds of dollars. They both expressed an interest in finding a couch that offered the most “interior” space. 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.” and then argue for the frugal alternative. He thus ended up having greater negotiating power. The husband found the dimensions of the couches in the brochures and Web sites. Example 1 A young couple were discussing a possible purchase of new furniture for their living room.

investment decision or deal with an error in a bill. you gain an edge when negotiating a new plan for your company. and Point of Service (POS) plans.” If you spend many hours learning about Health Maintenance Organizations (HMOs). 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. he argues that she is the expert. and should therefore handle the problem. 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 . Preferred Provider Organizations (PPOs). 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.

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

so that your customers can park on the street. 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. That sounds like a wonderful solution. and better than a fast-food restaurant with late-night hours and a drive-through window. It was the type of shop the nearby residents preferred. I helped with the bags without being asked twice.m. and her children were in school. your new shop hours have caused your customers to park in our parking spaces. and keeps it open longer so she can attract customers on their way to and from work. Marilyn originally set her shop’s hours for 10:00 a. We realized that if we cut the cake lengthwise. she got a visit from some of the residents. One day. This cake is white cake. and I really like white cake.m. Now that her children are in college. 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. We really want you to go back to your original times.m. Example 2 Marilyn’s Memorabilia Store was located along the main commercial street of a residential neighborhood. Planning a Strategy 53 . I can have the part with the icing and Bill can have the part with the cake and filling. 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. to 3:00 p. so these hours worked out well. Customers have started to park in nearby apartment lots. Residents: Marilyn. The last cake we had was chocolate cake. because there is no parking along the street during morning and evening rush hours. and that’s not my favorite either.

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

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

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

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

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

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

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

000) Settlement Range ($22. (2004). by Michael R.500) Resistance Point ($25. Carrell and Christina Heavrin. 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. such as proposing to continue at the current rate or price. 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.500) Fig.000 Buyer Initial Offer ($21. as illustrated in the following figure: Seller Resistance Point ($22. 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. 2: Distributive Bargaining Process.750) Target Point ($24. The initial offers of both parties are usually set reasonably above or below what each believes to be the settlement range. None is as important as the first one. Another common strategy is to start with the status quo. quick agreement. “Distributive” bargaining (“win-lose” or “zero sum”) is used.500) M $21. Adapted from Labor Relations and Collective Bargaining.750–$25.000) Target Point ($23.Stage 3: Exchanging Initial Offers any offers and counteroffers are made during a typical negotiation—sometimes even hundreds. 190–192. This is a practical starting point that will not anger the other side (and might even be expected). for example. Many negotiators make their initial offer the highest acceptable offer (Tactic #19: Make a First and Best Offer). The initial offer sets the tone of the negotiations and reveals something about the strategy of each side. The negotiator firmly states that it is their best offer in an attempt to gain a nice. Exchanging Initial Offers 61 .000 22 23 24 25 26 27 Initial Offer $28.

In this example. each initial offer ($21. thus producing a true “win-win” negotiation. if the buyer’s initial offer was $25. the seller would immediately accept it because it is greater than the target point and the buyer would suffer a winner’s curse. these points have set the outer limits. 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. Experienced negotiators will begin the negotiation of several items by quickly proposing such a package.000. it is termed the settlement point – not the “right price” or “fair price. Two extremely helpful tactics to be used immediately after initial offers are made are Tactic #15: Caucus and Tactic #20: Posturing.000) is reasonable. thus starting out on a positive note. and is the range in which most negotiations actually occur. 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 the example. A target point is the desired settlement value a party has set as a goal when negotiations begin. 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).” but the settlement price. When the two parties agree to a price within the range. the process quickly narrows to the range between the initial offers.000 and $28. The settlement range is the distance between the resistance points. See Tactic #18: Agree on Something As Soon As You Can. After initial offers are exchanged. 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). 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 other side does not agree to this value). usually. 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).

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

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

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

The company’s negotiator didn’t recognize the misunderstanding. Union: (angrily) I’m not presenting this proposal to my people. I’m just saying that tuition benefits are sometimes a good substitute for health insurance. Union: Why are you so concerned about new job opportunities? Are you holding out on us? Company: No. 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. The union’s lead negotiator misunderstood the proposal. Union: You’re offering a choice between health insurance and tuition payments? What kind of a deal is this? Company: Hey. Tuition in place of health insurances? They’ll think I’ve lost my mind. and thought he was being asked to choose between a health insurance plan and a tuition benefit plan for all members. many will want to use it for their children’s education. Union negotiator #2: Please—just a moment outside. A lot of employees have spouses who can get health insurance coverage through their work. and the following conversation occurred. What is this.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. The tuition benefits will encourage the workers to be prepared for new job opportunities. 66 50 Practical Negotiation Tactics . it’s a good proposal. With the cost of college educations so high.

