MOR 569: Negotiation & Deal-Making

Marshall School of Business

Professor:Scott S. Wiltermuth

Office:HOH 405

Phone:213-740-1128

E-mail:

COURSE INFORMATION

Life is filled with negotiations. While most of us know that learning how to negotiate effectively can yield us higher salaries and better terms when we buy or sell houses and cars, we often fail to appreciate just how often we can benefit ourselves, our families, and our companies by employing negotiation skills. In this seminar, we will learn negotiation skills and practice them in interactive exercises

The course is designed to be relevant to the broad spectrum of negotiation problems that managers face. Thus, the content is relevant to students interested in a wide variety of topics such as marketing, real estate, consulting, entrepreneurship, and mergers and acquisitions. In addition, the course will emphasize negotiations that occur in the daily life of the manager.

A basic premise of the course is that while managers need analytic skills to discover optimal solutions to problems, a broad array of negotiation skills is needed to get these solutions accepted and implemented. The course will allow participants the opportunity to develop these skills experientially and to understand the negotiation process via useful analytical frameworks. Considerable emphasis will be placed on simulations, role-playing, and cases. In this sense, you can think of this negotiations class as a workshop.

Goals for Students

  • Assess the nature of negotiation. This objective is paramount because many of the important phenomena in negotiation, e.g., interests, goals, and cooperation, are ambiguous and often do not have “right” answers - we cannot teach a set of formulas that will always maximize your profit (although they might help).
  • To synthesize a broad intellectual understanding of a set of central concepts in negotiation. These concepts will be the building blocks from which we can systematically understand and evaluate a negotiation process.
  • To develop confidence in the negotiation process as an effective means for resolving conflict in organizations.
  • To analyze the behavior of individuals, groups, and organizations in competitive situations.
  • To plan and negotiate effectively, including learning to evaluate the costs and benefits of alternative actions and how to manage the negotiation process.

COURSE FORMAT

The course is built around a series of negotiation exercises and debriefings. These exercises require advance preparation. Students are expected to be fully prepared for exercises prior to class and to participate in the debriefings. While some class time will be provided when group preparation is required, students may occasionally have to meet outside of class.

COURSE MATERIALS

Fisher, R., Ury, W., and Patton, B. (1991) Getting to Yes. New York: Penguin.

Course Packetwill be available from the bookstore on August 22nd.

Voucher ticket for ABC/Local 190 and other cases (Purchase from USC Bookstore)

COURSE REQUIREMENTS

1. Attendance and Participation (20%)

Preparation and execution of the exercises, and contribution to the debriefing discussion. Your preparation involves having completed the assigned readings and prepared the negotiation exercise for that day. Your classmates and I expect you to be prepared for the negotiations. Being unprepared for a negotiation harms your negotiation partner’s experience as well as your own. Participation grades will reflect how prepared you were for the negotiations.
When negotiating, you must follow all the instructions that are provided for your role. However, you do have freedom to be creative in how you interpret this information and the kinds of strategies you employ, provided that they do not contradict any of the explicit instructions or fundamentally alter the negotiation’s structure.

Participation in class discussion involves active participation that contributes to the class. Merely showing up and having read the assigned readings do not get you any credit. Attendance is required. Active participation means that you speak up in class. Whether this accomplished by answering questions, making observations, commenting on other students’ comments or challenging the instructor’s views does not matter. The second requirement is that what you say actually contributes – merely repeating comments made by other students or telling the class that you agree with what someone else said does not count. Your comments should move the discussion forward. If you are shy, prefer to sit quietly in the back, or just do not feel comfortable speaking in front of your classmates, my suggestion is that you see this class as a challenge to improve those skills. No such excuses will be accepted when the day is done and the grades are assigned.

Note: This course has a strict attendance policy. You must provide prior notice to the instructor if you have to miss a negotiation. If you do not provide such notice, your negotiating partner for the day is left hanging and many people can end up being inconvenienced. If you miss a negotiation without prior notice to the instructor, you will be penalized in the final grading of the course. Even if you do provide prior notice, but miss multiple classes, you may also be penalized.

This syllabus contains the dates for all negotiation exercises. This schedule will not be changed. If you need to miss an exercise, please refer to the latest version of the posted role assignments for that case, contact your assigned partner(s) to see if alternative arrangements can be made for negotiating the case [i.e., either with those partner(s) or with other classmates who have been assigned the requisite role(s) and who would be willing to switch with your assigned partner(s)] and inform me via e-mail regarding the outcome of these efforts. You must notify me of your absence from class, and any arrangements you have made with regard to this absence, at least 24 hours before the start of class so I can make the necessary classroom adjustments. Please note that I will not match up students for the purposes of making up an exercise. Such arrangements will be your responsibility.

