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

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

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

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

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

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

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. Information.

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

Example 1 Tom had always admired John’s 1861 Confederate rifle. John: Tom: John: Tom: Tom. she might have to take a lower offer just to be able to move. right? John: Sure. and told John several times to let him know if he ever wanted to get rid of it. you know. Just running out of space. at some point. it’s to your advantage to know what is behind a seller’s decision to put it on the market. I think so. This is a good thing to know. sure. 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. Just as important is the why. because if the company does not provide relocation benefits. what the other party’s desired outcome is. What changed your mind about getting rid of it? It is still in perfect condition. Gosh. A person who has to sell her home because her company is relocating her. How much are you thinking it’s worth? John: Well. If you are the party making the offer on the house. Tom: $20. Preparation 17 . I’ll have to think about that. you still interested in my rifle? Of course. I guess I couldn’t take less than $20.000? That’s more than I planned.000. John assured Tom that this would never happen. Make me an offer.Tactic 2: Know Your Opponent’s Real Objective Each party in a negotiation will know. It is extremely rare—one of only 100 made with that bore and handle. it’s still perfect. so Tom was surprised when John called him out of the blue one day with a proposal. for example. Are you finally ready to sell it? Yes. I’ve been thinking of getting rid of it for a while. 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.

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

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

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

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

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

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

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

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

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

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

Then negotiations can resume on the remaining 43 items. thus removing them from the discussion table. 28 50 Practical Negotiation Tactics . 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.Conclusion In most labor negotiations.

Timing is everything! Example 1 Bob Hillard had been coveting a turquoise 1963 Chevrolet Impala Supersport convertible for several years. $12.000? No. which turned out to be only a few blocks from his own house. One day. (For the next three years. I love this car—restored it myself.Tactic 6: Timing Is Everything The exact month. day. He stopped and knocked on the door. Not even for. say. Bob followed the man home. he noticed a FOR SALE sign in the yard. he saw an elderly man get in his dream car and drive away. I live a few blocks from here. Prepare carefully. thanks. That’s a generous offer. time of day. As the man got out of his car. my name is Bob Hillard. Hi! What can I do for you? I’ve admired your ‘63 Impala for years. One day. on Briarwood Road. just out of curiosity. as he left the supermarket. but money doesn’t mean anything to me at this point in my life … Well. Bob made it a point about once a month to go out of his way and drive by the man’s house. It was nice meeting you. 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. the following conversation occurred: Bob: Car owner: Bob: Car owner: Bob: Car owner: Bob: Hello.) Preparation 29 . and do your homework. and general circumstances under which negotiations take place can substantially impact the outcome. Would you possibly be interested in selling it? No.

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

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

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

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

If you consider the demand ridiculous. Finally. Carol wants $160. your request must not be so low that the other party concludes that you are not negotiating in good faith. Anyone buying the house would want to change wall colors or add new carpets. Each time. Carol: We really want to sell.Tactic 7: Decide How “High” Is High Your first demand in the negotiation process is the most important decision you will make. her real estate agent told her that they were probably not going to get a buyer because she is asking too much. as well. Your demand should be high enough to give you room to compromise. and then look at the demand from your opponent’s perspective. but the redecorating is of little value. so think this through well ahead of time. After all. Carol: Maybe not. but certainly not exceptional in any way. it is likely that your opponent will. Planning a Strategy 35 . We also think that the neighborhood has improved over the last few years. six years ago you bought it for $60. Buyer: We really like the house. and just refuses to reduce it. so do not underestimate what you might be able to achieve. Be realistic. Example 1 Carol has been unhappy with the house she and her husband bought six years ago. The market hasn’t gone up that much in six years. but quite frankly. with no success. And I don’t see a lot of difference in the neighborhood. we think $160.000. but the house has increased in value. You are not likely to get more than you request. First. we’ve put a considerable amount of money into a new air-conditioning system and in redecorating.000 is very high. Buyer: The air conditioning might have increased the value of the house. but not so high as to end the negotiations before they begin. She has had it on and off the market for the last five years.000. It’s a good neighborhood. Surely there’s some flexibility in your asking price. but we simply can’t take less than $160. one buyer shows some interest.000. However.