Now.) I’m sorry. let’s move on. I didn’t understand that your proposal was to allow each individual member to choose between the health coverage or the tuition benefit. I thought that the contract would cover one or the other for everyone.Union: Union: Company: Okay. Negotiator #1 regained his footing. (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. Good. I think that what you’re proposing is a really good idea. Exchanging Initial Offers 67 . 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. we’ll be back in 5 minutes. the parties returned to the room. and I apologize for explaining it poorly.

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

Employees will be paid time-and-a half for each of these days... The days in question are: Exchanging Initial Offers 69 . Why didn’t you mention the color before? I didn’t expect to actually buy a new car today (note: not the truth). The three are sitting at a lunch table to discuss the schedule. Then we have a deal. All three employees must agree to the schedule. he brought it up and convinced the salesman and manager that it was an important item to him—possibly even a deal-breaker. 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 . and seniority will be used to determine who gets to choose the first day.no it’s not. Example 2 The office supervisor told the three internal sales representatives (Jenny. Hobbs successfully chose color as a throwaway item.. 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. At the very end of the negotiations. Miguel. I’ll take the red one for $100 less.Manager: Hobbs: Manager: Hobbs: Manager: Hobbs: Manager: We are offering you a great deal. Conclusion Mr. The manager was convinced enough to sacrifice a final $100 for the throwaway. 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.

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

one might package all of the financial issues in one group and negotiate on that package as one issue. Their mother’s will was very clear: the three daughters were to all have an equal share of her estate.000. they met at the house. it is often helpful to package the items in distinct groups and then deal with each package separately. Anne: As I see it. Autumn: I don’t have any objection to selling the stock and distributing the proceeds and the cash three ways. and a collection of antique furniture. a house valued at $250.Tactic 17: Package Items In a negotiation where there are multiple issues or items to be negotiated. 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. the antiques. we need to sell the house. 300 shares of stock in a pharmaceutical company. but I’d like to talk about the house and the furniture. can indicate that something you think is minor is really a major concern to your opponent. for example. three ways.000 with no mortgage on it. were faced with the task of selling the house and disposing of their mom’s personal belongings. The estate’s assets included a checking and savings account totaling $450. along with the cash. Anne and her sisters. realizing that the total cost of a deal might make or break the agreement. For example. A reluctance to include one particular financial item with other financial issues. Example 1 When their mother died at age 82. 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 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. Autumn and Angela. and the stock and distribute the proceeds. When the girls decided it was time to talk about the estate. In addition.

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

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

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

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

The monthly payments are about the same. as long as the cost was approximately the same. If both of us had been working the year I went to graduate school. we decided to each pick out our “dream car” and that we would not overrule the other’s choice. about the house and furnishings. I think it only fair that I take over repayment of all the school loans. an art gallery. I don’t intend to “stick” you with anything. 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. I got my convertible. I say we agree to transfer the convertible loan to me and you take over the loan on the sports car. Example 2 ABC Company. Okay. Tim: Well. hold on. They also agreed that Tim wouldn’t have to pay her that amount for five years. Kathy: Now. as you remember.. we would have paid down our school loans more. yes. and XYZ Co. What do you want to do about them? Conclusion Having agreed to two items very quickly. When we bought them two years ago. Kathy: I suppose we should look at the school loans next.Kathy: Hey. Tim: Okay. even though the convertible is being paid for through a 48-month loan and the sports car through a 36-month loan. 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. I can hardly argue with that. Frankly. 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. I think that makes sense. a wholesale art dealer. and you got your sports car. ABC usually uses UPS 76 50 Practical Negotiation Tactics .

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. and that XYZ needed to either go to the shipping company or its own employees for compensation for the damage. Unfortunately. ABC refused to pay WeCanShipArt until it received payment from XYZ. and arrived on time and apparently in good condition. We’ll expect you to pay for the 12 works that will be in your show. XYZ: ABC: Exchanging Initial Offers 77 . There was no indication that the gallery’s electricity had gone out over the weekend. it was obvious that the art in one of the boxes had suffered considerable water damage. 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 other times this happened.to ship artwork. They arrived right before the holiday weekend began. but only if you let us ship it UPS. 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. However. water from the gallery’s air conditioning unit pooled on some of the surfaces of the warehouse area. ABC’s position was that the artwork was fine when it left their location. 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. XYZ contacted ABC immediately. and the boxes showed no external damage. or else the box was damaged in XYZ’s warehouse. The artworks filled four boxes. WeCanShipArt claimed that the boxes were not damaged in shipment—the artwork was already water damaged. You can get the three new artworks here so that we can hold the sale as scheduled? Yes. ABC: Before we begin. and began preparing to return all of the artwork to ABC. when the boxes were opened on Monday. but XYZ asked specifically that a little-known company specializing in shipping art known as WeCanShipArt be the shipper.