2. Peer Feedback Paper(10%)

A two to three page evaluation of your negotiation counterpart in the Merging Companies case (scheduled for Week 4). This paper is due on Week 5. Copies should be submitted both to me and your counterpart. This evaluation is assigned to provide meaningful, personalized, and constructive feedback to your classmates and help them improve their negotiation skills.

The following is a list of possible topics / issues that you may cover in your feedback.

a)Preparation

  • Did they prepare adequately for their role (i.e., know the content)?
  • Did they play their role convincingly?

b)Listening skills

  • How carefully did they listen?
  • Did they interrupt in ways that were frustrating?
  • Did they create an atmosphere that encouraged you to divulge your interests?

c)Communication skills

  • Did they communicate their own interests clearly?
  • How effectively / persuasively did they present their claims?

d)Critical statements or tactics that benefited or hurt the negotiation

  • Did they do or say anything that created suspicion (or put you at ease)?
  • Were there any inconsistencies or contradictions that caused problems?

e)Body language

  • (e.g., eye contact, body posture, gestures, revealing ticks)

f)Overall impressions

  • (e.g., of their effectiveness, confidence, competitiveness, cooperativeness, competence, integrity, trustworthiness)
  • Biggest strengths and liabilities

g)Suggestions for the future

  • What could they have done differently?
  • To improve their own performance?
  • To improve your collective performance?

3. Midterm Exam (30%)

There will be an in-class midterm exam towards the middle of the course. The exam will cover the concepts discussed in class to date, as well as the readings, and will focus on a particular in-class exercise. The exam will ask you to apply the concepts to the exercise.

4. Reflection Paper(40%). A paper copy of your reflection paper is to be turned into the MBA office by noon on Thursday, Dec 8th.

The purpose of the reflection paper is to demonstrate what you have learned about principles (theories, concepts) of bargaining and negotiation. A reflection paper should not exceed 6 pages and is composed of three elements.

(1) Choose one of the negotiations: Texoil, Merging Companies, Federated Sciences Fund, Viking Investments, or Mouse. Write a brief summary of what happened (this should not exceed one page). This might include what you negotiated, and what the outcome was. It might also include a summary of your strategy going into the negotiation, your perceptions as the negotiation unfolded, what behaviors you (or the other side) engaged in during the negotiation, and how the two negotiators influenced each other during the negotiation. It is important that your summary cover not only the facts of what happened, but also your perceptions and impressions of those facts as they unfolded. It might also be relevant to compare what happened in your negotiation to what happened in other negotiations like yours, or other negotiations in which you have participated.

Remember that the purpose is to demonstrate what you have learned. In the summary, you do not need an exhaustive description – in fact, you won’t have the space to provide one! You will need to decide which facts of what happened are relevant to the important lesson(s) you learned. Focus on the critical factors that affected the negotiation situation and outcomes.

(2) Identify and explain relevant conceptual material (theories, concepts) from our course. In this part of the reflection paper, the point is to demonstrate your “ownership” of the concept/idea/theory that you identify. The first half of ownership is being able to describe and explain the concept/idea/theory. In the best of all reflection papers, the element of the paper should be able to stand alone as an explanation of some concept/idea/theory from our course. Don’t assume that I know the concept/idea/theory. The point is for you to demonstrate that you know it. Also, there is a tendency in this part of the reflection paper to try to explain as many concepts or ideas as seem relevant. Don’t fall into this trap! If you try to explain too many ideas, you will not be able to discuss/explain any of them in enough depth to really demonstrate your ownership. Stick with a few core concepts that you see as most central to the negotiation you are analyzing.

(3) Use the concept/idea/theory to analyze what happened in the negotiation. The other half of demonstrating ownership with the central concepts/ideas/theories in our course material is to be able to apply them successfully and insightfully. That application may include using the concept/idea/theory to explain why what happened in your negotiation happened. It might include using the concept/theory/idea to explain how or why you might have behaved differently, and what would have happened if you had. It might include using the concept/idea/theory to suggest what you should do the next time you find yourself in a similar negotiation situation.

In this element of your reflection paper, it is critical that you USE the concept, idea, or theory to drive your analysis of what happened in your negotiation. Thus, it is not sufficient in your analysis to know what to do; you also need to correctly explain why to do it. In this section you should demonstrate what you learned about bargaining and conflict from this situation and identify what you would do the same or differently in the future to perform more effectively.

