Volume 12 r Number 8 | August 2009
Program on Negotiation
Negotiation
Helping you build successful agreements and partnerships
Master the art and science of haggling
In our current marketplace, opportunities to negotiate are cropping up in new places.
I magine you’re celebrating a special
occasion with friends at an upscale
restaurant. Soon after you take your seats,
the wine director introduces himself and
hands you a list of high-end bottles of wine.
You notice that the prices—all in the $200 to
$600 range—have been slashed through with
a red pen.
“The prices on our reserve list are nego-
tiable tonight,” the wine director says. “Would
you care to make an offer on a bottle?”
This sales ploy might sound like the
daydream of an oenophile. But believe it or
not, a fine-dining restaurant in New York
City, David Burke Townhouse, was practicing
the strategy in May. Chef and restaurateur
David Burke has taken unusual steps to
navigate the economic downturn, including
printing the word sale on menus and holding
this “wine auction” promotion, writes Katy
McLaughlin in the New York Times.
Did the gimmick work? The restaurant’s
wine director reported negotiating the
sale of about five bottles of wine per night
at prices that met or improved on his
reservation price—the minimum he would
accept to reach a deal. While most upscale
Manhattan restaurants were experiencing
sales declines of about 15% in 2009 as
compared with 2008, Burke told the Times
that Townhouse was down only about 8%
during the recession, perhaps due in part to
his flexible pricing strategies.
The story illustrates a larger trend:
businesses that never would have con-
sidered negotiating with customers last
year are now willing, even eager, to make
a deal. Just like the prices of houses, cars,
“How should I negotiate with our
and other big-ticket items, the prices of
furniture, electronics, wine, jewelry, and
other “medium-ticket” goods are now
frequently up for discussion. The ancient
art of haggling—the back-and-forth dance
of offers and concessions between buyer
and seller—is making a comeback, and you
would do well to brush up on your skills.
Do I have to haggle?
In some cultures, a long tradition of
haggling in markets and bazaars flows
naturally into brick-and-mortar stores. By
contrast, in the United States and many
other countries, haggling between buyers
and sellers is an under-practiced art,
typically employed only in negotiations
for cars and real estate. As a consequence,
many Westerners have an aversion to
haggling, especially in contexts where
negotiation is not the norm. You might
routinely pass up opportunities to haggle
because you’re afraid of offending the
seller or because you feel inexperienced or
uncomfortable.
But you’re probably passing up chances
to save money. A May 2009 Consumer
Reports poll found that 66% of Americans
had tried to negotiate discounts in the
previous six months. Of these hagglers, 83%
succeeded in getting lower hotel rates, 81%
got better deals on clothing and cell phone
service, 71% negotiated cheaper electronics
at Harvard Law School
In this issue
Trying to resolve a dispute?
Choose the right process . . . . . .5
Threatened with extinction
A negotiation saga at the
Boston Globe . . . . . . . . . . . . . . .7
Dear Negotiation Coach
younger employees?”. . . . . . . . 8
What’s new
The Program on Negotiation
at Harvard Law School has
launched a new Web site!
Take some time to explore
www.pon.harvard.edu,
your one-stop resource for
negotiation strategies, seminars,
publications, special events,
and more.
Sharpen your negotiation
skills in one of the Program
on Negotiation’s Executive
Education Seminars in
Cambridge, Mass., this fall.
Coming up: our “Program
on Negotiation for Senior
Executives,” September
23–24; “Dealing with
Difficult People and Difficult
Situations,” September
24–25; or a combination of
these two programs. For
more information, visit www.
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Negotiation
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and furniture, and 62% lowered
their credit-card fees.
If the potential financial
benefits aren’t enticing enough,
look at haggling as a chance to
improve your negotiation skills in
a relatively low-risk context. The
price cut you negotiate at a chain
store for a washing machine could
make you feel more confident in
your next heavy-hitting workplace
negotiation. (And you can haggle
on your company’s behalf, of
course, whether for lower rent,
travel expenses, or office supplies.)