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

What do you want for it? Colleen: Well. but if you’re interested. no hard feelings either way. You must mean what you say and be prepared to walk away from an unacceptable offer. We plan to put an ad in the paper next week. and it came with the bush hog and the leaf pick-up. we paid $5. Conclusion Ann and Colleen did not feel like negotiating over the tractor and running the risk that it might affect their friendship. Exchanging Initial Offers 79 . Ann: Well. we’ll sell it to you. I know you and Jeff said you’d like one because you have about five acres. 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. Example 1 Colleen: Ann. Okay? No quibbling. Ann: That sounds great! I don’t want this to affect our friendship. 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. period.000 for it six years ago. The “first and best” tactic enabled them to settle the matter easily. Ann: Thanks! We really need one. Why don’t you give me a price? Colleen: Oh.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. I don’t have any idea. 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. we plan on selling our Ford tractor when we move. I don’t want to quibble. Jeff spends many hours mowing the yard every week. consider using the “First and Best” tactic. and even more hours in the fall picking up leaves.

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

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

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

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

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

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

Tactic 21: Avoid the “Winner’s Curse” It is often quite difficult to make the first offer. 86 50 Practical Negotiation Tactics . or 3) Make an unrealistic offer (i. because you have settled quickly. but you feel cursed because you gave away too much. is the most (or least) the other side will accept. such as last year’s price. never give them their asking price. thus requiring greater concessions on both sides. They found one they both like that lists for $325. 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.” The perfect first offer. at minimum cost. of course. Their realtor told them that it sold for $290. offer $150.000—what they paid for it.000 and $337. Sue: Let’s offer $325. 2) Start out with an old number. Jay: No. particularly if you don’t know the other party’s “settlement range. before someone else does.000 for a house that sold for $185. think things through before you make or accept the first offer.000 this year.000. That’s a fair price. and houses in this area sell fast.e.000 two years ago. Avoid giving away too much at the outset.” (You have won a settlement. Jay: No. The sellers must be willing to come down a few thousand … Sue: Well. We don’t know how anxious they are to sell or if they know the market. Example 1 Jay and Sue are looking to buy a house in a specific neighborhood because it has a good school system. The other party will probably come back with an equally ridiculous offer.000 three years ago). which can be very useful). and that two similar ones on the same street sold for $330.000. then $320. 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.) To prevent this from happening.000. and you cannot withdraw it in good faith. Let’s low-ball them and offer $290..

Sue: Don’t be crazy. since they had already bought another house. Both parties felt that they made a good deal. Frank: Me too. Lyle Foxworthy. I can’t tell our realtor $290. (Bob and Frank meet privately to discuss the situation.) Bob: I’d do it for $3. Lyle: So what’s your price? Bob: Can you tell us what you have budgeted for this project? Lyle: No. They outlined how they would develop a new employee performance-appraisal system. That’s an insult! Jay: Well. the sellers obviously would have accepted and Jay and Sue.000. but who knows what they are planning on offering. Sue: Then you do it. The buyers were very motivated to sell. realizing they offered too much.000 total. (the next day …) Jay: They made us a counteroffer of $307.000. the company president. as requested by the human resource director. If. Let’s accept it! Conclusion Jay and Sue avoided the so-called winner’s curse by making a low (but reasonable) first offer. 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. Give us your lowest price. they had offered $325.000 for each of us—$6. then let them make a counteroffer. Exchanging Initial Offers 87 . as Sue had first suggested. and the offer was based on fact: the prior negotiated price. was very impressed with their presentation.500—half the difference! Sue: Great.

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

and remain open to offers and options that you did not originally expect (see Tactic #30: Always Leave Room for Dessert). is likely to pull away from the table. T Making Counteroffers (The “Give and Take”) 89 . 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. Instead. in fact. Also.Stage 4: Making Counteroffers he heart of the negotiation process is the give-and-take. This can produce a negotiated solution without giving up your priorities (see Tactic #28: Fixed Alternatives). do not dismiss it because it is not all you want. because if you do not at least appear to be flexible. It has often been said that the key to negotiations is to be flexible (see Tactic #25). Wait to counter (see Tactic #24) because this will give the opponent the sense that you are serious about bargaining. One or more parts might be acceptable or indicate movement from their previous positions. what appears to be an outer limit of the settlement range when the process starts can. carefully evaluate an opponent’s offer. 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. 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. Expect that the “total pie” will be different from what it was at the outset. Experienced negotiators seldom reveal their exact priorities and objectives. the other party. seeing no common ground. labor negotiators. be enlarged (see Tactic #27: Expanding the Pie). and attorneys use tried and true tactics in giving and receiving offers. which is often the case. which would most likely weaken their position (see Tactic #26: Keeping Secrets). and do not flatly reject it because it is not your offer. but possibly of different values to your opponent.