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

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

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

(bad guy) and implies that his or her side will hold firm on their demands. Paula: Go ahead and ride it home. Peggy: I assumed they went with the mower. Andy and Paula.200! We should get $1. I’ll go home and you can call me if you two can reach an agreement. Half what it cost us new. Your opponents will want to avoid confrontation and unpleasantness with the “bad guy” and are likely to be more willing to cooperate with you. you’re really moving! I hate to see you leave.Tactic 8: The Good Guy/Bad Guy Routine The “good guy/bad guy” routine is a useful one. what’s your price? Andy: $1.400 if the catcher and can are included. Andy: No. Andy: I want them… Paula: Go ahead and take them. etc. Peggy. not for $1. I don’t know what the deal is now. since they are sitting out in the driveway with it. I want to keep those. we won’t need it at the new condo. I can use them. Peggy: That’s fair. angry. I heard that you want to sell your riding mower. only three years ago. and I know how you take care of things. Peggy: I’m hearing one thing from Paula and another from Andy. Peggy: Planning a Strategy 39 . One member of your team acts friendly to people on the other side (the good guy) in order to gain their trust and support. so I’ll take it. And take the leaf-catcher attachment and the gas can. Peggy: So. Example 1 So. threatening.200. They cost about $300. Andy and Paula: Yes. while another acts difficult. Andy: No.

She very wisely recognized the routine and forced Andy and Paula to give her a clear. Miguel: Well. perhaps even unintentionally. Miguel: But not at this ridiculous rate. And we want to change the 24-hour service response time to 48 hours. She realized that it put her in an impossible negotiating position. We estimated that it has cost us more than $50.000 per month is one of the highest in town. You are located outside our primary service area. Liz: But we still want to renew your contract. your account has taken too much time. Sandy. 40 50 Practical Negotiation Tactics . the quality of the technicians’ work.000 in service calls last year alone because your damn people don’t take care of the equipment. firm offer if they decided to continue negotiations. And cut the training hours from 55 to 20. causing our reps to spend hours on the road. Sandy. For the past three years. Sandy: What? First of all. And we need to add a clause that holds your company responsible for machine damages. and your training programs. your rate of $3. we’re here to negotiate a new service agreement.Conclusion Peggy thought she was getting the old “good guy/bad guy” routine. we’ve been fairly happy with your responsiveness. Example 2 Sandy (business owner): Miguel and Liz (representatives of a computer firm).200 will be about right… Sandy: I can’t begin to pay that! Liz: Calm down. Miguel: I’ve figured $4. Let’s talk.

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

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

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

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

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

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

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

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

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

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

you gain an edge when negotiating a new plan for your company. and should therefore handle the problem. 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.investment decision or deal with an error in a bill. 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. Preferred Provider Organizations (PPOs). a negotiator in a similar situation was able to get the other side to agree to include a plan that they had opposed only days before! Planning a Strategy 51 . he argues that she is the expert.

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

Now that her children are in college.m. and her children were in school. she got a visit from some of the residents. Planning a Strategy 53 . Example 2 Marilyn’s Memorabilia Store was located along the main commercial street of a residential neighborhood.m. We really want you to go back to your original times. The last cake we had was chocolate cake. Marilyn originally set her shop’s hours for 10:00 a. It was the type of shop the nearby residents preferred.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 realized that if we cut the cake lengthwise. and keeps it open longer so she can attract customers on their way to and from work. This cake is white cake. so that your customers can park on the street. I helped with the bags without being asked twice. to 3:00 p. and that’s not my favorite either. One day. Residents: Marilyn.m. and better than a fast-food restaurant with late-night hours and a drive-through window. I can have the part with the icing and Bill can have the part with the cake and filling. because there is no parking along the street during morning and evening rush hours. 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. your new shop hours have caused your customers to park in our parking spaces. Customers have started to park in nearby apartment lots. she opens her shop at 7:30 a. 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. so these hours worked out well. and I really like white cake. That sounds like a wonderful solution.

