Merged

Strategic Negotiation Skills
Satish Duryodhan
Puzzle-Poll
Unstoppable Cone
Immovable post
Typical Real World Negotiations
We want ABC We want XYZ

Negotiation “Empty set” in action
Role Character Actor
01 Business Michael
Al Pacino
owner Corleone
02 Corleone’s Thomas Robert

Lawyer Hagan Duval
03 Patrick
Senator Spradlin
Geary
My offer is…
$250K to grant license

01 5% of all 4 hotel revenue Nothing 02
as commission
Negotiations
Why Why? 04
03 Do not like underworld Normal licensing $20K
intend to squeeze! Lawyers agreement
Empty Sets in real world negotiations- case discussion
Empty Sets in real world negotiations-group case
Read Understanding the reservation point scenario 1
What do you think of these statements?
“Don’t you think Accusation

Firm A …. “Don’t you..”
Empty
Set
but can’t you see Objection:
that Firm B … “But..”
Understanding the reservation point scenario 1-1
Empty Sets in real world negotiations
What do you think of these statements?
you want to hire an Veiled

inexperienced firm …. threat
Empty
Set
we can’t afford to Veiled

spend the fortune … advocacy
Why empty sets
Different perceptions of issues may lead to fixed positions
Landlord Lease renewal negotiation Tenant
The rent is already

The rent has not been too high
increased for a long time
Why empty sets
Fixing blame on people may lead to fixed positions
Production manager Generator service company
You firm is incompetent-It’s Your people have overused

the third time plant the old generator beyond
generator has broken down capacity despite warning
after your servicing
Understanding the reservation point difficulty
requires one to look

01 beyond own point of view
open yourself up to being
persuaded by other party
02
Priority Outgoing
Results
Task Focussed Persuade
People Focus
DISC
Challenge assumptions,
Accuracy Reserved Stability and support
Can you identify which type of personality they represent? Decisive
Deliberate
Spontaneous
Collaborative
Businesslike
DISC
Playful
Methodical
Calm
Solution
• Being ignored
• Loss of control
• taken advantage of D I • Loss of influence
• Social rejection
• Forceful • Sociable
• Self confident • Talkative
• Willing to take risk • Enthusiastic
• Criticism • Offending others

• Loss of Harmony
• Being wrong
• Slipshod Method
C S • Sudden change
• Loss of stability
• Focus on Precision • Calm Approach

• Over analytical • Team player
• Skeptical and quiet • Humility
Strategy to adapt personality to be successful negotiator
01 Master negotiation skills
02 Positive attitude
Initiative without Aggression
03 Adapt strategy to other’s

Negotiating with a D personality type
Characteristics So you…
Present the bottom

Prioritizes Action line – briefly
& Results
Fears being taken Focus on solutions

than problems
advantage of
Values
Competence & Compliment them
Accomplishments publicly
Negotiating with a I personality type
Allow time for them

Fears loss of to ask questions
influence
Values freedom Don't interrupt

of expression them
Limited by lack of
follow through Don't overload
with details
Negotiating with a S personality type
Express your
Values loyalty interest in them
and security
Prioritizes Avoid
support and confrontation
collaboration
Fears loss of Explain what is

stability expected of them
Negotiating with a C personality type
Motivated by Focus on Facts and

details
expertise &
quality work
Prioritizes
analysis and Be precise and
challenging correct
assumptions
overcritical, over
analyzing Be patient and
diplomatic
Take DISC personality test using link https://www.123test.com/disc-personality-test/
DISC primary personality Poll and analysis
general population breakdown
Class:
D-
I-
S-
C-
Line representation
Segment
Intensity
Si Personality
2 6 7 4
Line representation
DISC Shades representation

How “C” personality can use shade representation to plan to adapt
behaviour for certain situations
DISC Circle- ability to compare multiple people
personality at once advantage
Twelve different regions of the

Everything DiSC® model
May feel alienated or
misunderstood by the rest
Team represented on the Everything DiSC Workplace® map

D styles and their priorities
Di: convincing
and daring
S styles and their priorities
Reserved,
deliberate, precise,
cautious
S: calm Si: Sc: modest

accommodating supportive unassuming
agreeable
Si personality Behavior:
Quiet, tactful, friendly,
casual – accepts affection
C styles and their priorities
C: analytical CS: quiet CD: unsentimental

private self-controlled matter-of-fact
Cd: Critical thinking,
logical, exact, reserved
I styles and their priorities
i: sociable iD: animated iS: upbeat and

and lively and inspiring lighthearted
I am S type (Sc personality)
Sc: modest
unassuming
How will you plan to negotiate with me? (Poll)

Course Assessment
Component Mode Details Wt

End Term Exam Online (80-90Q) 120 min 40%
Mid term Exam MCQ (60Q) 60 min 20%
Sim analysis Negotiation analysis 8-10 hours
and Video (4-5 No) effort/assignment 20%
Total 100%
Course Assessment
Component Mode Details Wt

Mid term Online (45-50Q) 60 min 20%
online Test
End Term Exam Online (80-85Q) 120 min 40%
Sim analysis Pre Negotiation team case 8-10
report hours 40%
Negotiation Videos/post effort
Negotiation reports (4-5 No)
Total 100%
negotiations Essential characteristics:
01 02
interdependent parties achieve best possible
result for themselves
04 03
parties believe they can
parties are motivated &
reach an agreement
capable of influencing
one another
Negotiation simulation :Inside a shadow negotiation
• As close to reality as possible