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

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

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

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

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

and we both get things we want. We have $1.500 $2. I’d like to spend some of it on lighting upgrades.# 1 Sod Item Cost $1.000! Brooks: Good.200 $200–$2. that makes sense. I’ll trade your sidewalk and trees for my whirlpool bath.000 $500 $1. Maureen: No. Making Counteroffers (The “Give and Take”) 95 .500 $500 $1.000 $5. $750 for lighting and $750 in the bank. Can we split it evenly? Brooks: Okay. These are all permanent immediate needs.000 $2.000 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.000 $3.000 $1.500 left.500 $5. which takes another $3. which I’d like to keep in the bank.

finally agreeing to split the difference on the remaining amount (distributive items).Conclusion By taking the time to list all the items each person wanted and their cost estimates. 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. Pension Increase 3. both sides exchanged lists of initial demands at their first meeting. All items to be negotiated and their desired outcome for each item were put in writing for review. even in difficult years. Profit-Sharing 5. Wage Increase 4. This year. Drug-Testing Program 96 50 Practical Negotiation Tactics . 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). Length of Contract 2. The combined lists total thirteen different items: Desired Outcome No. 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. management and union negotiators found that a “winwin” approach to negotiations worked well.

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

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

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

Rob: (Rob was about to suggest midnight on Mondays through Thursdays. Under ABC ‘s contract with the union. but changed his mind when he saw Jasper’s attitude.m. Neither side anticipates that there would be 100 50 Practical Negotiation Tactics . b) written complaint to a floor manager if the matter is not resolved in 5 days. is all I’ll consider. and that’s not negotiable. 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. and the union foreman would report directly to the plant manager.m. No agreement was reached.) Listen. The union contract required that management renegotiate this change in the grievance procedure with the union. I want a 10:30 p. Under the restructuring. Failure of both young men to allow one another to have their proposal considered caused the relationship to break down. the positions of non-union crew leader and floor manager would both be eliminated. and d) a hearing with company owner if the matter is not resolved in 20 days. Example 2 ABC Company’s management was being restructured and compressed in order to facilitate its new “just-in-time” manufacturing philosophy. 10:30 p. and that’s it. Jasper: (without taking a breath) At best. Rob: (there is no hesitation in this voice) No. c) a formal “meeting” with plant manager if the matter is not resolved in 10 days. midnight during the week is the only thing I’ll consider. The appeals procedure would have to be altered to reflect the restructuring. employee grievances had to go through four levels of supervisory review and appeal: a) verbal complaint to the non-union crew leader. Jasper: Midnight. curfew on TV and other noise every night.

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

After a cooling off period. and we’ll strike if we have to. the two parties did meet again. This time. Union: We’re very serious.two-step grievance procedure instead of a four-step procedure. You can’t be serious. 102 50 Practical Negotiation Tactics . the company entertained the ideas the union had tried to propose before. We’ll see you on the picket line. 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. rather than in the 35 days the current system provides. 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.

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

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

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

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

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

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

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

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

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

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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000 for advertising. Conclusion At first. Take it or leave it. I can’t help. but I will cut your staff by one part-time person (or $15. I’m not going back to him again to discuss this program.000.000 for advertising.000). Felipe: Well. I’ll do it now. Example 2 Roberto: I can’t properly advertise this new program with a $5. that is enough time. I’ll find a way to do without one part-time person. Clean it after your game. I’ll approve $15. Felipe: Sorry.000 in the budget.Amber: row before your basketball game. Use the $5. B. I’ll approve $15. or C. At least this way the program will have a chance to succeed! 116 50 Practical Negotiation Tactics . and clean it. but no TV or anything until it’s done! (pause) Okay. Roberto: But I need to start the direct mail and newspaper ads within two weeks.000 budget! I need at least $20. or we lose a whole year. Roberto: But it will never generate enough interest if no one knows about it. Roberto: Well. I have three hours. Three. but I will cut your travel budget out completely. she chose the one she most preferred. but the company president does not share your optimism on this program. keeping her Saturday free. But when her mother laid out the schedule and gave her alternatives. Amber resisted the chore she hated. (long pause) Felipe: Let me give you three options: A. I can accept B. Felipe: (Roberto’s supervisor) Sorry.