In addition, many sellers are
hurting these days. When faced
with a choice between haggling
with you or losing you as a
customer, many will gladly accept
the challenge. Similarly, lenders
and landlords may be willing to
renegotiate existing contracts to
keep good customers or tenants
who are struggling financially due
to layoffs and pay cuts.
In today’s market, consumers
are often the more powerful
parties in negotiations with sellers.
To claim the most value in your
next haggling experience, use the
following six strategies.
1. Explore your alternatives.
Sometimes negotiation
opportunities pop up on the
fly, such as David Burke’s “wine
auction” or a one-of-a-kind piece
of jewelry you stumble across while
traveling. You can be forgiven for
plunging into such negotiations
without doing much, if any,
research. But in most haggling
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2 Negotiation | www.pon.harvard.edu
situations, thorough preparation is
advisable.
Suppose your television breaks
and you’d like to get a replacement
quickly, but you don’t want to pay
full price. Before you march into
the nearest electronics superstore,
take time to conduct the same type
of research you would if you were
in the market for a house or a car.
Otherwise, you could sacrifice more
value than necessary or pass up a
good deal.
Begin with a thorough consider-
ation of your BATNA, or best alterna-
tive to a negotiated agreement—the
action you’ll take if a particular
negotiation ends in impasse. In the
case of a television, your BATNA
might be a low, no-haggle price from
an online retailer or it might be to
repair your current TV.
Even when a negotiation is
impromptu, as in the case of a
bargaining wine director, you can
still ask for time to think through
your BATNA. If your negotiation
fails, will your group buy a cheaper
bottle of wine off the regular wine
list or order wine by the glass?
Knowing what you will do if
you can’t get a good deal will give
you bargaining power during the
negotiation that follows. Your
BATNA also helps you calculate
your reservation price—the highest
price you’d be willing to pay for that
bottle of wine, television, or washing
machine in the current negotiation.
Suppose your neighborhood
electronics store is selling the TV
you want for about $1,100 and
Amazon.com is selling the same TV
August 2009
for $900 as part of an electronics
sale that will end the next day. (For Sellers: Negotiate more, worry less
simplicity’s sake, assume taxes
and shipping are included in these
prices.) Buying from Amazon.com
S ellers sometimes resist haggling over commodities that,
in a stronger economy, aren’t typically open to negotiation.

becomes your BATNA in your
negotiation at the electronics store.
As for your reservation price, you
might decide that it’s $975, or $75
above Amazon.com’s price, for the
added benefit of taking the TV
home that day and not having to
worry about shipping it back if you
don’t like it.
It’s true you don’t want to waste time haggling over inexpensive
items or negotiating with buyers who make unreasonable demands.
Still, if you’re facing money woes, consider being flexible in your
pricing of slow-to-move stock. That’s what chef David Burke did
when he opened up his reserve wine list to negotiation. “It’s worth a
shot,” he told the New York Times. “I’m sitting on $200,000 worth of
wine anyway, already paid for.”
Not only can haggling move unwanted merchandise, but
promotions that mention negotiable pricing might draw in
new customers who want to try their hand at making a deal.

2. Assess their alternatives.

Now it’s time to assess the best deal
you might get. Figuring out the
other party’s reservation price is the
key to knowing how far you will
be able to push him, write Deepak
Malhotra and Max H. Bazerman in
their book Negotiation Genius: How
to Overcome Obstacles and Achieve
Brilliant Results at the Bargaining
Table and Beyond (Bantam, 2007).
Start by considering the other
party’s BATNA: What will he do
if he can’t close the sale with you?
Like most retailers, he’ll simply have
to wait for someone else to walk
through the door. You may be able
to judge how desperate a business
is to make a deal by the amount
of foot traffic in the store or by
researching its financial standing.
Generally, the worse business is, the
more willing an organization will be
to haggle with you—and to give you
a very good price.
To estimate just how low a
salesperson will go, you can do
online research on the product,
just as you would when buying a
car. Study store policies concerning
discounting, returns, and
warranties. You can even do your
research in the store; Consumer
Reports notes that inventory tags
often indicate how long an item has
been on the shelves. Salespeople
may be more willing to haggle over
merchandise that has been sitting
on the floor a long time.
