Executive Summary
Hang_321
NegotiationforReal.pptxNegotiating for Real
(Team #5)
Katherine
Overview
WMUC formal event
Needs
Venue
Drinks
Food
Music
Goals
WMUC holds a formal event each spring for its DJs and community members
Needed a venue, drinks, food, music
Budget of $2500, per person $25, expecting 100-120
Goal: get a good deal for WMUC (Less than $2,500)
Hope to learn: See how flexible the venue could be, even when they have “set” prices
Stretch
Haven’t booked event like this before, no prior experience
Our client was WMUC, which is UMD’s student run radio station. It is located above the south campus diner and broadcasts on 88.1 FM as well as streams online. Each spring, they plan a formal event for their DJs. Since Katherine is on their executive board, she offered to help plan this event and negotiate the contract.
Plan
Ranked Priorities
Open Bar
Own music
Cost per person
Gathered Information
-Menu prices
-Available dates (May 12th)
-Music set-up
Determined BATNA and Strategy
-Could pursue other venues
-Will try to reduce per person cost by showing value
What did you do to prepare for this negotiation? Plan to provide a solid rationale for your preparation and strategy.
Gathered all information from client
Organized interests, ranked priorities
BATNA: To find a different venue if they won’t compromise below $2500, will be on a time crunch if this happens, Cornerstone - $1000
Guessed interests and BATNA of venue
Formulated an opening offer and questions for more information
Reservation point: $2500
, goal, opening offer
Rationale/strategy:
-integrative: many terms in the negotiation that can be conceded
Use creative options: suggest options to expand the pie
Uncover interests of opposition - make guess then ask questions to uncover interests
Keep BATNA in mind
Preparation
Reservation Point
$2500 ($25 Per Person)
Goal Price
$24 Per Person
Opening Offer
$23 Per Person
Strategy:
Integrative
Collaborative
Tactics:
Uncover Interests by asking questions
Keep BATNA in mind
What did you do to prepare for this negotiation? Plan to provide a solid rationale for your preparation and strategy.
Gathered all information from client
Organized interests, ranked priorities
BATNA: To find a different venue if they won’t compromise below $2500, will be on a time crunch if this happens, Cornerstone - $1000
Guessed interests and BATNA of venue
Formulated an opening offer and questions for more information
Reservation point: $2500
, goal, opening offer
Rationale/strategy:
-integrative: many terms in the negotiation that can be conceded
Use creative options: suggest options to expand the pie
Uncover interests of opposition - make guess then ask questions to uncover interests
Keep BATNA in mind
Preparation
| Our Team | Our Opponent | |
| Assumptions | Milkboy would want our goal = profit | We prefer to Host Event here Would want revenue from event |
| Interests | Open Bar Affordable Cost | $2,000 minimum |
| Possible Options for Mutual Gain | Negotiate the price for food/open bar | Buy cheaper beverages and food to lower their costs |
| BATNA | Book at an alternative venue | Book another event |
| Reservation Points | No more than $25 a Person | $2,000 (Minimum) |
| External Standards | Other bars have a cheaper minimum (Cornerstone has a $1,000 minimum) | Higher end compared to other venues |
Our team:
Assumptions: Milkboy would want our reservation because it would be bring them in over $2000 in revenue
Interests: open bar, desired length of event, own music
Possible Options:
Open bar: $17.50 for 1.5 hours.
Food: $7.50 / person - cut the food in half (was $25)
DJ: free - bring our own and set it up by ourselves (was $100)
Bring in outside food
BATNA: to find a different venue if they won’t compromise below $2500, will be on a time crunch if this happens, Cornerstone - $1000
Reservation Points: $2500
External Standards: other bars have a cheaper minimum, Cornerstone has a $1000 minimum
Opponent:
Opponents Assumptions: We would prefer to host our event there versus other places.
Opponents Interests: hitting $2,000 minimum, minimizing costs
Opponents Options: try to buy cheaper beverages and food to lower their costs, or offer tier 2 for a higher amount, but cheaper than they would normally
Opponents BATNA: possibly book another event
Opponents Reservation Points: $2,000
Opponents External Standards: organizations are willing to pay the minimum
Preparation
Setting/Timing
Client’s Email
Event Date: May 12th
Plan for Soft
Gauge flexibility
Reduce Price
Plan for Hard
Strict Interests
Consider BATNA
Strategy
Integrative
Collaborative
What was your strategy for this negotiation—how did you plan to handle the timing, setting, etc.? What did you plan to do in case you dealt with a soft vs. hard negotiator? How did you plan to deal with unexpected problems?
What Happened?
BATNA
Sent email
Date Conflict
Description of what happened (slide 6). Once you went to negotiate, what happened? Describe the sequence of events and summarize your outcomes (including what happened to the relationship as well as what terms you received).
Sent Email:
Date Conflict: MilkBoys was unable to accept a booking for our date due to other commitments, so we were unable to negotiate further as they had ended the talks because our key interest was our date of event
BATNA: To find an alternative venue that would accommodate our event that is still in our budget. We decided to reach out to Terrapins Turf (Turf)
Aspects of Preparation
Effective
Collecting Information
Build Trust
Collaborating, open about giving information, questions
Outlining Key Positions and Interests
Ineffective
Not Very Flexible
Thinking of More Options
Looking back over your preparation and delivery: what aspects were particularly useful or helpful? What aspects/tactics did not seem to work or were ineffective, and why? Be as candid as possible and try to integrate with class materials as appropriate (e.g., negotiation and conflict styles, etc.).
Aspects of Delivery
Effective
Justify demands
Collaborating Negotiation Style
High cooperativeness & high assertiveness
Ineffective
Negotiation through a client
Email Negotiation
Timeline was too Restricted
Aspects of Delivery
Lessons Learned and Recommendations
Lessons Learned:
It’s hard to work with clients instead of dealing directly with the opposition.
We discovered many different ways to expand the pie.
Sometimes reactions will be opposite of what you are expecting
Recommendations:
When possible, ask the client to work with the party directly instead of acting as an intermediary.
Have possible options to expand the pie when negotiating.
Change your behavior to get desired reactions.
What did you each learn from this negotiation experience? How did it influence your learning and what you will do in future negotiations? If you or your classmates had to do a similar type of negotiation in the future, what would you recommend? Be sure to provide logical, sound reasoning for your recommendations.
References
If you draw on course materials or outside research, please provide full citations. If appropriate, include an “Additional Readings” section that provides information about other resources.
Appendices
Plan to include your preparation and strategy worksheets for the negotiation as well as any other supporting documentation (e.g., research on the product or service, BATNA opportunities).
Peer appraisals and contributions ratings.
The details for this requirement are summarized below. All member evaluations and a summary must be included.