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

he can make an open-ended statement. You know my commitment to this company. I very much appreciated the fair job performance review you gave me. I have to tell you that while I appreciate what you have done for me. 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. and the annual merit raise she was getting from the company was the same 3% other employees were receiving. I think you would agree with me that I have performed well above expectations this past year. Unfortunately. I am very disappointed in the company’s decision not to promote me and to limit my merit increase to 3%. The negotiator for the other side says nothing. This should have resulted in an automatic promotion and a sizable pay increase. the promotion had not yet been approved. and 118 50 Practical Negotiation Tactics . 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. Jones: I certainly do. It was 16% less than she had been led to believe she would be getting. but one side comes back with a non-negotiable demand. received a glowing report from her boss on her job performance. inviting a response. Example 1 Susan. If his opponent cannot agree to the demand but does not want to end the negotiations. nearing her third year with the company. Susan: I hope so. She was determined to hold her ground for at least a 13% pay increase and a promotion. After a few minutes of silence. Susan: Mr. Jones. 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. you are a valued employee.Tactic 29: Prolonged Silence When negotiations have hit a critical stage. Here’s how the negotiations went.

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

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

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

The property came with three acres of forest alongside a meandering brook. She went to discuss this problem with the upstream neighbor and had every intention of demanding that the barrier be removed immediately. the brook and rock barrier are on my property. Madeline built a gazebo about 500 yards from the brook. It calls for compromise. One day. The brook 122 50 Practical Negotiation Tactics . “I have to have this. Neighbor: Well. in a small clearing. when one of you might say. As was sometimes the case in these parts. after the gazebo had been there for about five months. 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. Madeline.Tactic 30: Always Leave Room for Dessert Negotiating is the art of give-and-take. Example 1 Madeline bought an old farmhouse outside of a small town. she noticed that the brook came within 100 yards of it. You will have to remove the rock barrier. She discovered that a rock barrier. Obviously. and began to renovate it as a home and a pottery shop. I have a problem. The reason I built it was so that I could protect my patio. Having an iron-clad demand probably won’t give you enough room to reach an agreement. you should always enter the talks with a good idea of what you are willing to agree to. Joe. She traced the brook back along its course to see why and where it had changed its path. 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. Madeline: Hi. 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. which an upstream neighbor had built. the brook was the property line separating her property from a neighboring farm. or we will be at an impasse. Your rock barrier has sent the brook onto my property and it is too close to my gazebo.

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

the discussions of the employee benefits package bogged down on the issue of health insurance costs and pension benefits. Pilots: Look. dependent coverage could cost us $1. This would be a better benefit in the long run. Everyone was afraid that the dispute would cause an impasse and a possible strike. then the pension benefits overall will increase by $10. that would be the minimum increase. as it has always been.000 to cover the premiums for dependent coverage. you are taking a risk on the costs increasing. and are willing to keep pension benefits the same. If we invest the $200. However. what they really need is for you to cover the costs of dependent coverage. With long-term planning and investments. As best as we can tell.000 figure. This is just a cash-flow problem that your members have to understand.000. The airline industry is in a slump. And we cannot afford that $1. the airline paid a total of $200.000 (which we reasonably should have expected to pay in premiums) in the pension account now. Over the last five years. with all wage and operations issues resolved fairly early. Over the next five years. Pilots: So you are projecting that the increase in dependent coverage premiums will average $200.000 a year over the next five years? Company: Yes. The pilots want dependent coverage paid for by the company.000.000.000. The projections for the next five years were that these costs would increase to about $1. The company wants to trade paying for dependent coverage for better pension benefits.000. the company can make your pensions much better.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. and we know that with this new contract term of five years. we know that health insurance premiums might skyrocket.000. But only a few of our people are close to retirement age. Company: This could not come at a worst time for us. 124 50 Practical Negotiation Tactics .000.

000 the first year on the premiums.000. If we can get two or even three years out of the $200. the company will not be expected to give us this benefit. Company: If the company spends the $200. It initially believed that the only option was to put that money into pension benefits.000 to either pay one year of the premiums. however.000? Once the cap is met. or invest in the pension plan? Company: Yes. The $200. so the decision to be flexible was a good one. Conclusion The company was committed to limiting its exposure to $200. with a cap of $200. can we agree to a year-to-year agreement on dependent coverage. then those funds will not be available to invest in the pension plan. Company: Then it’s okay with us. and the pilots knew what to ask for when the contract expired. The pilots expanded the range of options. Pilots: Since the concern is about agreeing to a 5-year commitment without knowing the increases we might have in health insurance costs. that would be worth it. The health insurance market stabilized. we are. Are you willing to risk not having an opportunity to increase pension benefits? Pilots: Yes. Making Counteroffers (The “Give and Take”) 125 . The dependent coverage is more important to us now than the pension benefits.000 available. if they were that high. by agreeing to let the company cap its exposure for dependent health coverage.Pilots: But you do have the $200.000 actually carried them through four years.