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

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

56 50 Practical Negotiation Tactics .Sue: Mary: Jenny: 5:00 p. Allan: Let me confer with the city attorneys. David: I understand your concern. Sue.. then the whole deal is lost because my company will lose $10 million in tax benefits under a federal law that expires on midnight. Example 2 Allan: As the negotiating team for the city. Okay. we cannot agree to these development plans submitted by your company until we have reviewed how they will affect the historic buildings. 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 we are not finished. and I appreciate your interest in the historic structure.m. However. your attorneys know the tax laws. 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 I cannot carry a negotiated and signed deal to my board by noon on December 31. December 31. being the oldest. All of us must come back before Saturday to take what is ours—agreed? Okay. And besides. Agreed. can sell or give away what is left. this is December 29.

Conclusion Knowing the external deadline gave David a significant negotiating edge. 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.Allan: (One hour later. we can’t get the reports we wanted in 48 hours. Let’s continue. Obviously. Planning a Strategy 57 .) I understand the December 31 deadline.

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

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

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

This is a practical starting point that will not anger the other side (and might even be expected). 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.750–$25. The initial offers of both parties are usually set reasonably above or below what each believes to be the settlement range.500) Resistance Point ($25.000 22 23 24 25 26 27 Initial Offer $28. Exchanging Initial Offers 61 . The initial offer sets the tone of the negotiations and reveals something about the strategy of each side.000) Target Point ($23. 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. Another common strategy is to start with the status quo. for example. “Distributive” bargaining (“win-lose” or “zero sum”) is used. Many negotiators make their initial offer the highest acceptable offer (Tactic #19: Make a First and Best Offer). Adapted from Labor Relations and Collective Bargaining. such as proposing to continue at the current rate or price.000 Buyer Initial Offer ($21. The negotiator firmly states that it is their best offer in an attempt to gain a nice.000) Settlement Range ($22. by Michael R.Stage 3: Exchanging Initial Offers any offers and counteroffers are made during a typical negotiation—sometimes even hundreds. quick agreement.500) M $21. Carrell and Christina Heavrin. 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. as illustrated in the following figure: Seller Resistance Point ($22. 2: Distributive Bargaining Process. 190–192.750) Target Point ($24. (2004). None is as important as the first one.

After initial offers are exchanged. and is the range in which most negotiations actually occur.In this example. 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. 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. thus producing a true “win-win” negotiation.000 and $28. Two extremely helpful tactics to be used immediately after initial offers are made are Tactic #15: Caucus and Tactic #20: Posturing. The settlement range is the distance between the resistance points. 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). In the example.000. Resistance points are the maximum or minimum beyond which a negotiator is likely to consider an offer unacceptable (and possibly walk out). See Tactic #18: Agree on Something As Soon As You Can. the other side does not agree to this value). usually. if the buyer’s initial offer was $25. 62 50 Practical Negotiation Tactics .000) is reasonable. Experienced negotiators will begin the negotiation of several items by quickly proposing such a package. 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). When the two parties agree to a price within the range. the seller would immediately accept it because it is greater than the target point and the buyer would suffer a winner’s curse. the process quickly narrows to the range between the initial offers. each initial offer ($21.” but the settlement price. thus starting out on a positive note. these points have set the outer limits. it is termed the settlement point – not the “right price” or “fair price. 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.

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

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

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

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

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

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

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

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

Example 1 When their mother died at age 82. 300 shares of stock in a pharmaceutical company. their mom left specific pieces of jewelry and art in the will to each of the girls. it is often helpful to package the items in distinct groups and then deal with each package separately. For example. 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. The house and much of the furniture has been in the Exchanging Initial Offers 71 .Tactic 17: Package Items In a negotiation where there are multiple issues or items to be negotiated. were faced with the task of selling the house and disposing of their mom’s personal belongings. In addition.000. realizing that the total cost of a deal might make or break the agreement. but I’d like to talk about the house and the furniture. a house valued at $250. When the girls decided it was time to talk about the estate. along with the cash. Autumn: I don’t have any objection to selling the stock and distributing the proceeds and the cash three ways. they met at the house. and the stock and distribute the proceeds. A reluctance to include one particular financial item with other financial issues.000 with no mortgage on it. Anne and her sisters. can indicate that something you think is minor is really a major concern to your opponent. and a collection of antique furniture. for example. Anne: As I see it. three ways. The estate’s assets included a checking and savings account totaling $450. 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 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. Autumn and Angela. we need to sell the house. the antiques.

