We had this situation during the last class - we were negotiating, almost everyone was fine with the outcome, but nobody actually won. What happened? Why the situation looked like that? Very simple - this what happens when you negotiate and you can't really tell whether should you be satisfied or not.
We have a task for this blog post. Post something about negotiation, that you didn't really know what was the real outcome. I was thinking about something close to that and I found it.
Sometimes, probably in our future career, we'll have this situation: discussion about future progress of company / firm / project / task. Actually, nobody wins here, because we shouldn't really think about it so much. However, when it comes to discussion about ideas, negotiation plays a vital role.
I was a very active member of Student Government and I realized that negotiation is not only about bargain, but also about making people believe or approve the things you're saying.
The case happened during one of our integration trips. 80+ gathered to have party, integrate and actually think in low-stress environment about the future of our unit. We were really thoughtful and actually very curious about the open-space conversation that was about to be conducted.
Catherine, the former President of SG (Student Government) was in charge of whole discussion (remember I don't like her? That was her case in the previous post). She wanted to perform the SWOT analysis and therefore whole analysis of "what will happen to us".
As you know, I am really eager to talk and to share my opinion, so I started from saying what's wrong, what should be changed, what I really liked, and what I thought that was bad. There were other people who really wanted to participate in that and there were some of them, who didn't share my opinion. In fact, some of them were really brutal and maybe a little to honest.
I told what my point was. Some people agreed, some didn't. So... I had to negotiate. Not to bargain, but to make them feel that we share the same values. I started from saying that we share the same values and goals (future of SG), however, some of them were still reluctant. That was the kind of negotiation, which I couldn't really tell what was my real goal. I knew that I wanted to be the one who's right, but I didn't really know what is the purpose of that. It was the same as with the board meeting negotiation we had in class. My drive was to win, but why? I can't really tell.
I remember, that I had to drop out some cases that weren't so important for me (like administration stuff management), in order to pursue more important things (like promotion and sponsoring). We were just writing things on flip chart, yet I still thought I had to negotiate really hard, so at least some of them would agree with me and go along with what I'm saying.
Eventually, I found that some people agreed with me and 90% of what I told was in those god damned flip charts, but still I thought that I accomplished nothing. Yeah, I just wasted one hour to make people believe in what I was saying, but still what was the point of that? I couldn't really tell that I won and nobody did, so do I couldn't say that everybody was fine with that. That was pretty much the same as with the last negotiation. I thought that I was fine, but the overall goal was different than what I was pursuing all the time.
The conclusion is, I didn't know what my goal is. I really wanted to win, that's the point. Chasing the white rabbit is not always the good cause. Especially, that you don't really willing to catch it. And even if you do, there is not much to do with the trophy.
środa, 28 października 2015
poniedziałek, 19 października 2015
Coallition in negotiations
Sometimes to beat the bigger guy, you don't have to be strong. You just have to ally with other small guys. Isn't it what the wolves pack do all the time?
I recalled the situation in class, where I didn't want one of the girls (Catherine) I didn't like to be a new coordinator of a student camp we've organised back then in Poland in Student Government. Back then, she was also the Preisdent of Student Government and I was a member of board of directors. She normally would be involved in the decision process, however she was involved personally, so the decision had to be made in democratic way. Executives and board of directors were supposed to meet. However, the day before there was a party. I really couldn't let it go, so I approached several people I thought would be still undecided. It took me 2 or 3 hours of the event. Luckily, I've managed to talk some people through, so when there was a moment of choice, my candidate won with 5 votes for and 3 against. It meant I did it. That was the first time I was politicking in such brutal way, but it let me to the very interesting insight: "it's easier to negotiate in the wolf pack".
When I think about this case, I find that I did it in a very interesting and actually in a model way. According to the chapter 3.11 in the book: I first recognized the potential coallition opportunites. I thought about 10 people that would be voting and what were my chances. I will describe them:
As you see, I had 4 people who were inconvincible, but still had to face the ambiguity. However, I sat to the negotiation table a little more calm and thought that I still had some chances.
There were no cons in that situation. I didn't want her to lead the Student Government anymore, I knew she was not good enough, so I had to do what what was necessary. People don't like politics, me neither, but the strong coalition was needed. People who were 100% with me helped me to reach other. It is also important that it was a battle of her executives against her. Very complicated and actually not cool situation for you as a leader.
