1. The record for most ancient arbitration is held by the deal reached by King Mesilim, which was designed to end the conflict between the city-states of Lagash and Umma, in the Sumer region of Mesopotamia (now Iraq), an agreement that dates back over four thousand years, to 2500 BCE.
2. See Christine Bell, On the Law of Peace: Peace Agreements and the Lex Pacificatoria (Oxford: Oxford University Press, 2008), 81.
3. Inevitably, some of the stories involve situations that were even more complex than the versions recounted here: more parties, more forces at play, and more issues at stake. The attempt has been to shine a brighter light on the events and actions that illustrate important and broadly applicable negotiation principles and strategies. Nonetheless, every effort has been made not to over- or underemphasize the role that any one factor played in the ultimate outcomes.
4. Reality is rarely acquiescent to simple classification systems; great stories yield multiple lessons, and skillful negotiators do more than one thing well. Some of the stories could easily fit in more than one section. I have allocated the stories and lessons across the three sections in such a way as to create a narrative that produces a whole that is greater than the sum of its parts.
1. Peter King, “An Unsung Hero in the League Office,” Sports Illustrated, August 1, 2011.
2. Albeit an oversimplification, if we approximate NFL revenues at $10 billion, the owners’ proposal would amount to ~46.4% of all revenues going to players: .58*[10B–2B] = 4.64B.
3. The upper cap in the years 2015–20 would be 48.5%.
4. This is not to say that the two sides were not also trying to out-muscle each other in the media and in the courts.
5. For example, if we have $100 to split between us, and no other issues or interests are at stake, every dollar I get will result in your getting $1 less (and vice versa).
1. Some details of this example have been changed or kept out of the story to preserve the anonymity of the people and companies involved. The essence of the story and the relevance of the lessons are unchanged.
2. The table has been modified to ensure that the parties remain anonymous.
3. If you punish your children every time they have the courage to tell you the truth about something they did wrong, don’t be surprised if they decide to revise their strategy.
1. This chapter borrows heavily and takes language directly from the case “Negotiating in the Shadow of Cancer,” which was written by Deepak Malhotra (this book’s author) and Behfar Ehdaie.
2. PSA screening entails a blood test that measures the levels of the normal enzyme PSA, which is responsible for liquefying semen, to determine if something is wrong in the prostate. An irregularity could be due to infection, cancer, or trauma that disrupts the structure of the prostate and causes more PSA to be released in the blood.
3. Roman Gulati, Lurdes Inoue, John Gore, Jeffrey Katcher, and Ruth Etzioni, “Individualized Estimates of Overdiagnosis in Screen-Detected Prostate Cancer,” Journal of the National Cancer Institute 106, no. 2 (2014).
4. The appropriateness of active surveillance for a patient depends on many factors that a physician must carefully consider.
5. A more comprehensive description of the intervention is available from the author, Deepak Malhotra.
6. James March and Johan Olsen, “The Logic of Appropriateness,” in The Oxford Handbook of Public Policy, ed. Robert E. Goodin, Martin Rein, and Michael J. Moran (Oxford: Oxford University Press, 2006).
7. March and Olsen mentioned two other (preliminary) questions that people implicitly consider: What kind of person am I? What kind of situation is this? Accordingly, a person will choose differently based on which role or personal identity is salient to him or her at the time (e.g., parent, employee, or citizen), and based on how the situation itself is framed (e.g., is this an ethical or an economic decision?).
8. The research on these topics has been conducted over many decades, by many scholars. For references, and to learn more about these and other related topics, see Deepak Malhotra and Max Bazerman, “Psychological Influence in Negotiation: An Introduction Long Overdue,” Journal of Management 34, no. 3 (2008): 509–531.
9. Robert Cialdini provides a more comprehensive discussion of this in his book Influence: The Psychology of Persuasion (New York: William Morrow & Co., 1993).
10. Behfar Ehdaie, personal communication with the author, 2014.
11. Ibid.
12. The psychological literature more precisely refers to this phenomenon as “anchoring and insufficient adjustment.” The idea is that people are aware that the starting point of an analysis (i.e., the anchor)—which may be an initial estimate, a first offer from the other side, etc.—might not be the right answer, but merely a point of departure; even so, the starting point is weighted too heavily, and efforts to appropriately adjust away from it tend to be insufficient.
13. Ehdaie, personal communication with the author, 2014.
1. North Korea had signed in 1995, but withdrew in 2003.
2. For more background on these negotiations see, Nicholas Burns, “America’s Strategic Opportunity with India: The New U.S.–India Partnership,” Foreign Affairs, November/December, 2007. And see Jayshree Bajoria and Esther Pan, “The U.S.–India Nuclear Deal,” Council on Foreign Relations, November 5, 2010.