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

Autumn: I can agree not to do anything with the jewelry and art Mom left me before we talk. and the assignment of the limited number of parking spaces. The second: working conditions (work schedules and promotional opportunities). deciding whether there would be annual wage increases as well as merit increases. Example 2 The attorneys and staff of the local Legal Aid Society formed a union and were about to negotiate their first contract with the executive director. Angela: That’s fine. and establishing a work schedule to accommodate evening and weekend clients. funeral. The third: Ben- Exchanging Initial Offers 73 . the antiques. vacation. 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). sick. May I suggest that we divide the items into three areas. Employees: We’ve got a lot of items to cover. Several issues also needed to be addressed: the ability of employees to move up through the organization. including benefits for partners in non-traditional relationships. and the art works—will be more difficult. the jewelry. Waiting to make decisions on those items until some time has passed gives the women an opportunity to look at a number of options. deciding to base the increases on a percentage or equally distribute the funds for increases among the professional and clerical staff. tuition benefits. what kind of paid leaves there will be (personal. Anne: Same with me. Conclusion Autumn’s suggestion to package the money and stock because they can be easily divided by three made agreement on those items possible. The following tasks needed to be a accomplished: establishing basic pay schedules.). health benefits. etc. The negotiations on the other items—the house.

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

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

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

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

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

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

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

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

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

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

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

Tencro: Well. and hired 500 new employees. Exchanging Initial Offers 85 . However. The new set-up was so profitable. Other than that. but for the fact that each party did its homework and was aware of the true facts. Tencro bought land in the industrial park. borrowed money for the new building. Future negotiations continued. Tencro was able to pay off the borrowed money in half the time. EDO: Get back to us as soon as you can. let us go back and take another look at our options. the training and the new road improvements were all the incentives offered to Tencro. and the state did end up participating in a housing subdivision in order to keep the purchase price down for the new employees. Conclusion The posturing by both sides could have caused the whole negotiation process to bog down. 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.

000 for a house that sold for $185. Avoid giving away too much at the outset. 2) Start out with an old number. which can be very useful). The sellers must be willing to come down a few thousand … Sue: Well.e. but you feel cursed because you gave away too much. and you cannot withdraw it in good faith.000—what they paid for it. Sue: Let’s offer $325.. Jay: No. and houses in this area sell fast. offer $150. because you have settled quickly. or 3) Make an unrealistic offer (i.) To prevent this from happening. The other party will probably come back with an equally ridiculous offer.000 this year. 86 50 Practical Negotiation Tactics .000.000 three years ago). Example 1 Jay and Sue are looking to buy a house in a specific neighborhood because it has a good school system. never give them their asking price. think things through before you make or accept the first offer. at minimum cost. of course. is the most (or least) the other side will accept. 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.000 two years ago. Their realtor told them that it sold for $290. either: 1) Let the other party make the first offer (this means that you will be giving up the chance to focus the negotiations on your figure.000 and $337. We don’t know how anxious they are to sell or if they know the market. such as last year’s price. That’s a fair price.” The perfect first offer.000. They found one they both like that lists for $325.” (You have won a settlement.Tactic 21: Avoid the “Winner’s Curse” It is often quite difficult to make the first offer. Jay: No. before someone else does. and that two similar ones on the same street sold for $330. Let’s low-ball them and offer $290. then $320. thus requiring greater concessions on both sides.000. particularly if you don’t know the other party’s “settlement range.