We still met with other party, looked on both candidates applications and ideas for organizing the camp. I had to use my rethorical skills at their finest, so people who were still undecided voted with me, not against me. I tried to be as rational as possible, didn't want to look like I'm prejudiced towards Catherine.
Eventually I got what I wanted. David won, Catherine had to swallow the bitter taste of loss and I slept better, because Student Government and university life was a big thing for me back then. Whipping the votes was important and actually kind of funny...
I recalled the situation in class, where I didn't want one of the girls (Catherine) I didn't like to be a new coordinator of a student camp we've organised back then in Poland in Student Government. Back then, she was also the Preisdent of Student Government and I was a member of board of directors. She normally would be involved in the decision process, however she was involved personally, so the decision had to be made in democratic way. Executives and board of directors were supposed to meet. However, the day before there was a party. I really couldn't let it go, so I approached several people I thought would be still undecided. It took me 2 or 3 hours of the event. Luckily, I've managed to talk some people through, so when there was a moment of choice, my candidate won with 5 votes for and 3 against. It meant I did it. That was the first time I was politicking in such brutal way, but it let me to the very interesting insight: "it's easier to negotiate in the wolf pack".
When I think about this case, I find that I did it in a very interesting and actually in a model way. According to the chapter 3.11 in the book: I first recognized the potential coallition opportunites. I thought about 10 people that would be voting and what were my chances. I will describe them:
- Agnes - former President of Student Government, best friend of Catherine, the candidate. Chance of success - 0%
- Ula - HR & Projects Executive, thankful towards Catherine for her position. Lost elections to David (my candidate), so she still had some problems about that. Chance of success - 0%.
- Magda - President of Board of Directors. You could write books about her integrity and lawful approach. She didn't like David (my candidate) because of his behavior on parties. On the other hand, she didn't like Catherine's approach towards leading the whole Student Government. Chance of success - 50%
- Mike - Administration Executive, liked Catherine, but was also a friend with David. He was easy to convince, for he also wanted to get a position secured in a team. Chance of success - 50%.
- Joanna - Finances Executive, didn't like Catherine at all, she didn't need to be convinced. Chance of success - 100%.
- Marlene - Marketing & Promotion Executive. She tried to be neutral, however she was one of my best friends, so she did it my way. Yet she was still anxious till the very end. Chance of succes - 90%.
- Filip - Business Development Executive. He has some arguments with David, didn't like his way of doing projects, yet still decided to choose "the minor evil", so he didn't pick Catherine. I also managed to encourage him a little, so he could help me during the argument. Chance of success - 85%.
As you see, I had 4 people who were inconvincible, but still had to face the ambiguity. However, I sat to the negotiation table a little more calm and thought that I still had some chances.
There were no cons in that situation. I didn't want her to lead the Student Government anymore, I knew she was not good enough, so I had to do what what was necessary. People don't like politics, me neither, but the strong coalition was needed. People who were 100% with me helped me to reach other. It is also important that it was a battle of her executives against her. Very complicated and actually not cool situation for you as a leader.
We still met with other party, looked on both candidates applications and ideas for organizing the camp. I had to use my rethorical skills at their finest, so people who were still undecided voted with me, not against me. I tried to be as rational as possible, didn't want to look like I'm prejudiced towards Catherine.
Eventually I got what I wanted. David won, Catherine had to swallow the bitter taste of loss and I slept better, because Student Government and university life was a big thing for me back then. Whipping the votes was important and actually kind of funny...
czwartek, 15 października 2015
Negotiation Ethics - 50 shades of gray
Negotiating represents everyday situations. We do lie, puff, bluff, hide the truth and are very often dishonest. People won't be different in negotiation. This is my opinion and approach. Actually I was this bad guy - 2137 number during the test.
Misrepresenting information is bad, lying to somebody also. However, when I have a car to sell, I won't hesitate to hide that air conditioning system is leaking. First of all, it doesn't affect safety and secondly, I don't care about this buyer. From rational economics perspective, this is a good attitude. However, we are irrational usually, so honest behavior is actually not so seldom. It is not easy to tell whether it's already a lie or just hiding the information. We are surrounded by ambiguity. Those ethical questions are neither black, nor white. Usually, as mentioned in a title, they're in many shades of gray.
