Accuracy motivation, 75–76
Akerloff, George, 86
Al-Assad, Bashar, 144–145
Alternatives
aspirations compared to, 22–23
establishing, 18–24
good-cop/bad-cop strategy, 20
power of, 19
quality of, 19
reservation price relating to, 18–21, 68
as safety net, 18
sunk-cost fallacy and, 20
value relating to, 19
Amazon, 144
Anchoring effect
first advocacy effect relating to, 193
of first offers, 104–105, 107–110
power relating to, 179–181
Art and Science of Negotiation, The (Raiffa), 155, 216
Art of Negotiating, The (Nierenberg), 155
Aspirations
alternatives compared to, 22–23
first offers relating to, 108
goals and, 22–24
in issue-value matrix, 62
performance relating to, 216
satisfaction relating to, 23–24
setting, 62
See also Goals
Assumptions, 119–120
Asymmetric information
actions reflecting, 88–89
Akerloff and, 86
congruent issues relating to, 91
encouraging reciprocal information sharing, 93–94, 121
integrative issues relating to, 91–93
packaging proposals relating to, 94–97
reservation price relating to, 89–90
strategic thinking with, 85–97
Attractiveness, 172
Auctions
advantages of, 201–202
with audience, 200
bidding behaviors, 198–201
buy-it-now options in, 198–199
in Chicago Cows example, 199
competition in, 197
competitive arousal in, 199–201
description of, 197–198
disadvantages of, 202–203
first offers in, 206–207
first-price sealed bid, 198
information in, 202–205
introduction to, 197–201, 244n1
metrics relating to, 202
multiple seller, 245n9
open ascending first-price, 198
open bid declining price, 198
of real estate, 207–208
reservation price in, 198–199, 201–202, 204–205
summary of, 208–209
time pressure in, 200
types of, 198
value in, 206
winner’s curse in, 203–208
Audience, 200
Avoiding negotiation, 5–7
Babcock, Linda, 8
Bargaining history, 129–130, 131
Bargaining zone
information sharing and, 32
reservation price and, 29, 31–34
with two distributive issues, 38–41
Behavior predictions, 83
Behavioral approach system (BAS), 168, 241n31
Behavioral inhibition system (BIS), 168
Bias, 81
for action, 181
fixed pie, 75
gender, 7–8
psychological, 35
unconscious, 64
Bidding behaviors, 198–201
Body language, 172–173
Business analysis, ix–xi
Buy-it-now (BIN) options, 198–199
Capital gains, 231n4
Chicago Cows, 199
Closure, 75
Coalitions
definition of, 191
enhancing effectiveness in, 193–194
formation of, 191–194
power in, 192–194
securing membership in, 194
Common-value items, 203–204
Communication
with physical stance, 172–173
team negotiations relating to, 188–189
Comparisons, 217–218
Competition
in auctions, 197
psychology on, 199–201
in team negotiations, 187–188
Competitive arousal, 199–201
Complementarity
mimicry compared to, 177–179
psychology of, 174–176
Concessions, 122–124
Confirmation bias, 7–8
Confirming evidence, 7–8
Conflict, 8
spirals, 154
Congruent issues, 24–25
asymmetric information relating to, 91
strategic thinking with, 91
Contingency contracting
criteria for, 55
description of, 53
enforcing, 55
transparency relating to, 55
value creation in, 52–55
Course credits, 3–4
Culture
extreme offers relating to, 109
negotiation relating to, 10–11, 109
social conventions, 169–170
Decision pattern, 150
Discipline, 20–21
Discontinuity effect, 187–188
summary of, 42
value creation with, two, 36–41
Dominance
behavior, 174
displays, 174–176
behavior, 74, 77, 174, 175, 176, 178
counterpart, 175
high power, 182
member, 175
response, 174
role, 175
solution, xix
subgroup, 191
Economic
aspect, 132
calculations, xi
cost, 143
differences, 123
effects, 206
efficiency, 226n1
environment, 53
foundation, 86
gain, 132
impact, 124
information, 86
insights, xii
integration of, and psychology, xix
justification, 124
paper, 86
perspective, xii, xv, xvii, 164, 199
principles, xii
and psychological aspects of a negotiation, 218
and psychological perspectives, xi, 126
theory, xv
uncertainty, 27
Economics
behavioral, xiii
integration of, and psychology, xv
and psychology, xi, xiii, xiv, 220
and psychology of the auction process, 208
psychology of organizations and, xii
Emotional contagion, 163–164
