NEGOTIATION WORKSHOP

Traineeship Summer 2012

Trainer:

Frans SCHRAM

A very short introduction

1. Introduction ESSEC IRENE 2. Using negotiation skills at a job interview

3. Questions & Answers

ESSEC IRENEs Three Missions: Research, Fieldwork, Training

RESEARCH
More than 60 international conferences A Monthly Research Seminar Visiting Scholars PhD Students Publications books journal articles working papers CD-ROMs simulations case studies

FIELDWORK
Negotiators of the World
IRENEs programs dedicated to mediation and reconciliation efforts in post-conflict countries or fragile societies

EDUCATION
+2,500 people a year Half in higher education institutions ESSEC, Paris Universities ENA, ENPC, etc.

Half in continuing education, worldwide Private Corporations Governments International organizations European Commission, WHO, UNDP, UNITAR, etc.

Activities in 60 countries so far - 2010: ESSEC IRENE ASIA in Singapore

Negotiation is everywhere
EXTERNALLY

Government
Customers

NGOs

Business Partners Regulatory Authorities

Executives YOU INTERNALLY

Colleagues Teams

And in your private life

The process leading up to being invited for a job interview and finally, the salary negotiations, do contain many of the typical characteristics of a negotiation. In your daily life there are many so-called negotiation situations.

First look at a little bit of general theory In any job interview you try to sell yourself; convey messages, building a relationship, come to an agreement - Good balance between assertiveness and empathy
- Active listening - Active speaking - Building trust (be honest, even show weaknesses, be willing to take risks, cooperative attitude) - Create value together, and then claim - Closing the negotiation

STARTING WITH KEY QUESTIONS

In this situation, what is my objective? What is my strategy to achieve this objective?

THREE DIMENSIONS OF ANY NEGOTIATION

WHO?

The PEOPLE involved

relationships, cultures, identities, emotions/passions, psychology/ego

WHAT? The PROBLEM at stake

the substantial issues, the questions to be solved

HOW?

The PROCESS of the negotiation

organisation, working methods, timing, agenda

ON THE PROBLEM: Tension between cooperation and competition

Two opposing strategies (Nash, 1950; Lax & Sebenius, 1986): Through cooperation, the negotiator helps create joint greater value (value creation). Through competition, the negotiator secures a better share of this value for himself (value distribution).
The negotiators dilemma (Zartman, 1976). the tougher the negotiator, the greater the probability to get the better share, but the lesser the probability to strike a deal at all; the softer the negotiator, the greater the probability to get a deal, but the lesser the probability to get a fair share

A Second Sequence as to PEOPLE, to overcome the gap between Intents & Impact

EMPATHY

then then then

ASSERTIVENESS

PUTTING MYSELF IN THEIR SHOES

(my impact on them)

PUTTING THEM IN MY SHOES

(their impact on me)

ACTIVE LISTENING

ACTIVE SPEAKING

THREE STAGES OF NEGOTIATION

But before that: preparation is essential The negotiation itself, of course.

And after: the debriefing

3 DIMENSIONS, 10 ELEMENTS TO PREPARE PEOPLE - Who?

Interpersonal Relationship Vertical Relationship: the Mandate Stakeholder Mapping

PROBLEM - What?
Core Motivations Solutions at the table (options) Justifications Solutions away from the table (alternatives, plan B)

PROCESS - How?
Organization Communication Logistics

NEGOTIATING in a JOB INTERVIEW

A-typical negotiation? You can either decide to negotiate at an interview or not Once they have psychologically chosen you, you can start to negotiate about salary etc. So only when the offer is made, not before!
Be prepared to Negotiate when they offer you the position. Have a comprehensive view, a package, ready before you start (Secondary benefits?)

What do you bring to that company in value? Selling points (education, experience, maturity, performance under pressure and ability to fit in are assets). Research on pay policy, financial soundness of the organisation Know your market value!

Negotiating your salary

Dont make it look like you are bargaining!
Dont make demands (positive framing. ..Could you..?

Only at the very end!

Have 3 numbers: Optimal Aspiration Value (Anchor), Target Value, Reservation Value (Red line) What is my plan B? B.A.T.N.A

Justifications: Based on my assets and experience

Use benchmarks Your employer doesnt care WHY you need the money, they care about what you can do for them

Difficult questions

How much did you earn before?

Dont lie but give a range. I am confident that I am in your range Answer questions with a question
- I was very well compensated for my responsibilities. what is your organization's range for this position? (puts THEM on defensive)

What salary are you expecting?

Postpone until the end (ask more questions) He who speaks first, loses If you have to give a number, then better give a range or say: I am willing to discuss on a salary when there is an offer to review

CLOSING THE MEETING

Emphasize on your motivation

If they make an offer, say that you need to think about it If you are not happy:
Based on my abilities, I was expecting a bit more..

After having reviewed the whole package, I think it is a bit below my expectations DO YOU HAVE ROOM TO MOVE?

Always close on a positive note

THE ZONE OF POSSIBLE AGREEMENTS

AV for buyer

RV for buyer

ZOPA
RV for seller
RV: Reservation Value AV: Aspiration Value

AV for seller

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ANCHORING FIRST?
Reason of anchoring first?
Works as an "anchoring" for the other Becomes a reference for the "negotiation dance"

Reason of not anchoring first?

Risk of asking "less" than what the other is ready to offer
Too pessimistic aspiration

Risk of asking "more" than what the other considers reasonable

Excessive aspiration (out of ZOPA or out of the market)

Solution?
Get as much information as possible first
in the preparation at the table

Then if you decide to anchor first, anchor above your aspiration value, still being able to justify this with an objective criteria, and while measuring the risks of excessive anchoring
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FACTORS HELPING JOINT GAINS

COOPERATIVE MOTIVATIONAL ORIENTATION UNDERSTANDING OF EACH OTHERS PRIORITIES AND PREFERENCES BY SHARING INFORMATION MODEL OF TRIAL AND ERROR

Asking questions and being willing to share risks Making and asking for offers Searching for other solutions Proposing different solutions equivalent for you
AVOIDING THREATS & POWER FOCUS

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WHAT? Solutions Away From the Table (SAFT)

Everything I/the other can do UNILATERALY if there is no agreement What helps each party judge any possible solution at the table What increases my/their power in a negotiation What needs to be worked on (not fixed) Among these alternatives, know your BATNA = The Best Alternative to a Negotiated Agreement

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HOW? Communication
Processing Information Exchange
What to share What NOT to share

Dialogue
Listening & asking the good questions Speaking & giving the good answers

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ACTIVE LISTENING
1. 2. 3. 4. 5. 6. 7. 8. 9. 10. Listening with all the signs of attention Integrating the others speech while suspending my internal voice Paying attention to what is said and not said Taking a few notes, if necessary Restating (looping) Asking the other to correct my understanding Checking what was missed in the first place Asking clarifying questions Getting validation of my understanding Closing the listening stage

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Thank you!!
Author: Frans SCHRAM schram@essec.edu