as requested by the human resource director. would have suffered the winner’s curse! Example 2 Bob Myers and Frank Costello made a presentation to the top management of a paint company.000 for each of us—$6. They outlined how they would develop a new employee performance-appraisal system. The buyers were very motivated to sell. Lyle Foxworthy. but who knows what they are planning on offering. Lyle: So what’s your price? Bob: Can you tell us what you have budgeted for this project? Lyle: No. and the offer was based on fact: the prior negotiated price. the sellers obviously would have accepted and Jay and Sue. since they had already bought another house. the company president. (Bob and Frank meet privately to discuss the situation. was very impressed with their presentation. Sue: Then you do it. If.Sue: Don’t be crazy. realizing they offered too much. I can’t tell our realtor $290. Let’s accept it! Conclusion Jay and Sue avoided the so-called winner’s curse by making a low (but reasonable) first offer. That’s an insult! Jay: Well.) Bob: I’d do it for $3. as Sue had first suggested. Exchanging Initial Offers 87 .500—half the difference! Sue: Great. (the next day …) Jay: They made us a counteroffer of $307. they had offered $325. then let them make a counteroffer. Give us your lowest price.000.000. Frank: Me too. Both parties felt that they made a good deal.000 total.

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

Skilled negotiators such as salespeople. the other party. In some negotiation situations. Expect that the “total pie” will be different from what it was at the outset. and attorneys use tried and true tactics in giving and receiving offers. Wait to counter (see Tactic #24) because this will give the opponent the sense that you are serious about bargaining. which is often the case. labor negotiators. One or more parts might be acceptable or indicate movement from their previous positions. is likely to pull away from the table. because if you do not at least appear to be flexible. Use a prolonged period of silence (see Tactic #29) to convey something at a strategic moment.Stage 4: Making Counteroffers he heart of the negotiation process is the give-and-take. 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. carefully evaluate an opponent’s offer. and remain open to offers and options that you did not originally expect (see Tactic #30: Always Leave Room for Dessert). and do not flatly reject it because it is not your offer. seeing no common ground. Also. Instead. be enlarged (see Tactic #27: Expanding the Pie). Experienced negotiators seldom reveal their exact priorities and objectives. what appears to be an outer limit of the settlement range when the process starts can. 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. which would most likely weaken their position (see Tactic #26: Keeping Secrets). It has often been said that the key to negotiations is to be flexible (see Tactic #25). in fact. When the other party makes an offer. but possibly of different values to your opponent. 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. T Making Counteroffers (The “Give and Take”) 89 .

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

the discussions of the employee benefits package bogged down on the issue of health insurance costs and pension benefits. The airline industry is in a slump. dependent coverage could cost us $1. and we know that with this new contract term of five years. 124 50 Practical Negotiation Tactics . Pilots: So you are projecting that the increase in dependent coverage premiums will average $200. the airline paid a total of $200. The projections for the next five years were that these costs would increase to about $1. But only a few of our people are close to retirement age. If we invest the $200. you are taking a risk on the costs increasing. The pilots want dependent coverage paid for by the company.000 to cover the premiums for dependent coverage. the company can make your pensions much better. As best as we can tell. and the premiums for health care just keep going up. and are willing to keep pension benefits the same.000.Example 2 The contract negotiations between the pilots and the airline had been going pretty well. Everyone was afraid that the dispute would cause an impasse and a possible strike.000.000. with all wage and operations issues resolved fairly early. Pilots: Look. Company: This could not come at a worst time for us.000. With long-term planning and investments. then the pension benefits overall will increase by $10. as it has always been. And we cannot afford that $1.000 figure.000 a year over the next five years? Company: Yes. Over the last five years.000. However. This is just a cash-flow problem that your members have to understand. Over the next five years.000. what they really need is for you to cover the costs of dependent coverage. we know that health insurance premiums might skyrocket. that would be the minimum increase.000. This would be a better benefit in the long run. The company wants to trade paying for dependent coverage for better pension benefits.000 (which we reasonably should have expected to pay in premiums) in the pension account now.

