| Negotiation Dynamics Lisbon Seminar |
Session 1 - Price Negotiations: Concepts and Tactics
Day 1, AM
Drawing on the participants’ experiences in a face-to-face negotiation
involving the purchase/sale of a parcel of land, this session analyzes the
conceptual structure of single issue bargaining problems, develops alternative
perspectives on the negotiating process and illustrates a variety of tactics
used when negotiators bargain over price.
8.30 Program Overview
8.45 Participants carry out the following one-on-one negotiation:
Lot # 21, Sect. Y, Episy
9.30 Price Negotiations: Diagnosis and preparation
10.15 Price Negotiations: Positioning
• Limitations of rational arguments
• Indirect approaches to frame the negotiation
- parables
- “negotiation jiu-jitsu”
10.45 Break
11.00 Price Negotiations: Bargaining
• Limits, targets, zone of potential agreement
• Opening offers
• Focal points
• Concession patterns
• Commitment
Follow-up handouts: • Single Issue Bargaining
• Haggling over Price
Session 2 - Package Deals: Defining the Optimal “Architecture” of
Complex Agreements
Day 1, PM
This session illustrates pitfalls and limitations of negotiating within a single
issue framework and proposes an alternative: package deals. Participants
will have an opportunity to put their bargaining skills to the test in CP France
- MégaMarché a complex multi-issue negotiation. In this session, we tackle
the problem of designing the right ‘architecture’ of package deals based,
identify efficient trade-offs, and introduce the fundamental concept of
‘exchange rates’ in multi-issue negotiations. In addition, we will review the
obstacles that negotiators can expect to encounter in a business deal and
suggest practical steps to overcome those obstacles and successfully
implement the “package deal” approach.
working lunch: Teams carry out the following team negotiation: CP
France - MégaMarché
15.00 Debriefing
• Identifying the different types of issues on the agenda
• Claiming and Creating Value
• The fundamental logic of “Give and Take”
16.30 Break
16.45 Structuring Smart Package Deals
• Creating a negotiable agenda
• Measuring the impact of concessions
• Evaluating tradeoffs: “Efficiency Ratios”
• ‘Homans’ Law’
17.45 Package Deals: Managing the Process
• Settle the easy issues first or agree on the package as a whole?
• ‘Salami slicing’
• Exploring options: ‘mini packages’
Evening: Participants prepare to carry out the following negotiation
exercise: Woburton Steel - Cryogenic Technologies
Session 3 - The “Nuts and Bolts” of Negotiation: Mastering the Process
Fundamentals
Day 2, AM
When a particular configuration of pieces on a chessboard occurs regularly,
Grand Masters study the pattern and all of its common variations. They
analyze and evaluate a wide range of potential responses, which enables
them to build a repertoire of smart moves to deal with the problem.
Obviously, Grand Masters improvise, but when they encounter a
characteristic pattern, improvisation is supported by a solid foundation of
analysis. Even though negotiations – like chess games - are infinitely varied,
we do encounter a number of prototypical situations. However, in contrast to
Grand Masters, negotiators rarely pause to analyze these “patterns” – they
prefer to simply “play it by ear”. In this session , we will thoroughly analyze
two prototypical problems: how to make proposals and how to handle tough
questions. The analysis will suggest a range of responses – including
specific language – that will help participants to build their own “personal
repertoire” of smart moves.
8.30 Making Proposals
• Ineffective language: A “worst case” example
• Dos and Don’ts: Criteria defining effective language
• Winning the “Battle for Mind Space”: Effective and ineffective
communication techniques
10.00 Break
10.15 Handling Tough Questions
• The dilemma
• Developing a repertoire of effective responses
- “The Freezer”
- The “Marlin Fitzwater response”
- “Selective Hearing”
- “Schubert’s Unfinished Symphony”
- Counter a Question wit a Question
- The “Lionel Jospin response”
- “Truthful misdirection”
- ...
• Spotting lies – and knowing how to deal with them.
working lunch: Teams prepare Woburton Steel - Cryogenic
Technologies negotiation
Session 4 - Dealing with Uncertainty
Day 2, PM
In this session, we examine difficulties that can arise in long-term contracts
when parameters that critically affect the results for both parties are subject
to change during the life of the contract. For example, the economics of a
waste incineration project will hinge on oil prices, which are subject to
unpredictable fluctuations over the life of the project. This session will
address two kinds of problems that arise in such settings: problems in
negotiating the deal, and problems in implementing the deal. Participants will
explore some of those challenges in the Woburton Steel - Cryogenic
Technologies negotiation. This case offers an opportunity to explore in depth
the fundamental theoretical concepts that lie at the basis of value creation in
negotiation. Towards the end of the session, we will review applications in a
broad variety of industries including financial services, mergers and
acquisitions, industrial gases and power generation.
13.30 Teams negotiate a complex long-term contract: Woburton
Steel - Cryogenic Technologies
15.00 Break
15.15 Debriefing
• Dealing with Uncertainty - Theoretical Concepts
- Uncertainty: an obstacle to agreement or an opportunity to
create value?
- Playing on differences between negotiation partners to
create value
- Playing on differences with competitors to lock in a
sustainable advantage
- Criteria to evaluate the structure of package deals
- Creating 'expected' value: opportunities and limits
• Dealing with Uncertainty - Applications
- financial services
- mergers and acquisitions
- power generation, basic chemicals, ...
- evaluating and rewarding managers in an uncertain
environment
Follow-up handout: Woburton Steel - Cryogenic Technologies
Evening: Participants prepare to carry out the following negotiation
exercise: Walkenhorst Chemical - Lakeland Industries
Follow-up handouts:
• Walkenhorst Chemical - Lakeland Industries
• Promises and Threats
• Information Asymmetries
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