INTRODUCTION TO

NEGOTIATION SKILLS
CHAPTER TWO (THE DISTRIBUTIVE NEGOTIATION)
The Distributive Negotiation Situation

• Definition: It is a competitive negotiation strategy in which one party gains only if

the other party loses something.
• Its Characteristics:
1. Goals of one party are in fundamental, direct conflict to another party
2. Resources are fixed and limited
3. Maximizing one’s own share of resources is the goal for both parties
Preparation for distributive situation needs to
set:
• Target point, aspiration point: The desired negotiation outcome or goal
decided at the start of the negotiation.
• Walkaway, resistance point: Is the least favorable point at which one will
accept a negotiated agreement.
• Asking price, initial offer: Depends on how will the first offer influence the
negotiation process and any final agreement?
The Role of Alternatives to a Negotiated Agreement

• Alternatives give the negotiator power to walk away from the negotiation
• If alternatives are attractive, negotiators can:
• Set their goals higher
• Make fewer concessions
• If there are no attractive alternatives:
• Negotiators have much less bargaining power
 5 Proven Distributive Negotiation Strategies

1. Focus on the Other Party’s BATNA and Reservation Value. In addition to

determining your own BATNA and reservation value, it is also important to try to
estimate the other party’s BATNA and reservation point.When you do so, you can
estimate the zone of possible agreement, or ZOPA—the range of deals that both parties
would accept.
2. Avoid Making Unilateral Concessions. Once each party has made an initial offer,
avoid the trap of making another concession before your counterpart has reciprocated
with one of her own. If the other party won’t match your concession, it may be time for
you to bow out of the negotiation and exercise your BATNA.
3. Be Comfortable with Silence. Negotiators often are inclined to make undue concessions
or retract their offer when their counterpart seems to be taking too long to respond. But keep
in mind that your partner’s silence may be strategic, designed to make you uncomfortable and
cave in. When you speak when it’s their turn to do so, “you will be paying by the word,”
4. Label Your Concessions. As human beings, we have an innate tendency to reciprocate the
concessions we receive from others.At the same time, to escape such feelings of obligation in a
distributive negotiation, negotiators can be motivated to undervalue or overlook one another’s
concessions. For this reason, it is important in to draw attention to your concessions by
labeling them.That is, clarify how costly the concession will be to you and make it clear that
you’re reluctant to give this value away.
5. Make Contingent Concessions. To further reduce your concessions, you might tie your
concessions to specific actions by the other party. Contingent concessions can also secures
commitments from your counterpart.
Four Propositions That Suggest how the Keys Affect
the Process
1. The higher the other party’s estimate of your cost of delay or impasse, the
stronger the other party’s resistance point will be.
2. The higher the other party’s estimate of his or her own cost of delay or
impasse, the weaker the other party’s resistance point will be.
3. The less the other party values an issue, the lower their resistance point will
be.
4. The more the other party believes that you value an issue, the lower their
resistance point may be.
Tactical Tasks of Negotiators

• Assess outcome values and the costs of termination for the other party
• Manage the other party’s impressions
• Modify the other party’s perceptions
• Manipulate the actual costs of delay or termination
Manage the Other Party’s Impressions
• Screen your behavior: Say and do as little as possible
• Direct action to alter impressions: Present facts that enhance one’s position
Modify the Other Party’s Perceptions
• Make outcomes appear less attractive
• Make the cost of obtaining goals appear higher
• Make demands and positions appear more or less attractive to the other party –
whichever suits your needs
Manipulate the Actual Costs of Delay or Termination
• Plan disruptive action: Raise the costs of delay to the other party
• Form an alliance with outsiders: Involve (or threaten to involve) other
parties who can influence the outcome in your favor
• Schedule manipulations: One party is usually more vulnerable to delaying
than the other
Positions Taken During Negotiations

• Opening offer: Where will you start?

• Opening stance: What is your attitude? Competitive? Moderate?
• Initial concessions: Should any be made? If so, how large?
• The role of concessions: Without them, there is a deadlock
• Patterns of concession making: The pattern contains valuable information
• Final offers (making a commitment): “This is all I can do”
Commitments: Tactical Considerations

• Establishing a commitment requires three properties:

• Finality /Specificity/ Consequences
• Preventing the other party from committing prematurely because Their commitment
reduces your flexibility
• Ways to Create a Commitment
1. Public pronouncement
2. Linking with an outside base
3. Reinforce the threat or promise
• Ways to abandon a committed position
1. Plan a way out
2. Restate the commitment in more general terms
3. Minimize the damage to the relationship if the other backs off