CHAPTER 4 4-1

Win-Win Negotiation:
Expanding the Pie
CHAPTER 4 4-2

Faulty Perceptions of
Win-Win Negotiation
Compromise
Even split
Satisfaction
Building a relationship

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CHAPTER 4 4-3

Telltale Signs of Win-Win Potential

Does the negotiation contain more than one issue?

Can other issues be brought in?
Can side deals be made?
Do parties have different preferences across
negotiation issues?

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CHAPTER 4 4-4

Exhibit 4-1: A Pyramid Model

of Integrative Agreements

Level 3:
Pareto-optimal

Level 2:
Settlement demonstrably superior
to other feasible settlements

Level 1:
Mutual settlement
(positive bargaining zone)

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CHAPTER 4 4-5

Expanding the Pie:

Strategies That Do Not Work
Commitment to reaching a win-win deal
Compromise
Focusing on a long-term relationship
Adopting a cooperative orientation
Taking extra time to negotiate

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 CHAPTER 4
Exhibit 4-2: Types of Information in Negotiation and How Each Affects Distributive and Integrative
Agreements
Type of
Definition (example)
Information
BATNA The alternatives a negotiator has outside of the
(and current negotiation (e.g., If I dont buy your
reservation car, I can buy my uncles car for $2,000)
price)
Position Usually, a negotiators opening offer; the
(stated behavioral manifestation of his/her target point
demand) (e.g., I will give you $1,500 for your car)
Underlying The underlying needs and reasons a negotiator
interests has for a particular issue (e.g., I need a car
because I need transportation to my job site,
which is 15 miles away in a rural zone)
Priorities A judgment about the relative importance of the
issues to a negotiator (e.g., I am more
concerned about the down payment than I am
about the financing for the car)
Key facts Pertains to information that bears on the quality
and the value of the to-be-negotiated issues
(e.g., The car has a rebuilt engine and has been
involved in a major collision; The oranges
are genetically modified)
Substantiatio Argument either made to support ones own
n position or to attack the other partys position
(e.g., You will get lots of dates if you buy my
car because women like it)
Pruitt, D. G., (1981). Negotiation Behavior. New York: Academic Press; Hyder, E. B., Prietula, M. J., & Weingart, L. R. (2000). Getting to best: Efficiency versus optimality in negotiation.
Cognitive Science, 24(2), 169204. ** Carnevale, P. J., & Lawler, E. J. (1986). Time pressure and the development of integrative agreements in bilateral negotiations. Journal of Conflict Resolution, 30(4), 636659.
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Claiming Value
Revealing this information severely hurts
ability to maximize negotiator surplus
Opening with an aggressive target point
significantly increases the negotiators
surplus (share of the bargaining zone)
Revealing this information generally
increases likelihood of obtaining a
favorable slice of the pie because
negotiators who provide a rationale for
their demands are more adept at realizing
their targets
Increases a negotiators surplus
indirectly, because if more value is
created via sharing priorities, then the
probability that a negotiator will get a
larger slice of the pie increases
This information can affect the slice of
the pie the negotiator obtains in that facts
either increase or decrease the value of
the to-be-negotiated issues
Most dominant type of distributive tactic
(24% to 27% of all statements);** can
increase a negotiators slice of the pie
because providing a rationale (even an
absurd one) can often be effective in
obtaining a demand
4-6
Creating Value
Revealing or obtaining this information does not affect
ability to reach level 2 or 3 integrative agreements;
might help negotiators reach level 1 integrative
agreements
Does not affect integrative agreements
Very important for reaching win-win deals; by
(truthfully) revealing underlying interests, negotiators
can discover win-win agreements (e.g., one sister tells
the other that she wants the orange because she needs to
make juice and has no need for rinds)
Vitally important for maximizing the pie (e.g., the sister
who said she cared more about the rinds relative to the
juice created potential for integrative agreement)
Affects the quality of win-win agreements in that failure
to reveal key information may lead a negotiator to over-
or undervalue a particular resource (e.g., someone who
sells fresh organic orange juice does not want to have
genetically-modified oranges as an ingredient)
A distributive tactic; does not increase win-win
negotiation and may, in fact, reduce likelihood of win-
win*
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CHAPTER 4 4-7

Expanding the Pie:

Strategies That Work (I)
Perspective-taking
Ask questions about interests and priorities
Provide information about your interests and priorities
Unbundle the issues
Make package deals, not single-issue offers
Make multiple offers of equivalent value simultaneously

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CHAPTER 4 4-8

Expanding the Pie:

Strategies That Work (II)
Structure contingency contracts by capitalizing on
differences
Valuation
Expectations
Risk attitudes
Time preferences
Capabilities
Cautionary note on effective contingency contracts
Presettlement settlements (PreSS)
Postsettlement settlements

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CHAPTER 4 4-9

Exhibit 4-6: Decision-Making Model

of Integrative Negotiation

not acceptable
(optimistic)
not acceptable
(bleak)
Construct Current
Resource Assessment
Offers and Best Impasse
Assessment of Differences
Trade-Offs Terms

both agree

Implement
Postsettlement Agreement
Settlements

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CHAPTER 4 4-10

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