• Controlled env. - Get to know and adapt to other parry personality
Exit & join main session 05
Negotiate and Record 04
Invite other party for Negotiation 03
Read Role CI and prepare 02
Go to breakout room 01
Playback of one/two breakout session and Discussions
Poll: Inside shadow negotiation and discussion

5-Negotiation stages
How do you prepare for negotiation case study-

breakout rooms of 2
What do you think are most important negotiation skills?
% Negotiation situations
FOCUS ON IMPLEMENTATION 20
Critical Negotiation Skill set
EMPATHY-EMOTIONS & PERCEPTIONS 40
FRAMING / OPTIONS 60
ASSERTIVENESS 80
PREPARATION 100
0 20 40 60 80 100 120
Top 5 skill sets

research with 1000+ top negotiators
By Gallop group
Source of “How to prepare for negotiation”
BSO
(MFG/RETAIL)
€22 MN
Experience case study
DL 3 year project contract 2002
Year 1 Year 2 Year 3 Total
Requirement,
Milestones 60% 25% functionality,
Design, Prototypes,
delivery functionality Implementation, Training
15% functionality
Milestone linked
6 12 8 26
Pmt $M
Year 1 delivery a grand success!!!

DL Project - Plan
Revenue MN 6 12 8 26
Est. Effots MY 100 300 200 600
1-MY cost $K 40 25 25
Est. Cost $MN 4 7.5 5 19
Est. PBT $MN 2 4.5 3 9.5
ACTUALS – END of YR1 Original Est. vs actual Y1 Org.

Level P&L
efforts MY 170
HW Corp. 2001
cost $MN 6.8 Revenue $ MN PBT $ MN
50 6/ 3.2
Should Hexaware absorb losses and go for negotiation?-Poll
Establishing feasibility –setting your range
Lowest point Target point Highest point
Resistance point Aspiration point Dream point

beyond which negotiator negotiator would like to Keep reaching target
is unwilling to settle conclude negotiations point a possibility
Our Range
Their acceptance range
Est. Their Best Value?

Est. Their Minimum
acceptable value? Poll
How ZOPA affects negotiations
Party 1 Range Party 2 Range

Caseatstudy
Defendant est. ZOPA of working
Preparation outofZOPA
stage for Out court settlement
-Ignore Lawyer or potential lawsuit costs
How do you prepare for negotiation case study-breakout groups of 2
Est . Claimant walk away revised during negotiation 380K

How do you prepare for negotiation case study solution
Rajesh Elizabeth
Rajesh’s range
97/100K 150 K
ZOPA (overlap of two ranges)
DP
TP RP
RP TP DP
135K 140 K
DP- Dream Point 125 K 145 K
TP-Target Point
RP-Resistance point Elizabeth range
ZOPA- As seen from Rajesh Perspective.
Negotiation Stages
How do you prepare for negotiation case study solution
Rajesh Elizabeth
Rajesh’s range
97/100K 150 K
ZOPA (overlap of two ranges)
DP
TP RP
RP TP DP
135K 140 K
DP- Dream Point 125 K 145 K
TP-Target Point
RP-Resistance point Elizabeth range
ZOPA- As seen from Rajesh Perspective
Why ZOPA is defined by Elizabeth’s RP and DP and not Rajesh’s RP?

Is ZOPA always as continuous range?
Depends on possible values/options issue can take
Issue option Will Elizabeth

Will goes Elizabeth fills up
unilaterally Ideal Not acceptable
Will goes after acceptable help

to Elizabeth (0, 1..n) and
Elizabeth fills up Acceptable Acceptable
Will does not go Not acceptable Ideal

Defendant est. ZOPA at Preparation stage for Out of court settlement
-Ignore Lawyer or potential lawsuit costs
Working out ZOPA under uncertainty and long

term implications- Hexaware
Hexaware case study-Group exercise
Est . Claimant walk away revised during negotiation 380K

DL Project at end of Year 1-Poll
Revenue MN 6 12 8 26
Est. Effots MY 100 300 200 600
1-MY cost $K 40 25 25
Est. Cost $MN 4 7.5 5 19
Est. PBT $MN 2 4.5 3 9.5
Actual efforts
170
MY
Actual cost
$MN 6.8
Case analysis class discussion:
How to estimate Our Best Value (Dream Point)?
Our Minimum acceptable value (Resistance point)?
Our Target value?
2
Anchor Case
3 Key components for setting ground rules
1. The Variables
2. The People 3. The process

→ →
Any issues with Effort Variation as proposed variable?

Negotiation Variable : What will be negotiated
Party1 Party2
01 02
Range-not fixed value Range – not fixed value
Negotiation
Variable
03 04
Willing to admit for Willing to admit for
negotiation negotiation
Will effort be acceptable to DL as negotiation variable?