3. Set the stage for success.
Suppose your research reveals
that the TV you want is fairly new
on the market. Further research
about your local store leads you
to believe it may be willing to go
as low as Amazon.com’s price of
$900. Now you have a general sense
of the ZOPA, or zone of possible
agreement: between $900 (your
estimate of the store’s reservation
price) and $975 (your reservation
price). Thus, your goal in the
upcoming negotiation is to get
a deal that’s as close to $900 as
possible.
Once you’ve done your
homework, it’s time to set the
stage for success. Consumer
Reports advises you to negotiate
early or late in the day, when
stores are often quiet, and late
in the month, when salespeople
may be especially eager to meet
quotas. At chain stores, where
regular sales staff may not have
the power to haggle, you might
need to approach a manager. Open
negotiations out of earshot of other
customers, recommends Consumer
Reports, as sales staff may not
want others to get wind of your
haggling. Bring along up-to-date
information about competitors’
prices (your BATNA) and expect
the other side to verify it.
Be polite and cordial throughout
the negotiation process, and also be
willing to accept no for an answer.
Finally, because stores typically pay
fees on credit-card purchases, keep
in mind that salespeople may be
more willing to bargain if you offer
to pay in cash.
4. Make the first offer.
After you discuss the pros and
cons of your desired item, the
salesperson might offer to give you
a discount without any prompting.
If not, open the negotiation
yourself: “I can buy this TV online
this weekend at a much lower price.
Can we work together toward a
more competitive deal?”
If the salesperson is willing
to negotiate, and if you have a
strong sense of the ZOPA, you are
positioned to make an offer: “Can
you beat Amazon.com’s price? It’s
$900. I can pay in cash, by the way.”
Imagine that the salesperson
tells you his store has a new policy

August 2009 www.pon.harvard.edu | Program on Negotiation 3

 Is everything
negotiable?
In his book You Can Negotiate Any-
thing (Bantam, 1982), Herb Cohen
offers advice on turning just about
any interpersonal encounter into an
opportunity for haggling.
When you seize on every small-
stakes negotiating opportunity that
comes along, you risk wasting valu-
able time and annoying those around
you. But as the May 2009 Consumer
Reports poll suggests, you could
save considerable cash by negotiat-
ing in the following realms:
O Hotel rates and airfare
O Phone, Internet, and cable-TV
service
O Credit-card interest rates and fees
O Clothing and jewelry
O Furniture, electronics, and
appliances
O Medical and dental bills
O Lease renewals
O College tuition
O Existing mortgages and other loans
against matching, let alone beating,
Internet deals. Furthermore, he
reminds you that your great online
deal is about to expire. Even so, by
dropping this “anchor,” you have
likely swayed him away from the
previous anchor—the TV’s $1,100
list price—and toward your end of
the ZOPA. What’s more, because
you proved you’ve done your
homework, he is likely to view your
offer as credible, if not entirely
reasonable.
5. Insist on reciprocation.
At this point, you have entered the
realm of haggling: the dance of
concessions that follows each party’s
first offer. (In our TV negotiation,
the $1,100 list price was the store’s
first offer.) For some, this is where
the real fun begins; for others, it’s
4 Negotiation | www.pon.harvard.edu
a time of great anxiety. To manage on a single issue: price. Although
your stress, keep your BATNA at the price might be the most important
forefront of your mind. Knowing issue at stake, you could sweeten
that you have a good alternative if the deal for both sides by discussing
the negotiation fails will help you other issues, such as delivery,
stay calm and rational. financing, and the possibility of
Suppose the salesperson tells you repeat business. You can open
there’s no way he can go as low as up such opportunities through
$900. “I could come down $75 to direct questioning or by making
$1,025, though.” Note that this offer what Malhotra and Bazerman call
is $50 above your $975 reservation contingent concessions—concessions
price—the maximum you’re willing that you link to specific actions by
to pay to get a deal. the other party.