According to 2.12 reading I prefer The Poker School of negotiating. Everytime I sit upon the table, I perceive negotiation as challenge and a game. I like collaboration - I'm more than happy to agree, but I still think about my personal interest. Moreover, I think that Poker School is more interesting than Pragmatic School, not even mentioning the Idealist School. I like the feeling of winning, I'm addicted to success and this is my driver. After the negotiation ends, I usually forget about whole situation and go over it. During the negotiation I have some kind of flow, that makes me care only about the outcome. When we collaborate and have mutual agreement, I still feel that I won. But if we can't, I won't hesitate to be selfish. It's funny actually. I don't know from where those incentives come, but frankly I started to like this feeling.
I also like the limitations and rules of that game. Usually those are legal, but also social restrictions. You need to move very carefully, because you can step on a land mine easily. You have to make a judgment call sometimes, for instance: "should I lie or not?" I am curious about it and actually looking forward to it in the future. Especially, that negotiation classes are risk free environment, so I can experiment a little. Nevertheless, the more I negotiate, the more I like this kind of ethical strategy. Probably my Mother wouldn't be glad about it...
I find it as a clever tactic. Misleading an opponent, confusion, chaos - isn't the same thing Sun Tzu wrote about in his "Art of War" several thousand years ago?
The only thing I can't yet apply to Poker School tactic is definitely anger or emotion management. When I don't like something, I say it loud. When someone upsets me, I retaliate. True players don't do that.
I know, however, that I have some limitations. As I mentioned above, I would never lie, if the case would affect human's life or health. But saying some petty things, just to sell the product - I don't actually mind. Or paying for information, or undermining the negotiating position of other party, or promising things I can't deliver (as long as it doesn't affect my company) - it's not a problem for me. Am I bad?
I don't think so. I treat it as a game. Exciting, interesting, complicated, but only a game. I hope it will stay like that.
Misrepresenting information is bad, lying to somebody also. However, when I have a car to sell, I won't hesitate to hide that air conditioning system is leaking. First of all, it doesn't affect safety and secondly, I don't care about this buyer. From rational economics perspective, this is a good attitude. However, we are irrational usually, so honest behavior is actually not so seldom. It is not easy to tell whether it's already a lie or just hiding the information. We are surrounded by ambiguity. Those ethical questions are neither black, nor white. Usually, as mentioned in a title, they're in many shades of gray.
According to 2.12 reading I prefer The Poker School of negotiating. Everytime I sit upon the table, I perceive negotiation as challenge and a game. I like collaboration - I'm more than happy to agree, but I still think about my personal interest. Moreover, I think that Poker School is more interesting than Pragmatic School, not even mentioning the Idealist School. I like the feeling of winning, I'm addicted to success and this is my driver. After the negotiation ends, I usually forget about whole situation and go over it. During the negotiation I have some kind of flow, that makes me care only about the outcome. When we collaborate and have mutual agreement, I still feel that I won. But if we can't, I won't hesitate to be selfish. It's funny actually. I don't know from where those incentives come, but frankly I started to like this feeling.
I also like the limitations and rules of that game. Usually those are legal, but also social restrictions. You need to move very carefully, because you can step on a land mine easily. You have to make a judgment call sometimes, for instance: "should I lie or not?" I am curious about it and actually looking forward to it in the future. Especially, that negotiation classes are risk free environment, so I can experiment a little. Nevertheless, the more I negotiate, the more I like this kind of ethical strategy. Probably my Mother wouldn't be glad about it...
I find it as a clever tactic. Misleading an opponent, confusion, chaos - isn't the same thing Sun Tzu wrote about in his "Art of War" several thousand years ago?
The only thing I can't yet apply to Poker School tactic is definitely anger or emotion management. When I don't like something, I say it loud. When someone upsets me, I retaliate. True players don't do that.
I know, however, that I have some limitations. As I mentioned above, I would never lie, if the case would affect human's life or health. But saying some petty things, just to sell the product - I don't actually mind. Or paying for information, or undermining the negotiating position of other party, or promising things I can't deliver (as long as it doesn't affect my company) - it's not a problem for me. Am I bad?
I don't think so. I treat it as a game. Exciting, interesting, complicated, but only a game. I hope it will stay like that.