What Will be acceptable to DL as negotiation variable?
Exercise
Unacceptable definition of Variable
Effort Variation- Why
1. Contract not linked to efforts

2. In-efficiencies / rework not responsibility of client
Acceptable definition of Variable
Scope of work
Work Breakdown Structure
DL Project (WBS)
Requirement HL Design Implement Test
LL Design
I1 In
R1 Rn
D1 Dn T1 Tn
Rn1 Rm
Over 1000 WBS line items
Should all 1000 line items be negotiated?
R1.1 R1m All together or one at a time?
In what sequence?
SDLC
Illustration of costs
of changes by
lifecycle phases
Illustration of costs
of changes by type
of change request
How will you plan flexibility? % by % by
Number efforts
A 10% 70%
ABC
B 20% 20%
Analysis
70% 10%
C
Process: Who will negotiate and role- Hexaware DL Negotiation
Hexaware DL
Project Managers Process owners
Who will
Division Head negotiate
Hexaware Legal DL Legal
Are you happy with this seating position- will it lead to productive negotiation?
Process: Identify negotiators away from table- Hexaware DL Negotiation
Hexaware DL
Project Managers Process owners
Who will
Division Head negotiate
IT head
Hexaware Legal DL Legal
3
Negotiation stages : Information Exchange in negotiation case study
How each Information Exchange may impact each party

Exercise
Guidance of proposing option

“If you are willing to negotiate flexible payment terms, then we
are willing to accommodate your request”?
Which two elements are part

the condition plus the offer
of proposal
Which element should be

Your condition
stated first
If Condition Then Concession

Exercise
the condition and or the offer can be vague
‘If you change your terms of business, then we could

consider some amendments to our payment schedule.’
A. Vague-vague (vague in condition and offer)
B. Specific-vague (specific in condition and vague in offer)
Answer: Vague-Vague
Convert the proposal to “specific-Vague”
Answer: ‘If you amended the penalty period from 14 to 7 days then we
could consider some amendments to our payment schedule’
Exercise
Guidance for framing options
Being vague is sign of? Proposal
What are the benefit of Being Gives you leeway.

vague? Prevents an impasse
instant acceptance
/rejection unlikely
How negotiators move

from vague to specific
in their proposal?
Exercise
Guidance of proposing option
When ‘wish’, ‘hope’, ‘would

not assertive
like’ be avoided?
What Considering proposals moving towards a jointly

means? agreed solution
Which two elements are part

the condition plus the offer
of proposal
Which element should be

Your condition
stated first
Neutral question for information gathering and defining priorities.
What impressed you about Firm B
When can we meet Firm A and Firm B for risk assessment
5W+H Where can we meet Firm A and Firm B for risk assessment
Model
Who you think can help us do better evaluation
Why do you think Firm B better fit for us than Firm A
How can we assess if Firm A or Firm B is a better fit for us

4
Negotiation stages: Bargaining in negotiation case study
How concessions were managed by each party-breakout groups of 2

Bargaining in negotiation: Managing concessions
C1=75K
C2=15K
C3=10K
600K 675K 690K 700K
1st Offer 2nd Offer 3rd Offer 4th Offer

Negotiation stages
Purely Distributive negotiation Characteristics
Single issue/ Relationship

Fixed Pie not imp.
Objective: Party 1 Motivation:

Claim Max.. Claim Party 2 Self interest
Claim
Compete
strategy Win-lose
Explain how costly are your concessions.
Est. other party reservation Even least imp. and portray them as
value. Protect your! valuable to other party
01 03
Distributive
negotiation
strategies
02 04
Avoid unilateral concessions. Be first Tie your concession to

on minor but not major. specific other party action
Don’t concede too often, too soon, too much!
Distributive negotiation tactics
Good cop / Bad cop
High ball / Low ball offer
01 03
value
claiming
tactics
04
02
Bogey
Chicken out
Salt Harbor Negotiation evaluation criteria
03 04
Coordination handling (objections,
And role execution tough situations)
02 05
Preparedness Personality
adaption
Relative
performance
01 06
Meeting goals- Strategy
Max. Value execution
Claim
Compete with other party
and other groups
I am Satish D. Easterly Owner
I am Priya S Easterly Lawyer
Introduction before Negotiation

Stage 1: Preparation: 20 min
Salt Harbor -before negotiation Part A
Complete the preparation analysis in provided

excel sheet
30 min
Negotiate with other party Buy/Sell
Stage 2: Salt Harbour Simulation

Post Negotiation Video playback and
feedback
Salt Harbor A–Faculty debrief
Post Negotiation analysis discussions
when total information for teams was identical?
Why some teams reached agreement as low as 130-135K

and some over 200-220K+
different Diff. level of
aspirations willingness to
70% risk impasse
Why diff.
20% Agreements 50%
?
30%
Some gather more First offer
info than others? influence
Why diff. agreements possible
Brims bought as commercial property

/ Buyers scared due to legal issue
90-
100
120-
140
Fair price for Brim
220
+
200- 160- Brim Alternate site cost
220 170
Easterly 190-
potential loss 200
Easterly Est. Alternate

site cost for Brim
Anchor proposals Listen to other party carefully
to get the desired 1
outcome
6 2
spot emotion-rephrase &
make them comfortable
5 3
Give illusion of
control-ask questions 4 Understand
by using "What/ resistance
When/ How/ Who Watch for positive
reaffirmations such as
"That's right"
Opportunity cost (OC) - the next best alternative foregone
Limiting fixed resource: 2 hours available before exam
Last Min. revision Relax with a game of tennis
OC – alternative to last
min. revision foregone
What is the opportunity cost-Poll?
What is the OC for keeping

New car price $12K?
the od car (USD)?
12k-10k=2K?
Old car price $10K?
10k?
3k?
Old car dep. price $3K? 12k-3k=9K?

