Key Highlights Class #2 (9/23/06)

Class # 2 Key Highlights 9/23/06

First Role Play Negotiation:

Planning For the Law Books Negotiation

As the buyer if the books for the first one-one role play, I read the case, put together a well-thought plan and did not stick to it. I believe the flow of the conversation and the first few minutes of questions and answers was the decisive factor in abandoning the original plan. We had a nice conversation and we were able to enter into the negotiation openly and honestly thus shifting perceptions to integrative vs. distributive. Since I was the buyer, I felt, immediately, at a disadvantage because the purchasing law firm needed the books more than the selling law firm needed the money. Throughout the negotiations, Obei used an effective technique of being quiet and letting me talk. At times, I got myself into a corner and was not effectively negotiating a good deal.

After debriefing with Obei, it turned out that neither of us stuck to our original Negotiation plan. In addition, I paid too much and Obei had set a much lower walkawya than I thought. The lesson learned was that it was clear that we both wanted to implement mutual gain by throwing other things into the pot such as office space in DC and client sharing. I went into it not thinking the little things mattered. For example, I was not concerned about shipping and handling mattered but Obei threw those in unexpectedly so I accepted it as part of the deal. I guess in this small concession that he made, I did get a good deal.

If I were to do this again, I would have negotiated a better deal (i.e., paid less for the books) by talking less. Although I felt like both sides were able to get some good advantages, I left money on the table. I should have asked additional probing questions and not have been afraid to take a coldhearted look at whether this deal makes sense money-wise for the overall firm.

Experiencing Intimidation
In going through the “Law Books” role-play, I discovered that I was intimidated by low-ball offers. I found it was difficult to recover and get back to negotiating a good deal. The reason I was intimidated is that I created the foundation for trust in the beginning and felt like I did not want to low-ball (gouge) because of the relationship. I think if I had kept my BATNA in mind than I would not have been nervous about responding to the low-ball offer with a high counter-offer. Somehow, I felt forced into doing business with him because of building trust and not doing a deal was not an option.

In summary, in shifting negotiations from distributive to integrative, you need to build trust and be creative but should not let one leave money on the table. Also, setting ambitious targets would help identify eachother’s walkaway as well as aid in discovering the ZOPA. Also important to keep in mind discovering your opponent’s BATNA (and always keep your own BATNA in mind as well).