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COMM 421 NEGOTIATION > EXAM 1 > Flashcards

EXAM 1 Flashcards

1
Q

What are the 3 Fundamental Needs?

A

Competence, Autonomy & Relatedness

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2
Q

What is the difference between negotiation & persuasion?

A

Persuasion (give someone reasons to do something)

Negotiation (give them concessions)

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3
Q

What are the two systems we have for processing info?

A

Emotional Brain & Logical Brain

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4
Q

Emotional Brain

A

Powerful, impulsive, concerned with the now

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5
Q

Rational Brain

A

Logical, concerned with planning, higher level thinking

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6
Q

80% of your efforts should be directed to

A

Preparation and research

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7
Q

Principal Negotiation

A

You make deals based on facts, objective value and standard prices not feelings.

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8
Q

BATNA =

A

Best Alternative To Negotiated Agreements

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9
Q

When forming a BATNA, you must think of the

A

ZOPA (Zone of Possible Agreement)

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10
Q

3 things to do when you cannot prepare adequately for a Negotiation:

A

Cancel, Postpone or borrow research

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11
Q

If you aren’t prepared you might get a

A

Bad deal OR walk away from a good deal

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12
Q

Specifics to ask yourself before negotiating:

A 
What do they want?
What are my Alts?
What is an appropriate range of prices? 
What’s the nature of the relationship?
Who are the people affected?
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13
Q

What are issues?

A

What you want (THE GOAL), ask why or why not

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14
Q

What are Interests?

A

Why you want it (HOW to reach the goal)

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15
Q

6 Critical Rules to Negotiating:

A
  1. No free gifts
  2. Start high
  3. Have a concession plan
  4. Krunch
  5. Nibble
  6. Only make agreements in totality
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16
Q

RULE 1. No free Gifts

A

“I’ll agree to x if…”

  • every time yo give you should get
  • when someone else wants something see it as an opportunity
  • if other side rejects the “if” they must reject the concession too
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17
Q

3 ways to say no

A
  1. I’ll agree on x but I can’t agree to y
  2. Bolkan No
  3. Japanese No
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18
Q

Bolkan “No”

A

Do not make the “if” so bad they won’t do it, just bad enough to be worth your time

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19
Q

Japanese “No”

A

Don’t say no, change it to a “yes, if” then extreme concession

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20
Q

RULE 2: Start High

A

The most important moment,because it will anchor and define the outcomes

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21
Q

RULE 3: Have a Concession Plan

A

Have 3 prices aka envelopes

Opening, target & bottom line prices

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22
Q

If there is an overlap between buyer and seller’s envelopes =

A

ZOPA (zone of possible agreements)

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23
Q

The Rule of Halves

A

When negotiating concessions, cut values in halves between opening and target. then baby steps

EX: $3000, $2500, $2200,2080

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24
Q

RULE 4: KRUNCH

A

When someone gives you an offer, instead have them give you another offer rather than giving a counter offer

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25
Q

KRUNCH EXAMPLES

A

“What else can we do with that?”
“Not what I was expecting, can you do better?”
“Eh anything else?”

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26
Q

RULE 5: Nibble

A

A concession gained at the very end of a negotiation, right before the deal is closed

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27
Q

RULE 6: Make agreements in totality

A

Never settle issues one at a time. Instead say “ we are good on that if we can agree on other things too”

Gives you leverage and you can list priorities

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28
Q

Why not start off at a fair price?

A

Better to start high and work your way to a fair price

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29
Q

Should you accept the other person’s first offer?

A

No because it is important to build rapport and you might offend the other side by accepting it

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30
Q

Having emotional intelligence of others leads to

A

Higher trust and willingness to work

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31
Q

Building rapport helps

A

Establish good relationships and a pleasant first impression

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32
Q

Who should make the first offer?

A

You should! Make it reasonably aggressive

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33
Q

First offers are one of the best predictors of the

A

Final price

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34
Q

25% of the initial number offer influences our

A

Final estimates

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35
Q

If I know the price of something, you can’t anchor me as much as when I

A

Don’t know

36
Q

Aggressive first offers hurt:

A

When shopping on Craigslist or job prospecting with salary

37
Q

Precise first offers lead to better outcomes because they are seen as more

A

Plausible and well thought out

38
Q

Why do first offers work?

A

Inability to move away from initial frame/anchor, taken as a sign of the true price of a product, allows room for concessions, makes negotiator seem reasonable.

39
Q

First offers work best when the price is

A

Ambiguous or vague

40
Q

Example of a Bracketing Offer

A

If you want $100
As a Buyer: ask for $80-$100
As a seller: ask for $100-$120

Gives off illusion of flexibility

41
Q

Making extreme first offers can

A

Offend people and they can walk away

42
Q

What happens if the other person makes the first offer?