Opportunity cost (OC) – for keep the car
sell old and buy new car Buy new while Keeping the old car
OC – 3K that could be
realised by selling old car
forgone
Salt Harbor Opportunity cost (OC)
Brims: OC – alternative of bought

parcel foregone
Bought Parcel:100K Alternate location: 165K
Easterly: OC – alternative of bought

parcel foregone
Bought Parcel:100K Alternate location: 200K

How easterly could have strategized?
Do not anchor ZOPA
on OC estimate
01
02
E
Alternate site price
not relevant for
negotiation (larger Try to find other
than parcel size)? party OC
B
04
Offer joint search
+ 03
E B
Exercise
Strategy : Separating influence and Info.
Information Influence
Offer
X Y
Scenario 1 Near 0% Near100%
Scenario 2 50% 50%
A. We have spoken to other companies with whom we do
business. Hence We want you to lower price to ABC value
B. We have recd a better offer from company “A”. Hence We

would like you to lower your price to ABC value
Strategy : Separating influence and Info.
Information Influence
Offer
X Y
Scenario 1 0 1
Response options: Ignore offer (discuss other topic),
Aggressive counter offer-propose moderation
Scenario 2 0.5 0.5

Response options:
Re-evaluate your assumptions , seek more info.
“Breath-taking isn’t it?
The seller wanted $5000
But I got it just for $4500
anchoring bias - tendency to give too much

weight to the first offer put forth in a Negotiation
Powerful effect of Anchoring (first offer) Poll FS-FO
$135K
Expert Gr estimate
$130K
$125K
$120K
$115K
$110K
$105K
A1
e1
e1 A2
e2
e2 A3
e3
e3 A4
e4
$119K $129K $139K $149K
Appropriate list price Anchor Value

Willingness to pay Source: Survey by Greg Northcraft and Margaret Neale
Poll – Answer in 5 second
You are given very large size paper of VH foldability (say
1Km by 1Km square size) of 0.1 mm thickness and asked to
fold it 50 times what will be the thickness after the final fold
03 > Moon to Earth
Dist.
02
100KM<X<1000KM
01
X<100KM
folding paper 50 times
0
2 = 1
220 = 1 048 576
230 = 1 073 741 824
1 099 511 627
240 =
776
1 125 899 906
250 =
842 624
23 folds will get you to one kilometer—3,280 feet.

30 folds -Your paper will be now 100 kilometers high.
42 folds will get you to the Moon
The Two Systems
System1: Fast System2: Slow
Continuous Used only if

necessary
Fast but Efforts - solve

error prone complex
problems / Self
control
Shortcuts
Impulse Slow but
Intuition reliable
Daniel Kahneman (winner of the 2002
Nobel Memorial Prize in Economics)
Heuristic: cognitive shortcut for fast “good enough” decisions
Available Association and

information priming
Substitution
Ex: sample for Stories &
population Causes
Judgement
Ex: Confidence Emotion
level
SO_P Identify letter in place of “ _ “
If we are thinking about food we will fill in _ with “U” and relate to SOUP
If we are thinking about cleanliness we will fill in _ with “A” and relate to SOAP
Bias-”Error when we use heuristics for a decision”
Framing Bias Moderna is 20% more effective

Mechanism to evaluate a than AstraZeneca vaccine
situation
Poll: Range of final settlement
My Business losses due to loss of view

Are 380K so wiling to pay anything lower!
Loss Gain Framing bias
EPS $ EPS $
This year Q1actual 1.25 T R A I L IN G Y E A R Q 1 1.21
This year Q1
expectation
1.27 THIS YEAR
1.25
Q 1 A C T UA L
1.24 1.25 1.26 1.27 1.28 1.18 1.2 1.22 1.24 1.26
Loss Frame Gain Frame
Frame Mechanism to evaluate a situation

Guarding against Framing effect
Easterly Gain Frame Easterly Loss Frame
Potentail loss USD K 450 Market Price USD 120
Property Deal USDK 150 Property Deal USDK 150
0 100 200 300 400 500 0 50 100 150 200
Rephrase Check impact

information Challenge framing
on conclusion
Logical Avoid impulsive No reflexive

Investigation decision action
Has any party falsified facts? Why?
1. Brims- Alternate property will cost us 250K so..
2. View blockage will cost us less than 150K so..

03
Ethical
“Lies” 3 perspectives
02
Tactical
01
Legal
“Lies” Legal definition

lie - a knowing misrepresentation of a material fact.
in an insurance fraud case, a material fact would relate to the

insurer's liability, policy, or coverage
•https://sloanreview.mit.edu/article/when-is-it-legal-to-lie-in-negotiations/
Ranbaxy Daiichi post negotiation “lie” legal battle
Negotiation “Lies” general Legal perspective
https://sloanreview.mit.edu/article/when-is-it-legal-to-lie-in-negotiations/
Lying tactics in Negotiation
Concealment
(withhold / Hide info)
Half Concealment Tell truth falsely
Dodge -Incorrect
Misdirection inference
Falsification
(False info. As true)
Scenario: Negotiation of painting of recently deceased Painter Mr. D.
Previous owners would value it more.
Seller- Are you familiar with Mr D the artist?
Honest disclosure Deflection question

I bought his painting last year
Didn’t he pass away recently?
Decline to respond Best response?