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

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

it will be a five-year lease.000 price into “slices” the buyer thought reasonable. as promised. down payment. Instead of a three-year lease.000 down. (looks at the numbers) That looks good.” She decided to cut the $45. do you want Disney? Yes. but what else must I buy? Only the basic service for $8. and added the trade-in. Sure.00 per month. Let’s see. do you want HBO? How much? $5. But my neighbor pays $39.” she had him—she worked around the $300 slices. You can do that.99 per month. Saleswoman: Simple. I can’t discuss another client’s account. with your car and $6. Making Counteroffers (The “Give and Take”) 127 .00 per month for your service. I can’t afford that much.00 per month. Example 2 Cable representative: Owner: Cable representative: Owner: Cable representative: Owner: Cable representative: Owner: Cable representative: Owner: Yes. Once the buyer volunteered that $300 was an affordable “slice. and payout slices to reach the total price she wanted.000 down and $300 a month! Conclusion The saleswoman knew the buyer was suffering from “sticker shock. but let me see the numbers. can’t you? Buyer: Yes.Buyer: I don’t see how you can do that. Great! So. I can afford $6. you can get the Disney channel for only $5.

99 per month. Yeah. 2? How much? $8. and probably felt much better about the total negotiated package because it was presented in modest individual slices. we had that before. 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. Thanks. and my wife wants the old movies. That’s $5. But that’s all! Then we’ll hook you up on Monday. and SI 1.00 per month was far too much.00. The total is $38.00 a month. Okay. 2. Conclusion The owner thought his neighbor’s service at $39. instead of one total amount.00 per month. Great. That’s another $5. they asked about the Cartoon Network. What about the music package? Yes.00! Why? Because he judged the per-slice price to be reasonable. 128 50 Practical Negotiation Tactics . 3. Any other kids’ channels? Yes. Disney is for the kids! The sports channels are for me. I really want the sports channels.

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

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

I’m surprised by your attitude. I was afraid something was going on when you all-butstopped joining us on the boat. Applying Pressure 131 . though it’s not so happy. (After Lacey and Chloe had a chance to talk. Abby: Well. If Don had not exaggerated the importance of the boat and dealt with Lacey honestly. and we’re moving farther south. Let me talk to her. We’ll be leaving here for the Midwest. Chloe: Oh. Don. which you would have to share if you want to retain half-ownership.is just about the most important thing we own. but separately. It just reminds me of how happy Don and I used to be. Abby told Chloe about the divorce and about how she never wants to see the boat again. the boat has depreciated. After all. I think it would be fair to pay you and Abby half of what you originally put into the boat for your 50% share. I thought you understood how important this boat is to Abby. he likely would have found himself in a stronger negotiating position. big news!! Don got his promotion. Abby is having this conversation with Chloe) Chloe: Abby. I’m sorry. (Around the same time. Don: Lacey. and I’ll get back to you. I’ve been thinking. It’s about time now for some major investment.) Lacey: Don. Lacey and Don’s negotiations changed considerably. I have big news too. Don and I are getting a divorce. I’ll be glad never to see it again. and neither of us put much in for upkeep. Abby: That boat. Lacey: Cut it out. 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 this has been such a crazy situation. Union negotiator: The stock price might be down right now. I read in the papers every day that the market is still strong. Company president: Well. we will need to make drastic cuts in our operating costs just to survive. I’ll be looking to you to make some major wage concessions on this upcoming contract. and that the economy is strong. And as you know. I’ll have to show them 132 50 Practical Negotiation Tactics . And while these fluctuations have little to do with the health of the company itself. Here’s how these negotiations went: Company president: Well.Example 2 Aimes Manufacturing had experienced major ups and downs in the price of its stock for the last two years. in fact. Telling me there’ll be no wage increase and asking for wage concessions now is a little premature. I can’t see how today’s numbers really impact the long-term profitability of this company. I think you’ll have to agree with me that wage increases in this next contract will not be available. the company president decided to use the stock price as a negotiating tool during the current union contract talks. I’m afraid that with this current information. I’ll be going back to them as soon as next week. 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. I’m telling you the stock price is having a huge impact on us already. The current stock price is the lowest it has ever been. the situation in the stock market is not good. in this global market. they will make their decision based on a review of the stock price that day.

