Professional Documents
Culture Documents
VS Integrative Negotiation
Zero-sum
Simply dividing
the pie
Competitive
Claiming value
Distributive Negotiation
Win-win
Interest based
Cooperative
Creating value
Integrative Negotiation
BATNA: Your Source of Power
Best Alternative To a Negotiated Agreement
Your greatest source of power
Do everything you can to improve BATNA before you negotiate
Do not fall in love with one alternative
Counterparts perceptions of your BATNA are also very
important
Reservation Price
Your bottom line, the point at which you are indifferent to
whether you achieve a negotiated agreement or walk away
Reservation price = BATNA +/- transaction costs to enact
BATNA
The Impact of Anchors
People make estimates by starting from an initial anchor value and
adjusting from there to yield a final answer
In negotiations, final agreements are more strongly influenced by initial
offers than by subsequent concessionary behavior
BUT If you make the first offer, you run the risk of undercutting the
bargaining zone, potentially leaving yourself with little room to make
concessions
To Make the First Offer or Not?
Information about Other's RP/BATNA
Yes No
Make aggressive
Maybe
Care about Yes first offer
relationship Make aggressive Consider very
No first offer aggressive offer
$90,000
$85,000
$82,700
$80,000
$75,000
$70,000
$65,000
$60,000 $61,600
$55,000
$50,000 $50,000
$45,000
$40,000 $40,000
$35,000
1985 1989
What to do when employer/recruiter
What to do if they ask for your previous salary?
If an extremely high anchor okay to reveal
If below your target price politely explain that your old salary is
irrelevant because you have a new skill set and better credentials
Ask the employer or recruiter to make you their offer
Be prepared to tell the employer what salary you are looking for to change
jobs (Set the anchor with your target priceaggressive but realistic). Dont
give ranges and dont signal willingness to concede
You can avoid letting their offer anchor the negotiation through
preparationfocus on your target price!
Remember that you should avoid giving this information to a prospective employer.
They may ask what salary range you are expecting. Most people ask for too little. Its
better to avoid answering the question.