Not prepared to discuss
my collection Concealment
Never heard of Mr D.
Dodge Misdirection
•“I am in town for a few days and I am not professional collector
have also liked some other paintings”
Understanding deception
Which Lying tactic is being used?
Is this the lowest price This is the

you can sell to us? lowest price we
ever sold the
product.
Buyer
Diff. views
Of data
Understanding deception
Using deflection?
What is the
Is this the lowest price Maximum quantity
you can sell to us? you are willing to
purchase?
Buyer
Diff. views
Of data
Lie detection Cues?
Facial Expression
Hostile/Defensive Micro change, Don't blink
lie getting detected Look toward the door. ...
Evading Body language

•“Why you want to know?” Touch face/mouth/throat
Lie detection
•“That’s not important”
Cues
Hot Spot Voice
“I am not angry” while Anxiety / nervousness
clenching jaw and raising voice change in voice pitch
Verbal content Verbal style

•“To tell you the truth” / “Believe me” Pause before answering
•“Let me be clear” / “The fact is” Repeat themselves
Consequences of lying in negotiation
Triangulation-process of gathering and validating information
Brims: 250K alternate Plot

Where: Is the plot at salt Harbor or away?..
What: is the size of alternate plot..

Conversational
Final
Assessment Did you get offer in writing?
Observational Written May I see it?
Alternate sites are

Cues-Body language
available at much less
Protecting A negotiator’s precious resource “Reputation”
Intrusive Question for strategic reasons you Move to

are not ready to discuss another topic
tempted to lie
about options that express your opinion, your
you don't have your optimism opportunities
"This is my
make more offers that Keep momentum
final offer" going but leave
contain smaller concessions room to move.
When not to negotiate…
Lose everything
Waiting can improve
01 position 02
Choose other options
Buy time
When Not to
negotiate
Unprepared
Unethical demands / bad faith
04
03 Seek time
Make your position clear
NEGOTIATION BATNA FRAMEWORK
Satish Duryodhan
Negotiation -Confer with others to reach agreement -Concise Oxford Dictionary
No common interest -nothing to negotiate for

H
Perceived Conflict
Litigation Let court of Law decide
Arbitration Let trusted party decide
Mediation Talk through third party
Consultant One/both to strengthen position
Negotiation
Partnering
L L Without Conflict -nothing to negotiate
Resolution approach H
Types of 3rd Party Interventions
LOW Court of Law Mediation

Level of negotiator control
over procedure
HIGH
Arbitration Negotiation
LOW HIGH
Level of Negotiator control over outcome
To Litigate or not to Litigate?
Owner of Manhattan apt. spent $999 to
install child proof window guard and
presented bill to Society co-op board
Board refused to pay. Law

was unclear
Six years and USD 100K legal feels later the two
parties were still fighting in the court
Source of Anchor case study
Personal Experience: Real life Negotiation
Apollo
Domain
workstation
Satish plan to sell business of CAD Products
Offer USD 0.9

Inter National
MN+ 3 YR
Giant Work bond
What should Satish do?

Introducing BATNA
Best Alternative To Negotiated Agreement
Agree
Walk Away
Best
alternative
value
Why should we be ready to walk away-Video

Satish Looks for walk Away position
$ 0.9 MN+
Agree 3YR Work
bond
Inter National
Giant
Regional
Walk Away
Co:$ 0.4
MN
What is Satish’s BATNA

How BATNA influences walkaway point
Satish Original BATNA-Bankrupty
Satish Revised BATNA-Accept

Value to MNC (Buyer)
regional 0.4MN offer
Value to Satish (Seller)

Satish Walkaway 0.6M Satish dream 0.9M
plus 1 year Bond plus 6M Bond
BATNA Quiz Poll
You are negotiating a purchase on unique

equipment with the supplier who won tech bid.
Which of following could be your BATNA
A. Accept only if they lower price to your budget
B. Meet another supplier and find their offer
C. Buy used equipment instead of leasing new

BATNA Strategies
Decide your BATNA before negotiation
Improve your BATNA by seeking alternatives that

don’t require the other side’s cooperation
How will you apply this strategy?

Case study: other party BATNA analysis
1912 US Presidential campaign brochure
Problem: Realization after printing 3MN copies......

Photographer permission not taken
What should be
negotiation value?
Pay photographer USD

1/brochure as per
Roosevelt copyright laws
campaign
managers
options
Negotiate a royalty value
with the photographer
BATNA Destroy and reprint (USD

1MN+3 Wk delay)
Strategy: identify your
counterpart’s BATNA
Strategy: Do not disclose

your BATNA
Challenge: identify your counterpart’s BATNA
Work to identify your counterpart’s BATNA
What should be
negotiation value now?
Analyse other party BATNA
No monetary gain
Estimating
Photographer
BATNA
Lose opportunity for
national publicity
Planning 3MN copies of campaign speech with
photograph. Excellent national level publicity
opportunity for photographers!
Appreciate opportunity,
but can afford Only $250.
Decide Discover
Offer / counter /
04 alternatives to
reject/ accpt 01 agreement
Applying BATNA
strategies
Improve BATNA Select
• More alternatives 03 02 the best
• Est. Other Party alternative-BATNA
BATNA
Seller BATNA Buyer BATNA

Case Scenario 1: Find Phadake’s BATNA
Case study: Work Out BATNA1 –Breakout rooms

Case study: Work Out BATNA
Case Scenario 2: Find Phadake’s BATNA
Case Scenario 3: Possible outcomes

Salt Harbor A, B–Faculty debrief
Brim’s court Sell in commercial Expected Financials
market
option $140K
Win: commercial use LOW
OK
pw
High X1
Sell to Easterly at “X”

Go to
Court Brim sells in residential (=$100K-$75K)
market
LOW 100K- $75K

pl
Lose: commercial
use is not OK High
X2 $75K
Brim Sells to easterly
Post analysis: Barriers to agreement
What really Happened
Exercise
What Really happened
Easterly lost early challenge
Easterly makes $120K offer..Brims rejects…No counter.
Easterly loses more appeals..goes to court
Responding to call Brim asks Easterly for best offer
Easterly offers USD220K…Brim refuses
Deal at USD 250K plus extras (USD 25K)

Hindsight..Brims had stronger case / less pressure
Exercise
Lesson’s learnt: Brim’s lawyer

Never underestimate risks of escalation
They (buyer) transformed a business matter

into emotional battle
“Avoid day-late-pound short” problem
Its easy to get greedy
Watch out for Principal-agent conflict

Value creation with Multiple issues
Satish Duryodhan
Puzzle
17 camels and 3 sons

1/3
1/2 1/9
Value creation approach?

