Презентация на тему: Games people play: negotiations

Games people play: negotiations

What is Negotiation? DISCUSSION SOLUTION

Game theory ● Game simulates real life● Includes 5 elements:Players = decision makersStrategies availableRulesOutcomesPayoffs

An Example of Game Theory: The Prisoner's Dilemma

Types of negotiations DISTRIBUTIVE Involve win-lose, fixed-amount situations wherein one party’s gain is another party’s lossINTEGRATIVE Involve joint problem solving to achieve results benefiting both parties which can lead to win-win or lose-lose outcome

Four Key Concepts BATNAReservation PriceZOPAValue Creation

Know your BATNA! Best Alternative to a Negotiated Agreement (BATNA)Typical example: negotiate or go to courtImproving your situationImprove your BATNAIdentify the other side’s BATNAWeaken the other party’s BATNA

Reservation Price The least favorable point at which one will accept a dealThe “walk-away”Example: you are looking for larger office space. You set your BATNA at $20/SF and your Reservation Price at 30$/SF

ZOPA Zone of Possible Agreement (ZOPA).The difference between the Seller’s Reservation Price and the Buyer’s Reservation Price Seller’s Reservation PriceBuyer’s Reservation Price

Question: What will happen if we change points of buyer’s and seller’s reservation price? Buyer’s Reservation Price Seller’s Reservation Price

Value Creation Create value = enlarge the pieBasic principles:Seek out shared interestsPropose mutually beneficial tradesSecure insecure contracts

Planning the negotiations:Pre-negotiating ObjectivesWhat is involved? (+extremes)Goals of oppositionNOT the costs => what is VALUABLE

Planning the negotiations:negotiating confidence and powerkeep the negotiation in your controlaim as high as you feel necessary remain flexible know your business

Coming to an agreement Write down the termsDiscourage the other side from seeking further concessionsBe happy =)

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