Full Contents

Preface  xix

Overview  xxi

PART I: ESSENTIALS OF NEGOTIATION 1
CHAPTER 1 Negotiation: The Mind and the Heart 1

Negotiation: Definition and Scope 2
Negotiation as a Core Management Competency 3

Dynamic Nature of Business 3
Interdependence 3
Competition 4
Information Age 5
Globalization 5

Most People Are Ineffective Negotiators 5
Negotiation Sandtraps 6
Why People Are Ineffective Negotiators 6

Faulty Feedback 6
Satisficing 7
Self-Reinforcing Incompetence 8

Debunking Negotiation Myths 8

Myth 1: Negotiations Are Fixed-Sum 9
Myth 2:You Need to Be Either Tough or Soft 9
Myth 3: Good Negotiators Are Born 9
Myth 4: Experience Is a Great Teacher 9
Myth 5: Good Negotiators Take Risks 10
Myth 6: Good Negotiators Rely on Intuition 10

Learning Objectives 10
The Mind and Heart 11

CHAPTER 2 Preparation: What to Do Before Negotiation 13

Self-Assessment 14

What Do I Want? 14
What Is My Alternative to Reaching Agreement
in This Situation? 15
Determine Your Reservation Point 17
Be Aware of Focal Points 19
Beware of Sunk Costs 19
Do Not Confuse Your Target Point with Your
Reservation Point 20
Identify the Issues in the Negotiation 20
Identify the Alternatives for Each Issue 20
Identify Equivalent Packages of Offers 21
Assess Your Risk Propensity 21
Endowment Effects 25
Am I Going to Regret This? 25
Violations of the Sure Thing Principle 26
Do I Have an Appropriate Level of Confidence? 27

Sizing Up the Other Party 28

Who Are the Other Parties? 28
Are the Parties Monolithic? 28
Issue Mix 28
Others’ Interests and Position 28
Other Negotiators’ BATNAs 29

Situation Assessment 29

Is the Negotiation One Shot, Long Term,
or Repetitive? 29
Do the Negotiations Involve Scarce Resources,
Ideologies, or Both? 30
Is the Negotiation One of Necessity
or Opportunity? 30
Is the Negotiation an Exchange or
Dispute Situation? 31
Are Linkage Effects Present? 31
Is Agreement Required? 32
Is It Legal to Negotiate? 32
Is Ratification Required? 33
Are Time Constraints or Other Time-Related
Costs Involved? 33
Are Contracts Official or Unofficial? 35
Where Do the Negotiations Take Place? 35
Are Negotiations Public or Private? 36
Is Third-Party Intervention a Possibility? 37
What Conventions Guide the Process of
Negotiation (Such as Who Makes the First Offer)? 37
Do Negotiations Involve More Than One Offer? 37
Do Negotiators Communicate Explicitly or Tacitly? 38
Is a Power Differential a Factor Between Parties? 38
Is Precedent Important? 38

CHAPTER 3 Distributive Negotiation: Slicing the Pie 40

The Bargaining Zone and the Negotiation Dance 41

Bargaining Surplus 43
Negotiator’s Surplus 43

Pie-Slicing Strategies 44

Strategy 1: Assess Your BATNA and Improve It 45
Strategy 2: Determine Your Reservation Point, But
Do Not Reveal It 46
Strategy 3: Research the Other Party’s BATNA
and Estimate Their Reservation Point 47
Strategy 4: Set High Aspirations (Be Realistic,
But Optimistic) 47
Strategy 5: Make the First Offer (If You Are Prepared) 49
Strategy 6: Immediately Reanchor if the Other
Party Opens First 50
Strategy 7: Plan Your Concessions 50
Strategy 8: Use an Objective-Appearing Rationale
to Support Your Offers 51
Strategy 9: Appeal to Norms of Fairness 52
Strategy 10: Do Not Fall for the “Even Split” Ploy 52

The Most Commonly Asked Questions 52

Should I Reveal My Reservation Point? 52
Should I Lie About My Reservation Point? 53
Should I Try to Manipulate the Other Party’s
Reservation Point? 54
Should I Make a “Final Offer” or Commit to a Position? 54
Saving Face 54

The Power of Fairness 55

Multiple Methods of Fair Division 56
Situation-Specific Rules of Fairness 56
Social Comparison 57
The Equity Principle 59
Restoring Equity 60
Procedural Justice 62
Fairness in Relationships 62
Egocentrism 63