Baxter Acquisition of small Pharma BP SP
19.5 R
Party 1 Baxter
(Big pharma BP) 20 R
Valuation Board Mandate
20.5 R
21 R
21M
Raise? Walkout? Greedy?
19.5M 20M
IP TP RP
RP TP IP
21.5 M 22M 22.5M

Negative
bargaining Zone
Party 2 Key ingredient producer

(Small Pharma SP)
Big Pharma (BP) acquirer (Buyer) Value creation approach scenario 1
NW 23.5M
$2.5MN Tax benefit of acquisition
-Additional Value discovered by BP
New est. ZOPA for BP

23M -BP does not know SP Walkaway
22.5M
22M
21.5M
T
W 21M W 21.5M 22M 22.5M I

SP BATNA-MP
T 20M Offer 21.4 M
Small Pharma (SP)
I 18.5M
Value creation approach scenario 2
$2.5MN Tax benefit of acquisition
-Additional Value discovered jointly by BP and SP
0.5 0.5?
Baxter Acquisition case
Positive
bargaining Zone
Party 1 Baxter range
(Big pharma BPR)
23.5M
A
Valuation BP Surplus
SP Surplus
19.5M 20M
IP RP TP IP
TP NRP
21.5 M 22M 22.5M
Party 2 Key ingredient producer range

(Small Pharma SPR)
Distributive
Compete Explore
H
Value claiming opportunity
A B A B
Balance
A
M
Integrative
Avoid Problem solving

A B
A B
L
Partnership
L M H
Value creation opportunity
What if diff. Parties have diff. Perceptions?
P1\P2
P1 Outcome P2 Outcome
Negotiator’s dilemma
Mixed Mixed
Distributive Integrative
Purely distributive Problem solving
Compromise
Distributive Elements Integrative Elements
Approach 1 Approach 2
Outcome
➢Fixed Pie ➢Expand Pie
➢Claim value ➢Create value
➢Compete behavior Relation ➢Collaborate behavior
➢One issue at a time ➢Multiple issues at once
Multiple
Single issue Issues-
Fixed Pie expand Pie
Motivation: Motivation:
Self interest Mutual interest
Compete - Collaborate
behaviour -behaviour
Distributive negotiation Integrative negotiation

DEAD BEAT DEAD END:
A CRITIQUE OF THE NEW U.S. PLAN FOR PAYMENT OF U.N. ARREARS
Breakout room
UN and US role:
Agree on two “Negotiation issues”
Each party to get one argument acknowledged in your favour
Case analysis and discussions

US UN dispute 2000- In favour of UN
What US wants What US

owes UN
25%
22%
20%
1.6 B
US share of UN
34M
1.27BN budget
US GDP EU GDP
27% 27%
US share 25% EU share 36%
Y-2000 Y-2000
US share of UN peacekeeping budget
What US owes UN
What US wants
31% UN PK Budget
25% $1.7 BN 0.26 B
36M US share 31%
=0.527BN
Y-2000
US UN dispute 2000- In favour of US
UN Budget
$1.27BN
50%
40%
30%
25% 25%
L-1940’s L-1950’s M-1960’s E-1970’s Y-2000
US share of UN budget
What should Holbrooke do?
UN did not accept
Helm-Biden bill
Pay US100MN
to keep vote 926M over 3 years
800M contested
UN
Japan-wanted
Proportionate
0 reduction
1 3%
Holbrooke
rounds of
negotiation
189 countries refuse to
ratify US
2
US side-lined in UN meetings
Can you guess “Why”
Impact of new variable
Holbrooke asked each country why they can not raise their
contribution and gain more influence in UN?
2000 2001
Budgets frozen Budgets available

Can not increase Can increase UN
UN contribution contribution
Who will pay the 3% in 2000?

Who Paid the cut?
Who Pays UN’s regular Yearly budget
China 12%
Japan 8.5%
Who Pays UN’s peacekeeping budget
Additional variable?
$5.40 billion
$3.61 billion
Intolerable cruelty movie
100+ countries US
01 02
Range-not fixed value Range – not fixed value
Add
Negotiation
Variable to
create value
02 04
Willing to admit for Willing to admit for
negotiation negotiation
Simcase Simulation
CI wil provide information on your negotiation variables goals
Use CI to prepare your target and wakaway price, BATNA
Plan your strategy, what information you will exchange etc
Min First two round of interaction only through simulation chat (No F2F)
After 2 offers you can use chat or aandon chat and do F2F negotiation
All bids as well as final deal or no deal must be entered in system
No video recording till you use chat. Only F2F to be recorded

Simcase Simulation
Simcase Simulation
Interact by
Sending Messages
When ready for offer

click Build offer)
A new offer automatically

Rejects Previous offer
Simcase Simulation Send Messages
When ready for offer click

