Thomas Kilman Conflict Resolution Grid Compete Collaborate (Achievement of Own Interests) (Need for Justice) (Value of Issue) Compromise Avoid Accommodate (Value of Relationship) (Importance Placed on Mercy) (Response to Other s Interests) Copyright 1993-1997, Adaptation of Kilman Grid by Pepperdine University Straus Institute for Dispute Resolution. All rights reserved. 1
How Do We Deal with Conflict? Avoidance Accommodation Competition Compromise Collaboration 2
Determining an Opening Offer Who opens? The first issue in determining an opening offer is to decide if you want to open first or if you want the other side to open. An important advantage of opening yourself is that you have the first opportunity to manage your opponent s expectations about the negotiation and have the opportunity to utilize the magnetic pull of the opening offer. An advantage of allowing the opposition to open first is that they may set the negotiation boundaries closer to your goals than you might have expected if you had opened you may have left money on the table. Where do you open? of Agreement, Reasonable, Credible, Extreme, and Insulting Offers An opening offer may be described as falling in one of following zones. An offer in the zone of agreement is acceptable to both parties. The parties may continue to negotiate to improve their positions; however, further negotiation should not be necessary if the goal is merely to reach an agreement. An opening offer may also fall in the reasonable zone in which case an opposing party may perceive the offer as outside his or her zone of agreement, but reasonable enough that the ultimate agreement can probably be predicted, i.e., it will tend to be halfway between this reasonable offer and the first reasonable offer from the other side. An offer in the credible zone may be perceived as slightly unreasonable and may or may not set a parameter for bargaining. An offer in the very outer limits of the credible zone falls into the extreme zone. This usually will not set the parameter for bargaining and there is a risk that it may be perceived as an insult. An offer in the insult zone is so unreasonable it not only fails to set a bargaining parameter, it may cause an opponent to refuse to bargain further. of Agreement Reasonable Credible Extreme Insult Copyright 1993-1997, Pepperdine University Straus Institute for Dispute Resolution. All rights reserved. 3
Extreme and Reasonable Openings How do you open? The Extreme Option A negotiator using the extreme option opens at the extreme edge of what is credible. There must be some rationale that supports the offer, even if somewhat farfetched. An offer is beyond the edge of reasonableness if either it is offensive or it is so extreme that it is not an offer. Such an offer may fall in the insult zone. An Extreme Offer Should Be Flexible The negotiator making an extreme offer should recognize that the offer is flexible. It is often made merely to affect the opponent s expectations and it will probably be conceded more quickly than would a more reasonable offer. This flexibility may be communicated in word, tone, inflection, and/or body language, however, the softness or flexibility does not have to always communicated to the other side. Monitoring Response The negotiator making an extreme offer should monitor the response from the other side and be ready to move from the offer or solidify his position depending on that response. Anticipating Concessions Finally, the negotiator making the extreme offer should anticipate the possibility of making substantial concessions and must plan a way to do so without losing credibility. Movement with Credibility If making a concession, it is best to provide an explanation for the concession. For example, Because of the new information you have just provided to me, I am willing to modify my opening offer. This will allow both sides to save face and will provide for further possibilities for concessions if further satisfactory explanations are given. Otherwise, the other negotiator may feel that you were simply bluffing or trying to take advantage of them in your opening offer and will be suspicious of your motives and moves. Copyright 1993-1997, Pepperdine University Straus Institute for Dispute Resolution. All rights reserved (adapted.) 4
The Reasonable Offer Falls Near the of Agreement A reasonable opening offer is one that is perceived to be within or close enough to the zone of agreement that if combined with a reasonable counter-offer will likely establish where the final agreement will result. May Encourage or Require Hard Bargaining Because such an offer also affects an opponent s expectations, it may encourage the opponent to bargain harder than the opponent might have otherwise. The negotiator making a reasonable opening offer must be prepared to solidify the negotiator s position through argument, communicating limited flexibility. Must Demonstrate Firmness and Commitment A reasonable opening offer must be accompanied by commitment to reduce the possibility it will be dismissed as an extreme offer. The language accompanying the offer must be firm in word, tone and inflection, and body language. If an actual number (cost of an item for purchase/sale or a figure being offered for settlement) is part of the opening offer, the explanation as to how the number was reached must be provided before the actual number is shared with the other party. Otherwise, the opponent will not be listening to the explanation they already have what they need (the number) and are planning their next move Reduces Concessions Concessions should be modest and should be made only after an appropriate amount of time. Copyright 1993-1997, Pepperdine University Straus Institute for Dispute Resolution. All rights reserved (adapted.) 5
Illustration of the of Agreement A s Bargaining Range B s Bargaining Range Reasonable of Agreement Copyright 1993-1997, Pepperdine University Straus Institute for Dispute Resolution. All rights reserved. 6
SECRETS TO SATISFACTION: Ensuring Durability Product (Outcome) Process Outcome - Psychological / Personal Copyright 1993-1997, Pepperdine University Straus Institute for Dispute Resolution. All rights reserved. 7