Wise Pie Slicing 67

Consistency 67
Simplicity 67
Effectiveness 68
Justifiability 68
Consensus 68
Generalizability 68
Satisfaction 68
Conclusion 68

CHAPTER 4 Win-Win Negotiation: Expanding the Pie 69

What Is Win-Win Negotiation Anyway? 70
Telltale Signs of Win-Win Potential 71

Does the Negotiation Contain More
Than One Issue? 71
Can Other Issues Be Brought In? 71
Can Side Deals Be Made? 71
Do Parties Have Different Preferences
Across Negotiation Issues? 72

A Pyramid Model 72

Most Common Pie-Expanding Errors 74

False Conflict 74
Fixed-Pie Perception 74

Strategies That Do Not Really Work 75

Commitment to Reaching a Win-Win Deal 75
Compromise 75
Focusing on a Long-Term Relationship 76
Adopting a Cooperative Orientation 76
Taking Extra Time to Negotiate 76

Strategies That Work 76

Build Trust and Share Information 77
Ask Diagnostic Questions 77
Provide Information 80
Unbundle the Issues 80
Make Package Deals, Not Single-Issue Offers 81
Make Multiple Offers Simultaneously 81
Structure Contingency Contracts by
Capitalizing on Differences 83
Presettlement Settlements (PreSS) 86
Search for Postsettlement Settlements 87

A Strategic Framework for Reaching Integrative Agreements 87

Resource Assessment 87
Assessment of Differences 88
Offers and Trade-Offs 88
Acceptance/Rejection Decision 88
Prolonging Negotiation and Renegotiation 89
Do Not Forget About Claiming 89
Conclusion 89

PART II: ADVANCED NEGOTIATION SKILLS 91
CHAPTER 5 Developing a Negotiating Style 91

Tough Versus Soft Negotiators 91
Motivation-Approach-Emotion 92
Motivations 93

Assessing Your Motivational Style 93
Strategic Issues Concerning Motivational Style 96

Approach 100

Assessing Your Approach 102
Strategic Issues Concerning Approaches 106

Emotions 113

Assessing Your Emotional Style 114
Strategic Advice for Dealing with Emotions at the Table 119

Conclusion 121

CHAPTER 6 Establishing Trust and Building a Relationship 123

The People Side of Win-Win 123
Trust as the Bedrock of Negotiation 125

Three Types of Trust in Relationships 125
Building Trust: Rational and Deliberate Mechanisms 128
Building Trust: Psychological Strategies 131
What Leads to Mistrust? 136
Repairing Broken Trust 137

Reputation 139
Relationships in Negotiation 141

Negotiating with Friends 142
Negotiating with Businesspeople 145
When in Business with Friends and Family 147
Bottom Line on Relationships 149

Conclusion 149

CHAPTER 7 Power, Persuasion, and Ethics 151

Your BATNA Is Your Most Important Source
of Power in Negotiation 152

Tapping into Your Power 153

Information 153
Status 154
Social Networks 156
Physical Appearance 157
The Effects of Power on Those with Less Power 158
The Effects of Power on Those Who Hold Power 158

Persuasion Tactics 159

Two Routes to Persuasion 159
Central Route Persuasion Tactics 160
Peripheral Route Persuasion Tactics 163

Ethical Negotiation 166

Lying 166
Other Questionable Negotiation Strategies 168
Sins of Omission and Commission 169
Costs of Lying 171
Under What Conditions Do People Engage in Deception? 171
Psychological Bias and Unethical Behavior 171

Conclusion 173

CHAPTER 8 Creativity and Problem Solving in Negotiations 174

Creativity in Negotiation 174

Test Your Own Creativity 175

What Is Your Mental Model of Negotiation? 175

Haggling 175
Cost-Benefit Analysis 178
Game Playing 179
Partnership 179
Problem Solving 179

Creative Negotiation Agreements 179

Fractionating Problems into Solvable Parts 180
Finding Differences: Issue Alignment and Realignment 180
Expanding the Pie 180
Bridging 181
Cost Cutting 181
Nonspecific Compensation 181
Structuring Contingencies 182

Threats to Effective Problem Solving and Creativity 185

The Inert Knowledge Problem 185
Availability Heuristic 188
Representativeness 188
Anchoring and Adjustment 189
Unwarranted Causation 190
Belief Perseverance 190
Illusory Correlation 190
Just World 191
Hindsight Bias 191
Functional Fixedness 192
Set Effect 192
Selective Attention 192
Overconfidence 193
The Limits of Short-Term Memory 193

