Strategy and Tactics of Distributive Bargaining1
Transcript of Strategy and Tactics of Distributive Bargaining1
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Strategy and Tactics of
Distributive Bargaining
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Chapter Outline
Distributive Bargaining Process
Fundamental Strategies
Tactical Task Positions taken During egotiation
Commitment
Closing the Deal
!ardball Tactics
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Bargaining " egotiation
egotiation is a process of interpersonal
decision#making$
Bargaining is a type of negotiation in%hich buyer " seller of a goods or service
dispute the price %hich %ill be paid and
the e&act nature of transaction %ill takeplace' " eventually come to an agreement$
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Types of Bargaining
Distributive : (t is a %in#lose bargaining because)
%hatever one side gains comes at the e&pense of the
other party# %hat is *%on+ by one is *lost+ by other$
(t is referred to as hard bargainingbecause it isusually a highly competitive process designed to reach
a formal %ritten agreement' such as a purchase
contract$
Integrative : Parties come to an agreement in anamicable manner' %in#%in situation for the parties
involved$
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Contd,$
(t usually occurs in negotiations based on
the sale of products %here all that matters
is price' for e&le in the sale of anautomobile and in real estate$
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-alue Claiming
The competitive process of claiming value involves
dividing up a *fi&ed pie+ or the total amount of value
available to the disputing parties$
.ach side tries to get as much of the pie as possible$The more one side claims' the less the other side gets$
This is also kno%n as a *%in#lose+ negotiation$
To claim a value in negotiation' one uses competitive
tactics to try to convince the other side$
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/hat are !ardball Tactics0
They are designed to pressure targetedparties to do things they %ould not other%ise do$
They are tactics %hich result in a changeout come of Distributive BargainingProcess$
They are tactics %hich %ork on poorlyprepared negotiators$
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Typical !ardball Tactics
1ood 1uy2Bad 1uy
!ighball23o%ball
Bogey ibble
Chicken
(ntimidation
Sno% 4ob
5ggressive Behavior
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1ood 1uy2Bad 1uy
amed after police interrogation
techni6ue$
(t is relatively transparent' especially %ithrepeated use$
egotiators using this tactic can become so
involve %ith their game and act they fail toconcentrate on obtaining their goals$
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!ighball23o%ball
Starts %ith a ridiculously high2lo% opening
offer that kno% they %ill never achieve$
The tactics goal is have the other partyreevaluate their opening offer and move
closer to the resistance point$
The risk is the other party %ill thinknegotiating is a %aste of time$
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Bogey
/hen a negotiator pretends an issue
important and it is not$
(t only %orks %ell (f they pick a issue thatis important to the other side$
(t can be a difficult tactic to enact$
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ibble
(s a tactic used to get small concession%ithout negotiating$
The concession is too small to lose the dealover' but large enough to upset the otherside$
(t is felt that nibble tactic is not in good
faith and may seek revenge in futurenegotiations$
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Chicken
egotiators %ho use this tactic combine a
large bluff and threaten actions$ 5 high stakes gamble$
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(ntimidation 2 5ggressive
Behavior (t is guilt' anger' legitimacy' fear' %hat ever givesyou po%er over the other party$
(f you are making a concession' because you
assume the other party is more po%erful' or
simply accepts the legitimacy of the other
negotiator' %hich means you are (T(7(D5T.D$
5ggressive behavior is similar accept it is therelentless pushing$
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Sno% 4ob
(s the 1overnments favorite tactic %hen
releasing information to the public$
(t is the over%helming of information thatyou have trouble determining %hich facts
are real or important$
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Dealing %ith Typical !ardball
Tactics
1ood 1uy2Bad 1uy
8.specially if you call them out on it at the
beginning$
!ighball23o%ball
8The best %ay to deal is not to counter the offer$
8Be prepared to leave to demonstratedissatisfaction of using this tactic$
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Dealing %ith Typical !ardball
Tactics Cont,$ Bogey
8 (s difficult tactic to defend against) ho%ever' being%ell prepared for negotiation %ill make you less
susceptible to it$8 5lso %atch out for sudden reversals in positions$
ibble8 Before closing a deal ask */hat else do you %ant0+
giving both parties a chance to negotiate in good faith$8 5l%ays have a your o%n list of nibble prepared to
offer in e&change$
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Dealing %ith Typical !ardball
Tactics Cont,$
Chicken8 (s very difficult to defend against$
8 Preparation and a through understanding of the situation$
8 9se e&ternal e&perts to help %eigh your options$
(ntimidation8 (f the other negotiator is acting aggressively' then discuss
issues by putting your stand in the negotiation process$
8 5nother effective strategy is the use of a team' usuallynot everyone is intimidated by the same thing and theyoffer support if the intimidation is uncomfortable$
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Dealing %ith Typical !ardball
Tactics Cont,$
Sno% 4ob83isten for consistent and inconsistent
information$ Do not be afraid to ask 6uestions
until you understand the ans%er$
8(f the matter is highly technical suggest for atechnical e&pert to look over the technicalissues$
85gain' preparation is the key to dealing %ith asno% :ob tactic$
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Summary
(t has been recommended not to use any of thehardball techni6ues$
9nderstanding hardball tactics %ill make you a%are
of the user;s ob:ective$ 1ood planning %ill help you deal and avoid hardball
tactics$
!ardball tactics can backfire$
They are offensive and motivate revenge$ 7any negotiators consider these tactics out of bounds
for any situation$
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Thank you