“I’d like to take the TV home In the TV negotiation, the
today,” you might say, “so I’m salesperson might reciprocate your
willing to go up to $925.” last offer by grudgingly agreeing to
Rather than responding to your come down to $950, a price within
offer, the salesperson starts going the bargaining zone. Or you might
over the features of the TV with agree to pay $975 in exchange for
you one more time. having the store dispose of your old
Experienced negotiators TV. But if the salesperson (or his
sometimes take their time manager) is still unwilling to make
responding to an offer, aware that a deal that you prefer to your online
the other side could grow nervous option, you should feel comfortable
and make a better offer, according walking away with the knowledge
to authors Malhotra and Bazerman. that you did your best.
But it would be a serious mistake Sometimes in a negotiation,
for you to make an unreciprocated you can get a better all-around
concession. Savvy hagglers wait out deal by changing the item under
their counterpart’s stalling tactics discussion. Returning to the wine
and insist on receiving a concession negotiation at a restaurant, suppose
in return. If none is forthcoming, your group has little interest in
thank the salesperson for his time. fine wines, but several of you are
The mere suggestion that you are tempted by a pricey entrée. “We’ll
about to walk away could inspire pass on the reserve list,” you might
him to come up with a counteroffer. say, “but if three of us order the
truffles, can you give us a group
6. Explore interests further. discount?” It’s a negotiating gambit
One common misconception of that chef Burke would almost
haggling is that it must focus only certainly admire.
6 tips for novice hagglers
1 Thoroughly research what you want and where you can get it.
2 Consider what the other side will do if you walk away from a deal.
3 Set a stage for the negotiation that’s comfortable for both sides.
4 Anchor talks in your direction by making the first offer.
5 Insist that the other side reciprocate each concession you make.
6 Expand the pie by discussing issues other than price.
August 2009
Trying to resolve a dispute? Choose the right process
When you’re stuck in a conflict, three basic questions can clarify which path to follow.
Consider the following disputes:
A divorcing couple disagrees on the
best custody arrangement for their
three young children.
A manager accuses his former
employer of firing him due to age
discrimination.
An electronics company accuses
another company of patent
infringement.
S uppose that in each case,
the parties and their lawyers
have exhausted their attempts to
negotiate a resolution on their own.
They’re ready for outside help in
ending their dispute, yet they don’t
know where to turn.
When it comes to dispute
resolution, we now have many
choices. Understandably, disputants
are often confused about which
process to use. This article offers
some guidance, adapted from
Frank E. A. Sander and Lukasz
Rozdeiczer’s chapter on the topic in
The Handbook of Dispute Resolution
(Jossey-Bass, 2005).
Types of dispute resolution
Here’s a review of the three basic
types of dispute resolution:
Mediation. The goal of mediation
is for a neutral third party to help
disputants come to consensus on
their own. Rather than imposing a
solution, a professional mediator
works with the conflicting sides to
explore the interests underlying
their positions. Mediation can be
effective at allowing parties to vent
their feelings and fully explore their
grievances. Working with parties
together and sometimes separately,
mediators try to help them hammer
August 2009
out a resolution that is sustainable,
voluntary, and nonbinding.
Arbitration. In arbitration, a
neutral third party serves as a judge
who is responsible for resolving the
dispute. The arbitrator listens as
each side argues its case and pres-
ents relevant evidence, then renders
a binding decision. The disputants
can negotiate virtually any aspect
of the arbitration process, including
whether lawyers will be present and
which standards of evidence will be
used. Arbitrators hand down deci-
sions that are usually confidential
and that cannot be appealed. Like
mediation, arbitration tends to be
much less expensive than litigation.
Litigation. The most familiar type
of dispute resolution, civil litigation
typically involves a defendant facing
off against a plaintiff before either
a judge or a judge and jury. The
judge or the jury is responsible for
weighing the evidence and making
a ruling. Information conveyed in
hearings and trials usually enters
the public record. Lawyers typically
dominate litigation, which often
ends in a settlement agreement dur-
ing the pretrial period of discovery
and preparation.
