Negotiation Skills 2020-2021 Laura Rubio González

ASSIGMENT Nº3: DISTRIBUTIVE NEGOTIATION AND

NEGOTIATION TACTICS
1. ANALYZING THE DISTRIBUTIVE NEGOTIATION

Movie: Erin Brockovich (2000): https://www.youtube.com/watch?v=5Jdk3riKKwo

The example we’re going to analyse is extracted from the movie Erin Brockovich
(2000), where the main character starts to investigate a case that involves the Pacific
Gas and Electric Company (PG&E) into a negligent administration of their residues.
This multinational is trying to quietly buy land that was contaminated by hexavalent
chromium and that is poising the people from the area.

In this particularly scene appears the representative of the PG&E Company, Erin
Brockovich, and her law firm boss. The company is willing to pay for a property that
they know is contaminated to stop the investigation Erin’s managing. She and Edwards
Masry had in their possession many documents made by the company, that prove that
the family’s diseases are typical symptoms of being exposed to toxic chromium for a
long time.

 DISTRIBUTIVE NEGOTIATION:

Is a negotiation where the parties compete over the distribution of a fixed sum of value.
In distributive negotiations, a gain by one side is made at the expense of the other.

In this excerpt we can see a distributive negotiation because both of the parties had
extreme and divergent positions. The pie in this case is the money that the company
should pay to the family to cost the effects of the contamination in the family’s health.
PG&E is looking to buy the silence of the family for hiding the problem with the
hexavalent chromium (“put this to rest”). The other party is looking not only for the
multinational to offer the economic value of the house, but also to cover the medical
expenses and the side effects that the poisoning has caused in the family.
Negotiation Skills 2020-2021 Laura Rubio González

They both want to take the biggest piece of the cake. While the company wants to buy
the silence of the family by investing as little money as possible, Erin and her colleague
are looking to raise more money to cover all the damage the company has caused.

 BATNA: Best Alternative to a Negotiated Agreement.

It’s the option you will accept if you fail to reach agreement in the negotiation at hand.

- PG&E’s BATNA: The company representative has a fixed price. The

multinational is playing with the power it has to intimidate the other party. The
lawyer is trying to weaken Erin and Ed's BATNA by showing the financial
strength of the company and making them see that using the legal channel can
be more costly for them.
- Erin and Ed’s BATNA: They have reports where the company itself
acknowledges the toxicity of its waste, they use it for getting a stronger position.
If they are unable to raise the amount of money the family needs to pay for
medical expenses, they will take the lawsuit to the court.

 ASKING PRICE (Anchoring):

Is the attempt to establish a reference point around which the negotiation will make
adjustments, is the first offer on the table.

The main goal of the representative of PG&E Corporation is that the lawyer Ed Masry
will accept the offer of $250.000.

 RESERVATION PRICE:

Is the least favourable point at which one will accept a deal.

For the representative of PG&E the reservation price is the same than the asking price,
he states that the offer is final and his refusing to negotiate.

Ed Masry does not agree with the amount and he ask for compensate the doctor’s fee for
the people who got sick because of waste problem.

 ZOPA: Zone of Possible Agreement

Is the area or range in which a deal that satisfies both parties can take place.

In this situation it was not possible to find a ZOPA because the company was not open
to renegotiate the asking price so, Ed and Erin preferred to apply their BATNA to find a
better solution that could cover the medical issues of the family. The representative
himself speaks of the economic power of the multinational. If this party were willing to
raise the amount of its first offer, there would be enough money to cover a large part of
the medical expenses of the family concerned.
Negotiation Skills 2020-2021 Laura Rubio González

2. NEGOTIATION TACTICS

Tactics for Win-Lose Negotiations

- Anchoring
- Counteranchoring
- Concessionary Moves
- Ticking Clock
- Package options for a favourable deal
From the chapter:

- Closing the Deal

Tactics for Integrative Negotiations

- Getting started
- Look for options that exploits differences
- Take your time

General Tactics:

- Framing
- Continual evaluation and preparation
From Voss C. & Raz T. (2016) Never Split the Difference: Negotiation As If

- Mirror words: slowing the conversation down, repeating

their words back to them, allowing for silence and changing
your tone of voice
- Tactical empathy: Demonstrate you see the nuances of
Your Life Depend On It. Harper Business Editorial.

their emotions labelling their fears for disarming them.

- Get to “no”: Ask no-oriented questions
- “That’s right” response: Show you are able to understand
their ideas and wants for breakthrough the negotiation
- Resist compromise: Navigate deadlines to create a sense of
urgency and anchor your counterpart’s emotions so that not
accepting your offer feels like a loss.
- Illusion of control: Ask questions, that begin with “How?”
or “What?” so your opponent uses mental energy to figure
out the answer
- Guarantee execution: Identify the motivations of the
players “behind the table” and spot liars by paying attention
to body language
- Bargain hard: Identify your counterpart’s negotiating style,
prepare, and steel yourself to take a figurative punch.
- Find black swans: dig deeper and uncover the hidden
variables of the situation by understanding the other side’s
position and worldview.
Negotiation Skills 2020-2021 Laura Rubio González