środa, 16 września 2015
Midwestern: Contemporary Art Case Study A & B
I've read the case study about problem in MCA musuem. It was a classical conflict between the top management facing financial problems. I won't describe the case, but I'll try to answer questions.
Part A.
1. Is Peter Smith micromanaging Keith Schmidt?
In my opinion, yes he is. There should be a difference and division between job description for CEO and board chairman. Actually, when deciding about Schmidt choice, Smith should be aware that some of his decision power is gone. I think he may have some problems with that he's not anymore playing first fiddle.
2. What type of conflict they are experiencing?
They are experiencing interpersonal conflict, which comes from differences between their leadership and management style. Smith is risk - averse and more conservative, Schmidt likes to risk and is ambitious to reach his goals. What is more, Schmidt doesn't like being controlled, so he feels that Smith is not trusting him or that he's not capable of leading the organisation.
3. What can organization do structurally to reduce conflict resulting from role ambiguity?
The first and most important thing is to set up a meeting, where Smith and Schmidt can discuss their differences. Feedback would be very important for the MCA's katharsis. Without that, the conflict will grow - they'll have to face the snowball effect. Secondly, there should be strict rules which divide what board directors do and what the executives do.
4. How should Peter Smith react when his advice is not followed by the board?
First of all, he shouldn't be upset. It is good sometimes to admit, that you're not right, so he can show himself as a person who doesn't hold grudge. If that was the choice of whole top - management, so be it. The worst thing he can do is trying to prove everying, that they were not right. The only thing he can accomplish with this strategy is jeopardizing his relations.
5. How are the roles of board chairman and an executive director different in an organization such as the MCA?
Actually, and that is the major problem, they're not very different. The JD is not specified, so it was just a matter of time, when such conflict would occur. Board chairman should be more a counsellor - i perceive him as more like Gandalf for organiztion and CEO should be more like Aragorn. Two of them play crucial roles in MCA, but the second one is more in charge, so he should make decisions.
Parb B.
1. What alternative approaches should Peggy Fischer use to collect the unfulfilled pledge?
In my opinion, lawsuit is the worst option. First of all, I have some ethical doubts about it and secondly, it will last for a very long time. Mutual agreement (and I know this from the Suits TV show ;)) is always the best. She should meet with Smith and talk to him in presence of lawyers. Then she should come up with the settlement, which both sides would respect.
2. Should Fischer involve the board in further discussions leading to a decision about whether or not to file a lawsuit? Or should she formulate a recommendation on her own for the board's next meeting?
I think she should choose more autocratic leadership style. Board has shown that it has no will to be helpful and also they have different opinions. Actually the board is the least professional part of this organization. She should make decision on her own.
3. Do you think the museum should sue the Smits? Why or why not?
As I wrote before, I think that lawsuit is the worst option. First of all, it's unethical to sue someone, who contributed a lot to development of MCA. Cancer argument doesn't matter here actually. Smith was responsible for growth of entire organization and this organization wants to sue him. It's just simply unfair. Secondly, I think it will be a very long process and it's probable that it won't end with MCA's victory.
Part A.
1. Is Peter Smith micromanaging Keith Schmidt?
In my opinion, yes he is. There should be a difference and division between job description for CEO and board chairman. Actually, when deciding about Schmidt choice, Smith should be aware that some of his decision power is gone. I think he may have some problems with that he's not anymore playing first fiddle.
2. What type of conflict they are experiencing?
They are experiencing interpersonal conflict, which comes from differences between their leadership and management style. Smith is risk - averse and more conservative, Schmidt likes to risk and is ambitious to reach his goals. What is more, Schmidt doesn't like being controlled, so he feels that Smith is not trusting him or that he's not capable of leading the organisation.
3. What can organization do structurally to reduce conflict resulting from role ambiguity?
The first and most important thing is to set up a meeting, where Smith and Schmidt can discuss their differences. Feedback would be very important for the MCA's katharsis. Without that, the conflict will grow - they'll have to face the snowball effect. Secondly, there should be strict rules which divide what board directors do and what the executives do.
4. How should Peter Smith react when his advice is not followed by the board?
First of all, he shouldn't be upset. It is good sometimes to admit, that you're not right, so he can show himself as a person who doesn't hold grudge. If that was the choice of whole top - management, so be it. The worst thing he can do is trying to prove everying, that they were not right. The only thing he can accomplish with this strategy is jeopardizing his relations.