Three questions to ask
Dispute resolution is often a
multistep process that can start with
negotiation, move on to mediation,
and, if necessary, end in arbitration
or litigation. This progression allows
parties to start off, quite naturally,
with less-expensive, less-formal
procedures before making bigger
commitments of money and time.
Still, there may be situations in
which you wonder if it would be
better to sue first and then aim for
www.pon.harvard.edu | Program on Negotiation
a settlement, rather than starting
with a more collegial process.
Sander and Rozdeiczer advise
you to choose the right dispute-
resolution method by answering
the following three questions about
the case you’re facing.
QUESTION 1: “What are my goals?”
Simply knowing what you want to
get out of the process can help you
decide where to start. Begin by pri-
oritizing your goals. For example,
Carla wants to hash out a custody
agreement with her husband as
quickly and inexpensively as pos-
sible. Because she wants to make
sure they both abide by the agree-
ment, she wants them to decide the
final outcome together.
It seems clear that, given
Carla’s goals, mediation is the best
choice for her dispute. Mediation
is typically faster and cheaper
than arbitration or litigation, and
mediation also gives parties the
greatest degree of control over the
final outcome.
By contrast, Jack, who feels he is
the victim of age discrimination by
his former employer, has the primary
goal of winning a large financial
settlement. Thus, for him it may be
wise to start with arbitration. If he
also wants to set a legal precedent that
could benefit others in his situation,
he might turn to litigation instead.
In both instances, he would do well
to listen closely to his attorney’s
assessment of his odds of winning the
case and a large settlement.
What if you and the other party
can’t agree on your goals? Sander
and Rozdeiczer advise you to start
off with mediation, as it is a safe,
nonbinding procedure for both sides.
5
 QUESTION 2: “Which process will
capitalize on the best features of the
dispute?” Every dispute has features
that can help you reach a ben-
eficial outcome, write Sander and
Rozdeiczer. Which process will best
trigger the strengths of the case?
The authors have identified a
number of dispute features that
lend themselves well to mediation:
a good relationship between parties
and their attorneys, opportunities
for creative problem solving, the
willingness of one or both sides
to apologize for any mistakes or
wrongdoing, eagerness to settle
quickly, and the presence of multiple
issues that might lead to tradeoffs.
If your dispute has one or more of
these characteristics, mediation may
be the best choice for you.
By contrast, if you would benefit
from formal protections, such as
enforcement of key decisions, then
arbitration or litigation might be a
more fitting option. Suppose that
Company A believes Company B
is guilty of infringing on one of its
patents. Even if mediation resulted
in Company B’s agreeing to stop
manufacturing the product in
question, Company A might not
have confidence that Company
B would abide by the decision.
Because it believes it has a strong
case, Company A decides to bypass
mediation and go straight to
arbitration.
QUESTION 3: “Which process will
best overcome barriers to resolution?”
As you try to answer this final
question, Sander and Rozdeiczer
advise you to keep in mind that
both sides to a dispute often prefer
a settlement to an arbitrator, judge,
or jury’s binding win-lose decision.
Thus, it helps to focus on the ability
of the three different dispute-
resolution methods to help you
overcome barriers to settlement.
In particular, when parties are
having trouble communicating
and have a strong desire to air their
feelings, mediation is often the
best choice. When more than two
parties are involved in a dispute,
such as grandparents or other
relatives in the case of a custody
dispute, mediation might also be
optimal, as it allows multiple parties
to become involved. However,
when parties have different
opinions regarding the law affecting
their case, a judge or arbitrator’s
expertise ultimately may be needed.
When in doubt, mediate
In sum, the low-risk, relatively low-
cost nature of mediation makes it the
“go-to” dispute-resolution process.
Mediation allows negotiators to work
together toward maximizing their
outcomes under the guidance of an
expert, rather than handing over
their dilemma for someone else to
resolve on their behalf. Mediation
can also be a beneficial choice when
negotiators need to work with each
other in the future.
If a mediator is unable to help you
and the other side reach agreement,
you may still need to turn to
litigation or arbitration, but you will
do so with a better understanding
of your case and the issues at stake.
In future articles, we will tell you
more about how different alternative
dispute-resolution processes,
including mediation and arbitration,
typically unfold.