Offer Build offer
Enter offer
Click add additional terms and

Then send offer with terms
Close builder if you

change your mind
and continue chat
Additional terms Cick to make offer
If no agreement is possible click No deal
Simcase Simulation
Faculty debrief after simulation
Leaderboard- Satisfaction, Offers and Chats

Debrief: communication channels in negotiation
How many teams did not go for F2F negotiation after round 2 ? Why?
Lets look at satisfaction and leaderboard…
What was response when a group made accusation? Why?
Memory
consolidation
Fear
Response
Emotional
Response
amygdala releases stress hormones

Stressed fight
or afraid or flee
Fear, anger, anxiety, aggression
verbal combat are unlikely to persuade anyone of anything

Technique: accusation audit
Plan how,
when to
introduce
List every possible accusation, before other
party makes
blame, complaint the other Role play within the accusation
party may make your group
Technique: accusation audit example case Responsibility-Delivery project
3. Govt change terms / Complaints
1. Helped Big Co Get Govt contract Low Margins Reduces Small Co. work
Thinks project profitable to Hexaware
2. deficient in coordinating work
4.Stopped communication with Big Co
Hexaware
(BIG Co)
5.Asks rethink of project
Small Co.
China Govt
Link to govt.
You may be thinking Big Co is trying force small Co out

We promised you all the work and going back on promise
We could have told you weeks in advance to prepare
Memory Fear
consolidation Response
Emotional
Response
Expert Technique:
Mirroring key words,
tone to show
empathy
Technique Example : Mirroring key phrases
Party 1: This is our final offer take it or leave it
Party 2: (softy with upward inflection as if asking question): take it

or leave it?
Party 2 : well its hard to give any concessions without

getting some from you…
Other options: does that apply for every term that we

discussed?
Technique: deploy Emotional intelligence (EI)
EI - ability to perceive, control, and evaluate emotions.
Managing disruptive impulses

A piece of innocuous
information that, once
revealed, changes the
course of the entire
negotiation. Find the Black Swans
Negotiation is, in many ways, all about finding black swans

and using them strategically.
personal lives or what, how
business history Calibrated
Motives Q
Body language,
tone
Research Nonverbal
Protect Own
Back aware black swans
pocket
use black swans strategy When, How to

At pivotal moment deploy black swans
Getting info: Create The Illusion of Control
Illusion of Take away Control Give Control

Technique: Power of How
Gangster: We have kidnapped your son and if you don’t pay us

USD 1 MN we will kill him
Father: How do I know if my son is actually alive and well? and How
am I supposed to get USD 1MN?
Father converted his problem to the gangsters problem while giving

illusion of control!
Technique Example3: Power of No
Party 1: This is our final offer take it or leave it
Party 2: If you were in our shoes would you like this offer put
to you?
Party 1: No
Every No” gets me close to a “Yes”

Technique Example 1: Power of No
Seller:Doesn’t it look ridiculous that we bought new cars recently

and here we are selling our whole business..
Buyer: No, Something like this happened to me when…..
“No- Oriented” Q is more powerful than a “Yes-Oriented” Q
A “yes” oriented Q give a feel of being asked to make a commitment.

Technique: Power of No
Protects people from

making ineffective
decisions
Helps people feel

safe, emotionally
Helps unearth
real issues
NO comfortable and
in control
Enables people freely

embrace decisions and
agreements they enter into
What assumptions each group made? consequences observed?
An assumption is a kind of belief considered to be true
A Hypothesis is A supposition or proposed explanation made

on the basis of limited evidence as a starting point for further
investigation.
Make H Ask open

Open ended Q Q
A hypothesis must
always go through the
process of verification Make H
and investigation Revise H
Ask open Q Revise H

H1
HO
HO - Car rental business is sold only when all vehicles are old
H1 - Car rental business is not sold only when all vehicles are old
Strategy: Making Package Value (PV) Offer
Customer to seller: Start Time Price

July ?
Seller to Customer Start Time Price USD

Approach A: July 650K
Seller to Customer Approach B:
Start Time Std. Service Premium Package
Price USD Services Value (PV)
July 650K No 650K
July 650K Yes-50K 700K
March 635K Yes-45K 680K
Buyer seller Negotiations Creating Package Value (PV) Offer
Value Price
01
Schedule delivery
02
Negotiation 03 Product Quality
Variables
04 Support Warranty
05 Terms Payment
Buyer Range Seller Range
(11.5-13) / 1.5 ( 15-13.5) / 1.5
0.3 0.5
+ 0.9 0.3
+.5 0.2
0.5 0.4
PV1: Price + Delivery (11.8-13.3) (15.5-14)
PV2: Price + Delivery+ Specs (12.7-14.2) (15.8-14.3)
PV 3: Price + Delivery+Specs+warranty (13.2-14.7) (16-14.5)

04 01
ISSUES ONE BY ONE
ISUUES TOGETHER
03 02
Promotes Promotes trust

competition
Many win lose some win-win

outcomes outcomes
Supports distributive Supports integrative

negotiation negotiations
Frameworks to select Negotiation generic strategy
Why Win-win , compromise and middle ground are worst strategies
Husband: I want to wear Wife: I want you to wear these

these shoes for the party shoes for the party
Husband: lets go for win-win and agree on the middle ground..