Emotions, 153–154
competitive arousal and, 199–201
conflict spirals, 154
experienced versus expressed, 160–163
functions of, 160–161
happiness, 23–24, 158–160, 163
heuristic thinking, 157–158
perception relating to, 156–157
performance relating to, 157, 212–213
power and, 179
reappraisal strategy and, 155
regulating, 155
strategic thinking relating to, 155
summary of, 164–166
thinking, in relation to feeling, 156–159
value claiming, value creation, and, 159–160, 162
value relating to, 154–155
Empathy, 134
Expectations
negotiation planning relating to, 73
performance relating to, 13
Pygmalion Effect and, 11
reputation relating to, 128–129
salary negotiation relating to, 12–13
stereotyped threat relating to, 11–12
Experienced emotions, 160–163
Expressed emotions, 160–163
Extreme offers, 108–109
Fairness, 84–85
False consensus effect, 66
Feeling, 156–159
First advocacy effect, 193
First offers
advantages, to making, 103
advantages, to receiving, 101–102, 112–113
anchor effect of, 104–105, 107–110
aspirations relating to, 108
in auctions, 206–207
designing, 108–110
influence of, 110
presentation of, 109
risk associated with, 102
satisfaction with, 111
summary of, 117
uncertainty relating to, 103, 114
what comes next?, 110–112
when to wait for, 112–114
who should make?, 101–108, 114–117, 116 (matrix)
First-price sealed bid auctions, 198
Freakonomics (Levitt and Dubner), xiii
Full-disclosure strategy, 48–49
Future
power of, 126–134
promises, threats, and, 146–148
relationships and, 129–134
reputation and, 126–129
Game theory, 80–82
Gender
confirmation bias and, 8
Getting to Yes (Fisher and Ury), xiv
“Gift of the Magi, The,” O. Henry effect, 132
Girard, Joe, 163–164
aspirations and, 22–24
Competitive Advertising game relating to, 58–59
counterpart’s, figuring out, 63–66
identifying, 17–18
issue importance, in relation to, 60–61, 64–65
performance relating to, 11
personal, figuring out, 58–62
Good-cop/bad-cop strategy, 20
Gorbachev, Mikhail, 121
Guinness Book of World Records, 163, 205
Happiness, 23–24, 158–160, 163
Henry, O., 132
Homo oeconomicus, xii
Homogeneity, 185–186
Information
asking and answering questions, 124–126
assessment of, 125–126
asymmetric, 85–97
in auctions, 202–205
gathering, about counterpart, 66
pattern of concessions, 122–124
in postsettlement settlement, 215
proprietary, 203
reservation price relating to, 204–205
strategic thinking relating to, 79–80, 82
in team negotiations, 188–189
value relating to, 79
Information sharing, 30
bargaining zone and, 32
full-disclosure strategy, 48–49
information exchange risks, 50–51, 213–214
information-gathering challenge, 48–49
value creation relating to, 48–49
asymmetric information relating to, 91–93
strategic thinking with, 91–93
Integrative potential
defining, 31
value and, 31
in value creation, 44–48
Issues
for counterpart, 63–64
differences in, 65
importance of, in relation to goals, 60–61, 64–65
settlement options for, 61–62, 66
value of, 45–47
Issue-value matrix, 46 (table), 62
aspirations in, 62
reservation price in, 62
Just-world belief, 143–144
Kellogg Graduate School of Management, ix, xi, xiii, xvii, 85, 147, 148
Laschever, Sara, 8
Leverage
of subjective value, 211–213
in team negotiations, 189–191
“Market for Lemons, The,” (Akerloff), 86
auctions relating to, 202
Mienzi, 133
Mimicry
complementarity compared to, 177–179
power from, 176–179
Ming, Yao, 205
Missing information, 67–68, 119
Mixed motives, 30–31
Multiparty negotiations. See Team negotiations
Multiple proposals, 96–97
Multiple seller auctions, 245n9
Negotiation, ix–xi
avoiding, 5–7
choosing to, 7–11
cost, of not negotiating, 9–10
culture relating to, 10–11, 109
with dry cleaner, xv–xvi
with friend, xvi–xvii
model development, xi–xiii
in mundane situations, 4–5
as problem-solving, 5
questions relating to, xx
reference points of, 39
standard approach to, xiii–xv
See also specific topics
Negotiation infrastructure
establishing parameters, 18–24, 62, 65–66
goal identification, 17–18
introduction to, 15–17
issue types and examples, 24–28, 68–71