A

It can either benefit or hurt you, people tend to fixate on initial number of negotiations

43
Q

Best Types of Price Range

A

Bolstering Range (if you want $100,you ask for $100-$120)

44
Q

Worst types of price ranges

A 
Back Down Range (you want $100, you ask for $80-$100)
Bracketing Range (you want $100, you ask for $90-$110)
45
Q

Dual Concerns

A
  1. What I’m getting

2. the others outcome & relationship

46
Q

5 different approaches to negotiating:

A
  1. me+,you- (what I’m getting)
  2. me-, you+ (other persons outcome)
  3. me-, you- (don’t care at all)
  4. me eh, you eh (sorta cares)
  5. me+, you+ (cares about both)
47
Q

5 Major Types of Negotiation

A
  1. competition/distributive
  2. Accommodation
  3. Avoidance
  4. Compromise
  5. Collaboration
48
Q

Competition/Distirbutive

A

Competes for best concession

49
Q

Accommodation

A

Doing what the other side wants

50
Q

Avoidance

A

Only good if both agree to it

51
Q

Compromise

A

Both sides give up something

52
Q

Collaboration/integrative

A

Creates value so both people feel good

53
Q

Distributive bargaining

A

Individual bargaining where you compete for scarce resources

54
Q

Distributive Bargaining primary focus:

A

Opening Offer: be aggressive
Bottom Line: get to their bottom line
BATNA: strength your envelope

55
Q

In distributive bargaining it is important to be thought but

A

Friendly in nature (keep environment positive)

56
Q

Before you start in distributive bargaining, find out other person’s

A

Bottom line

57
Q

Deadlines in negotiation affect both people

A

Equally (if you have a deadline, share it)

58
Q

In the offensive stance of distributive bargaining:

A
  • highlight losses (make something seem scarce)
  • disaggregate gains, bundle losses (give gains spaced out, combine losses)
  • use reciprocity
  • make your problem their problem
59
Q

Defensive Stance in Distributive Bargaining

A
  • prepare
  • gain outside opinion
  • BATNA
  • contingency contacts
60
Q

Contingency Contract

A

Make contract to where you can find out if the other person is lying.

61
Q

Example of contingency contract:

A

“I’ll take a low salary, but if I perform ata certain level in 5 months, I get a bonus plus a raise.”

62
Q

When to negotiate distributively:

A

Never (you should focus on building good rapport and good will) but always

63
Q

Top concerns in integrative bargaining

A

Outcomes, others outcomes, relationship, coming up with multiple issues, working together

64
Q

Myths about integrative bargaining

A

You need to improve the relationship, you can’t be aggressive, you should compromise, there is a fixed pi

65
Q

Two important things in integrative bargaining

A

Separate person from the problem and focus on interests

66
Q

(Int. Bargaining) Separate person from the problem

A

Be careful of negative emotions. It prevents you from paying attention, you are less cooperative and less likely to honor the deal.

67
Q

5 things to do when separating person from the problem

A
  • Give them the benefit of the doubt
  • Relax
  • reframe situation
  • stop negative spiral
  • be sensitive to your words
68
Q

(Int. bargaining) focus on interests

A

Focusing on interests gives flexibility to meet needs. (ACT LIKE YOU CARE)
should you share interests? YES

69
Q

4 Common Problems in Intergrative Bargaining

A

Premature judgement
Searching for a single answer
Thinking their problem is their problem
Not using principled negotiation

70
Q

3 aspects of finding solutions in integrative bargaining

A
  1. Log rolling
  2. Nonspecific compensation
  3. Have multiple equivalent Offers
71
Q

People say yes when

A

Their needs are met and there is nothing left to get from you

72
Q

6 Common Objections

A 
Lack of ownership
Unmet interests
The other party losing face
Complexity
Too expensive
People need more time
73
Q

Objection 1. lack of ownership

A

Invent opportunities to provide them with choices (ask questions, ask for feedback)

74
Q

Objection 2. Unmet Interest

A

Show people how their outcome will be better with your deal (called relative advantage)

75
Q

4 types of relative advantages

A

Economic, social prestige, convenience, satisfaction

76
Q

Objection 3. When other party loses face

A

People need to feel CAR (competent, autonomous and respected)

77
Q

Objection 4. complexity

A

Just keep it simple

78
Q

Objection 5. Too expensive

A

Show the other person the value of your proposal

79
Q

Objection 6. people need more time

A

Ask them why they need more time (giving them more time is not good for you)

80
Q

5 Closing Deal Tactics

A
  1. just Ask
  2. flip a coin
  3. Commitment (if I solve x issue, do we have a deal?)
  4. Sweetener (one last concession for the yes, opposite of nibble)
  5. Exploding offer (limited time only with sweetener)
81
Q

What are signs that suggest you should be ready to close the deal?

A

Decrease in objections, person admits that proposal has merit, if person switches from concerns to how it will work, positive comments

82
Q

In distributive bargaining what do you care about? When is this type of bargaining appropriate?

A

Care bout my outcome, and it’s appropriate in one time interactions

83
Q

What does the old brain do for us?

A

Reptilian brain results in direct behavior that is constant, instant and you can’t control. Exposes us to our 3 fundamental needs

84
Q

Why can’t Americans negotiate?

A

There are more options, we are a culture set to shop. We view it as impolite

85
Q

Are objections to your final position bad?

A

No, it means they are still with you/the negotiation

86
Q

Log rolling

A

Trading issues of importance

87
Q

Nonspecific compensation

A

Pay people off

COMM 421 NEGOTIATION (3 decks)

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