Standards of Evaluation: Not longer than 6 pages double-spaced, typed in 12-point font, with 1”margins. Any late reflection papers will lose one letter grade for every day that they are late.

Insightful = 18-20 points

Description of the course concepts demonstrates reflection and learning beyond just summarizing what was discussed in class.

Application to the negotiation situation demonstrates real ownership of the ideas.

Tight logical link between the description of the negotiation, the concepts from the course, and the conclusions or implications drawn.

Conclusions are a logical outgrowth of applying the concepts to the description of the negotiation.

The conclusions/implications go beyond the boundaries of our classroom discussion, and show some initiative in exploring the learning opportunity.

Focus of the paper is depth of understanding, rather than breadth of coverage.

May tie several disparate ideas from class together into a central concept, or find some insightful connection to an apparently unrelated issue.

Competent = 15-17 points

Paper demonstrates correct and complete (but not insightful) analysis and application of the course concepts to the described negotiation situation.

It is clear from reading the paper that the student understands what was communicated and discussed in class, but probably has not necessarily learned something more from the analysis/application and reflection/write-up of what happened. (NOTE: this may occasion very little feedback from the grader.)

Paper’s link between description, concepts, and applications is not tight.

Not clear how the concepts relate to the description, or how the description and concepts logically lead to the conclusions or implications.

Paper touches on several concepts on the surface, rather than exploring them in any useful depth or identifying a theme that ties them all together.

Paper missed some of the subtleties of the featured concept(s).

Needs Improvement = 15 points or less

Description of the course concepts is incomplete or incorrect.

Application of the concepts to the negotiation situation is flawed.

Paper does not link the negotiation description, course concepts, and application.

Paper describes the negotiation situation without really using the concepts to analyze it.

Paper bounces around among a variety of concepts without fully explaining or applying any of them.

Paper uses words/terms from the class without communicating a sense of understanding their real meaning.

Paper doesn’t make clear what the student learned, or that the student learned anything.

COURSE GRADING

Grades for the class will be assigned according to the percentage distribution outlined above. At any time during the semester you may inquire about your participation score, and I will tell you how you are doing compared to other students in the class. At the end of the semester, I look very closely at students that are close to any cutoff between two grade categories, and try to find a way to boost any such students into the higher category.

In the event of a grading dispute - which would most likely occur following the midterm or the final project - the procedure is as follows: (1) Think hard about why you believe your grade should have been different. (2) Write down the reasons why you believe your grade should be changed. (3) Send me the written explanation via e-mail, and I will respond to it as quickly and fairly as possible.

One final note: I will not accept 'retroactive excuses' by students. By this I mean students bringing up ameliorating circumstances to justify their poor performance at the end of the semester. If there are unique or unusual circumstances that prevent you from doing as well as you normally might -- such as illness or death in your family, a mental or learning disability, a struggle with chemical dependence, etc. -- you must inform me at the beginning of the semester. I make no guarantees as to what is acceptable and what is not, but I encourage you to communicate any problems to me.

Students with Disabilities

Any student requesting academic accommodations based on a disability is required to register with Disability Services and Programs (DSP) each semester. A letter of verification for approved accommodations can be obtained from DSP. Please be sure the letter is delivered to me (or to your TA) as early in the semester as possible. DSP is located in STU 301 and is open 8:30 a.m. - 5:00 p.m., Monday through Friday. The phone number for DSP is (213) 740-0776.

Viewing of your negotiation tapes

ELC tapes are stored at JKP 201K. At this location there is one dubbing station in JKP 201K, and another in the Dean's Boardroom. Viewing (not dubbing) can also be done in the JKP ELC rooms on the second and third floors. These rooms are first come-first served, unless a reservation was made online 24 hours in advance at ( Viewing can also be done at the Keck Center (BRI 200).

No recording and copyright notice

No student may record any lecture, class discussion or meeting with me without my prior express written permission.The word “record” or the act of recording includes, but is not limited to, any and all means by which sound or visual images can be stored, duplicated or retransmitted whether by an electro-mechanical, analog, digital, wire, electronic or other device or any other means of signal encoding.I reserve all rights, including copyright, to my lectures, course syllabi and related materials, including summaries, PowerPoints, prior exams, answer keys, and all supplementary course materials available to the students enrolled in my class whether posted on Blackboard or otherwise.They may not be reproduced, distributed, copied, or disseminated in any media or in any form, including but not limited to all course note-sharing websites.Exceptions are made for students who have made prior arrangements withDSPand me.