summary of, 28
Negotiation management
asking and answering questions, 124–126
assumptions relating to, 119–120
pattern of concessions, 122–124
power of future and, 126–134
relationships and, 129–134
reputation relating to, 126–129
setting right tone, 120
summary of, 135
Negotiation planning, 6–7
counterpart’s goals and desires relating to, 63–66
expectations relating to, 73
finding gaps in plan, 71–72
issue types, determining, 68–71
missing information and, 67–68, 119
personal goals and desires relating to, 58–62
phases of, 57–58
planning considerations, 73–76
strategy development, 67–73
summary of, 76–78
tactics and strategies, determining, 72–73
in team negotiations, 185, 190–191
time spent on, 76
uncertainty relating to, 74–76
Nierenberg, Gerald, 155
Nudge (Thaler and Sunstein), xiii
Objectification, 170
Open ascending first-price auctions, 198
Open bid declining-price auctions, 198
Packaging proposals, 94–97
Parameters
establishing, for counterpart, 65–66
Pareto, Vilfredo, 226n1
Pareto efficient, 226n1
Pareto-optimal deal, 214, 246n7
Pattern of concessions, 122–124
Perception
emotions relating to, 156–157
world-view, power, and, 168–171
Performance
aspirations relating to, 216
assessing, 211, 212–213, 216–218
comparisons relating to, 217–218
emotions relating to, 157, 212–213
expectations relating to, 13
goals relating to, 11
publicity of, 216–217
reputation relating to, 127–128
satisfaction with, 23–24, 111, 216–218
Physical attractiveness, 172
Physical stance, 172–173
Picard, Captain Jean-Luc, 168–169
Planning. See Negotiation planning
Postmortem negotiation, 216–218
Postsettlement settlement (PSS), 213–216
Posture, 172–173
Power
of alternatives, 19
anger relating to, 179–181
within a coalition, 192–194
from complementarity, 174–176, 177–179
defining, 167
dominance displays, 174–176
effects of, 168
emotions and, 179
of future, 126–134
of laugh tracks, 157
from mimicry, 176–179
objectification and, 170
of precommitments, 148–149
of promises and threats, 140–143
social conventions relating to, 169–170
sources of, 167–168
strategic thinking relating to, 171
of suggestion, 155
summary of, 181–182
thinking about, 172
of threats, 144
value creation, value claiming, and, 170–171
world-view relating to, 168–171
Powerful
individual, 168–169
mind-set, 171–174
negotiator, 169
Precommitments, 148–149
Predictably Irrational (Ariely), xiii
Price, 10
See also Reservation price
Private-value items, 204–205
Problem-solving, 5
Promises, 137–138
analyzing, 141
cost/benefit analysis of, 145–146, 151 (table)
decision pattern regarding, 150
future relating to, 146–148
power of, 140–143
precommitments and, 148–149
psychology and, 139–140, 143–148
summary of, 149–151
threats compared to, 138–140
Proposals
multiple, 96–97
packaging, 94–97
Proprietary information, 203
Psychological bias, 35
Psychology
behavioral approach system, 168, 241n31
behavioral inhibition system, 168
of bidding behaviors, 198–201
closure and, 75
on competition, 199–201
of complementarity, 174–176
confirmation bias and, 7–8
economics and, xii–xiii, xv, 220
of just-world belief, 143–144
predicting behavior, 83
promises, threats, and, 139–140, 143–148
Schadenfreude concept, 143
value creation and, 43
Publicity
of performance, 216–217
as threats, 144–145
Pygmalion Effect, 11
Quality
of alternatives, 19
price and, 10
Questions
asking and answering, 124–126
negotiation, xx
Rational perspectives, 80–83
Rationality, 84–85
Reactive devaluation, 120–121, 122
Reagan, Ronald, 121
auctions of, 207–208
capital gains on, 231n4
Reappraisal strategy, 155
Reference points, 39
Relationships, 129–134
friends, xvi–xvii
nephew, xvi
Reputation
expectations relating to, 128–129
future and, 126–129
performance relating to, 127–128
Reservation price
alternatives relating to, 18–21, 68
asking about, 125
assessment of, 32–33
asymmetric information relating to, 89–90
in auctions, 198–199, 201–202, 204–205
bargaining zone and, 29, 31–34
changing or violating, 20–21, 34–36
defining, 18
discipline and, 20–21
information relating to, 204–205