5. How are the roles of board chairman and an executive director different in an organization such as the MCA?
Actually, and that is the major problem, they're not very different. The JD is not specified, so it was just a matter of time, when such conflict would occur. Board chairman should be more a counsellor - i perceive him as more like Gandalf for organiztion and CEO should be more like Aragorn. Two of them play crucial roles in MCA, but the second one is more in charge, so he should make decisions.
Parb B.
1. What alternative approaches should Peggy Fischer use to collect the unfulfilled pledge?
In my opinion, lawsuit is the worst option. First of all, I have some ethical doubts about it and secondly, it will last for a very long time. Mutual agreement (and I know this from the Suits TV show ;)) is always the best. She should meet with Smith and talk to him in presence of lawyers. Then she should come up with the settlement, which both sides would respect.
2. Should Fischer involve the board in further discussions leading to a decision about whether or not to file a lawsuit? Or should she formulate a recommendation on her own for the board's next meeting?
I think she should choose more autocratic leadership style. Board has shown that it has no will to be helpful and also they have different opinions. Actually the board is the least professional part of this organization. She should make decision on her own.
3. Do you think the museum should sue the Smits? Why or why not?
As I wrote before, I think that lawsuit is the worst option. First of all, it's unethical to sue someone, who contributed a lot to development of MCA. Cancer argument doesn't matter here actually. Smith was responsible for growth of entire organization and this organization wants to sue him. It's just simply unfair. Secondly, I think it will be a very long process and it's probable that it won't end with MCA's victory.
czwartek, 3 września 2015
Bluff vs. Sincerity - what is the best way?
In this post I would like to describe the latest Negotiation classes - to be precise: Used Car and Engine Parts cases.
I had a different approach in both cases. In the Used Car I tried to hide all the information, bluff a little, you can even tell that I lied. In the Engine Parts case I was sincere from the very beginning and play with open cards. Which of them was better? Let's find out.
I started the Used Car conversation and quickly led the whole "small talk" about how car was great and what bargain it is and that I wouldn't sell it, but I bought a new one. I was the first person who offered the first price. I said: "9500 $ and it's good". Frankly speaking it was a classical anchor. Justin tried to negotiate a little, saying that 7400 $ is all he has (yes, he also bluffed) and then I came up with a deal of him paying me 7400 at the beggining and then 1000$ in 3 months. He asked me if he can get a little discount, so I offered him 900$ in 3 months. And that was my mistake. Being in a frenzy of negotiation I forgot what was my first target: 8500$. It was still better than my BATNA, yet still I thought that I made a bad deal.
In the second case - the Engine Parts I also dominated the conversation. I proposed to start from negotiating a price and focus on additional agreement in the second part. Both sides agreed to that. I started from the anchor and offered 350 $ per piston, but I realized that I've tried this already with Justin, so I wanted to be honest. I asked Jennifer: Ok, let's be completely sincere with each other. What is your margin you want to have?" She replied: "Actually I have 10 thousand of it. I just want to get rid of them.". So I bought them for break - even price. She was more interested in advertisement and I was interested in warranty. This is why eventually she got her advertisement and I got 8000 pistons and 10% extra, which I could give back if unused. One of the best deal I've ever made.
To conclude, once again being ethical and honest is the best way in negotiation. I got a better deal and also it was easier to focus on the final goal, which was getting pistons in good price for company and secure the contract. In the first case, when I was straying I forgot what was my goal. With Jennifer we were able to discuss as partners and I'm looking forward to future negotiations.
niedziela, 30 sierpnia 2015
Advantage of information and technique in negotiation
While I was sitting in the first class of "Negotiation" and got reminded of game theory and prisoners dilemma I wondered: "how would it look like if they would share the same ammount of knowledge?"
Unfortunately they didn't. Prisoners in this case will never know what was the decision of another one until it comes to their good or bad end. This is why I think that getting good information and knowledge before sitting at the negotiation table is not only crucial but also obligatory if you're taking it seriously.
It does not matter whether you sign a million dollar contract or haggle for a better price at BestBuy (M. Richiel. Even at Megastores, Hagglers Find No Price Is Set in Stone. 2010. Negotiation: Readings, Exercises & Cases. Reading 1.10).