Resource:
“Selecting an Appropriate Dispute
Resolution Procedure,” by Frank
E. A. Sander and Lukasz Rozdeiczer.
The Handbook of Dispute Resolution,
ed. Michael L. Moffitt and Robert C.
Bordone. Jossey-Bass, 2005 (a publica-
tion of the Program on Negotiation at
Harvard Law School).

Executives: Maximize Your Negotiation Outcomes

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What are the secrets to negotiating impressive deals, We also offer an extended three-day program that combines
navigating disputes, and defusing crises? Here are three: our advice for senior executives with strategies for managing
1. Separate the people from the problem hard bargainers and tough situations. Dealing with Difficult
2. Turn differences into opportunities for mutual gain People and Difficult Situations will help you:
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6 Negotiation | www.pon.harvard.edu August 2009


Threatened with extinction:
A negotiation saga unfolds at the Boston Globe
W
hen a powerful party
threatens to destroy you if
you don’t meet its de-
mands, how seriously should you
take the threat? That’s the question
the Boston Globe faced this April
when its owner, The New York Times
Company, threatened to shut down
the paper unless its unions agreed to
$20 million in concessions.
The papers make headlines
Back in 1993, the Times Co. bought
the Globe for a staggering $1.1 bil-
lion, the highest price ever paid for
an American newspaper. The invest-
ment paid off through the 1990s,
but as the century turned, many
of the Globe’s advertisers moved
online. As at most other daily U.S.
newspapers, ad revenue and print
circulation declined.
In April, the Times Co. told union
leaders that the Globe had lost $50
million in 2008 and was on track to
lose $85 million in 2009. Manage-
ment said it would shutter the Globe
unless the unions agreed to pay
cuts, reduced benefits, lower sever-
ance pay, and an end to the lifetime
job guarantees held by certain
workers.
Globe employees and many Boston-
area residents were outraged at the
idea of losing their daily newspaper
of record. Some accused the
Times Co. of making empty threats.
Others felt the company had
neglected the Globe in favor of its
flagship New York Times. Specula-
tion mounted that the company was
preparing to sell the Globe.
Newspaper wars
The Times Co. wanted half of its de-
manded $20 million in concessions
to come from the Globe’s largest
union, the Boston Newspaper Guild,
which represents editorial, advertis-
ing, and office workers. But in the
August 2009
Successes
Messes
month that followed, Times Co.
management and the guild failed to
reach agreement.
The night of May 3, the Times Co.
said it would file a notice the next
morning stating its intention to shut-
ter the Globe within 60 days. The
guild, for its part, insisted it had
issued a proposal that exceeded Copies of the Globe pile up.
management’s demands and
an end to lifetime job guarantees.
criticized the Times Co. for using
They also learned of a new threat
“bullying” tactics, according to the
from the Times Co. if they voted
Washington Post.
down the deal: a pay cut of 23%
rather than 8.4%.
Turning a page
By the morning of May 4, the Times On June 8, guild members narrowly
Co. had secured tentative agree- rejected the proposed $10 million in
ments on its desired concessions concessions. Some members held
from several other Globe unions. An out hope that negotiations would
all-night bargaining session with the resume, but the Times Co. likely
Boston Newspaper Guild followed, expected that the other unions,
and management put its closure- which had accepted the conces-
notice filing on hold. sions asked of them, would revolt if
that happened.
The two sides failed to reach a deal,
but the guild agreed to present the Within an hour, the Times Co. de-
Times Co.’s plan to its membership clared an impasse and said it would
without a recommendation for or impose an immediate 23% pay cut
against it. At a packed meeting on on guild members. The guild made
May 8, guild members heard the plans to file unfair labor-practice
details of the proposal they would charges with the National Labor
vote on in a month’s time: $10 mil- Relations Board and to seek a court
lion in cost concessions, including order blocking the pay cut—battles
an 8.4% pay cut for most members; that could drag on for months,
unpaid furloughs; benefit cuts; and even years.