I guess it would be around $600 per month.” “affordable weekly payments.500! Saleswoman: Yes. and compare it to your strategic objective. If you are on the receiving end of such a tactic. do you want to look at something else? Buyer: No. what monthly payment did you have in mind? Buyer: More like $300 per month.000 car.” 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. Phrases such as “for only pennies a day. $45. Buyer: Yes.” and “low monthly rates” are examples of the salami tactic. I love this car. Saleswoman: I’ll be right back. if I can give you this car with a $300 monthly payment. but that was several years ago. Example 1 Car buyer: What. I just can’t imagine the monthly payment on a $45.000 for a Volvo? I bought the one I’m driving for $19. Buyer: Way too much! Saleswoman: Well. be sure to add up the total cost. but the Consumer Price Index has not gone up 150%—nor has my paycheck! Saleswoman: So.… (20 minutes later) Saleswoman: So. I recall the day you drove it out of here.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. Saleswoman: With your 740 in trade. it’s a deal? 126 50 Practical Negotiation Tactics .

Great! So. (looks at the numbers) That looks good. Sure. Instead of a three-year lease. you can get the Disney channel for only $5.000 down. it will be a five-year lease. but let me see the numbers. but what else must I buy? Only the basic service for $8. do you want Disney? Yes.00 per month.99 per month. can’t you? Buyer: Yes. Once the buyer volunteered that $300 was an affordable “slice.” she had him—she worked around the $300 slices.00 per month.000 price into “slices” the buyer thought reasonable.00 per month for your service.Buyer: I don’t see how you can do that. Example 2 Cable representative: Owner: Cable representative: Owner: Cable representative: Owner: Cable representative: Owner: Cable representative: Owner: Yes. Making Counteroffers (The “Give and Take”) 127 . do you want HBO? How much? $5. down payment.” She decided to cut the $45. I can’t afford that much. You can do that. with your car and $6. and payout slices to reach the total price she wanted. as promised. But my neighbor pays $39.000 down and $300 a month! Conclusion The saleswoman knew the buyer was suffering from “sticker shock. I can afford $6. and added the trade-in. Saleswoman: Simple. Let’s see. I can’t discuss another client’s account.

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

and it can destroy your credibility. it is effective. When both sides believe that each has equally strong positions. 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). Humor might not look like pressure. turned off by the tactic. an unexpected element of humor can break the tension and encourage a person to calmly get back to the issues. 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. the traditional car salesperson might tell the buyer. but others will walk out the door. however. In some cases. so are you ready to make a deal? This might convince a few buyers. Tactic #35 (Applying Excessive Pressure) is a similar tactic that should also be used with caution. Tactic #36 (The Element of Surprise) can catch an opponent off-guard and cause stalled negotiations to move forward. but in tense. For example. but it can be used effectively when one party clearly has an edge. and the use of humor. Tactic #33 (The Bluff) is a classic pressure tactic. Applying Pressure 129 . pressure tactics should probably be avoided. Other less-obvious pressure tactics include Tactic #37 (Divide and Conquer). “I can only guarantee this price until 6:00 p.m. 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. angry negotiations. today. which can be successful if the opposing team has two or more members who hold different views of an issue.

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

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

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

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

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

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

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

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

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

because you will probably only get to use it once. and I can’t stand it. The doll can be shared. and Susie hid them under the seat. Just because you saw it first doesn’t make it yours. Susie: Okay. you have it this part of the trip. Mom said so. We’ve got a long ride ahead of us. the girls had been fussy. This time. Tell Susie to let me have it. Andrea: The doll is mine.) Dad: Stop it right now. but use this tactic judiciously. the argument is over the doll’s shoes. Just share the doll. the fighting starts up again. and here’s how the “negotiations” went: Dad: You two stop fighting. Andrea: Okay. (In a few minutes. Example 1 A father and his two daughters were on their way to visit the grandparents. You’re driving me nuts. I took it out of the box. (Their dad pulls to the side of the road and turns to face them in the back seat. Almost from the beginning of the three-hour drive.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. Their dad tried to reason with them.) Applying Pressure 143 . Andrea. you have it when we drive home. I can’t drive if you keep this up. Susie: The doll belongs to both of us. the little girls began to fight over the doll. About an hour into the drive. Andrea had taken them off the doll. Consider making a suggestion or a proposal that completely surprises your opponent. Why? A sudden surprise can disrupt the dynamics of a negotiation. and Susie. They stopped for lunch at a fast-food restaurant and shared a children’s meal that came with a small doll.

