The (MBTI) grouping of scales: team Roles in Negotiation

Information Decisions Structure

Energy Nature Tactics

S Sentinels J
T

Thinker Sensor Judger

F N P

Diplomat
Feeler INtuition Perceiver

Check understanding
 Group-Strategies (preferred ways of doing things)

People Social
Confident Improvement Mastery Engagement

I I E E

Introvert Extrovert Extrovert

Introvert

A T A T

Assertive Turbulent Assertive Turbulent

Private /alone improve Outgoing Like in Group

Self confidence Self doubt communication People concern
 NT Analyst 10.4%
(SJ)
(SJ)
NF Diplomats 16%
(SJ)
(SP)
(SJ)
(SP) I S T J
(NF) E N F P
(SP)
(NF)
(SP)
(NT)
SJ Sentinels 46.4%
(NT)
SP Explorers 27%

Roles Group
 Mommies show –Simulation background

Producer
 Syndicate Market – relation between number of reruns,
ratings & ad revenue
Expectation of Show Ratings based

7
on research Of target audience

4
3

2M 4M 6M 8M 10M 12M

Expected Ad Revenue
 Mommies show –Negotiation
Expected Ad revenue

Seller share Negotiated Seller Price USD

(uncertainty)
(Not % of Ad revenue)

Syndicate
channel profit
Syndicate Negotiated Syndicate
channel cost channel share
 Mommies show (MS) –Negotiation issues

MS Licensing fee MS Licensing fee

Runs per episode

4

Junior
show

Charles:Seller
David:Buyer
 Poll Analysis Mommies show

Per students per team to take poll

Student negotiation insights
Simulation Survey insights
Faculty insights
How do Charles and David view diff. research findings
Cognitive illusion with difference frames based in info
 Average NHL player Salary
2
Can you guess key issue in NHL
1.8
Management and Player
1.6
Association conflict in 2005?
1.4

1.2
USD MN

0.8
NHL Player Salary as % Team revenue
0.6
per player
0.4 80

0.2 70

0 Percentage 60
93-94 94-95 95-96 96-97 97-98 98-99 99-00 00-01 01-02 02-03 03-04
50
40
30
20
10
0
93-9494-9595-9696-9797-9898-9999-0000-0101-0202-0303-04
NHL Revenue trend 1993-2004
NHL lockout 2004-5
 NHL Negotiations December 2004

Issue NHL mgmt. NHLPA

Current avg. Salary/player USD MN 1.8 1.8
1
Proposed avg. Salary/player USD MN 1.3
Negotiated avg. Salary USD MN 1.36

current salary to Revenue % 75

2 Proposed Max. salary to Revenue % 55 None
Negotiated salary to Revenue % None

to be so close they have to make a deal

-mighty ducks player mike Leclerc
NHL Management and Player Association (PA) Negotiations 2005

Salary cap 39 MN
Sal. Cap. 55% Team rev.
NHL Mgmt Player Association
Sal Cap 52MN
No Sal link to Team Rev.

Salary cap 42.5 MN

No Sal link to Team Rev.
NHL Mgmt Player Association
Sal Cap 49 MN
No Sal link to Team Rev.

70% (400) players defected

to European teams
NHL Negotiation 2004-5 what happened?

Entire season was lost!

USD 2BN loss in Revenue

USD 1BN loss in salaries

 NHL agreement July 2005 after one year loss of season

Salary cap 54% after lockout season

New leadership came to the NHLPA in 2005- Goodenow was

replaced as executive director by Ted Saskin

Why did player association agreed lower than

what was proposed by NHL Mgmt!
 NFL Negotiations 2011
You guys keep talking past each
Other instead of to each other

NFL Owner Position

Off-the-top credit from revenue before any split USD 2 BN
Split of revenue after the off-the top-credit Players : Owners 58:42

NFL Player association Position

Off-the-top credit from revenue before any split 0
Split of revenue Players : Owners 50:50
 NFL Agreement achieved by splitting Revenue variable in to 3 variables
Players Each Party Victory speech
Revenue spilt Owners share
share
TV rights 55% 45%
Stadium Owner expected stadium revenue
40% 60%
collection
Other related
share to increase over a period
45% 55%
business
 Why Players agreed?