3. Indeed, both the Hyde Act of 2006 that had authorized negotiations with India, as well as the Atomic Energy Act (1946 and 1954), would essentially disallow continued nuclear cooperation with India if it detonated a nuclear device.
4. Condoleezza Rice, Congressional Record of the United States Senate, October 1, 2008.
5. “India Will Abide by Unilateral Moratorium on N-tests: Pranab,” The Times of India, October 3, 2008, http://timesofindia.indiatimes.com/india/India-will-abide-by-unilateral-moratorium-on-N-tests-Pranab/articleshow/3556712.cms. Accessed June 25, 2015.
6. Ibid.
1. Maggie Farley, “The Big Push for U.N. Council’s Support,” Los Angeles Times, October 12, 2002.
2. See the full text of Resolution 1441 here: http://www.un.org/depts/unmovic/documents/1441.pdf.
3. See the full text of his speech here: http://www.un.org/webcast/usa110802.htm.
4. The term “parasitic” was first introduced in this context by James Gillespie and Max Bazerman in their article “Parasitic integration: Win–win agreements containing losers,” Negotiation Journal 13, no.3 (1997): 271–282. See also Deepak Malhotra and Max Bazerman, Negotiation Genius (New York: Bantam Books, 1997).
1. There are over 2,500 National Historic Landmarks. Apart from those located in US states, territories, and commonwealths, the remaining few are in island nations with whom the United States has a “free association” relationship.
2. The treaty was ratified the following year, in 1787, by Congress.
3. Ambassador Tommy Koh made these remarks in 2014 at Harvard University, where he was presented the Great Negotiator Award by the Program on Negotiation, which is based at Harvard Law School. The remarks were made during a panel discussion, as part of the activities surrounding the Great Negotiator event.
4. What follows is from historic accounts kept by the US Department of State, United States Diplomatic Mission to Morocco. See “U.S. Morocco Relations—The Beginning,” http://morocco.usembassy.gov/early.html. Accessed June 25, 2015.
1. The Articles were not formally ratified by all 13 states until 1781.
2. Some of the details mentioned here are found in Richard Beeman, Plain, Honest Men: The Making of the American Constitution (New York: Random House, 2009).
3. Ibid.
1. Vinod Khosla, personal communication with the author, October 2014.
2. A “financial investor” is someone who invests entirely in hopes of a good future return on the amount invested. A “strategic investor” usually has an interest in the financial outcome of the investment as well, but is someone who sees additional benefits in a relationship with the target company.
3. Two key parameters in any such investment are (a) the amount being invested and (b) the jointly agreed-upon valuation of the company. Taken together, these determine what percentage of ownership is being transferred to the investor. In the case of Sun, the investor would be receiving 10% equity for having invested $10 million in a company perceived as valued at $100 million after the investment.
4. The deal worked out well for all involved. After another 27 years of growing the business, Sun Microsystems was eventually acquired by Oracle in 2010 for over $7 billion.
5. Spoilers are parties whose primary or sole interest in the negotiation is for there to be no deal.
6. Khosla, personal communication, October 2014.
1. In 1993–94, the two sides tried to negotiate the new CBA under a “no strike, no lockout” pledge on both sides. When this did not yield an agreement, the owners locked out the players at the start of the following season. Since then, a lockout has been initiated each time a CBA has been up for negotiation.
2. The players did not have a labor union for many of those earlier years. The National Hockey League was established in 1917. The Players’ Association was formed only in 1967.
1. There were, of course, many other nations present.
2. Eugene White, “The Costs and Consequences of the Napoleonic Reparations,” National Bureau of Economic Research, working paper no. 7438, December 1999. doi:10.3386/w7438.
3. The Concert of Europe was an offspring of the Quadruple Alliance, whereby Great Britain, Russia, Austria, and Prussia agreed to work together to maintain the European balance of power and enforce the peace that was negotiated in Vienna. France joined this group a few years later, and Great Britain eventually exited.
4. France also accounted for the greatest number of war deaths among the Allies. Only Germany had more deaths among all nations.
5. Margaret MacMillan, Paris 1919: Six Months That Changed the World (New York: Random House, 2002), 465.
6. David Fromkin, A Peace to End All Peace: The Fall of the Ottoman Empire and the Creation of the Modern Middle East (Macmillan, 1989).