He grabbed it and threw it out the window. The local newspaper was prepared to urge the auditor to end the litigation.) Dad: Now there’s no more fighting over the doll. but nothing else up to that point was working. The auditor asked to meet with the editor to explain his position. Dolly doesn’t need shoes on in the car. and that they had invested and spent the tax dollars wisely. She can have them later. Conclusion Dad’s use of a “surprise” tactic was extreme. so it was worth the risk. The auditor’s job was to make sure that tax dollars collected for the local education system were appropriately handled. Both Andrea and Susie were so shocked by their dad’s action. Here’s how the meeting went: Auditor: I appreciate a chance to talk to you about this litigation. 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. He initiated the litigation against the local school board members and several banks that invested the money for the board. 144 50 Practical Negotiation Tactics . in fact. to no avail. and I hope I can convince you of that. Dolly has to have her shoes. The litigation itself had been going on for more than three years. at great expense to the auditor’s office and the school board. and reached back for the doll. he slowed down. charging that they breached their duty in their handling these funds. Finally. I think I have acted properly. (They continued to argue and whine and pinch each other. they didn’t say another word. The tactic was so successful. Daddy said I got the doll on the way to Grandma’s house. Dad tried correcting them a few more times. I want the shoes. The defendants contended that the auditor’s actions were politically motivated. Susie: Daddy didn’t say anything about the shoes.Andrea: Give me the shoes back.

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

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

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

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

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

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.

Applying Pressure

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

They did all the compromising they were willing to do.: Julie: Hey. Conclusion The children stayed inside and played dress-up.Mr. neighbors became concerned about the changes to the mall. We don’t want to go outside. 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.” No. 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. however. The owner decided to try for a variance. failed to offer the children something that was as important as the plans they had made. C. or apply for a variance. When his variance application was made public. We want to play dress-up and then color. the parking lot will start to look trashy. The neighbors: The neighborhood has four concerns: Theater patrons will be taking up scarce on-street parking spaces. The owner and a small group of neighbors met to talk about these problems. According to the city’s zoning laws. the owner had to supply additional parking. C. Mr. wouldn’t you like to go outside first? After you swing for a while or play ball. and they still had time to color. 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. 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. and teenagers attracted by Making Progress 155 .

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

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

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

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

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

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

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

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

of course. Roberto will get to choose which half he wants.” the divider. is usually careful about dividing the object into two equal parts. the classic “split and choose” tactic might be the best way to settle the issue.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. Maria. Their dad instructed them to share the candy bar. Realizing the potential of getting the “smaller half. Maria and Roberto: No. Maria: Roberto: Maria: Father: Father: We can’t share it! It’s in one piece! I’ll eat half and give you the rest. What is it? Maria: Father: 164 50 Practical Negotiation Tactics . with the remaining part going to the person who did the dividing. take this knife and slice the Snickers into two halves. which certainly is large enough (he naively thought) for two young children to easily share. The second person then chooses which of the two parts they will receive. Oh.… No way! Haven’t you two heard of ‘split and choose’? It’s a fair way to divide things. because you did the cutting. 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. one person is given the task of dividing the object(s) into two parts. so I’ve got to cut it into two equal pieces or else he will choose the bigger one? Exactly.

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

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 .

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

This experienced bargainer said. At the end of negotiations. If one party misjudges the situation. If used correctly—at the very end of a negotiation—the tactic can usually provide a small gain. “Okay.” The company negotiator yielded to this small-potatoes counteroffer in order to win agreement on the health plan. the two sides had been engaged in considerable bargaining over an improved medical insurance plan (“Health Plan A”) costing hundreds of thousands of dollars. so be prepared to withdraw the nickel and dime item at the hint of trouble. In one case. it can be a dealbreaker. 168 50 Practical Negotiation Tactics . 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.” Conclusion The nickel and diming tactic is a classic negotiation tactic used successfully in a variety of situations. we’ll agree to Health Plan A with another ½ cent on the pension fund.important item.