Basis for behavioral negotiation matrix
❖ Your needs only
01 ❖ Interrupt /not listen
Aggressive ❖ Dominate others
❖ blame others
❖ State feelings, wants, needs

Passive Assertive respectfully, but clearly
03 ❖ listen without interrupting
02 ❖ Speak calmly
❖ Other’s needs only
❖ Good self control
❖ worry about what other people think about you
❖ Afraid to speak up; withdrawal symptoms

Five Generic strategies for buyer seller negotiations
Assertive ness Segmented Negotiating
H Behavior Matrix
Dominating / Collaboration
Competing (win /Win)
(Win / Lose)
L Compromising H Cooperation
Avoiding Accommodating
(Lose / Lose) / Yielding
(Lose / Win)
L
Kraljik matrix as basis of buyer negotiation strategy development
High
Scarcity
( Impact of Purchasing )
( Impact on profits )
New Technology
Difficult to produce
Monopoly
Oligopoly
Low
Low ( Complexity of Supply Market ) High

Fasteners -bolts, screws, studs..
Car Bodies
Rare Earth Material High tech Windshield

Kraljik matrix as basis of Car Manufacturer negotiation strategy
Fasteners Std. Parts Rare Earth Mtl. High tech Windshield
Q2 Q4
Profitability impact
Leverage Items Strategic Items

“Negotiate Low prices” “Form partnerships”
Q3
Q1
Non Critical Items Bottleneck items
“Efficiency” “Contracts”

Kraljik matrix as basis of Car Manufacturer negotiation strategy
Abundant Supply Natural Scarcity

Strategic Items
Profitability impact
Leverage Items “Form partnerships”

“Negotiate Low prices” ((High Tech
(car Bodies) windshields)
Product standardization Unique products
Bottleneck items
Non Critical Items
“Contracts”
“Efficiency”
(Rare raw materials)
( Fasteners )

Supplier preference Table
Provide superior service and quality

(LT Attractiveness of account )
Willing to Invest time and Keep customer at all cost

Effort in the relationship
Development Core Business

( Get further business ) (Retain and Expand)
Low Priority No Reason to Develop

No Development Potential relationship, No Priority
Nuisance Exploitable
(Withdraw) (Maximize profits)
Low ( Relative value of account) High

Negotiation Strategy selection for buyer
H Assertive ness
Dominating /
Competing Collaboration
(Win / Lose) (win /Win)
L H
Compromising
Cooperation
Avoiding Accommodating
(Lose / Lose) / Yielding
(Lose / Win)
L
If supplier is powerful and dominant and relationship is mportant (Bottleneck),
then use a yielding strategy
For negotiating on highly imp category where the supplier relationship is

low-importance (Leverage), it might be appropriate to use a competing style
Supplier account portfolio position
Develop / Grow Exploit harvest
Accept dependency Reduce consequences
Reduce consequences Reduce dependency
Bottleneck
Core /Invest Nuisance / Divest
Reduce dependency
Accept dependency
Reduce consequences Find another supplier
Customer Purchasing portfolio position

Exploit Accept locked in partnership
Build partnership Avoid
Strategic
Bring in competition
Maintain Partnership
Terminate Partnership

Bring in competition
Exploit
Convenience buying long term
Partner if risk increases
Leverage
Exploit
Convenience buying long term
Partner if risk increases

Pool requirement if
Pool requirement attractiveness can be increased
Non critical
Convenience buying
See efficient process

Negotiation Strategy selection for buyer

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Strategic Negotiation Skills

We want ABC We want XYZ

Role Character Actor

02 Corleone’s Thomas Robert

$250K to grant license

Read Understanding the reservation point scenario 1

What do you think of these statements?

“Don’t you think Accusation

Empty Sets in real world negotiations

What do you think of these statements?

you want to hire an Veiled

we can’t afford to Veiled

Different perceptions of issues may lead to fixed positions

Landlord Lease renewal negotiation Tenant

The rent is already

Fixing blame on people may lead to fixed positions

Production manager Generator service company

You firm is incompetent-It’s Your people have overused

requires one to look

• Criticism • Offending others

• Focus on Precision • Calm Approach

01 Master negotiation skills

03 Adapt strategy to other’s

Present the bottom

Fears being taken Focus on solutions

Allow time for them

Values freedom Don't interrupt

Fears loss of Explain what is

Motivated by Focus on Facts and

DISC primary personality Poll and analysis

general population breakdown

DISC Shades representation

Twelve different regions of the

Team represented on the Everything DiSC Workplace® map

S: calm Si: Sc: modest

C: analytical CS: quiet CD: unsentimental

i: sociable iD: animated iS: upbeat and

How will you plan to negotiate with me? (Poll)

Component Mode Details Wt

Component Mode Details Wt

• As close to reality as possible

Exit & join main session 05

Negotiate and Record 04

Invite other party for Negotiation 03

Read Role CI and prepare 02

Poll: Inside shadow negotiation and discussion

How do you prepare for negotiation case study-

EMPATHY-EMOTIONS & PERCEPTIONS 40

Top 5 skill sets

Year 1 delivery a grand success!!!

ACTUALS – END of YR1 Original Est. vs actual Y1 Org.

Lowest point Target point Highest point

Resistance point Aspiration point Dream point

Est. Their Best Value?

Party 1 Range Party 2 Range

How do you prepare for negotiation case study-breakout groups of 2

Est . Claimant walk away revised during negotiation 380K

ZOPA (overlap of two ranges)

ZOPA (overlap of two ranges)

Why ZOPA is defined by Elizabeth’s RP and DP and not Rajesh’s RP?

Depends on possible values/options issue can take

Issue option Will Elizabeth

Will goes after acceptable help

Will does not go Not acceptable Ideal