Rules are always the same. Come prepared and use your knowledge without further hesitation for you should focus on one thing: getting a better deal.
For instance, if you go to a shop and want to get a discount for new pair of Under Armour shoes simply check their real price on Ebay or Amazon. Now I see that I've paid about 15$ more for my new running shoes that I should have… I will do better next time.
It's the same with bigger matters. For example, it's good to know how important the deal for the opposite side is. If it's strategic for them, then it's easy to get better position before negotiation and eventually get a good bargain.
Moreover, not only information is a key to success. Knowledge of techniques and negotiation strategies is sometimes even more significant.
When I was studying the "Effective Negotiating Techniques" chapter I wondered how many of them I know and that I used them already.
Few years ago I was working in call-center and one of a very succesful techniques I used was a "crossroad". I remember that very often I brought several topics for conversation and then I was giving "the apparent choice". The question which I said for closing the deal was more or less like: "Ok, so to conclude: do you want a 30$ for 24 months or 60$ for 12 months plan?" In 80% of cases it worked and I had a deal. It worked not only in call-center but in family home as well. I remember that I was negotiating with my Mom and asked her: "At what time should I be home? 10 or 11 P.M?" It actually worked fine.
Also, one year later, I was a salesman working for a small creative agency in Wrocław, Poland. My job was to sell SEO & SEM services. It happened that I was cornered by a potential buyer I used: "the agent of limited authority". With that I could buy time, got a moment to gather information and to consult problems with my boss and come up with a decent tactic.
To conclude, I think that there may be kind of semi equation for being a good negotiator. I think it's: "information + knowledge = good bargain".
By information I mean: preparing to the meeting and knowing the priorities, good and bad sides of the opposite side.
On the other hand by knowledge I mean: controlling your emotions, using proper techniques when they're needed and having an experience. All of those things combined should be the elementary keys to success.
Unfortunately they didn't. Prisoners in this case will never know what was the decision of another one until it comes to their good or bad end. This is why I think that getting good information and knowledge before sitting at the negotiation table is not only crucial but also obligatory if you're taking it seriously.
It does not matter whether you sign a million dollar contract or haggle for a better price at BestBuy (M. Richiel. Even at Megastores, Hagglers Find No Price Is Set in Stone. 2010. Negotiation: Readings, Exercises & Cases. Reading 1.10).
Rules are always the same. Come prepared and use your knowledge without further hesitation for you should focus on one thing: getting a better deal.
For instance, if you go to a shop and want to get a discount for new pair of Under Armour shoes simply check their real price on Ebay or Amazon. Now I see that I've paid about 15$ more for my new running shoes that I should have… I will do better next time.
It's the same with bigger matters. For example, it's good to know how important the deal for the opposite side is. If it's strategic for them, then it's easy to get better position before negotiation and eventually get a good bargain.
Moreover, not only information is a key to success. Knowledge of techniques and negotiation strategies is sometimes even more significant.
When I was studying the "Effective Negotiating Techniques" chapter I wondered how many of them I know and that I used them already.
Few years ago I was working in call-center and one of a very succesful techniques I used was a "crossroad". I remember that very often I brought several topics for conversation and then I was giving "the apparent choice". The question which I said for closing the deal was more or less like: "Ok, so to conclude: do you want a 30$ for 24 months or 60$ for 12 months plan?" In 80% of cases it worked and I had a deal. It worked not only in call-center but in family home as well. I remember that I was negotiating with my Mom and asked her: "At what time should I be home? 10 or 11 P.M?" It actually worked fine.
Also, one year later, I was a salesman working for a small creative agency in Wrocław, Poland. My job was to sell SEO & SEM services. It happened that I was cornered by a potential buyer I used: "the agent of limited authority". With that I could buy time, got a moment to gather information and to consult problems with my boss and come up with a decent tactic.
To conclude, I think that there may be kind of semi equation for being a good negotiator. I think it's: "information + knowledge = good bargain".
By information I mean: preparing to the meeting and knowing the priorities, good and bad sides of the opposite side.
On the other hand by knowledge I mean: controlling your emotions, using proper techniques when they're needed and having an experience. All of those things combined should be the elementary keys to success.
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