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

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

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

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. $237. $235.000. Here’s a list of the five that are about the same size as yours. I’ll get back to you.000.000. has owned the house for 24 years and is downsizing to a condo. Sam Jones: Sam Jones: 172 50 Practical Negotiation Tactics . (Next day) We’ve reviewed the records you’ve produced. Example 1 Henry and Maria Lopez are interested in a house that lists for $275. We love your house. and we are countering with an offer of $250. Sam Jones. but you’ve priced it way too high. Sometimes.Tactic 45: Use Facts Fact-gathering must be part of the preparations for every negotiations session. and $237.000.000. They sold for: $225. Henry Lopez: Sam Jones: Maria Lopez: Sam Jones: Maria Lopez: We love the house and have made a written offer of $240. The owner.500. $229. They believe it is overpriced. but the key is to gather facts that you might need—not just the facts that you will need. but we feel that it’s a fair offer. This offer is for more money than any four-bedroom houses on this neighborhood list.000 under the listing price! We realize that. the other party will ignore or refuse to believe the information. What? That’s $35.000. Being able to present them at the most appropriate and critical times has made the difference in countless negotiation situations. but the right facts presented at the right time can chill or astound and completely turn things around.000.

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

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

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

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

When two parties believe they have an oral agreement.Stage 7: Reaching Agreement he final stage! It might come minutes. 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. or even months after the first offer is presented. 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. When multiple issues are at stake and most have been agreed upon during negotiations. and the classic Walk Away (Tactic #48). If friends or neighbors need to settle something but prefer to avoid the negotiation process. this tactic can produce an agreement. this process can easily result in a final settlement. They bring it out when a dispute arises. If both parties desire a settlement but cannot seem to reach it through the usual give-and-take process. In this process. Tactic #49 (Final-Offer Arbitration) should bring about a settlement. T Reaching Agreement 177 . hours. 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). 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. and the child learns an important lesson about life. 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. 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. days.

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

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

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

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

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

they were prepared to accept $5. Michael: I have a check right here for 4.5 million. go back to your office. which the Bizannes accept. What do you think? Judy: Larry. I still want to develop this block. One day. Larry: Yes.5 million for the building.) 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. and he is offering us $4. Reaching Agreement 183 . Larry: Judy. our accountant said it’s worth $6 million. but their continued walkout convinced Michael that they would hold firm. Michael calls on them again with a check for $5. come out here! (Judy comes out from the back room. Larry: Michael. Michael: Well.0 million. let’s eat lunch. and I only need your building to own it. so why are you here? Michael: I’ve discussed it with my partners.) Larry: Michael is here again. Larry. and I’m prepared to offer you $4. visited their store. a local developer. Two months later. with a certified check. today.5 million. Michael: Good morning. after no contact from Larry or Judy. How’s business? Larry: Great! I’m surprised to see you again. and we gave you our price. He met with Bizannes twice before.5 million. You rejected it.both of them love their store. (Judy and Larry walk into the back room and close the door. you’ve already told us that. Michael Roberts. Larry. In reality. and I’m not interested in less. Judy: Larry.

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

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

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

everyone is busy grappling with the details of the negotiations. we won’t be involving our real estate agent. and decided to stop by to see if they liked the house. however. Seller: Yes. Example 1 Bill and Paulette had been house-hunting for some time. They finally looked at a house they really liked. Bill: Reaching Agreement 187 . During a discussion. The owners were selling the house without a real estate agent. We’d like to make you an offer of $150. and felt that they would have to work fast to make an offer before someone else did.000. and while Bill and Paulette had been using an agent to help locate houses. not the furniture. 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. Obviously. Seller: We’re asking $152. Bill pulled the seller aside. they looked at this particular house on their own. 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. The goal of recording the precise details is to either avoid any misunderstandings or address them before the talks conclude. At the very least. They saw the “For Sale” and “Open House” signs. They were not the only couple to come to the open house. all the usual stuff in a sale.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. seeing the agreement in writing will force both sides to acknowledge what has been said and agreed to in the negotiations. and one of the other couples looked very interested. If we shake hands on it right now.000.

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

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

000 just to get the employee to “withdraw” the complaint. but word did get out that a public agency paid $200. 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. Monica accepted the $200.She: authorized to pay $200. There was a confidentiality agreement.000. 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 and the conditions of the offer. 190 50 Practical Negotiation Tactics .000.000 when all that was asked for was $100. 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. It was made clear that the employer had paid the additional $100.

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

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

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

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

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

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

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

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

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

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

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. Jefferson County. 202 50 Practical Negotiation Tactics . Recently voters approved the merger of the City of Louisville and Jefferson County Governments. 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. an agreement between the State of Kentucky.park and a successful industrial park in the City’s enterprise zone. Ms. the City and a for-profit hospital for guaranteed indigent health care services for city residents. 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.