Players expected Ad
revenue share To
increase over a period

Fine print: If Player share > 48% it will be reduced to 48%

If Player share < 47% it will be increased to 47%
 NFL negotiation success tactics

Negotiation Tactic #1) Establish relationships of trust.

Negotiation Tactic #2) Generate options for mutual gains.

Negotiation Tactic #3) Convince your side to make concessions at key

moments.

Negotiation Tactic #4) Negotiate for the long term.

 Why you think this happened?
Fixed pie
bias

57%
75%
NBA NHL
Framing
Systematic NHL Player Salary as % Team
Bias
Vividness revenue per player 2004
Irrationality
Bias

Commitment
bias
Reactive
devaluation
Two mountaineer team who lost everything in avalanche
–find and fight for one rope

Guys! Lest just untie the knot

Fixed pie bias Flexible rope=8

Fixed rope=6 runs
runs
Framing Original frame: Charles - we are not
bias interested in giving more than 4 runs

How Charles could have reframed it?

Impact of number of runs
2
1.5
1
0.5
0
-0.5 4 5 6 7 8
-1
-1.5
-2
Impact Charles MN Impact David MN
 % responding its good for US
100

80

60

40

20

0
Reagan-US President Independent analyst Gurbachav-Russia
Premier

Arms disarmament Plan by Reactive

devaluation
Commitment
bias

admit our initial strategy was wrong?

Admit we held on position too long?
Do we agree to what we said was unfair?
 Pareto Improvements

Changes to a deal that make at least one party

better off without making any other party worse off.

Logrolling (the
trading of favours, or
quid pro quo)can
lead to Pareto
Improvements
 Personal Experience

Post Settlement Settlement (PSS)

PSS are agreements that are reached after the
initial Agreements are signed
Software delivery in 24 Months,
3M Warranty

A: Software development project B:

U&I Negotiation NRSA

USD 1MN : 10% Adv.+80% on Delivery+10%

after warranty

Satish Called up Client 2 days after agreement & requested 40% advance
Satish: 300K needed to deliver project on time -loans
would take min 3 month;
Would help attracting angel investors (Future Proj.)
Satish proposed 1 Yr free support in return
Client agreed: Satish saves 18% interest;
client gets software in time and 1 year free support
PSS: 40% advance, 1 year free support
 Mommies show: Licensing fees- 6 Episodes
Charles
$3.5MN $9.6 MN

$ 4 MN $ 6.5MN
David

Charles David
Lowest Price $3.5MN Highest Price $ 6.5MN
Highest Price $9.6 MN Lowest Price $ 4 MN
Target Price $7MN Target Price (vary) $ 5 MN

A possible likely negotiated price : 5.5 MN

Value gain for Charles: $ 2 MN ($5.5MN-$ 3.5MN)

Value Gain for David: $ 1.0 MN ($ 6.5 – MN- $ 5.5 MN)

 Financial impact of number of runs
Runs Effect on Holymedia Effect on Champion
/episode Revenue USD MN TV Revenue USD MN

4 Save 0.5 Lose 1.6

5 Save 0.25 Lose 0.8
6 No effect No effect
7 Lose 0.25 Save 0.8
8 Lose 0.5 Save 1.6
 Creating value through logrolling (Exchange)

Original Agreement (O)- Licensing fees $5.5MN -6 runs

Alternate agreement (A)- Licensing fees $6.5MN -8 runs

Agreement Value to Value to David Total value

Charles created
Original (O) $ 2MN $ 1MN $ 3MN

Alternate (A) $ 2.5 MN $ 1.6 MN $ 4.1 MN

 Creating value by adding issues
Juniors Licensing fees
Party A-Charles Party B-David
Lowest Price $1MN Highest Price $ 2.0MN
Highest Price $ 2 MN Lowest Price $ 1 MN
Target Price $1.5MN Target Price (vary)$ 1.5 MN

Agreement Value to Value to David Total value

Charles created
Original (O) $ 2MN $ 1MN $ 3MN

Alternate (A) $ 2.5 MN $ 1.6 MN $ 4.1 MN

With Junior (J) $ 3MN $ 2.1 MN $ 5.1 MN