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

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

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

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

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

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

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

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

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

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

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

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

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

Cory:

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

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

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

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

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

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

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

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

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

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

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

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

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

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

age 14.00 to spend. were on vacation with their parents in Myrtle Beach. Alexis then played the tape for her father. Susan wanted to negotiate with Alexis to “pool” their money so they could buy something together. or used to pressure the other side to agree to certain demands. Example 2 Three men were meeting to discuss a charge of sexual harassment that had been made against Stuart Jones. He asked his elder daughter about the arrangement. age 15. thus becoming a source of embarrassment. Then he played the tape. Susan understood the impact a tape recording can have when it reveals a lie. Susan denied it. 162 50 Practical Negotiation Tactics . are talking about a possible settlement of the issue. the younger sister. and Jones. She borrowed a tape recorder so she could ask her father if this was a fair deal. Jones’s supervisor. until Susan said they would evenly split what they bought. had $40. Somehow. who was disappointed to hear that she might propose such a deal. The effect on the other party might be even more substantial if lies.00. Conclusion For the first time in her life. or simply “bad faith” methods have been used by the other party. the accused. Example 1 Susan. She agreed that her proposal was not fair and that she had tried to take advantage of her younger sister. but Susan had only $20. Susan repeated her demand. this time in front of a hidden recorder. Alexis. the investigator. They might worry that the tapes will be made public or given to others. threats. Alexis agreed.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. Alexis knew this was not fair. Michael Wood. and Alexis. Fred Adams. The two sisters had saved up a little money so that they could buy souvenirs. South Carolina.

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

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

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

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

With a great deal of effort. attach legs. The suite they liked best was already at the lowest price in town (the retailer was having a real sale). he also set up all of the furniture in a second-floor bedroom. supposedly the bargainer in the household. Example 2 An experienced and skillful union organizer liked to tack on a tiny less-significant item each time a company and its union negotiated on a large and Making Progress 167 . His tactic was to throw in a “nickel” in order to make lots of “dollars.” Under store policy.” thus extending the scope of the negotiations. delivery was limited to a small geographical area. 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. However. They recently purchased a new bedroom suite after they carefully priced comparable furniture all over town. because a “nickel” item has been added to negotiations about a much more significant item costing “dollars.” Many people have witnessed or used this effective negotiating tactic. etc. so the salesperson delivered the suite himself. Jason was having a hard time getting the salesman to lower the price. Her husband Jason. miles from their home. “Okay. is expected to dicker over the price. 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. What started out as a single issue is now a combination of a major issue and a much smaller issue. Conclusion The amount the couple spent was fairly large.

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

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

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

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

000. and $237. The owner. Here’s a list of the five that are about the same size as yours. They sold for: $225. We love your house.000. Sam Jones: Sam Jones: 172 50 Practical Negotiation Tactics . $229. has owned the house for 24 years and is downsizing to a condo.000.Tactic 45: Use Facts Fact-gathering must be part of the preparations for every negotiations session. Sometimes.500. $237. but you’ve priced it way too high. but we feel that it’s a fair offer. 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. 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. the other party will ignore or refuse to believe the information. but the key is to gather facts that you might need—not just the facts that you will need.000.000.000. Example 1 Henry and Maria Lopez are interested in a house that lists for $275. This offer is for more money than any four-bedroom houses on this neighborhood list. Henry Lopez: Sam Jones: Maria Lopez: Sam Jones: Maria Lopez: We love the house and have made a written offer of $240. (Next day) We’ve reviewed the records you’ve produced.000. I’ll get back to you.000 under the listing price! We realize that. and we are countering with an offer of $250. What? That’s $35. They believe it is overpriced. $235. Sam Jones.

You can’t pay more than $1.600 unless the company president approves.Henry Lopez: Sam Jones: Henry Lopez: Sam Jones: Let us discuss this for a minute. Order the new computers. I asked for a list of all new PCs bought this year. Hatfield: My staff has done a lot of research. We accept. and wisely chose exactly when to present them in order to make his point. Supervisor: If I okay this purchase order. Example 2 Supervisor: You know the policy. No one can go over $1. I’ll be… Okay. He found facts that supported his position. who was not particularly knoledgeable about real estate. Conclusion Hatfield had anticipated what his supervisor’s position would be. That’s the bottom price. We’ve talked with purchasing and we have the authority to buy seven for $2. Here it is. I’ll get called on the carpet. let’s not worry about it.000 each. Conclusion The Joneses had based their asking price on the advice of a friend. Making Progress 173 . Hatfield: While I was at purchasing. if other departments have ignored the policy. and did his homework. and we know that only this model will meet our needs. The last 20 were over $2. The facts presented by Henry and Maria Lopez caused Jones to re-counter their asking and likely sale price. Supervisor: Well.400 each. Well… We have a written counter of $245.000.600 for a computer.