3 factors that matter in threat response:
1. Public versus private. By issuing two consecutive threats publicly, the
Times Co. signaled it meant business. Privately issued threats can be
easier to ignore and defuse.
2. Powerful versus weak. As the owner of the Globe, the Times Co. had
the power to follow through on its threats. Yet it also risked tarnishing its
reputation with behavior some perceived as bullying.
3. Hostile versus cooperative. The Times Co. lost points in Boston by
refusing to open its books or publicly explain the rationale behind its
extreme threats. Hostile threats get attention, but they also can inspire
a backlash.
www.pon.harvard.edu | Program on Negotiation 7
Dear Negotiation Coach MANAGING THE MILLENNIAL GENERATION

Q
likely to value autonomy and flexibility in
Over the past few years, employees who have joined
the workplace than their predecessors. While
my firm directly from undergraduate and graduate
inwardly respectful of experience, Millennials
programs have seemed to me like creatures from a dif-
may not defer immediately to authority and
ferent world. In particular, they don’t expect to have to
may respond more favorably to a less-formal
struggle to get ahead, and they don’t take criticism well.
workplace. Before making assumptions about
How can I negotiate with them in a way that will be ef-
their interests, take time to inquire about what
fective, while keeping them happy and me sane?
matters most to your younger staffers.
2. Increase transparency. Consistent with
As compared with the baby boomers or research extolling the value of individual

A the Generation Xers who followed, many

Send a question to
our Negotiation Coach
By e-mail
negotiation@law.harvard.edu
(Please write “Q and A”
in the subject line.)
By mail
Negotiation, Program on Negotiation
Harvard Law School
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513 Pound Hall
Cambridge, MA 02138-2903
members of the Millennial Generation—
adults born after 1981 who have been entering
the workforce since 2000—seem to approach
work life with a sense of entitlement, a craving
for praise, and an expectation that they will
ascend the organizational ladder quickly.
More-seasoned supervisors are sometimes
taken off-guard by these young upstarts.
For example, efforts by law firms to slow
the attrition rates of young associates by
raising base pay and increasing bonuses
have had little impact, Alex Williams of the
New York Times reports. In response, some
firms have unveiled new approaches to
keeping Millennials satisfied. These range
from “happiness committees” that offer candy
apples and milkshakes to concerted efforts by
partners to thank and commend associates for
their hard work.
Negotiating with Millennials can be
challenging, but keep in mind that this
generation of workers is a highly motivated,
creative, and fast-thinking group. The key
to dealing with them is to understand that
they’ve been raised to expect a workplace
that is worker-focused, transparent, and
collaborative. In particular, aim to do the
following three things when negotiating with
Millennials in your organization:
1. Educate yourself about generational dif-
ferences and trends. Though it’s safe to as-
sume that most employees would prefer
more money and benefits rather than less,
many Millennials prioritize their interests
differently. For example, they may be more
participation in decision-making processes,
Millennials will be more inclined to respond
cooperatively to decisions, even unfavorable
ones, if they’ve been consulted as part of a
transparent process. Raised to believe that
their views matter, they respond negatively to
decisions made without broad consultation.
Thus, when negotiating with them, focus on
being open and clear in your communications.
To bolster the legitimacy of your decisions and
convey the respect that Millennials require,
take time to describe the reasoning behind
your thinking.
3. Address problems jointly. When nego-
tiating with Millennials, stress the value of
working together to find solutions to tough
problems. In addition to appealing to Millen-
nials’ desire for inclusion and autonomy, this
approach may generate options you wouldn’t
have come up with on your own.
By taking the time to learn Millennials’
interests, increase transparency, and include
them in the problem-solving process, you will
increase productivity, prolong job satisfaction,
and create better intergenerational business
relationships.
Robert C. Bordone
Thaddeus R. Beal Clinical Professor of Law,
Harvard Law School
Director, Harvard Negotiation &
Mediation Clinical Program
Matthew J. Smith, lecturer on law at Harvard Law School
and Harvard Negotiation & Mediation Clinical Program
fellow, also contributed to this article.

8 Negotiation | www.pon.harvard.edu August 2009