7. Henry Kissinger, Diplomacy (New York: Simon & Schuster, 1994).
1. Robert J. Hanyok, “(U) Skunks, Bogies, Silent Hounds, and the Flying Fish: The Gulf of Tonkin Mystery, 2–4 August 1964,” Cryptologic Quarterly https://www.nsa.gov/public_info/_files/gulf_of_tonkin/articles/rel1_skunks_bogies.pdf. Accessed June 25, 2015.
2. What follows is taken from documents maintained by the US Department of State, Office of the Historian. See “Foreign Relations of the United States, 1964–1968, Volume VII, September 1968–January 1969.,” http://history.state.gov/historicaldocuments/frus1964-68v07. Accessed June 25, 2015.
3. Ibid.
4. Ibid.
5. Ibid.
1. Ben Blatt, “Which Friends on ‘Friends’ Were the Closest Friends?” Slate, May 4, 2014.
2. Bill Carter, “‘Friends’ Deal Will Pay Each of Its 6 Stars $22 Million,” New York Times, February 12, 2002.
3. Robert Hackett, “Jerry Made Serious Cash in the Last Season of ‘Seinfeld.’” Fortune, June 1, 2015.
4. Brian Lowry, “‘Friends’ Cast Returning Amid Contract Dispute,” Los Angeles Times, August 12, 1996.
5. Lynette Rice, “‘Friends’ Demand a Raise—TV’s Top Sitcom Stars Want Another Huge Pay Hike, Meaning the Future of the Show Is Uncertain,” Entertainment Weekly, April 21, 2000.
6. Warren Littlefield, “With Friends Like These,” Vanity Fair, May 2012.
7. Carter, “‘Friends’ Deal Will Pay.”
8. Madan M. Pillutla, Deepak Malhotra, and J. Keith Murnighan, “Attributions of trust and the calculus of reciprocity,” Journal of Experimental Social Psychology 39 (2003): 448–455. doi:10.1016/S0022-1031(03)00015-5.
9. Littlefield, “With Friends Like These.”
1. Simply put, defensive missiles (think “surface to air”) could be used to defend against an attack by the United States; offensive missiles (think “surface to surface”) could be used to initiate or retaliate against an attack by targeting the United States itself.
2. There are many sources for the further study of the Cuban Missile Crisis. One useful place to start: http://microsites.jfklibrary.org/cmc/.
3. The Cuban Missile Crisis, 1962: A National Security Archive Documents Reader, 2nd ed., edited by Laurence Chang and Peter Kornbluh (New York: New Press, 1998), from the foreword by Robert McNamara.
4. Ironically, when President Kennedy ran for president in 1960, he referred to the “missile gap” as being an important issue. He implied, however, that it was the United States that was lagging in nuclear capability, and that he would restore parity. Apparently, neither JFK nor the Soviet Union benefited from acknowledging that the United States was, in fact, far ahead of the Soviet Union.
5. The same might be said of Khrushchev’s willingness to understand and respect JFK’s constraints.
6. Robert Kennedy, Thirteen Days: A Memoir of the Cuban Missile Crisis (New York: W. W. Norton, 1969), 95.
7. Robert McNamara, supplementary interview, Dr. Strangelove or: How I Learned to Stop Worrying and Love the Bomb (1964), 40th anniversary release (Columbia Tristar Home Entertainment, 2004) DVD.
8. Kennedy, Thirteen Days, 49.
9. Ibid. 43.
1. Some details of this example have been changed to preserve anonymity of the people and companies involved. The essence of the story and the relevance of the lessons are unchanged.
1. Göran Larsson, “‘The Invisible Caller’: Islamic Opinions on the Use of the Telephone,” in Muslims and the New Media Historical and Contemporary Debates (Farnham: Ashgate, 2011).
2. “A Chronology: The House of Saud,” Frontline PBS, http://www.pbs.org/wgbh/pages/frontline/shows/saud/cron/. Accessed June 25, 2015.
3. There is a dark epilogue to this story. Despite King Faisal’s success in introducing television to his country, some protests and riots still followed. Among the rioters was one of the king’s nephews, Prince Khalid, who was killed during the protests. Almost a decade later, in 1975, Prince Khalid’s brother assassinated King Faisal.
4. The trade-off, in a simple sense, is between the reliability and the validity of different performance measures. For example, tenure might be the easiest to measure accurately (high reliability) but be only weakly correlated with performance (low validity). Teacher evaluations, if done well, might be more strongly correlated with performance (high validity) but would be difficult to measure with precision and without bias (low reliability). Student test scores might be somewhere in the middle on reliability and validity.
