Negotiation Strategy KJ Sung GSP Kyung Hee University

Negotiation Strategy KJ Sung GSP, Kyung Hee University

Nash Solution? B B Confess A Confess Not Confess ( -5, -5) (0, -10) Introduce Not introduce Introduce ( 0, 0 ) ( x, -x ) Not introduce ( - x, x ) ( 0, 0 ) A Not Confess ( -10, 0) (-1, -1) Matsushita Beta Vhs Beta ( 1, 1 ) ( 0, 0 ) Vhs ( 0, 0 ) ( 1, 1 ) Sony Negotiation Strategy by KJ Sung 2

Nash Bargaining Solution (Homework Set) Divorce Example Give all to Tom. Now, which one to give to Sue? In order for Sue to have 1 unit of utility, how much should Tom give up? 　 1 2 3 4 5 Tom 35 24 15 13 13 Sue 30 25 12 15 18 Ratio 1. 2 1 1. 3 0. 9 0. 7 Order = 5 4 2 1 3 Negotiation Strategy by KJ Sung

Nash Bargaining Solution (cont’d) This is the short cut…. Order = 5 -4 -2 -1 -3 Tom's Items Sue's Items Tom's Utility Sue's Utility Product 5, 4, 2, 1, 3 0 100 0 - 4, 2, 1, 3 5 87 18 1, 566 2, 1, 3 5, 4 74 33 2, 442 1, 3 5, 4, 2 50 58 2, 900 3 5, 4, 2, 1 15 88 1, 320 0 5, 4, 2, 1, 3 0 100 - Negotiation Strategy by KJ Sung

Wrap-up KJ Sung GSP, Kyung Hee University

What shall I do from now on? … 1. Preparation sheet for sudden negotiation 2. Is ‘win-win’ really possible? - ET? 3. Are there any new things I learned? 4. What to do …in a word? - know thyself, and others 5. How can I embody these principles? 6. Is there any shortcut? Free lunch?

Sudden Preparation

What are priority problems to which preparation may be part of the answer?

Any Summary? 1. Business is business: don’t get mad 2. People are rational: question yourself if the other party seems irrational 3. Illustrative options: opening the door for principled negotiation. Flexibility, interest, and joint search for alternatives(easy to improve) 4. Standards: how shall I persuade my people? 5. BATNA: no free lunch

Some useful tips? 1. 2. 3. 4. Never negotiate with a complete stranger Do not go to negotiation table alone Nobody is crazy; to them you ARE… You are never understood the way you want; did they understand you correctly? 5. Do not send the person who has the full power to the table 6. Do not push the other over the cliff; save their face 7. Real deals are made in 1 -1 private meetings 8. Just listen, and do not talk too much; ask open-ended questions 9. Never negotiate just over one agenda; make it multiple 10. Think about how you would justify the agreement

Thanks for your patience and cooperation…