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Week 4 Lesson 1:
Distributive Strategies in
Negotiation

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Learning Outcomes

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• Explain what is Distributive Negotiation  
• Explain key concepts and terms commonly used in negotiation
such as BATNA (Best Alternative to a Negotiated Agreement),
etc.  
• Explain the importance of goal, strategies and planning in a
negotiation 
• Apply the concepts through a Negotiation Activity  
• Discuss how distributive negotiation can be effectively used
in a business 
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See if you can A father left 17 ducks as assets for his three sons.

solve this

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When the Father passed away, his sons read the will:
problem… • The will of the father states that the eldest son should get
half of 17 ducks, the middle son should be given 1/3rd of 17
ducks and the youngest son should be given 1/9th of the 17
ducks
• As it is not possible to divide 17 into half or 17 by 3 or 17
by 9, the sons started to fight with each other

Not able to resolve the problem, the sons decided to consult a

wise man in the village
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See if you can
solve this

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problem…
The challenge:

If you are the wise man, what

would you do?
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What is ONE thing
you learned about
Negotiation from the
earlier challenge?
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Getting from Problems to Solutions

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Believe that there Establish common Listen Solve problem
is a solution ground Listen to Focus on possible
Start with the right Focus on building understand and solutions and not
mindset. Being common goals not listen to be handicapped
optimistic is very instead of the respond. with many
important. many differences. problems.

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Distributive
Negotiation
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Characteristics of Integrative Negotiations

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Key Characteristics Integrative Negotiations

Resource Availability Variable amount of resources to be divided

Primary Motivations I win, You win

Primary Interests Convergent or Congruent with each other

Focus of Relationships Long Term

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Characteristics of Distributive Negotiations

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Key Characteristics Distributive Negotiations

Resource Availability Limited resources to be divided

Primary Motivations Personal gains; Trade-offs

Primary Interests Divergent or Incongruent with each other

Focus of Relationships Short Term

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Negotiation is a process of interacting with the goal of obtaining

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agreement or the result you desire

NEGOTIATION DISTRIBUTIVE NEGOTIATION

Occurs when there is a need between parties:

• To agree on how to share or divide a LIMITED RESOURCES

• To CREATE SOMETHING NEW that neither party could attain

on his or her own

• To RESOLVE A PROBLEM or dispute between the parties

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GOAL, STRATEGY, AND PLANNING IN
NEGOTIATION

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GOALS S T R AT E G Y PLANNING
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• Negotiators should specify goals and objectives clearly
GOALS –
THE FOCUS THAT • The goals set have direct and indirect effects on the
negotiator’s strategy
DRIVES NEGOTIATION
STRATEGY
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• Strategy: The overall plan to achieve
one’s goals in a negotiation
STRATEGY VERSUS
TACTICS • Tactics: Short-term, adaptive moves designed to enact
or pursue broad strategies

• Planning: The “action” component of the strategy

process; i.e. how will I implement the strategy?
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Preparation—set a
PLANNING • Starting/asking price, initial offer
• Target point, aspiration point
• Walkaway, resistance point
• Alternative outcomes
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THE DISTRIBUTIVE BARGAINING SITUATION
(EXTENDED VIEW)

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Party A - Seller

Walkaway Point Target Point Asking Price

Initial Offer Target Point Walkaway Point

Party B - Buyer
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UNDERSTANDING ALTERNATIVES, BATNA & WATNA

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The Role of Alternatives to a Negotiated Agreement

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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

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Activity: In pairs:

Car One will take the SELLER and the other will be the BUYER

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negotiation Read the handout given respectively by your tutor.
Spend 15 minutes to plan for your negotiation.

Seller – plan your asking price, target point, walkaway point,

frame of options and alternatives
Buyer – plan your initial offer, target point, walkaway point,
Time frame of options and alternatives

Allocated: 30 Spend the next 15 minutes to negotiate. Put your names and the
minutes agreed price on a post-it pad and pass the post-it pad to your tutor
when done
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Let’s discuss…

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How did the negotiation go?
Were you pleased with the negotiation?
What were the strategies used?
Any deviation from your original plan?
If you were to do it again, how will you do differently?
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DESCRIBE IN ONE
STATEMENT how will
you do it differently?
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DISTRIBUTIVE NEGOTIATION

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Activity: In your BETA team:
Distributive Assuming you are opening a cake shop, spend 20

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minutes to discuss how you will use distributive
negotiation in negotiation to negotiate for an equipment that you require
a business for your business.
setting
Draw up your plan, include the possible tactics you can
come up with to tackle the possible moves of the seller.
Time
Allocated: 30
minutes Spend the next 10 minutes to walk through your plan
with the class.

Explain what is
Distributive
Negotiation  The first, and often the
Distributive Negotiation
occurs when there is a need
between parties to agree on
how to share or divide a
limited resource.
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Explain the Discuss how
importance of distributive
goal, strategies Apply the concepts negotiation can
and planning in a through a be effectively
negotiation  Negotiation used in a
Activity  business 
most important step It’s time to get the
Practice makes perfect!
toward successful team together to think
Practice often if you want
negotiation is planning through the strategies
to be a skilful negotiator.
and preparation. Do plan and tactics when
and prepare before you dealing with a
head into any negotiation. distributive business
negotiation.
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+ Familiarise yourself with the Stay Calm and Learn Well

Assessment criteria for CA1 [Revisit and Reflect. Look through
[Spend some time to go through what you and your team have
CA1 requirements. Discuss with covered for the week. What is one

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your team on how you can key learning for you?]
contribute towards the team’s
success!]
Think about getting your first
SALE!
Revisit and Refine your BETA
[If you have yet started on your
structure
BETA operations, this is the week
[Refer to the organisational structure
to start working on something.
and job descriptions your team has
Discuss with your team using the
created in Week 1. How would your
ET&A template on 1 idea your
team set goals and complete the
team will take for the week.]
appraisal structure? ]

Next Steps forward

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Thank You.