CHAPTER 5 – POWER IN NEGOTIATION

S
 POWER

S Power is the capacity of a person, team, or

organization to influence others.
S Sources of Power
Legitimate
Reward
Coercive
Expert
Referent
SOURCES OF POWER

S Agreement that people in certain

roles can request certain behaviors
of others

S Based on job descriptions and

mutual agreement
 SOURCES OF POWER

Ability to control the

allocation of rewards valued
by others
 SOURCES OF POWER

Ability to apply punishment to others

 SOURCES OF POWER

The capacity to influence others by

possessing knowledge or skills that
they value
SOURCES OF POWER

Occurs when others identify with,

like, or otherwise respect that person
 POWER IN NEGOTIATION

S Power: is a function of alternatives

1. Alternative sources

2. Alternative currencies

3. Alternative skills and behaviors

 Alternative Sources

S By exploring alternative sources, you gain

power in negotiation
S Identify alternative sources when you want to
buy an iPhone XS Max
S Sources are explored from the Needs
 Alternative Currencies

S Identify what kind of currencies you can bring

to a negotiation
1. Prime currencies

2. Alternative currencies

3. Elegant currencies
Alternative Skills and Behavior

S Recognize power of the relationship

S Develop a good working relationship with

other party to ensure win-win agreements
 Individual Assignment
The Masteri Thảo Điền

You want to buy a 2-bedroom apartment for your 2

daughters who are studying at International University.
After seriously considering several options, you put the
Masteri Thảo Điền as your top choice. The 2-bedroom
apartment is 60 square meter with 1 living room, a
kitchen, 2 bathrooms, a shopping center (Vincom Mega
Mall), a Cinema, a fitness center and 2 swimming pools
in the area. It locates on Xa Lo Ha Noi, which is very
convenient for transportation.
The Masteri Thảo Điền
The Masteri Thảo Điền
The Masteri Thảo Điền
The Masteri Thảo Điền
 The Masteri Thảo Điền

The selling price for that apartment is VND 3 billion

while you intend to purchase at maximum VND 2.5
billion. Your daughters love the apartment but also
worry about noise and dust because the apartment is
very near to the metro railway and the main boulevard.
In addition, the monthly management fee will be
VND20,000 per square meter, which is slightly higher
than other real estate projects in the same segment
(approximately VND15,000 per square meter)
 The Masteri Thảo Điền

If purchasing that apartment, you also have to prepare

another VND200 million for furniture and home
equipment. There are 2 options to buy it: pay all at one
time and get 3% discount on the price (VND3 billion) or
pay 30% at the first installment (deposit), 50% when
receiving the apartment and the last 20% when receiving
the ownership certificate (usually 12 months after the
purchase).
 The Masteri Thảo Điền

 Identify the buyer’s alternative sources

 Identify the seller’s alternative sources

The annual interest rate is currently 7% for most of banks in

Vietnam.