Negotiating Entry Flashcards
1
Q
Congruent aspects
A
identical preferences
2
Q
Distributive aspects
A
win/lose, single issue that is equally important to both parties
3
Q
Integrative aspects
A
win/win, multiple issues
4
Q
Maximize joint value
A
Maximize congruent aspects
Compromise distributive aspects
Tradeoff integrative aspects
5
Q
Building integrative agreements
A
- Build trust and share information
- Ask questions
- Give away some info
- Make multiple offers simultaneously
- Search for post-settlement settlements
6
Q
BATNA
A
Best Alternative To a Negotiated Agreement
- Identify your “no deal” alternatives
- Calculate the values associated with each
- Select which is best this is your BATNA
7
Q
Reservation value
A
Point at which you are indifferent between accepting the deal and walking away
Also called: Your walk-away point, point of indifference, , reservation point
Think of this is as your maximum willingness to pay
8
Q
Other common mistakes
A
- Assuming a fixed pie
- Poor planning and information asymmetry
- Irrational escalation of commitment
- Overconfidence
- Framing effects
9
Q
Distributive bargaining
A
- Typically involves a single issue
- Fixed-sum structure: one party’s gain is another party’s equivalent loss, you are distributing or dividing the value
- Conflicting interest: each party is typically trying to maximize their share
10
Q
Integrative bargaining
A
- Integrative bargaining involves value creation (expanding the pie)
- Involves multiple issues, differences in priorities
- Many situations can be transformed into integrative situations by adding issues - Interests-based bargaining, not just positions-based