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

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

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

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

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

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

However.Conclusion This “premature congratulation” tactic can only be used successfully at the very end of an unsure and shaky negotiation. 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. 180 50 Practical Negotiation Tactics .

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

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

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

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

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

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

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

but I’d like to make sure there are no misunderstandings. The employer’s affirmative action officer looked into the charges and determined that 188 50 Practical Negotiation Tactics . in fact. and that the problems with her job performance were. and the garbage disposal. Under the section for appliances to be left on the property. then we have a deal. Seller: Okay.) Seller: So. Conclusion The seller had always intended to leave the garbage disposal. and two area rugs. and had been prepared to drop his price to $145. In the section for fixtures and miscellaneous items to be left on the property. since he probably would have missed them) Yes.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. he listed an attached hutch in the kitchen. real. If it’s what you meant. and when she refused.000. a public agency. the hutch. The supervisor pointed out that he had a staff of 20 or so women. he began to have “problems” with her job performance. the hutch. In her complaint. all window blinds and drapes. Let me just get the standard “offer of sale” form and fill out what I hear you saying.000. I think we can work something out. the house is yours. look this over. Example 2 Monica brought a sex discrimination charge against her employer. Bill: (pleasantly surprised to learn that the garbage disposal. Sign here. It worked. and the two area rugs were specifically included. 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. The supervisor assured the employer that there was no basis for her complaint.Seller: Just a minute. (The seller recorded the offer of $150. the refrigerator. he listed the stove. she said that her supervisor had repeatedly asked her out. he left the price at $150. When he had the chance to put the deal in writing.

Why’s that? Well. It might be standard when there’s a settlement. you didn’t mention in the agreement that in exchange for the $100.000. settling—What difference does it make to her? She’s getting her $100. Withdrawing. even though you are paying Monica because we can prove he did do something wrong.000. by this time. But the employer doesn’t want to go through the expense and publicity of a trial. but it’s not standard when a complaint is formally withdrawn. And the confidentiality clause is standard. found a new job and wanted compensation for “embarrassment” and lost wages in the amount of $100. 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. and must agree not to tell anyone about the $100.000. You’re just trying to make it seem as if your supervisor did nothing wrong. even though we’re certain we would prevail. Monica’s lawyer (She): Employer’s lawyer (He): She: I was surprised by your settlement documents. and expensive matter.there was little basis for the complaint. The employer’s lawyer told Monica’s lawyer that the employer was ready to settle the deal for the $100. He offered to send settlement agreement papers to her. my client is supposed to formally withdraw the complaint rather than just settle it. Monica had. but said that fighting the charges would be a long. He’s happy to prove that in court. I’m He: She: He: Reaching Agreement 189 .000.000 without actually having to prove anything. the supervisor says he did nothing wrong and that Monica just misinterpreted what he said. The supervisor insisted that if the employer felt he had to settle. drawn-out. Look. then Monica had to acknowledge that the supervisor did nothing wrong.

000. It would have been a better strategy in this situation to raise the issue of withdrawing the complaint during the actual negotiations. but word did get out that a public agency paid $200. I’ll take your offer back to her and let you know. to his disadvantage. 190 50 Practical Negotiation Tactics .She: authorized to pay $200.000. It was made clear that the employer had paid the additional $100. Monica accepted the $200.000 and the conditions of the offer. 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. There was a confidentiality agreement.000 just to get the employee to “withdraw” the complaint.000 when all that was asked for was $100. but that’s under the same conditions—the claim must be formally withdrawn and Monica can never reveal the amount of the settlement.

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

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

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

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

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

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

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

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

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

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

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