Negotiation Basics
What is BATNA?
This term refers to the “Best Alternative to a Negotiated Agreement.”
What does ZOPA stand for?
Zone of Possible Agreement.
What is the Anchoring Effect?
According to AIM, the first offer influences the course of the negotiation.
What is Positional Bargaining?
Negotiators stick to fixed demands rather than focusing on interests
What are concessions?
The reductions a negotiator makes from their initial offer.
What is a reservation point?
The absolute lowest a seller will accept or highest a buyer will pay.
If a buyer’s maximum price is $500 and the seller’s minimum is $450, the bargaining zone is this wide.
$50
What is the importance of precise numbers?
These numbers are stronger anchors than round numbers, as they make your offer seem less easy to argue with.
What are the three fairness rules?
Equity, Equality and Needs.
What is the difference between reciprocity and aversion?
One encourages, the other discourages making concessions.
What is Distributive Negotiation?
Negotiation type known as “win-lose” or zero-sum.
The lowest price the seller is willing to accept is called?
The seller's reservation point.
What is re-anchoring?
Countering an anchor quickly with your own to shift away from extreme anchors.
What is Egocentrism Bias?
The bias where negotiators apply fairness in self-serving ways.
This is where only one party makes all the concessions.
What is a Target Point?
The most ideal outcome a negotiator hopes to achieve.
When there is no overlap between buyer and seller limits, the result is often this.
An impasse.
What is an advantage of making an offer later on in the negotiation?
Late offers allow time to learn about other party’s interests.
What is 1 out of the 3 mentioned de-escalation tactics?
1) Separate the people from the problem.
2) Acknowledge and Reframe Emotions.
3) Introduce Objective Criteria.
In the BH/WH strategy, is is recommended to start ---- (how?) and later on make ---- (what?)
1) tough.
2) larger concessions.
It is important to know your own and estimate the other party's ---- (what?) in negotiations.
BATNA.
What are the two types of possible bargaining zones?
Negative and positive.
What does AIM stand for?
Anchoring Information Model.
People often use this word/phrase to justify their position in a negotiation.
This is FAIR.
Information seeking = a loss of power, true or false?
False, Information seeking = greater power.