Lecture on Negotiation Tips

Introduction

• Focus on influence and persuasion in negotiation
• Negotiation involves voluntary agreements
• Applicable to ADR fields: mediation, negotiation, arbitration

Key Tips for Negotiation

1. First Offers

• Be cautious about making first offers
• Story of Thomas Edison and his invention
  • Offered $40,000 when seeking only $5,000
  • Importance of knowing the other party’s bottom line
• Make first offers only with strong objective criteria

2. Flinching and Questioning Offers

• When receiving an offer, flinch and question the number
• Ask for justification of the offer
• Avoid accepting first offers as they are usually not the lowest

3. Different Approaches

• Some prefer straightforward offers without negotiation dance
• Others engage in negotiation dance, starting with extreme offers

4. Use of Objective Criteria

• Use independent, third-party data to validate your offers
• Examples include Blue Book values for cars, comps for homes

5. The Three W's

• Why, What If, Where did you get that number?
• Why: Ask for explanations to gather more information
• What If: Use trial balloons to gather information, ensure it’s not perceived as an offer
• Where did you get that number: Make them justify their offers

6. Ego, Emotion, and Escalation

• Ego and emotion can lead to escalation and deadlock
• Important to keep the conversation going without defensiveness

7. Underlying Interests

• Focus on interests, not positions
• Story of two siblings and an orange illustrates exploring underlying interests

8. Importance of Communication Mode

• Mehrabian’s study on communication
  • Words (7%), Voice (38%), Body Language (55%)
• In-person communication is best

9. Ask for More Than You Expect

• Be credible in your high offers
• Concessions should be small and rare
• Use "if-then" tactics for concessions

10. Open-Ended Questions

• Ask open-ended questions to gain information
• Use silence strategically

11. Listening

• Listen before speaking to understand and be understood
• Listen twice as much as you talk

12. Handling Emotions

• Don’t react to anger or emotions from the other side

13. Breaks and Information Strategy

• Take breaks to lower emotions
• Be strategic about what information to reveal

14. Creating Value

• Find trades that cost you little but are valued by the other side
• Story of the elderly woman and her buried pets illustrates importance of addressing non-monetary concerns

15. Tone and Humor

• Be cautious with tone, voice, body language
• Use humor carefully

16. Pace and Defensiveness

• Avoid the "winner's curse"
• Slow down negotiations, avoid raising defenses

17. Drafting Contracts

• Draft contracts together to avoid unilateral interpretation

18. Emotional Contagion

• Mood affects negotiation dynamics
• Consider environment for negotiation

19. Avoiding Splitting the Difference

• Don’t be the first to offer to split the difference

20. Testing Bottom Lines and Generating Options

• Constantly test bottom lines
• Provide multiple agreeable options for the other side

21. Building Relationships

• Relationships can influence negotiation outcomes
• Example of a man buying a house due to a long-term relationship built through annual postcards

Conclusion

• Building relationships and understanding interests are keys to successful negotiation
• Apply these tips in various ADR scenarios to achieve better outcomes