in issue-value matrix, 62
middle point between, 229n7
strategic thinking with, 89–90
uncertainty about, 225n5
value relating to, 34–36
Rolling Stone magazine, 169
Royalties, ix
Safety net, 18
Salary negotiation
expectations relating to, 12–13
previous pay relating to, 10
Satisfaction
aspirations relating to, 23–24
with first offers, 111
with performance, 23–24, 111, 216–218
Schadenfreude, 143
Settlement
leveraging subjective value, 211–213
postmortem negotiation, 216–218
postsettlement, 213–216
summary of, 218–219
value of, 61–62
Sleuthing, 66
Social conventions, 169–170
Spence, Michael, 86
Standard approach, xiii–xv
Stanford Graduate School of Business, xiii, 4, 19, 76
State of Denial (Woodward), 169
Stereotyped threat, 11–12
Stiglitz, Joseph E., 86
Strategic thinking
with asymmetric information, 85–97
with congruent issues, 91
emotions relating to, 155
encourage reciprocal information sharing, 93–94, 121
fairness versus rationality, 84–85
focus and, 219
game theory on, 80–82
information relating to, 79–80, 82
with integrative issues, 91–93
knowledge relating to, 84–85
multiple proposals as, 96–97
packaging proposals as, 94–97
power relating to, 171
rational perspectives, 80–83
with reservation price, 89–90
summary of, 97–98
Strongly Pareto efficient, 226n1
Subjective value, 211–213
emotion, 156
Suppressing, 156
Suppression, 165
efforts, 156
Suppressed, 158
Success
defining, 17–18
Sunk-cost fallacy, 20
Team negotiations, 183–184
advantages of, 188–189
communication relating to, 188–189
competition in, 187–188
discontinuity effect in, 187–188
first advocacy effect in, 193
homogeneity in, 185–186
information in, 188–189
internal disagreements in, 184–185, 187
leverage in, 189–191
negotiation planning in, 185, 190–191
summary of, 194–196
surface-level similarities and differences in, 186
three-step preparation process by, 190–191
value claiming in, 190
value creation in, 189–190
Thinking
feeling, in relation to, 156–159
heuristic, 157–158
about power, 172
See also Strategic thinking
Thinking Fast and Slow (Kahneman), xiii
Threats, 137–138
analyzing, 141
cost/benefit analysis of, 145–146, 151 (table)
decision pattern regarding, 150
future relating to, 146–148
power of, 140–143
precommitments and, 148–149
promises compared to, 138–140
psychology and, 139–140, 143–148
publicity as, 144–145
stereotyped, 11–12
summary of, 149–151
timing and effectiveness of, 146
Time pressure, 200
Tone, setting, 120
Trade secrets, 203
Transient, 128
counterpart, 128
Transparency, 55
Treatment, 133
Uncertainty, 65
accuracy motivation relating to, 75–76
first offers relating to, 103, 114
managing, 74–75
need for closure relating to, 75
negotiation planning relating to, 74–76
about reservation price, 225n5
about value, 114
value creation relating to, 74
Unconscious bias, 64
United Nations, 104
Value, xiv
alternatives relating to, 19
in auctions, 206
emotions relating to, 154–155
in exchanges, 15–16, 29–30, 31–42
information relating to, 79
integrative potential and, 31
of issues, 45–47
in issue-value matrix, 46 (table), 62
leveraging, 211–213
mixed motives and, 30–31
reservation price relating to, 34–36
of settlement options, 61–62
subjective, 211–213
uncertainty about, 114
winner’s curse relating to, 206
Value claiming
emotions relating to, 159–160, 162
power relating to, 170–171
in team negotiations, 190
value creation compared to, 31, 79–80
Value creation, 15–17
benefits of, 43
in contingency contracting, 52–55
emotions relating to, 159–160, 162
increasing value, 51–52
information exchange risks and, 50–51
information sharing relating to, 48–49
integrative potential in, 44–48
power relating to, 170–171
psychology and, 43
summary of, 55–56
in team negotiations, 189–190
with two distributive issues, 36–41
uncertainty relating to, 74
value claiming compared to, 31, 79–80
See also Salary negotiation
Weakly Pareto efficient, 226n1
Wenner, Jann, 169
Winner’s curse
in auctions, 203–208
description of, 203–204
example of, 204–206
value relating to, 206
Women Don’t Ask (Babcock and Laschever), 8
World War II, 148–149