Creative Negotiation Strategies 193

Multiple Roads Lead to Rome (and an
Expert Understanding) 194
Feedback 194
Creativity Templates 195
Incubation 196
Rational Problem-Solving Model 197
Fluency, Flexibility, and Originality 197
Brainstorming 198
Convergent Versus Divergent Thinking 198
Deductive Reasoning 200
Inductive Reasoning 200
Flow 202

Conclusion 202

PART III: APPLICATIONS AND SPECIAL SCENARIOS 206
CHAPTER 9 Multiple Parties, Coalitions, and Teams 206

Analyzing Multiparty Negotiations 207
Multiparty Negotiations 208

Key Challenges of Multiparty Negotiations 209
Key Strategies for Multiparty Negotiations 214

Coalitions 217

Key Challenges of Coalitions 217
Strategies for Maximizing
Coalitional Effectiveness 221

Principal-Agent Negotiations 222

Disadvantages of Agents 223
Strategies for Working Effectively
with Agents 225

Constituent Relationships 227

Challenges for Constituent Relationships 228
Strategies for Improving
Constituent Relationships 229

Team Negotiation 230

Challenges That Face Negotiating Teams 231
Strategies for Improving Team Negotiations 233

Intergroup Negotiation 235

Challenges of Intergroup Negotiations 235
Strategies for Optimizing Intergroup Negotiations 237

Conclusion 240

CHAPTER 10 Cross-Cultural Negotiation 242

Learning About Cultures 243

Defining Culture 244
Culture as an Iceberg 244

Cultural Values and Negotiation Norms 245

Individualism Versus Collectivism 245
Egalitarianism Versus Hierarchy 254
Direct Versus Indirect Communications 257

Key Challenges of Intercultural Negotiation 259

Expanding the Pie 259
Dividing the Pie 260
Sacred Values and Taboo Trade-Offs 260
Biased Punctuation of Conflict 263
Ethnocentrism 263
Affiliation Bias 265
Faulty Perceptions of Conciliation and Coercion 265
Naïve Realism 266

Predictors of Success in Intercultural Interactions 267
Advice for Cross-Cultural Negotiations 267

Anticipate Differences in Strategy and Tactics
That May Cause Misunderstandings 268
Analyze Cultural Differences to Identify Differences
in Values That Expand the Pie 268
Recognize That the Other Party May Not Share
Your View of What Constitutes Power 268
Avoid Attribution Errors 269
Find Out How to Show Respect in the Other Culture 269
Know Your Options for Change 270

Conclusion 272

CHAPTER 11 Tacit Negotiations and Social Dilemmas 273

Business as a Social Dilemma 275

Decentralization 275
Strategic Alliances 275
Specialization 276
Competition 276

Common Myths About Interdependent
Decision Making 276

Myth 1: “It’s a Game of Wits: I Can Outsmart Them” 276
Myth 2: “It’s a Game of Strength: Show ’em You’re Tough” 277
Myth 3: “It’s a Game of Chance: Hope for the Best” 277

The Prisoner’s Dilemma 277

Cooperation and Defection as Unilateral Choices 278
Rational Analysis 278

Social Dilemmas 285

The Tragedy of the Commons 287
Types of Social Dilemmas 288
How to Build Cooperation in Social Dilemmas 291
How to Encourage Cooperation in Social
Dilemmas When Parties Should Not Collude 297

Escalation of Commitment 298

Avoiding the Escalation of Commitment in Negotiations 300

Conclusion 302

CHAPTER 12 Negotiating via Information Technology 303

Place-Time Model of Social Interaction 304

Face-to-Face Communication 304
Same Time, Different Place 307
Different Time, Same Place 308
Different Place, Different Time 308

Information Technology and Its Effects on Social Behavior 311

Status and Power: The “Weak Get Strong” Effect 312
Social Networks 314
Risk Taking 315
Rapport and Social Norms 315
Paranoia 316

Strategies for Enhancing Technology-Mediated Negotiations 316

Initial Face-to-Face Experience 317
One-Day Videoconference/Teleconference 317
Schmoozing 318

Conclusion 318

Appendix 1 Are You a Rational Person?
Check Yourself 320

Appendix 2 Nonverbal Communication
and Lie Detection 340

Appendix 3 Third-Party Intervention 348

Appendix 4 Negotiating a Job Offer 354

Academic References 362

Popular Press References 396

Subject Index 401

Author Index 423