Negotiation Analysis
Code
2385
Academic unit
null
Department
null
Credits
7
Teacher in charge
Luís Almeida Costa
Teaching language
English
Objectives
This course offers a strategic and integrated perspective about how to prepare and how to deal with different types of negotiating situations. The first part of the course (Sessions 2-5) covers the basics: elements of Decision Analysis, as well as some applications to competitive bidding. The remainder of the course deals with bargaining proper. Building from simple to complex negotiations (two parties - one issue; two parties - many issues; many parties - many issues), the course will develop an analytic framework that will help participants to understand their negotiating situation, the tactics that are available given the situation, and the array of moves that can be employed to improve their prospects by changing the situation.
Prerequisites
N/A
Subject matter
Session 1 (September 12, 14:30-15:50):
Course Overview Session 2 (September 12, 16:00-17:20):
Elements of Decision Analysis Session 3 (September 19, 14:30-15:50):
Introduction to Competitive Bidding (1) Session 4 (September 19, 16:00-17:20):
Introduction to Competitive Bidding (2) Session 5 (September 23, 9:30-10:50):
Introduction to Competitive Bidding (3) Session 6 (September 23, 11:00-12:20):
Distributive Bargaining (1) Session 7 (October 3, 14:30-15:50):
Distributive Bargaining (2) Session 8 (October 3, 16:00-17:20):
Distributive Bargaining (3) Session 9 (October 7, 9:30-10:50):
Bargaining under Uncertainty (1) Session 10 (October 7, 11:00-12:20):
Bargaining under Uncertainty (2) Session 11 (October 10, 14:30-15:50):
Integrative Bargaining (1) Session 12 (October 10, 16:00-17:20):
Integrative Bargaining (2) Session 13 (October 17, 14:30-15:50):
Integrative Bargaining (3) Session 14 (October 17, 16:00-17:20):
Bargaining under Uncertainty (3) Session 15 (November 11, 9:30-10:50):
Inducing Cooperative Behavior (1) Session 16 (November 11, 11:00-12:20):
Inducing Cooperative Behavior (2) Session 17 (November 14, 14:30-15:50):
Asymmetric Information (1) Session 18 (November 14, 16:00-17:20):
Asymmetric Information (2) Session 19 (November 18, 9:30-10:50):
Coalition Analysis Session 20 (November 18, 11:00-12:20) & Session 21 (November 21, 14:30-15:50):
Insecure Contracts Session 22 (November 21, 16:00-17:20):
Conclusion Session 23 (November 28, 14:30-15:50) & Session 24 (November 28, 16:00-17:20):
Discussion of Team Projects
Bibliography
The following book is required for the course:
- R. Fisher and W. Ury, Getting to Yes, Penguin Books, Harmondsworth, Middlesex, 2012.
The following book is recommended (except the chapters mentioned throughout the Program, which constitute required readings):
- H. Raiffa (with J. Richardson and D. Metcalfe), Negotiation Analysis - The Science and Art of Collaborative Decision Making, The Belknap Press of the Harvard University Press, Cambridge MA, 2007.
Cases and additional readings are available online or in the print shop (Negotiation Package). Confidential instructions for different players required in some of the negotiation exercises will be distributed throughout the course.
Acknowledgements:
I wish to thank Professor Ingemar Dierickx, whose teaching materials are used in this course with his kind permission.
Teaching method
This course combines lectures, class discussions, negotiation exercises, individual exercises and a negotiation write-up. Lectures/Class Discussions objectives:
There are two types of exercises: games with statistical interactions and with personal interactions. In games with statistical interactions, such as the bidding exercises, students are asked to record their strategy, which will then be pitted against the strategy of all other students in the course. In games with personal interactions, students are told which role they are to play in a given situation and are given the name(s) of the other player(s) with whom they will negotiate; students will then have to interact face-to-face (or over the phone). For each exercise, the relative performance of students is recorded.
Students should learn a great deal from the out-of-class exercises. A major requirement of the course, therefore, is to carry out the exercises and to share the insights with others. In general, the aim should not be to do "better" than the counterpart; "better" is often meaningless in games which are not strictly competitive and where players start in very asymmetric positions. The aim of each student is to maximize his or her own score tempered with a concern to do what is right.
The score of students in any game is only partly a measure of their own skills. As in "real life", it also depends on their partner, and on luck. On balance, these effects on students overall scores are likely to be minor, however. In addition, to avoid that a single game could completely ruin the overall average of a given student, his or her worst score is deleted.
While negotiated outcomes obviously matter, the process by which these outcomes have been achieved is often equally (if not more) important. Consequently, performance on the process dimension is measured as well. Students will be asked to rate each of their partners negotiating behavior on a scale of 1 to 10. The "raw" score of a student on the process dimension is then simply the average of the ratings given by his or her negotiating partners. Again, to avoid any rating from too adversely affecting the student´s overall average, the worst score is deleted.
A final note. Students should always respect the "rules of the game". The instructions for the games are typically self-explanatory. In many of the exercises, students will receive confidential instructions. During the negotiations, students may wish to share information with their counterpart. However, the "rules of the game" do not permit students to show their actual confidential instructions to the other side. In actual negotiations, we cannot refer to a set of confidential instructions to authoritatively convince our negotiating partner about our values, beliefs or capabilities. In fact, one of the major problems in actual negotiations is to convince a skeptical counterpart of the truth.
It is easy to defeat the purpose of the games. Students could, for example, find out how other students played in a given game before they "officially" play. Students could pick up clues from former students. Students could deviate from the specified rules and collude with their opponents when it is prohibited. Some of this behavior will undoubtedly occur, but I trust not very often. Such behavior is especially inappropriate in a sequence like this because it can spoil things for others, deaden discussion, and distort the information in the scores. It certainly defeats the purpose of the exercises.
The exercises used in the course are mentioned in the detailed Program. The exercises have three main objectives:
The object of the Write-Up is the analysis of a real-life negotiating situation using the concepts, models and frameworks discussed in the course. The Write-Up should be elaborated by groups made up of 3 to 5 students. Each team chooses its own topic, but has to validate it with the instructor. The final report should have a maximum of 15 pages and is due on the day of the final exam. The different groups will have the opportunity todiscuss the Write-Up with the instructor in the last two sessions, Sessions 23 and 24. The Write-Up has several objectives:
Evaluation method
Negotiation exercises:
Independently of the grades obtained in the negotiation exercises and in the Write-Up, in order to pass this course students must have a grade of at least 9 out of 20 in the final exam.
Course grades are final and not negotiable.