1. The treaty is more commonly known as the Third Treaty of San Ildefonso.
2. Carlos Martínez de Yrujo, To James Madison from Carlos Martínez de Yrujo, 27 September 1803, National Archives: Founders Online, Madison Papers, http://founders.archives.gov/documents/Madison/02-05-02-0470. Accessed June 25, 2015.
3. Robert Livingston, To James Madison from Robert R. Livingston, 11 July 1803. National Archives: Founders Online, Madison Papers, http://founders.archives.gov/documents/Madison/02-05-02-0204. Accessed June 25, 2015.
4. James Madison, From James Madison to Robert R. Livingston, 6 October 1803. National Archives: Founders Online, Madison Papers. http://founders.archives.gov/documents/Madison/02-05-02-0504. Accessed June 25, 2015.
5. Robert Livingston and James Monroe, To James Madison from Robert R. Livingston and James Monroe, 7 June 1803. National Archives: Founders Online, Madison Papers, http://founders.archives.gov/documents/Madison/02-05-02-0085. Accessed June 25, 2015.
6. François Barbé-Marbois, The History of Louisiana (Philadelphia: Carey & Lea, 1830), 298–299, http://www.napoleon.org/en/reading_room/articles/files/louisiana_hicks.asp. Accessed June 25, 2015.
7. Thomas Jefferson, From Thomas Jefferson to Robert R. Livingston, 18 April 1802, National Archives: Founders Online, Jefferson Papers. http://founders.archives.gov/documents/Jefferson/01-37-02-0220. Accessed June 25, 2015.
8. Adolphe Thiers, Histoire du Consulat, Livre XVI, March 1803. http://www.napoleon.org/en/reading_room/articles/files/louisiana_hicks.asp. Accessed June 25, 2015.
9. James Monroe, To James Madison from James Monroe, 14 May 1803. National Archives: Founders Online, Madison Papers, http://founders.archives.gov/documents/ Madison/02-04-02-0717. Accessed June 25, 2015.
10. Despite the seemingly low price, many considered the purchased asset to be a distant, useless piece of land. Detractors labeled it “Seward’s Folly.” It was not until later in the 19th century that gold was discovered on the land. In the 1960s, oil was discovered.
11. Alexander Hamilton, Purchase of Louisiana, 5 July 1803. National Archives: Founders Online, http://founders.archives.gov/documents/Hamilton/01-26-02-0001-0101. Accessed June 25, 2015.
12. A little background on how such trades work: Because there are many constraints on teams using money to make trades in the National Basketball Association (NBA), you can’t simply write a big check to get the player you want from another team. Instead, you need to structure a trade. A basic trade would involve two teams, each offering up a player that the other wants. If you don’t have any players that the other team wants, one option is to include a future player in the deal: Team X offers a player it is going to acquire in the future (a “draft pick”) in exchange for a player it wants now. A second option is to include someone else’s player in the deal. Team X wants a player Team Y has, but has nothing of value to give to Team Y. So Team X finds a Team Z that has a player Team Y will want; X makes a trade with Z to get that player, and then uses it to get what it wants from Y. Yet another option is to combine these first two options: get someone else’s future players. For example, X makes a trade with Z for one of Z’s draft picks and includes it in the deal with Y. Things get even more complicated when you add other regulations, such as the team salary cap and luxury tax, which limit how much any team can pay its players in aggregate, in any given year, without incurring hefty penalties.
13. Daryl Morey, personal communication with the author, 2015.
14. Joshua Keating, “The Greatest Doomsday Speeches Never Made,” Foreign Policy, August 1, 2013.
1. Some details of this example have been changed to preserve anonymity of the people and companies involved. The essence of the story and the relevance of the lessons are unchanged.
1. The people of Kashmir also have their own wide-ranging views on the situation.
2. John Gravois, “The Agnostic Cartographer: How Google’s Open-ended Maps Are Embroiling the Company in Some of the World’s Touchiest Geopolitical Disputes,” Washington Monthly, July–August, 2010.
3. The Palestinian Liberation Organization recognized the State of Israel in 1993. The request for recognition “as a Jewish state” is a relatively newer one, perhaps first surfacing in diplomatic engagement around 2007.
1. Robert Fish, “Heaven, Hell and Irish Politics,” The Independent, February 13, 1997.
2. Owen Bowcott, “Northern Ireland’s Arch-enemies Declare Peace,” The Guardian, March 26, 2007.
3. Jonathan Powell, Talking to Terrorists: How to End Armed Conflicts (London: Bodley Head, 2014), 217.
4. Ibid., 217.