NEGOTIATION

HARVARD STYLE

Mahmoud Khater
Car Negotiation exercise
Car negotiation exercise (Analysis)

Final sale price: high, low or appropriate.

Why?
The Program on Negotiation

• University consortium,
• Established in 1983,
• Harvard University, MIT and Tufts University,
• Courses, Trainings, Books, Newsletters, Journals.
 Negotiation Vs Bargaining

• A structured interaction • The most common way

or dialogue, between of negotiation, where
two or more parties, parties take a position
aiming at resolving a and argue for them
difference to reach an while making
agreement. concessions to reach a
compromise (positional
bargaining).
Negotiation:

A structured interaction or dialogue, between two or more

parties, aiming at resolving a difference to reach an
agreement.
Personal Reflections: Positional Bargaining

Party 1:
Party 2:

Initial Position of Party 1:

Initial Position of Party 2:

Final Position of Party 1:

Final Position of Party 2:
Positional Bargaining

DRAWBACKS???
The drawbacks of positional bargaining

1. It misses out an opportunity of better solutions;

Example: Why do you want the orange?

2. Its context encourages lying and deception;

3. Damages relationships;

4. It usually results in a Win-Lose and misses the Win-Win;

BUT: We still use it!
Why??

1. Requires very little planning;

2. Very Convenient;
3. It works, It delivers results;
4. It is a learned behavior;
5. It can be applied to any situation.
 Fundamentals of Strategic Negotiations
-PIHPOC-
1. Principles
2. Interests
3. Humane
4. Possibilities
5. Objective Criteria
Zone of Possible Agreement (ZOPA)
BATNA (Best Alternative to a Negotiated Agreement)

Your best alternative to a negotiated agreement.

“The negotiating power of a party is partly determined

by how attractive is the option of not reaching an
agreement.”
Fundamentals of Strategic Negotiations(1)

1.Based on rinciples:
a) We shall not lie;
b) We shall not deceive;
c) We shall not take unfair advantage of someone’s
weakness;
Fundamentals of Strategic Negotiations(2)

2. Focus on nterests, not positions;

3. Be mindful of the uman angle;

4. Generate a variety of ossibilities before deciding

what to do;

5. Insist on an bjective riteria: negotiate on the

standards before negotiation on the substance.
Principles
• A fundamental truth or proposition that serves as the
foundation for a system of belief or behavior or for a
chain of reasoning.
• A rule or belief governing one's personal behavior
(regardless of the consequences).
• Principles for Negotiation:
a) We shall not lie;
b) We shall not deceive;
c) We shall not take unfair advantage of someone’s
weakness;
Interests

• Identify, ask why?

• Multiple interests (prioritize them)

• Multiple stakeholders (example: buying new mobile

for your son)
The four basics of the human angle:
(Perception, emotions, communication, and authority)

Perceptions

1. Understand that people may have different

perceptions of the same reality.
2. For people, their perceptions are their reality and
they will act accordingly.
3. The better you understand yours and the other
party’s perceptions, the better you can negotiate.
Steps to understand the other party’s perceptions
1. Put yourself in their shoes;

2. Identify possible perceptions and check if they

believe in one of them.

3. Listen very carefully.

4. Discuss each other’s perceptions.

5. In the event of negative perception about you, act

inconsistently with their perceptions.
The Importance Of First Impressions

7 Seconds
“You never have a second chance to make a
good first impression”
Steps to tackle emotions in negotiations
1. Be calm.
2. Recognize emotions; theirs and yours.
3. Make emotions explicit.
4. Let the other side let off steam.
5. Check Emotional Bank Account Balance
Body Language- Tone of Voice- Use of
Words

Body Language – 55%

Tone of Voice – 38 %

Use of Words – 7 %

Prof. Albert Mahrebian

Facts

1. Eight positions for our brows and forehead.

2. Seventeen positions for our eyes and eyelids.
3. Forty five positions for our lower jaw.
4. Forty three distinct and separate muscle movements in the
face giving us a combination of 10,000 identifiable facial
configurations.
5. Some facial expressions are fleeting, lasting for four
hundredth of a second.

Reference: Performance Management,

Baguley, Phil; Contemporary Books, 2003
Human Angle: Non-verbal Communication

1. Speech pace and pauses

2. Pitch and tone
3. Use of space and distance
4. Body motion and gestures
5. Body posture
6. Facial expressions
7. Gaze
8. Touch and body contact
9. Style of written text
 The impact of a speaker's feelings and attitudes in a
conversation
60% 55%

50%
38%
40% Verbal (words)
Impact

30% Visual (face)

Vocal (voice)
20%
7%
10%

0%

Verbal (words) Visual (face) Vocal (voice)

Source: Making Presentations Happen by Michael Brown 2004
 Your words versus how you present them
100% 93%

80%

60% Your Words

Impact

40% How you present

your words?
20% 7%

0%
Your Words How you present
your words?
Source: Making Presentations Happen by Michael Brown 2004
Possibilities
The four major obstacles towards a creative mutually beneficial solution

1. Premature judgment.
2. Searching for the single answer.
3. Assumption of the fixed pie.
4. Solving their problem is their problem.
Objective Criteria (standards)

1. Market value
2. Precedent
3. Scientific judgment
4. Professional standards
5. Law or Court Ruling
6. Moral standards
7. Shariah
8. Tradition
Four steps to PIHPOC

1. List out all the applicable standards.

2. Negotiate on the standards before negotiation on
the substance.
3. Don’t yield to pressure, only to principles.
4. Learn to say no.
 Negotiation Techniques

• Deliberate deception
• Niccolo Machiavelli
– “The end justifies the means”
– “It is double pleasure to deceive the deceiver”

DO YOUR HOMEWORK;

DO NOT ALLOW TO GET DECIEVED
 Negotiation Techniques

• GC-BC (video)
– Don’t always be the Good Cop
• Deferring to Higher Authority
– I will check with my boss/committee/wife…”
– Take a concession from counterparty, without
giving any.
– Combined with GC-BC (how)
 ASK in the beginning? (how)
 Negotiation Techniques
Extreme demands
 Negotiation Techniques

1. Stressful physical 7. A calculated delay

conditions 8. The reluctant buyer
2. Personal attacks
3. Threats
4. Refusal to negotiate
5. Escalating demands
6. Decoy technique
More Resources

Make sure you apply

your principles

Thank You